News Release: NYSUT recognizes budget strong points; hits proposed tie to evaluations

ALBANY, NY – New York State United Teachers today said it shares the commitment of the governor and Legislature to improve the efficiency and performance of public schools. However, the union said three consecutive years of decreasing education budgets — including last year’s $1.3 billion cut — and the looming tax cap are making that job difficult, forcing districts to increase class sizes; chop course offerings; and eliminate 20,000 teacher and staff positions.

NYSUT credited the governor and Legislature for taking decisive action to close the state’s budget deficit and to begin restoring fairness to the state’s tax code. The state’s largest union, however, said other portions of the 2012-13 budget — including $250 million for competitive grants and tying districts’ state aid increases to completion of teacher and principal evaluation plans — are problematic.

“They create a level of uncertainty that, when combined with the tax cap, make it very difficult for districts to plan their own budgets and provide the programs and courses our students need,” said NYSUT President Richard C. Iannuzzi.

NYSUT Executive Vice President Andrew Pallotta, in testimony before the Senate Finance and Assembly Ways and Means committees today, said the budget’s proposal to strip out $250 million for competitive grants would leave only a 2.9 percent average overall increase, with many districts getting less. Because the performance grants would be released in the 2012-13 school year, it’s unlikely that districts could plan for and use the funding during the 2012-13 school year.

“Simply put, an over-reliance on competitive grants undermines the state’s ability to meets its moral and constitutional obligations to provide a sound, basic education to every child,” Pallotta said. “Without significant additional aid, and a reasonable adjustment to the tax cap for costs beyond the control of districts, many schools will continue to lack funding for current programs. That hurts students, and our efforts to end the achievement gap.”

Pallotta also criticized a new Tier 6 proposal, which he called a “funding scheme that would force new employees to shoulder more financial burden in lean times, with the hopes of recouping that lost income in good times.”

“Those are our students, the next generation of teachers, nurses and first responders, and we don’t want to see their retirement security destroyed,” Pallotta said.
He said the governor’s pension plan comes only two years after NYSUT and other unions agreed to save the state and localities $35 billion over the next generation through creation of a Tier 5.

Pallotta said that, while the governor promoted Tier 6 as “only for new hires, the unborn,” it would actually undermine the retirement security of current retirees and those in other tiers by diverting dollars into 401-k plans, thus jeopardizing the long-term stability of the pension fund.

Pallotta also urged the joint fiscal committees to restore funding for teacher centers, which provide essential professional development and were a key part of New York’s Race to the Top application. He also noted that New York libraries are currently funded at $79 million – or at 1994 levels.

NYSUT, the state’s largest union, represents some 600,000 classroom teachers and other school employees; faculty and other professionals at the state’s community colleges, State University of New York and City University of New York, and other education and health professionals. NYSUT is affiliated with the American Federation of Teachers, National Education Association and AFL-CIO.

BALCONY Members Comment on Gov. Cuomo’s 2012-2013 NYS Budget

CSEA President Danny Donohue:

“Governor Andrew Cuomo’s proposed budget lays out some complex challenges in many areas. CSEA remains concerned that the governor seems out of touch with the day-to-day challenges that public workers in both state and local government face as a result of his budget priorities. Too many necessary services in every part of the state are deteriorating because people are working short staffed and at risk without adequate equipment, training and backup.”

“CSEA has no hesitation in saying that the proposal for a new public employee pension tier is an assault on the middle class and a cheap shot at public employees. It will provide no short-term savings and will mean people will have to work longer, pay more and gain less benefit. Simply put, the Tier VI provisions would be onerous on working people and undermine middle class security and the governor ought to be more concerned about that.”

“The governor’s proposal of a 401K style option as part of Tier VI would certainly be attractive to highly paid political appointees who could max out their contribution, have it matched by the public employer and take it with them as they come and go. It’s a lot different for front-line career employees who have to worry about whether being at the mercy of Wall Street ups and downs will provide them with adequate retirement security 30 years from now.”

NYSUT President Dick Iannuzzi and Executive Vice President Andrew Pallotta:

New York State United Teachers today welcomed that Gov. Andrew Cuomo honored his commitment to boost education funding, but said this would still leave students with less state support than they need.

NYSUT also said the governor’s plan to tie proposed school aid increases to agreements on a teacher and principal evaluation system, as well as competitive grants, is problematic and would create an uncertainty that districts cannot afford.

NYSUT President Richard C. Iannuzzi said that while the union “shares the governor’s frustration over delays in implementing the evaluation law and many of his points about the education bureaucracy at SED, we think there are better ways to achieve implementation rather than tying it to funding increases that benefit students.”

Iannuzzi pointed to frustration also shown by districts and local teachers unions that have been hampered by the State Education Department’s failure to develop a model to measure student growth; a working data system; and the Department’s appeal of a state Supreme Court’s ruling validating the existing law.

