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Gov. Cuomo's Budget Holds Spending Growth to 1.8%, Includes Plan to "Thwart" Federal Tax Law

Governor Cuomo's flickr page

Governor Cuomo released a $168 billion budget proposal Tuesday that he says is more of an economic transformation plan aimed at ensuring the state’s viability in light of the federal tax law.  He followed through on an idea presented in his state of the state address to restructure New York’s tax code.  Cuomo says instead of taxing income received by employees, the state would tax wages paid by employers to counter the loss of income deductibility.

"Employers pay a wage tax which would be equal to that individual's income tax.  The payment by the employer is federally deductible.  The employee has no state income tax liability on those taxes." 

Senator Dave Valesky with the Independent Democratic Conference Cuomo is rightly focusing on what the state can do to address the possible impact of the federal tax law.

"Despite how complicated it may be, I think it's too important to not tackle it head on.  The potential impact to taxpayers is that significant and that severe, that to not do everything we can to adjust policies to protect taxpayers would be irresponsible."

More details on Cuomo’s plan will come out Wednesday.  Valesky was also glad to hear about a $65 million commitment to combat algal blooms on Skaneateles Lake and others, as well as a three percent increase in education aid.  Cuomo says 70 percent will go to the poorest districts, the highest ever. 

"It's not enough to give funding to the poor district.  You have to make sure  the money goes to the poorer schools in the poorer districts.  Right now, we have no idea where the money is going.  We should mandate that they have a formula sending money to the poorer schools."

To help fill the $4.4 billion budget gap, Cuomo wants to defer large corporate tax credits, and charge a windfall profit fee for not-for-profit health care companies previously funded by Medicaid.

"They want to sell to a for-profit or convert.  The state already has a statute where we get the majority of the revenues.  There are several that are pending.  We estimate that [revenue] at $750 million."

But some lawmakers felt the governor spent too much time blaming Washington for the state’s troubles.  Republican Assemblymember Gary Finch in a statement says the federal government didn’t create New York’s $4.4 billion deficit.  He also says Washington also didn’t riddle Cuomo’s development programs with corruption and waste.  Finch says he was hoping for a budget plan that charted a new course.

Scott Willis covers politics, local government, transportation, and arts and culture for WAER. He came to Syracuse from Detroit in 2001, where he began his career in radio as an intern and freelance reporter. Scott is honored and privileged to bring the day’s news and in-depth feature reporting to WAER’s dedicated and generous listeners. You can find him on twitter @swillisWAER and email him at