News from STATE SENATOR

Liz Krueger

New York State Senate, 26th District

 

COMMUNITY BULLETIN – September 2004

 

Message from Liz . . .

Last month, the State Legislature finally passed the budget for 2004-2005, setting a new record for the latest budget ever.  This might be forgivable if we had passed a good budget, but of course we did not, and the damage the legislature did was only increased by the Governor’s vetoes of a number of key programs.  Here are some of the details:  

 

First and foremost, the budget package totally ignores the Campaign for Fiscal Equity (CFE) court decision, which directed the legislature to provide New York City’s high-need schools with additional state funding.  While education aid increases $740 million over last year’s level, state aid to New York City’s public schools is roughly the same percentage (37 percent) of statewide aid that those schools received last year.  Of the big five school districts, New York City received the smallest increase by far. The Senate Democrats attempted to address this inequity by offering an amendment to add $700 million in additional operating aid to address the CFE decision, and to provide $20 billion over 5 years in capital funds for schools in high-needs districts. Unfortunately, the Senate Republicans rejected this proposal.

 

The budget also cut important health programs that provide critical support for middle- and working-class New Yorkers, including Family Health Plus, the AIDS Institute, and community health programs that provide asthma treatment and family planning services.  These cuts make no sense from a public health perspective.  Cutting preventive services will only increase costs down the line in the form of increased emergency room visits and hospital admissions, which cost much more than preventive medicine.

 

The budget process also failed again.  After waiting over four months to prepare a budget, the Legislature again failed to wait even the three days required by law to allow the bills to be reviewed by the public (not to mention the legislators themselves) before passing them.  Instead, we once again passed the majority of the budget bills with ‘messages of necessity’ from the Governor, which eliminated the need for the bills to be publicly available for three days before a vote.  I have introduced legislation requiring budget bills to be available for 10 days before a vote to allow adequate time for public comment on the critical decisions involved in a $100-billion budget.  The Citizens Budget Commission recently asked legislators to sign a pledge to demand that budget bills be available for three days before a vote.  I signed that pledge, which was an additional reason I could not support the bills that did not meet this minimal standard of public review.

 

The Governor took our bad budget and made it worse.  While I sympathize with the Governor’s concern about whether this budget is fiscally sound, his vetoes target programs that assist New Yorkers in getting a quality education and meeting basic human needs.  If the Governor felt the budget was out of balance, there are a number of places he could have cut, such as the new $250 million in discretionary spending allocated to the governor for undefined economic development.  The Governor also repeated the Legislatures mistake by not providing any serious analysis of expected revenue.  We cannot know whether these cuts were needed to balance the budget, because no one has really crunched the numbers.  This is one more reason why we need to require that New York State adopt accepted accounting procedures for balancing our budget:

 

Among the particularly damaging vetoes:

§         $6.5 million in HEOP, SEEK, Liberty Partnership and other programs aimed at increasing access to higher education;

§         $21 million in public school and library aid, including $3.1 million for programs supporting disabled new workers;

§         $25 million in operating aid and $500 million in capital programs for CUNY and SUNY;

§         $7.3 million in aid to preserve housing throughout the state;

§         $57 million in capital funding for affordable housing – the first significant increase since 1985;

§         $500,000 in in-home services for the elderly;

§         $250,000 for services for autistic New Yorkers;

§         $38,000 for domestic violence prevention programs.

 

Between the Legislature’s failures and the Governor’s vetoes, Albany has once again provided a budget that does not meet the needs of the State.  It is not based on sound fiscal analysis, and cuts essential programs and services.  We can do better, and must develop a process that will allow the State to create more responsible budgets.

 

 

 

Community Spotlight

 

 

Planning For Emergencies – Ready New York Nights:

The American Red Cross and New York City Office of Emergency Management are hosting free trainings on how to be prepared for emergencies.  Learn how to assemble a go bag, how to develop a disaster plan for your home, and find out about opportunities to get involved in community emergency response programs.  There will be a Manhattan training on September 9 from 7-9PM at Hunter College Brookdale Campus, 425 East 25th Street.  To sign up call 311 or visit http://www.nyredcross.org/readynynights/.  Space is limited.
 
Affordable Housing Applications Being Accepted for the Biltmore, 271 West 47th Street:
The Biltmore at 271 West 47th Street is currently accepting applications for its wait list for studio and 1 bedroom affordable housing units.  To be eligible, applicants must have incomes between $13,366 and $21,980 for a single person and $14,233 and $25,100 for a family of 2.  Rents for these units are expected to range from $401 to $544 per month, depending on income and the size of the unit.  To request an application, send a postcard to The Biltmore, Post Office Box 2577, New York NY 10108.  Application requests must be postmarked by September 21, 2004.
 