Iannuzzi added, “After the court decision, NYSUT gave the State Education Department a proposed settlement that meets the department’s needs, and would immediately jumpstart the process in many school districts. There has been no response. We welcome the governor’s leadership in helping to implement what he characterized as a ‘real teacher evaluation’ law by moving to settle the lawsuit, break the logjam and move implementation of the teacher evaluation law forward.”

NYSUT Executive Vice President Andrew Pallotta said the budget’s proposed Tier VI “would endanger the current workforce, as well as the pensions of retired public employees, by diverting or reducing contributions to state retirement funds.” He noted that, just two years ago, unions worked collaboratively to deliver $35 billion in savings to taxpayers by agreeing to a new Tier V. “Enough is enough,” Pallotta said. “Current and future public employees – just like all workers in the private sector – should have a measure of retirement security. This plan does the opposite.”

Pallotta said the proposed budget also falls far short of what SUNY, CUNY and community colleges need. He said funding increases for public hospitals, colleges and universities — the economic lifeblood of communities likes Syracuse, Oswego, Cortland, Oneonta and Plattsburgh – must be a budget priority. “We agree with the governor that the answer is jobs, jobs, jobs. Our question is: Why don’t we start with a greater investment in our public hospitals and higher education systems?” Pallotta said.

Pallotta pledged to work collaboratively with the governor and lawmakers to build on the positive elements in the proposed budget and to correct those that would shortchange students from pre-kindergarten all the way to the post-graduate level. “A new year brings a new opportunity for NYSUT and the Assembly, Senate and Governor’s Office to work together in a positive way to improve education and enhance learning opportunities for all our students,” he said.

PEF President Ken Brynien:

It is time for our state’s elected leaders to recognize that nothing gets done without workers: trained,
competent, professional workers. The governor’s proposed budget ignores the fact that state workers have done their
share to address the state’s fiscal problems.

Since 2008, the state’s workforce has been reduced by 16,000 jobs. The state pension plan was changed in 2010 to create
a new Tier 5 that will save state and local governments $35 billion over the next 30 years. In 2011, PEF agreed to a
labor contract that freezes pay, requires workers to pay more for health insurance and cuts salaries through furloughs.
This contract will save the state more than $230 million over the next four years.

The governor’s proposal calls for another new pension tier that will do little, if anything, to affect the 2012-13 state
budget. The Tier 6 proposal is nothing more than a false choice of accepting severely reduced pension benefits or joining
an inefficient 401k style pension system. It would force public employees into a pension gamble that virtually guarantees
a lower level of benefits. This proposal is similar to the misguided proposals for reforming Social Security proposed by
former President George W. Bush.

Our members earned their pensions, which are reasonable. The average state pension is $19,000 per year. The current
increases in pension costs don’t result from increased pension benefits. They were caused by the collapse of the stock
market.

Initiatives proposed in this budget will increase the privatization of key state services in agencies that serve youths and
people with disabilities. The governor has also proposed “reforms” to the Civil Service system that will make it easier to
appoint politically connected individuals by making who you know a more important factor in hiring than what you
know.

While the overall size of the state workforce remains relatively unchanged in the budget, many state agencies remain
severely short-staffed. This hinders the ability of agencies to perform their statutorily mandated mission which can only
lead to wasteful and costly contracting out of state services as agencies struggle to meet their statutory mandates. For
example the Department of Transportation has already lost 1,900 employees since 2000 including more than 900
engineers. They will lose another 91 employees this year including 62 engineers. During this time period DOT has
increased its spending on consultant engineers even though they cost between 50 percent to 75 percent more than state
employees. In the last year alone, DOT has increased its spending on consultant engineers by 22 percent.
We support a different approach to budgeting. Respect the professionalism of the state workforce and we can work
together to get the job done.

STATEMENT ON THE 2012-1013 NYS BUDGET: Alan Lubin co-chair of the Business and Labor Coalition of New York, BALCONY

STATEMENT ON THE 2012-1013 NYS BUDGET
by: Alan Lubin, co-chair of the Business and Labor Coalition of New York, BALCONY

The Cuomo administration’s 2012-2013 budget message is a positive step that can create jobs, rebuild New York’s infrastructure, rejuvenate our convention business and revive the City of Buffalo.

The administration’s desire to create a Tier VI pension system for public employees is misguided and premature since the state created a Tier V in the past two years.

We believe a fair teacher evaluation program can be worked out within the governor’s time-frame if City and State officials come to the table seeking a honest solution.

We need further details on the administration’s desire to consolidate state agencies and programs, and the resulting impact on the delivery of services to the residents of our state. Finally BALCONY supports the Governor’s creation of the New York State Insurance Health Care Exchange as required by the Patient Protection and Affordable Care Act of 2010.

