Government Affairs Albany UpdateMarch 17, 2006
- Government Affairs Council to meet Monday, March 20th
- Senate Passes Broad-based Business Tax Reductions
- State Lobbying Commission Report
The Government Affairs Council is meeting Monday, March 20th starting at 10:00 a.m. The featured speaker will be State Comptroller Alan Hevesi. Business Council staff will provide updates on budget deliberations, including the status of business tax cuts, workers' comp reform, the so-called "Wal-Mart" health-care bills and the status of the state's Power for Jobs program. Margarita Mayo will give a presentation on Just for The Kids. Ken Pokalsky will update the group on new Lobby Commission guidelines.
- Please remember to leave enough time for finding a parking space.
On Monday of this week the Senate passed by a vote of 40 - 18 Senate bill number S.6460B. The bill was developed by the Senate Majority and was passed as part of the Majority's Fiscal Year 2006-2007 State Budget for the year commencing April 1. The measure then went to the Assembly Ways & Means Committee -- whose Majority on Monday passed their own tax change bill (A.10258) as part of their house's FY 2006-2007 State Budget.
Senate bill 6460B contains the following broad-based business tax reductions -- none of which are in A.10258:
- Reduction of the Corporation Franchise Tax rate for manufacturers from 7.5% to
5% for taxable years beginning from April 1 through December 31, 2006,
2.5% for taxable years beginning in 2007, and
0% for taxable years beginning after 2007;
- Manufacturers were defined as those taxpayers whose activities during the taxable year classify them under sectors 11, 31 through 33, or 51 of the North American Industry Classification System;
- One-third reduction in 2007 of both the Corporation Franchise Tax Business Capital Alternative and the Bank Tax Asset Base Alternative;
- Two-thirds reduction in 2008 of both the Corporation Franchise Tax Business Capital Alternative and the Bank Tax Asset Base Alternative;
- Total repeal in 2009 and thereafter of both the Corporation Franchise Tax Business Capital Alternative and the Bank Tax Asset Base Alternative;
- Reduction of the Corporation Franchise Tax Minimum Taxable Income (AMT) tax rate from 2.5% to 2% in 2007;
- Repeal for manufacturers of the Corporation Franchise Tax Minimum Taxable Income (AMT) tax in 2007;
- Reduction of the Bank Tax Minimum Taxable Income tax rate from 3% to 2.5% in 2007 and to 2% in 2008;
- Reduction of the Bank Tax rate from 7.5% to 7.25% in 2007 and to 7% in 2008;
- Elimination of the Corporation Franchise Tax additional tax on Subsidiary Capital;
- Reduction by a quarter percentage point each of the Insurance Tax maximum (cap) and minimum (floor) tax rates on taxable premiums;
Reduction of the Insurance Tax 2% tax rate on non-life premiums to 1.9% in 2007, to 1.825% in 2008, and to 1.75% in 2009;
- Immediate alignment of New York's Estate Tax to match Federal Estate Tax Law and Repeal of New York's Estate Tax for decedents dying after 2009.
Lobbying Commission Report
Staff Contact: Ken
At yesterday's meeting, the State Lobbying Commission elected a new chairman, Paul Shectman, adopted a “zero gift” policy for Commission members and staff, and made several significant changes in their interpretation of the statutory limit on “gifts” from lobbyists and clients to public officials. The Commission also issued their annual report on lobbying expenses and activities for 2005, but held off on any recommendations for legislative changes until at least their April 4 meeting.
In finalizing their revised guidelines on Lobbying Act compliance, the Commission agreed to the following changes regarding the definition of gifts:
- they eliminated the "reimbursability" test for applying the gift exemption for "widely attended, officially related" events. The new "test" of whether an event is "officially related" is whether the "principal purpose of the event is the exchange of information on issues of public interest."
- they established the effective date for the "$75 in aggregate per calendar year" cap on gifts from lobbyists to pubic officials criteria as the date that the guidlelines were approved by the Commission (i.e., 3/16/06). As a result, all gifts offered or given prior to that date were subject to Commission's prior $75 per event interpretation of the gift cap, and will not count toward the aggregate limit of $75 per official for calendar year 2006.
- to qualify for the gift exemption for the cost of travel and accommodations for “participants” at an informational event, the public official will have to be invited to the event with the understanding that the official will have an active role in the presentation of information.”
- with regard to complementary attendance at “charitable” events, only those costs that are either related to food and beverages, or that are deductible as a charitable contribution, will be considered as exempt from the definition of “gift.” The remaining cost of the event ticket will be considered as a gift; anything else of value given to the public official (e.g. hospitality packages) will be presumptively considered a gift.
- guidelines for “arms length transactions” between lobbyists and public officials were modified to say that “any expectation of offsetting payment must be stated contemporaneuously with the offer, and that actual payment must be made within a reasonble period of time.” The draft guidelines had said that such payment must occur contemporaneously with the offer.
In other changes:
- they redefined the proposed definition of “knowing” violations, to say that “failure to know or appreciate the requirements of the Lobbying Act” is not a defense against “knowing” violations. This change would allow for a defense for “errors in fact” (e.g., factual errors in lobbying reports.) The initial draft guidelines said that 'Knowing' is interpreted by the Commission as having knowledge of the Act, and that knowledge of the Act is imputed to any and all parties subject to the law.
- with regard to reimbursements by public officials for private transportation (e.g., travel on private planes), the new guidelines state that reimbursement must be based on first class fare for comparable common carrier travel, and if there is no comparable rate, be based on a prorated share of the actual cost of travel.
The intent is to have the final version of these compliance guidelines on the Commission web site next week. The State Lobbying Commission's 2005 Annual Report is available online today at: www.nylobby.state.ny.us/ann_rept05/index.html