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Government Affairs Albany Update

March 17, 2000

BUDGET RESOLUTIONS

Both houses adopted budget resolutions this week that indicate their proposed changes to the Executive Budget. A summary of the Senate and Assembly resolutions is attached for your review.

SCHIMMINGER GRT BILL

Last week, Assembly Schimminger, chair of the Assembly Commerce Committee, announced that he was introducing a gross receipts tax phase-out bill. The bill, which would phase-out the tax after two years, is still in draft form and will be in print early next week. As of last count, 35 members of the Assembly have joined Schimminger as co-sponsors. They include: Higgins, Robach, M. Cohen, Tokasz, John, Sweeney, Hill Hopper, Gromack, Hoyt, Luster, Weprin, Ortiz, Sidikman, Connelly, Millman, McEneny, Morrelle, Mazzarelli, Lafayette, Canastrari, Tocci, Galef, Seddio, Destito, Christensen, Cahill, Matasow, Rivera, Abbate, Gunther, Vann, Cymbrowitz, Towns, Magnarelli, and Colton. We hope that you continue to urge you local Assembly representatives to support this proposal.
Staff Contact: Ken Pokalsky

WHISTLEBLOWER BILL NEEDS YOUR ACTION

S.1453a (Spano), a bill which would expand whistleblower protections for employees, is now on third reading in the Senate. This bill was reported out of the Senate Labor Committee in February. The original version would have increased protections for employees in the healthcare industry exclusively, but its scope was broadened to include all employers. Your state Senators need to hear from you regarding this bill.

ASSEMBLY SPEAKER OFFERS BUDGET TAX PROPOSALS

Assembly Speaker Sheldon Silver has issued his tax reduction proposals for the FY2001 State Budget. Highlights of the tax cut plan include the following:

IMPLEMENTATION OF SALES TAX ON UNBUNDLED ELECTRICITY AND NATURAL GAS

Business Council members should know that an energy tax that has been suspended since January 1999 is scheduled to take effect in April. This tax could lead to significant increases in energy costs for many employers. The Business Council has lobbied against this tax, and is encouraging its members to do the same. Beginning April 1, certain customers receiving gas or electricity through an alternative energy supplier will see their cost rise by as much as 8 percent due to an advisory opinion issued by the State Department of Tax and Finance. The entire charge for the product and its distribution and transmission was not subject to sales tax as interpreted by Tax and Finance in January 1997. The Department of Tax and Finance issued a Taxpayer Service Bureau Memorandum (TSBM) that stated that, effective January 1, 1999, a 4 percent state sales tax would be imposed on the transmission and distribution of unbundled electricity and natural gas. The tax would not be imposed on residential, manufacturing, and certain non-profits. Tax and Finance stated that the transportation of electricity and natural gas, sold by an energy service in a competitive market, was then subject to sale tax. This applies almost exclusively to commercial facilities.

WISCONSIN ACTS TO ADOPT 100% SALES FACTOR APPORTIONMENT FORMULA

AB735, by Rep Michael Lehman (R-58) and Sen. Kevin Shibilski (D-24), passed the Committee on Ways and Means on February 29 and is expected to be put to Assembly vote early next week. The single sales factor would replace the current 50% sales factor formula. Adoption of a 100% sales factor apportionment formula in New York is The Business Council's number 1 Article 9-A job incentive legislative proposal.