Coalition Calls on Governor, Legislature to Close Corporate Tax Loopholes & Level Playing Field for Small Business

Groups Release List of Corporate Tax Dodgers

Albany, NY — A large coalition of community, labor, student, faith and Occupy organizations gathered on Monday to announce their campaign to bring fairness and transparency to New York’s corporate tax system. The organizations, who last year worked together on the “Millionaires Tax” and personal income tax reform, are calling on Governor Cuomo and the Legislature to close corporate tax loopholes, raising over $1 billion dollars for this year’s state budget. The additional revenue will help New York to create jobs, create a fairer environment for small business, and prevent more devastating budget cuts to services and our safety net and allow for restorations of reduced funding.

The groups released a list of some of New York’s worst corporate tax dodgers, including Travelers Insurance, American Express, Verizon, and Goldman Sachs. The list highlights the gross inequities in our tax system that hinder small businesses, job creation, and our economy.

“Last year, Governor Cuomo and the Legislature worked together to make simple, clear changes to the personal income tax code that made it more fair and raised more revenue, while asking a new Tax Reform and Fairness Commission to work on long-term changes. This year, they should do the exact same thing for corporate taxes,” said Michael Kink, Executive Director of the Strong Economy for All Coalition. “Our recommendations provide a roadmap for reform: strong enforcement, real fairness, and new transparency so the public can know what’s going on. We’d raise over a billion dollars for this year’s budget and eliminate the absurd situation where bodegas and car repair shops are paying a higher rate in corporate taxes than Goldman Sachs or Verizon.”

“The fight for tax fairness is just getting started,” according to Ron Deutsch, Executive Director of New Yorkers for Fiscal Fairness and coordinator of the GrowingTogetherNY coalition. “Once again all of the coalitions that worked together last year will be coming together to ensure that enforcement, fairness and transparency are part of or corporate tax code and that we restore a fair and level playing field for small businesses in NYS.”

The plan to reform New York’s corporate tax structure released today focused on three main principles: enforcement, fairness, and transparency. The points of the plan include:
• Requiring real estate partnerships to pay the taxes they owe
• Reforming New York’s Corporate Alternate Minimum Tax
• Taxing nonresident hedge fund management fees
• Eliminating the Carried Interest Exemption under New York City’s Unincorporated Business tax
• Cracking down on schemes that create “nowhere income”
• Requiring public disclosure of corporate tax payments for publicly-traded companies

“New York State’s corporate income taxes have become more and more like Swiss cheese as more and more tax breaks have been added to the tax code in the name of economic development,” said Frank Mauro, Executive Director of the Fiscal Policy Institute. “Ironically, beginning in 1994, more tax breaks have been added to the state’s corporate Alternate Minimum Tax, which was established in 1987 to ensure that profitable corporations made at least some contribution to the cost of government services. The result of these developments is that general business corporations have gone from carrying 9.6% of New York State’s tax load in the 1970s to 4.3% last year.”

‘New York State should repeal or reform corporate tax breaks that are not creating jobs and not allow tax breaks in the calculation of corporations’ Alternate Minimum Tax obligations,” Mauro added.

The Swiss cheese nature of New York State’s corporate income taxes are also demonstrated by the most recent data on state and local government finances from the U.S. Bureau of the Census. The Census Bureau tabulations show that in 2008-09, New York City’s corporate income tax collections were actually greater than New York State’s ($6.03 billion vs. $4.43 billion). And, the collections attributed to the state include the proceeds from the 17 percent surcharge on the portion of corporations’ tax liabilities attributable to activities in the Metropolitan Transportation Authority service area.

“The human services sector appreciates the move toward more fair income and corporate tax systems and continued progress should generate enough revenue to maintain services for New Yorkers struggling to make ends meet. Not only do human services play a critical role in supporting families and removing barriers to work, they also employ 1.25 million throughout the state and purchase over $1 billion in goods and services.” Michael Stoller, Executive Director, Human Services Council.

“Because of our unfair corporate tax structure, New York’s economy continues to be held back,” said Ivette Alfonso, President of Citizen Action of New York. “The need for these reforms is yet another example of the massive influence that big CEO campaign contributors have in our Capitol. We need a tax code set up by, and set up for the 99%.”

“In schools across the state students have sacrificed college prep courses, reading tutors, arts, sports, music and thousands of teachers,” said Billy Easton, Executive Director of the Alliance for Quality Education, “meanwhile we are giving sweetheart tax deals to insurance companies, credit card companies and investment bankers. It’s just wrong.”

Mario Cilento, President of the NYS AFL-CIO, said, “Throughout this budget crisis working men and women have been asked to bear the entire brunt of cost cutting through new pension tiers, higher health premiums and wage freezes. At the same time many corporations fail to even pay the taxes they owe. We need to close corporate tax loopholes to infuse reoccurring revenue and end the vicious cycle of cuts to middle class families.”