 
 

Spotlight on Policy

 

Clothing Sales Tax Repeal

 

One of the major flaws in this years budget was the failure of the Legislature and the Governor to keep their promise to end the sales tax on clothing items under $110.  The failure to eliminate the clothing sales tax was one key reason I voted against the budget.  This regressive tax was supposed to be phased out on June 30, 2004.  It has a disproportionate impact on middle-class and needy New Yorkers, as well as small businesses.  Instead of eliminating this tax, the governor and legislature have instead resorted to the gimmick of “tax-free weeks,” in an effort to obscure the fact that they have broken their promise.

 

While we didn’t eliminate this tax increase that primarily impacts lower and middle class New Yorkers, we were more generous to the wealthy.  We did follow through on our commitment to wealthier New Yorkers when we scheduled a personal income tax reduction for people earning $150,000 to $500,000 a year.  So we gave wealthy New Yorkers the tax cut we told them we would from last years budget, but we have not given lower-income and working New Yorkers the tax cut we promised them.  The sales tax on clothing was reinstated in 2003 as one of the measures to close what was then an  $11 billion deficit, with the understanding that it, like increased income taxes on wealthy New Yorkers, would be phased out in 2004.

 

The Governor and legislative leadership are now advertising “tax-free weeks,” including one that ran from August 31st to September 6th, where the tax on clothing under $110 is suspended.   Tax free weeks hardly make up for the fact that the state had promised to eliminate the tax altogether.  I am amazed by the chutzpah of our state leaders, who take credit for three tax free weeks while neglecting to mention that they have deprived New Yorkers of another 49 weeks of tax free shopping.

 

The clothing tax is also particularly damaging to small businesses.  They lose business to out of state companies and internet sales, and do not have the flexibility of larger chains to absorb the impact of this tax.

 

The Legislature and the Governor should act to fulfill their original promise, and repeal the sales tax on clothing.  There is still time to act this year, and doing so would create a more equitable tax structure and a more favorable business climate in the State.

 

Fair Education Funding Formulas

 

In yet another example of New York’s dysfunctional State government, New York State Supreme Court Justice Leland DeGrasse yesterday was forced to appoint three special masters to oversee the Campaign for Fiscal Equity case.  I am gratified that Judge DeGrasse has taken this action.  Since the legislature and governor have failed to meet the courts’ mandate to approve a plan for providing New York City schoolchildren with a sound basic education, it will be up to the courts to meet the needs of our students.

 

In a ruling last year, New York’s highest court had given State government until July 30th to 1) determine the actual cost of providing a sound basic education for public-school children in New York City; 2) reform State finance measures to ensure full implementation of findings; and 3) create a system of accountability to track and ensure sufficient education funding.  Despite the risk of being held in contempt of court, Governor Pataki, the Senate and the Assembly have yet to reach an agreement on how to reform the archaic and unnecessarily complex State funding formula for education.  

 

The Legislative branch of New York State government has yet again failed to do its job.  Because of this failure of the Albany process, New York City students will start yet another school year without receiving the qualified instruction, adequate tools for learning and much-needed extra support they deserve.


The three individuals appointed by the court are: the Honorable E. Leo Milonas, former state appellate judge and former president of the City Bar Association; the Honorable William C. Thompson, also a former state appellate judge, state senator and father of the city’s comptroller; and John D. Feerick, former dean of Fordham Law School and also past president of the City Bar Association. Judge DeGrasse charged the Special Masters with producing a report with recommendations as to how the state should meet its obligations to provide a sound basis education in New York City.  The report is to be completed by November 30, 2004.  Based on the recommendations of the Special Masters, Judge DeGrasse will issue a final decision as to the appropriate remedy in the case.

 

Minimum Wage

 

In Late July, Governor Pataki vetoed legislation increasing the state’s minimum wage from $5.15 to $6.00 an hour in January 2005, followed by increases to $6.25 in 2006 and $7.15 in January 2007.  The Governor has demonstrated that he is out of touch with the realities faced by working families in our state.  The Assembly overrode this veto in August,  and the key question now is whether Senate Majority Leader Bruno will bring the override to the floor for a vote in the Senate.

 

Senator Bruno had spoken forcefully in support of this bill when it passed the Senate on July 21st.  In his remarks on the floor, Majority Leader Bruno,  “people out there who earn the minimum wage deserve a raise.  You can’t support a family, they can’t support themselves…we’re going to move the minimum wage and get it done on behalf of the people who truly need it here in the state.”  The minimum wage bill passed the Senate by a vote of 51 to 7, far exceeding the margin needed to override the governor’s veto.

 

We have the votes in the Senate to pass this bill despite the Governor’s action.  I hope that Senator Bruno will keep his word to New York’s working families by getting the minimum wage increase done.

 

New York State has had the same minimum wage - $5.15 an hour - since 1997, meaning that low-wage workers have seen a decline in real income of almost 75 cents an hour.  This continues a long-term trend in the relative decline of the earning power of the minimum wage.  In 1970, the purchasing power of New York’s minimum wage was 71% higher than it is today.    

It is simply not possible to support a family in New York on the minimum wage.  New York needs to commit to providing a decent living for workers in this state, and Majority Leader Bruno can demonstrate his commitment to this goal by bringing an override to a vote.