NY Budget Talks Down To The Wire As Holidays Loom

Mar 29, 2018

State lawmakers continue to try to work out a budget agreement in New York. They need to finish by midday today so legislators and staff can get home for the Passover and Easter holidays. However, some major issues related to the spending plan are still not resolved.

They hope to finish by mid-day Friday so legislators and staff can get home for the Passover and Easter holidays.

Senators emerged from a party conference Thursday afternoon after discussing what’s in and what’s out of the budget.

Republican Senator John Bonacic, who represents portions of the Hudson Valley, says education spending will likely be increased by over $1 billion, a higher amount than recommended by Governor Cuomo, a Democrat. It’s still not known whether the governor would get his wish to have greater control over the exact school aide distributions for New York City schools and large school districts upstate including Buffalo, Syracuse and Rochester.

Republican Senator Jim Tedisco, from Schenectady, says all of the new taxes proposed by Governor Cuomo are out of the budget, including a new tax on Internet sales.

“All the taxes are off,” Tedisco said. “We’re going to save the constituents a lot of money.”

Tedisco says the proposed 2 cents per milligram tax on prescription opioids might be included, but will not technically be called a “tax." 

“They are not calling it a tax, but a stewardship,” Tedisco said, with a laugh.

Governor Cuomo has also created two “fixes” to try to mitigate the partial loss of state and local tax deductions in the new federal tax overhaul. One would offer an optional employer payroll tax as an alternative to employees’ paying their state income taxes. Business owners would then pay the equivalent amount in tax to the state, but they would still be allowed to deduct it from their taxes. The governor also wants to set up charitable trusts that property taxpayers could contribute to in lieu of paying their property taxes. They would then receive a deduction for the donations.

Democrats in the Assembly have accepted Cuomo’s plans largely intact, but some Republican senators are not on board, but concede the plans might end up in the budget anyway. Senate Deputy Majority Leader John DeFrancisco calls the payroll tax option an “administrative nightmare." He says the proposed charitable entities are “foolish” and “misleading." because he does not believe the IRS will accept them as true charitable deductions.

“They don’t work,” DeFrancisco said. The Republican senator is also a candidate for governor.

Several items that Cuomo had tied to the budget are not currently in the spending plan, including the Child Victims Act for survivors of childhood sexual abuse, the Dream Act, to provide college aid for children of undocumented immigrants, and bail reform. A uniform policy for dealing with sexual harassment in state and local governments is still in the budget. The details are being finalized.

DeFrancisco and other senators say there’s still a chance, though, that even what’s been agreed to so far could fall apart, and budget extenders could be needed.

“There’s still some serious things that have to be decided,” DeFrancisco said. 

Senator Bonacic says there’s talk of approving a one-month long temporary spending bill, to last until early May. But he says the threat of extenders can also provide impetus for warring sides to compromise before time runs out on Friday.

“It’s the final ‘chicken move’,” Bonacic said. “Where it’s an extender, or we get it done.”

School districts immediately objected to a month long budget extender. The New York State Council of School Superintendents says that school districts need to know how much they are receiving in state aid by mid-April. They need to meet a state deadline of April 23 for school boards to finalize the budget proposals that go before voters on May 15.