“Accountability is a two-way street. It isn’t just for schools,” said NYSUT Executive Vice President Andrew Pallotta. “As New York grows its economy and creates jobs — a goal we all share — we need business to be accountable, too, and pay its fair share to help pay for the strong schools and colleges; safe bridges and roads; and other vital services that New Yorkers need.”

“Governor Cuomo and the legislature took action to make personal income tax rates more fair,” said Michael Mulgrew, President of the United Federation of Teachers. “Similar action is needed on corporate tax reform. By eliminating the most glaring corporate tax loopholes New Yorkers would save millions more.”

“It is outrageous that hard working PEF members pay the same or higher tax rate than New York companies that make up to $33 billion in profits a year. Its particularly insulting that middle class families are paying the same tax rate as Rupert Murdoch’s News Corporation,” said Ken Brynien, President of the New York State Public Employees Federation (PEF).

“These are the sweetest tax loopholes for Wall Street’s wealthiest hedge fund managers,” said Walter Lipscomb, a board member of Community Voices Heard from Yonkers, “but are just bitter for the working families forced to carry them. Wall Street’s wealthiest need to pay their fair share.”

“Students across New York are being asked to pay more for access to New York’s public higher education system, which erodes in quality every year because of massive budget cuts,” said Angelica Clarke, and organizer with New York Students Rising and Save Our SUNY. “As students, we demand Governor Cuomo and the legislature initiate a tuition freeze to alleviate some of the burden caused by his regressive tax on students instead of expanding NYSUNY 2020 which allows corporations to continue to take advantage of our public institutions through unequal public-private partnerships. A tuition freeze would provide temporarily relief to working students and families and will be an important first step in protecting access to New York’s public universities and colleges. If Governor Cuomo truly wants to work in the interest of students, he must join New York Students Rising in our efforts to repeal NYSUNY 2020 and fully fund CUNY and SUNY.”

“In New York we have record homelessness – over 45,000 men, women and children spent last night in New York City shelters or sleeping rough on the streets – at a government cost of over $1 Billion per year. And yet there is no plan to address this crisis that brings over 110,000 different men, women and children (40,000 of them) into city shelters each year. The front line services provided by Coalition for the Homeless to prevent and resolve homelessness have suffered years worth of deep cuts – a million dollars per year in lost services and jobs just for our own organization. The Coalition supports efforts to close corporate tax loopholes to help avoid further cuts and secure the resources we need to we need to rebuild these vital services and reverse course,” said Shelly Nortz, Deputy Executive Director for Policy with Coalition for the Homeless.

“The fact that all too often powerful corporations are able to wield political influence to create tax loopholes to avoid paying their fair-share is a paradigmatic example of the broader economic and political inequalities that have motivated the Occupy movement,” said Colin Donnaruma of Occupy Albany. “Occupy Albany enthusiastically joins in the efforts to close these loopholes in New York and generate much needed revenue for the 99%.”

“All New Yorkers should pay their fair share, including corporations that benefit greatly from our state’s people and infrastructure,” said Sunshine Ludder, the senior economic policy strategist at the Center for Working Families. “It’s essential for a strong democracy and economy.”

“Religious communities are called to feed the hungry, shelter the homeless, and clothe those who would go cold,” said Sara Niccoli, Co-Director, Labor-Religion Coalition of New York State. “However, when the richest New Yorkers continue to enjoy unthinkable wealth as the lines for our faith-based feeding programs and shelters just grow longer – it’s time to call for fundamental change. it’s time for corporations to pay their fair share. We remind our state government: “No one can serve two masters. Either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve both God and Money.” Matthew 6:24.

Statement of PEF President Ken Brynien on tax rate reform

Albany – We applaud the Governor’s and Legislature’s effort to address the growing income inequality in New York. The agreement announced today on tax reform is a step in the right direction but unfortunately falls short in obtaining the goal of a fair tax system.

The agreement would give millionaires the largest tax cut at more than 2 percent while the middle class would get the smallest tax cut at less than half a percent.

Tax rate reform should include tax cuts for the middle class, but we support higher tax rates for New York’s wealthiest as proposed in the “Tax the 1 percent” plan developed by the Fiscal Policy Institute. This plan would raise the tax rate for the wealthiest New Yorkers and generate between $4.4 billion and $5.1 billion in annual revenue.

We are urging lawmakers to adopt a true tax reform plan that addresses the basic unfairness in our tax system while raising the necessary revenue needed to provide important services including health care, education, environmental, mental health and human services as well as necessary infrastructure improvements.

PEF is the state’s second-largest state-employee union representing 55,000 professional, scientific and technical (PS&T) employees and other public and private employees.

