NYS Budget

New York State Legislators and Governor Cuomo Agree to a $175 Billion Budget Plan

State leaders announced Sunday they reached a budget deal just in time for the fiscal year that starts Monday.  The $175.5 billion plan includes an array of deals, but leaves a few major decisions undone — such as legalizing marijuana and creating a board to decide how to publicly finance political campaigns.

Here are some of the highlights:

Manufacturers Intermediary Apprenticeship Program (MIAP)
The final budget included $750,000 for MIAP to ensure the program can continue and grow in partnership with the Alliance Partners.  Thank you to the Alliance Partners, companies, and apprentices who advocated relentlessly for this program.  Whether you wrote or called your State Legislators or travelled to Albany for Manufacturing Lobby Day, your efforts resulted in this funding being included in the final budget.   We will be thanking all the legislators who ensured this funding was continued and encourage you to thank your representatives for their support as well.

Empire State Apprenticeship Tax Credit
We are pleased to report the continuation of the Empire State Apprenticeship Tax Credit in this year’s budget.  If you are not already accessing this tax credit, we encourage you to do so.  Information can be found here:  https://labor.ny.gov/apprenticeship/empire-state-tax-credit.shtm A big thanks to Assemblyman Bronson for creating this tax credit and ensuring its continuation. 

Pass-Through Manufacturing Zero Tax Rate
Unfortunately, the zero tax rate for pass through manufacturers was not included in the final budget.  Our team of Alliance Partners along with our expert Paul Henry of The Bonadio Group, worked diligently starting early last fall and through the last days of the budget negotiations to have this important provision included.  While we were not successful, we made a tremendous amount of progress including securing a new Senate sponsor, Senator Kaplan – Chair of the Commerce and Economic Development Committee, to join Assemblyman Stirpe, the sponsor in the Assembly.   In addition, we educated many legislators and administration officials on the positive impact this rate would have on the more than 11,500 manufacturers an their over 300,000 employees.  We will continue to advocate for this issue in 2019 to further laid the ground work for the next budget cycle.

Prevailing Wage
The Senate and Assembly included language in their one house budget proposals that was ultimately rejected in the final budget that would require prevailing wage on public works projects, as written, this would have included IDAs and grants from the REDC program. This proposal was championed by Senator Jessica Ramos – Chair of the Senate Committee on Labor, Assemblyman Harry Bronson and members of the organized labor community specifically, the building and construction trades unions. While Governor Cuomo has expressed support for expanding the definition of public works, he recognizes the need to find a reasonable compromise that does not halt development in the state. We expect the prevailing wage conversation to continue this legislative session, the Governor has made it clear this is one of his post-budget priorities. 

A Permanent Property Tax Cap
The budget deal included the enactment of a permanent 2% property tax cap. Making the tax cap permanent is a massive win for hardworking taxpayers across New York State.

Economic Development
The state’s economic development efforts are the biggest beneficiary of the new budget, getting a 10 percent funding bump. (Spending as a whole, by contrast, went up a smaller 2 percent.) Much of that is earmarked for the Empire State Development Corporation, which distributes various state tax credit and grant programs.

Billions of Dollars in New Taxes
Unfortunately, this budget also includes billions dollars in new taxes, fees and assessments that will further burden business and taxpayers at a time when they can least afford it. New energy taxes on New York businesses, fees on broadband deployment, a new ban on plastic bags and fee on paper among several others will only add to New York’s high tax reputation and make the state more expensive to live and do business.

Taxpayer-Financed Political Campaigns
The Legislature approved $100 million taxpayers’ dollars be set aside annually to fund a matching system for political campaigns. Details including amounts and eligibility will be worked out by a special commission

 

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As Governor Cuomo and the Legislature Continue Budget Negotiations – Issues Critical to Manufacturers are in Play

Gov. Andrew Cuomo told reporters earlier this week that this year’s state budget negotiations are particularly difficult because of revenue declines, the threat of big federal funding cuts and disputes with lawmakers over spending priorities.  Cuomo said there’s still time to agree on a budget before the April 1 deadline but that this budget may prove to be more difficult than past spending plans.

Here is a brief update on some items being discussed of particular interest to manufacturers include:

  • A provision legalizing and taxing marijuana was dropped after lawmakers couldn’t agree on the details. Cuomo now says it could be taken up after the budget.
  • Cuomo says he won’t sign a budget that doesn’t make the 2 percent local property tax cap
  • The New York State Senate included $750,000 in its one-house budget to sustain the New York State Manufacturing Intermediary Apprenticeship Program (NYSMIAP), an employer-led, public-private pilot program for registered apprentices in manufacturing occupations. The Council of Industry administers the program in the Hudson Valley.
  • A provision to “zero out” the income tax for New York State Manufacturers organized as “pass-through entities is still a possibility as negotiations continue.
  • Both houses of the legislature have backed a provision in the budget calling for prevailing wages to be paid for all projects in the state that receive any state funding. Such a provision would mean dramatic increases in the cost of projects from hospitals to schools to any private project that received economic development assistance. 

Many of these issues were discussed at the Manufacturing Alliance Lobby Day March 6th where more than 50 manufactures from across the state visited with legislators to voice their hopes and concerns.

Council of Industry President Harold King introduced Lt. Governor Kathy Hochul who keynoted the day’s luncheon.  The Lt. Governor has a long history of support for manufacturing especially in the area of workforce development and she is also the Chair Person of the State’s Regional Economic Development Councils. She spoke on the importance of investing in the next generation of manufacturing workers and of the need to continue to support the sector.

 

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