This Week in Albany

Legislative Update

Governor Cuomo signed a package of veterans-related bills into law, including:

  • S.2911A – Croci / A.3198A – PaulinThis bill allows state employees who are combat veterans to take time off to receive health care services related to their service. CSEA strongly supported this legislation;
  • A.7006 – Gottfried / S.569 – Savino: This bill adds post-traumatic stress disorder as an eligible condition for a medical marijuana prescription; and
  • S.946A – Croci / A.1105-B – Hunter: This bill waives civil service examination fees for honorably discharged veterans.

The Governor vetoed legislation (S.1850 – Ortt / A.6277 – Abbate) that would have allowed counties to allow county correctional officers or deputy sheriffs performing correction officer duties to retire after 20 years with a fifty percent final average salary pension.


Pension Fund

Comptroller DiNapoli announced that the New York State Common Retirement Fund had a value of over $200 billion as of September 30 after posting a 3.67% rate of return for the second quarter of 2017-18. As of that date, the Fund had an estimated value of $201.3 billion.

New York continues to have one of the best managed and most well-funded pension systems in the country thanks to Comptroller DiNapoli’s leadership.

 

Federal Tax Reform

The U.S. House of Representatives passed legislation to overhaul the nation’s tax code this week. The Senate is expected to pass their plan, which differs from the house bill, after the Thanksgiving recess.

Both bills would provide massive tax cuts to corporations and the wealthy while providing few, if any, benefits to middle class taxpayers. According to an AFSCME analysis, nearly 3 in 10 people with incomes between $54,000 and $154,000 would pay an average of $680 to $2,090 more in taxes by the tenth year of the House bill. Further, each proposal would increase the federal deficit by $1.5 trillion over ten years.

The two bills would reduce the corporate tax rate from 35% to 20% without eliminating loopholes that allow corporations to drastically reduce the taxes they pay. This cut alone will cost $1.5 trillion over a decade. Further, while the cuts to individual tax rates would expire under these plans, the corporate tax rate cuts would be made permanent.

The most important difference between the House and Senate bills is over the issue of state and local tax (SALT) deductions. Currently, New Yorkers can deduct the state and local income, sales, and property taxes they pay from their federal taxes. Under the House proposal, the deduction for sales and income taxes would be eliminated, and the property tax deduction would be limited to $10,000. Under the Senate’s proposal, state and local tax deductions would be eliminated entirely. Under either plan, New Yorkers lose.

Eliminating SALT deductions would be especially harmful to workers in states like New York. CSEA joined with AFSCME, the AFL-CIO, and other groups in impressing upon the New York Congressional delegation the importance of maintaining these deductions that workers in New York depend on. Because of the severe impact of eliminating SALT deductions, several New York Republicans voted against the bill in the House, including Lee Zeldin (NY1), Peter King (NY2), Dan Donovan (NY11), John Faso (NY19) and Elise Stefanik (NY21). Claudia Tenney (NY22), Tom Reed (NY23), John Katko (NY24), and Chris Collins (NY27) all voted for the bill. All Democrats in the House voted against the bill.

Once the Senate passes a bill, the two houses will have to work together to reach a consensus on the legislation. Republican leaders have said that they plan on agreeing to a final bill before the end of the year.

 

We’ll Be Back In December

“This Week in Albany” will take a week off for the Thanksgiving holiday and return on Friday, December 1. Have a safe and happy holiday.