BALCONY APPLAUDS PROGRESS ON NEW YORK STATE FAIR TAXATION

BALCONY APPLAUDS PROGRESS ON NEW YORK STATE FAIR TAXATION

For Release Tuesday December 6th

BALCONY, the Business and Labor Coalition of New York, today (Tuesday) commended the New York State Legislature and Governor Andrew Cuomo for reaching an agreement on a fair tax code reform for New York State. BALCONY urged immediate passage by the New York State Assembly and Senate.

The new plan provides the shared sacrifice by all New Yorkers in order to rebuild the New York economy for businesses, workers, seniors and children.

BALCONY agrees with Governor Cuomo that New York State is in a dire fiscal situation and that we must address an immediate revenue shortfall of at least $350 million and a $3-$5 billion revenue shortfall next year.

The business and labor representatives of BALCONY supported the New York State surcharge on higher income New Yorkers in 2009. At the same time, since our inception BALCONY has supported a more progressive tax system for New York and we are pleased to see the Governor and Legislature move decisively in that direction.

The new tax reform code will spur economic growth by both individuals and corporations. Lowering taxes on small businesses and moderate income families will help stimulate economic activity and spending.

The urgency to reform the tax code is made even more necessary due to the failure of the Congressional “Super Committee” to reach a consensus on tax policy. Washington’s gridlock could cost New York State more than $5 billion in Federal funding over the next ten years. A more progressive tax system in New York State will help fill the gap in the loss of those federal funds. We need strong business so that New Yorkers can keep their jobs and be provided with the vital services which our residents need.

We urge all parties in New York State to enact the comprehensive tax package that will benefit all New Yorkers.

BALCONY is co-chaired by Alan Lubin, the former NYSUT Executive Vice President and Bruce Ventimiglia, Chairman of Saratoga Capital Management.

BALCONY represents more than 1000 New York State Business, labor unions, non profit advocacy organization seeking common ground between Business and Labor in public policy debate in New York State. BALCONY is a 501 c(4) non-profit, non-partisan organization.

For more information contact: Lou Gordon (212) 219-7777

GOVERNOR CUOMO, MAJORITY LEADER SKELOS & SPEAKER SILVER ANNOUNCE COMPREHENSIVE PLANS TO CREATE JOBS AND GROW THE ECONOMY

GOVERNOR CUOMO, MAJORITY LEADER SKELOS & SPEAKER SILVER ANNOUNCE COMPREHENSIVE PLANS TO CREATE JOBS AND GROW THE ECONOMY

Governor Andrew M. Cuomo, Senate Majority Leader Dean Skelos and Assembly Speaker Sheldon Silver today announced that they have reached a proposed three-way agreement on legislative and executive proposals to create jobs and cut taxes for middle class New Yorkers. The agreement includes support for a comprehensive New York Works Agenda that will create thousands of jobs with new investments in New York’s infrastructure, passing a fair tax reform plan that achieves the first major restructuring of the tax code in decades resulting in a tax cut for 4.4 million middle class New Yorkers taxpayers, approving $50 million in additional relief for areas devastated by recent floods, and reducing the MTA payroll tax to provide relief for small businesses. The leaders will now present the agreement to their members for approval.

“Our state government has come together in a bipartisan manner to create jobs, grow our economy and, at the same time enact a fair tax plan that cuts taxes for the middle class,” Governor Cuomo said. “We are investing in projects that will restore our state’s infrastructure and put thousands of people to work. We are cutting taxes on middle class New Yorkers and small businesses, which will inject nearly $1 billion into our economy. We are targeting new tax credits to hire inner city youth and reduce unemployment in some of the poorest areas of our state, as well as providing direct aid to communities struggling to recover in the wake of this year’s severe storms. This would be lowest tax rate for middle class families in 58 years. This job-creating economic plan defies the political gridlock that has paralyzed Washington and shows that we can make government work for the people of this State once again. I commend Majority Leader Skelos and Assembly Speaker Silver for their partnership in our effort together to create jobs for New Yorkers and put our state’s economy on a path for growth.”

“This year, working in a bipartisan manner, we’ve accomplished some very important things for the people of this State – - including eliminating a $10 billion deficit, bringing spending under control and capping property taxes,” Majority Leader Skelos said. “This comprehensive plan will reduce the tax rate for middle class families to their lowest levels in more than fifty years, create thousands of new private sector jobs, and begin to turn our economy around. I am pleased that this proposed agreement realizes long-held Senate Republican priorities like cutting the corporate franchise tax for manufacturers, reducing the job-killing MTA payroll tax for small businesses, eliminating New York’s stealth tax by indexing tax brackets and deductions, and building our reserves, along with providing additional flood relief to support job growth in devastated communities. I am looking forward to presenting this framework agreement to the members of our conference tomorrow and hearing their feedback.”

