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January 9, 2004
- Session Kick-Off
- Construction Council Submits Testimony on 240/241
- Single Sales Tax Apportionment Included In State-of-State Message
The 2004 legislative session got off to a busy start this week with the Governor's State of the State message, and detailed legislative agendas issued by both the Assembly Majority and Minority.
State of the State - The Business Council applauded Governor Pataki's State of the State message, which advocated several issues that have been on our priority list for the past several years, including adoption of a "single sales factor" allocation scheme for manufacturer's corporate income taxes; a new round of workers' compensation reform; and extension of the Power for Jobs program. The Governor also spoke about reforms to the state's financing programs for medicaid and school aid, two areas that account for nearly 50 percent of the state's General Fund budget.
Assembly Response - Assembly Speaker Sheldon Silver held a press conference immediately after the SOTS, and issued both a response to the Governor's speech, and a discussion of Assembly priorities for 2004. Silver emphasized the issues of school aid and medicaid funding. He also said that the Assembly would be supporting state funding for Pre-K programs, repassage of the Assembly's Empire Zone reform bill from 2003, and an increase in the state minimum wage.
Assembly Minority "Roadmap" - On Tuesday, preceeding the SOTS, Assembly Minority Leader Charlie Nesbitt issued a report entitled "Roadmap to Renewal," outlining their legislative priorities for 2004. Of particular interest to Business Council members is the Assembly Minority's support for single sale factor allocation, expansion of the Empire Zone program to all counties, a number of new incentive and assistance programs aimed at supporting the state's manufacturing sector, and extension of Power for Jobs.
On December 29, 2003, the New York State Construction Industry Council (NYSCIC), an affiliate of The Business Council, delivered testimony to the State Insurance Department on Sections 240/241 of the state's Labor Law. The testimony was delivered by NYSCIC chairman Jack Endryck of the New York State Building Industry Employers (BIE). Sections 240/241 exposes New York's property owners and contractors to unfair liability, makes business insurance prohibitively expensive if it's available at all, and drives up everyday costs for taxpayers and all New Yorkers, the testimony stated.
In its testimony, NYSCIC wrote that New York's construction industry faces an insurance crisis caused by the uniquely shortsighted state labor law. Construction industry members have reported to NYSCIC that their insurance industry premiums are spiraling out of control. Some members state that their insurance costs have increased as much as 500 percent in a single year, and that they cannot buy insurance at any price.
No other state has a law like 240/241 on the books. This situation is forcing New York contractors to look for work in other states. Additionally, the costs of insurance in New York are so needlessly inflated by 240/241 that a new burden is imposed on New Yorkers - because it is they, after all, who ultimately pay the inflated costs of construction projects in this state.
NYSCIC made the repeal of 240/241of the Labor Law its number one priority when it met last fall and is supporting legislation to have the law revamped. It will be the topic of the January 20, 2004 NYSCIC meeting and the rallying focus of a proposed lobby day in March 2004.
Governor Pataki pledged to include adoption of "Single Sales Factor" as the apportionment formula for manufacturers in his upcoming Executive Budget later this month. The Governor stated that it would be done on a phase-in basis. Other details -- including the timing of the phase-in and the definition of manufacturing -- await the Governor's Executive Budget later this month. Single Sales Factor apportionment for the Corporation Franchise Tax is a top priority of The Business Council's Legislative Program for the 2004 legislative session. Governor Pataki proposed adoption of Single Sales Factor apportionment for a narrow definition of manufacturers on a five-year phase-in basis in his 2001-2002 Executive Budget; that year the Legislature and Governor could not agree on a Budget and an expenditure plan without tax changes was adopted in the Fall after the terrorist attacks of September 11.