“Assembly Democrats share the Governor’s belief that we need to restore fairness and equity to our tax system – someone who makes $50,000 should not be paying the same tax rate as someone making $5 million,” Speaker Sheldon Silver said. “With Governor Cuomo’s leadership, we have forged a bipartisan plan that is fair to all New Yorkers and will help build a brighter economic future for this State. I am submitting to my conference a proposal that will provide $2 billion in revenue for the people of New York in each of the next three years by creating a more progressive tax structure, coupled with a significant middle class tax cut. I will recommend that they give it favorable consideration. I congratulate the Governor for helping to forge this comprehensive plan to revitalize New York State’s economy.”

The Governor’s New York Works Agenda will create tens of thousands of jobs through a $1 billion targeted and accelerated investment in key infrastructure projects around the state including roads, bridges, parks, energy and water projects. The NY Works Agenda also includes pursuing a comprehensive gaming plan and enacting a new tax credit to incentive the hiring of inner city youth.

The Governor and the legislative leaders have agreed to tax code reforms including a temporary restructuring of current tax brackets to reduce taxes for 4.4 million middle-class New Yorkers. The Governor is also establishing a commission to examine a comprehensive overhaul of the state’s entire tax code that will make it simpler and fairer for all taxpayers and to create economic growth in the state.

In addition to these agreements, the Governor and legislative leaders announced a new round of flood relief, including a $50 million grant program for at businesses and counties impacted by Hurricane Irene and Tropical Storm Lee. The plan also includes a job retention tax credit for businesses impacted by a natural disaster during the last year. Finally, the Governor and legislative leaders announced that the MTA payroll tax will be reduced for small businesses.

The details of the proposed agreement are as follows:

The New York Works Agenda

New York Works Infrastructure Fund: Creating Jobs by Rebuilding New York

The Governor and the legislative leaders have agreed to a plan creating New York’s first infrastructure fund to inject over $1 billion in job creating investment. The accelerated state funding will leverage $10 billion in direct capital investment to create thousands of direct jobs by rebuilding roads and bridges; parks, dams and flood control projects; upgrading water systems and educational facilities; and investing in energy efficient improvements to commercial and residential buildings. The plan will focus on projects that support regional Economic Development Plans in the transportation, energy, environment and public facilities sectors. The accelerated infrastructure fund investment is within the state’s debt ceiling.

Specific investments undertaken by the New York Works Infrastructure Fund include replacing deficient state and local bridges in every region of the state, rehabilitating dams and flood control infrastructure, renovating parks, rebuilding water systems, conducting energy retrofits on homes, farms, businesses, and schools, as well as accelerating major SUNY and CUNY projects.

The Governor and the legislative leaders agreed on proposing legislation that will permit the New York Works Infrastructure Fund to bid the design and construction of infrastructure projects as a single contract, reducing costs and improving construction time. Passage of “Design-Build” legislation would shave 9 – 12 months from the construction time of major infrastructure projects. The Fund would also streamline permitting and regulatory approvals for infrastructure projects and procurements and consolidate activities across agencies and authorities.

Financing for the infrastructure fund would be provided through advancing capital investment and the creation of a public/private infrastructure fund. $700 million in state capital investments would be front loaded to increase job and economic impact by moving up capital projects planned for 2013 to 2012 wherever possible. An additional $300 million from the Port Authority would be directed towards funding for infrastructure projects in New York City. A new public/private infrastructure fund would raise up to $1 billion from pension funds and private investment.

Gaming Agreement

The Leaders expressed support to work with the Governor and request support from their respective majorities to put a constitutional amendment up for a vote.

Inner City Youth Employment Program and Tax Credit

The Governor and the legislative leaders agreed to create an inner-city youth employment program and a $25 million tax credit for employers who hire unemployed youth between 16 and 24 years of age over the first six months of 2012. The program and credit would be available to employers in businesses such as clean energy, healthcare, advanced manufacturing and conservation. Eligible employers would receive up to $3,000 for a six month training period and an additional $1,000 if they retained their workers for an additional six months.

Nearly $37 million in funding will be provided to critical jobs programs for inner city youth. This includes $12 million in support grants to youth providers for work readiness training, occupational training, placement or job matching, workplace mentoring and follow up services to increase retention. Participating youths will be provided with up to three monthly stipends of $300 each to cover costs associated with transitioning into the workplace. An additional $25 million will be appropriated for workforce skills training and support programs including digital literacy, basic education and occupational training, summer youth employment, job search and placement, and facilitated child care enrollment.

Fair Tax Code Reform

The Governor and the legislative leaders announced tax code reforms to create jobs and restore fairness to the tax system. Under the new rate structure, a total of 4.4 million New Yorkers would receive a tax cut, including a $690 million reduction for middle class taxpayers, and all taxpayers would see a tax reduction or no change compared to their previous tax bill. Brackets would increase with the rate of inflation. The newly implemented top bracket expires in December 31, 2014.

The new tax structure would generate $1.9 billion in additional revenue for the State. Any additional unspent funds from this revenue would be held in a new priority reserve fund to be dedicated towards future needs regarding job creation, local mandate relief, education, health care and mortgage foreclosure protection.

The new tax bracket structure would be reorganized as follows:

Income Level	Previous Tax Rate	New Tax Rate
$40,000 to $150,000	6.85%	6.45%
$150,000 to $300,000	6.85%	6.65%
$300,000 to $2 million	7.85% – 8.97%	6.85%
Over $2 million	8.97%	8.82%

Through an executive order, the Governor has created the New York State Tax Reform and Fairness Commission to address long term changes to the tax system and create economic growth. The commission will have thirteen members, including four recommended by the Senate and Assembly majority leaders and two recommended by the Senate and Assembly minority leaders. The chair of the Commission will be appointed by the Governor. All members are required to have expertise in the tax field and will receive no compensation.

The Commission will conduct a comprehensive and objective review of the State’s taxation policy, including corporate, sales and personal income taxation and make revenue-neutral policy recommendations to improve the current tax system. In its review, the Commission will consider ways to eliminate tax loopholes, promote administration efficiency and enhance tax collection and enforcement.

Flood Recovery Grant Program

The Governor and the legislative leaders have agreed to establish a $50 million grant program to continue recovery efforts in regions of the State impacted by Hurricane Irene and Tropical Storm Lee.

The program includes the following support for communities recovering from the storms:

· $21 million for small businesses, farms, multiple-dwellings and non-profit organizations that sustained direct physical flood-related damage costs not covered by other federal, State or local recovery programs. Grants would be limited to $20,000 and eligible only to companies that are on the Small Business Administration’s list of companies that have sustained damage.

· $9 million for county flood mitigation or flood control projects. The grants for each county would range from $300,000 to $500,000; however, counties could jointly apply. Eligible counties must be included in Federal disaster declarations

· An additional $20 million included in federal disaster declarations distributed on an as needed basis
· Permitting local government to let taxpayers impacted by the storms to pay their property taxes in installments

Jobs Retention Credit for Businesses Impacted by a Natural Disaster

The Governor and the legislative leaders have agreed to the enactment of a job retention credit for businesses harmed by a natural disaster. The credit would be available to firms with at least 100 employees that have retained or expanded their workers’ roles during this time. The credit would equal 6.85 percent of the wages of retained jobs and is targeted towards employers in financial services, manufacturing, software development, new media, scientific development, agriculture and other sectors.

Reduced Manufacturing Tax Rate

The Governor and the leaders agreed to provide a new reduction in the tax provided to corporate manufacturers by lowering their tax rate that would save them $25 million.

Reducing the MTA Payroll Tax

The Governor and the legislative leaders have agreed to reduce the MTA payroll tax on small businesses while maintaining the necessary funding for the MTA from other sources. The payroll tax would be eliminated or reduced for 294,900 taxpayers overall. The tax would also be eliminated from an additional 415,000 taxpayers by raising the self-employment income exemption. In addition, private elementary and secondary schools, as well as parochial schools, would be exempt from the tax. The State would compensate the MTA for the $250 million in lost revenue.

FPI Report: Reforming the New York Tax Code

New York State is at a crossroads. Our tax structure is scheduled to change in a way that will render state revenues inadequate for the budget years ahead. Hundreds of thousands of households struggle to pay property tax bills that represent an inordinate share of their incomes. And, in the aftermath of the Great Recession, far too many New Yorkers are still looking for jobs as good as the ones they used to have.

What can be done? What strategies can we pursue that will increase revenues to preserve the services that support New Yorkers’ quality of life and make it possible for families to move up the socioeconomic ladder—and that will, at the same time, make the tax system fairer?

Read the entire report: Tax Code

PEF Members Ratify Revised Tentative Agreement, 3,496 Jobs Saved

Albany – By a count of 27,718 to 11,645, members of the New York State Public Employees Federation (PEF) ratified a revised four-year agreement with the state that averts significant layoffs.

The ratification of the new agreement saves the jobs of 3,496 PEF members and preserves the vital services our members provide.

The agreement preserves the pay-scale, the employment and the careers of PEF members. It maintains increments and salary-grade parity, longevity payments and co-pays for doctor visits at their current levels. It calls for no salary increases for years 2011, 2012 and 2013. A salary increase of 2 percent is included for 2014.
The new contract increases the share members will pay of their health insurance premiums, but includes changes to the productivity enhancement program which will allow members greater opportunity to use vacation time to offset health insurance costs. The new contract includes reimbursement for the 9 furlough days payable at the end of the agreement.

“More than 75 percent of our membership voted on the agreement,” said PEF President Ken Brynien.

“Although this was a difficult decision for our members, it demonstrates they are willing to do their part to put New York state on a stable financial footing, as all New Yorkers should, and are helping to resolve a fiscal crisis for which they were not responsible.
“This agreement preserves our members’ jobs and the services they provide. During this economic downturn, the state’s citizens are more dependent on these vital services than ever, in the wake of the flooding earlier this year.

“We are certain the governor understands the sacrifice our members have agreed to accept, and recognizes the value PEF members and other public employees provide to the citizens of the state.

“We now call on the governor as part of his efforts to increase the efficiency of state government, to direct his attention to areas where PEF has highlighted cost savings. These areas include the elimination of wasteful contracting out and reducing the state’s excessive authorities, commissions and public benefit corporations that make up the state’s shadow government,” Brynien said.

PEF is the state’s second-largest state-employee union, representing 55,000 professional, scientific and technical (PS&T) employees and other public and private employees. The contract covers the state’s PS&T employees.

Despite Protests, Cuomo Says He Will Not Extend a Tax Surcharge on Top Earners

by Thomas Kaplan

ALBANY — Even as Occupy Wall Street stokes debate over income inequality, Gov. Andrew M. Cuomo dug in his heels on Monday against extending a so-called millionaires’ tax on high-earning New Yorkers, saying the income tax surcharge would place New York at a competitive disadvantage with neighboring states.

Mr. Cuomo, a Democrat who campaigned for governor last year on the promise that he would not raise taxes, compared his resistance to renewing the temporary tax surcharge with the stand his father, former Gov. Mario M. Cuomo, took against the death penalty two decades ago.

The similarity, Mr. Cuomo said, was that both positions were highly unpopular with voters.

“The fact that everybody wants it, that doesn’t mean all that much,” he said in a news conference. “I represent the people. Their opinion matters, but I’m not going to go back and forth with the political winds.”

Mr. Cuomo insisted that under no circumstances would he consider backing the extension of the surcharge, saying it would encourage residents and businesses to move to other states. He said he would support a federal millionaires’ tax, because it would treat residents of all states equally.

The governor, aided by Senate Republicans, this year succeeded in warding off efforts by Democratic lawmakers during the legislative session to extend the surcharge, which expires Dec. 31.

But the Occupy Wall Street movement and the spreading protests it has inspired — scores of people gathered at the Capitol on Saturday, and an occupation is planned in Albany beginning at noon Friday — have reinvigorated lawmakers, organized labor and community groups that advocate for the tax’s extension. The surcharge was a primary topic of conversation at a retreat hosted by the New York State Black, Puerto Rican, Hispanic and Asian Legislative Caucus on Friday; those lawmakers overwhelmingly agreed that they wanted to press further in favor of extending the measure.

And on Monday, various advocacy groups and labor unions, including New York State United Teachers and many of the state’s other largest unions, formed a coalition to start what they described as a “renewed” push for the surcharge’s extension. They are calling themselves 99 New York, a reference to Occupy Wall Street’s theme of representing 99 percent of Americans rather than the richest 1 percent.

“We have everybody joining together now to say, ‘Enough is enough,’ and we’re hoping our elected officials are going to start listening to us,” said Ron Deutsch, executive director of New Yorkers for Fiscal Fairness, a liberal advocacy organization.

Mr. Deutsch and others found evidence of public support for their position in a new poll released on Monday by Siena College, which found that 72 percent of registered voters supported increasing taxes on New Yorkers earning over $1 million per year. The poll, conducted from Oct. 10 to 12, has a margin of sampling error of plus or minus four percentage points.

Asked about the poll, Mr. Cuomo invoked his father’s position on the death penalty and cited his refusal to budge despite overwhelming public pressure.

“Reporters would say, ‘Well, people want it,’ ” Mr. Cuomo said. “And the point was, you know, we don’t elect — you can’t just have as a governor a big poll-taking machine, right? And we take a poll, and whatever the poll says, that’s what we do.”

The Assembly speaker, Sheldon Silver, a Manhattan Democrat, on Monday sent out a press release citing the Siena poll and affirming his commitment to advocating for the tax’s continuation.

The current surcharge applies to income over $200,000 for individuals and $300,000 for married couples; Mr. Silver is proposing to extend the surcharge only for income over $1 million. His office estimated that the surcharge, if extended for an extra year, would generate an additional $4 billion, including $2.8 billion in the next fiscal year.

The state is facing a projected $2.4 billion budget gap for that period. In light of that, Mr. Silver said Assembly Democrats would continue to press for the tax surcharge in the legislative session next year, even after it has expired.

Asked his posture looking toward next year’s budget in a telephone interview, Mr. Silver, citing his desire to improve education and health care, said, “I think the answer is, ‘Governor, we’re not making more cuts.’ ”

Mr. Silver added that “clearly there’s more attention” to the issue because of the Occupy Wall Street protests. Assemblyman Karim Camara, Democrat of Brooklyn and chairman of the legislative caucus for minorities, agreed.

“They’re forcing us to have a very necessary conversation,” Mr. Camara said, “and that’s the beauty of it.”