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Government Affairs Albany Update

May 19, 2006

Paid Family Medical Leave Bill Amended

The Senate side of the paid family and medical leave bill, S.1501 (Morahan) /A.1301, was amended and recommitted to the Senate Labor Committee on May 3rd. It has now been placed on the Senate Labor Committee's May 22, 2006 meeting agenda.

The bill has been near the top of the NYS AFL-CIO's priority list and has been tracked by the Council's Labor & Human Resources Committee for several years.

S.1501-A has picked up Senators Oppenheimer, Schneiderman and Spano as additional sponsors. Other changes include triggering the entitlement at employers of fifty or more employees, up from ten; requiring employers to allow their employees to use company sick time pay as well as paid disability benefits; reducing the paid time off in several categories; and changing the paid leave for family emergency and necessary medical care to episodes of "serious" medical conditions...but doesn't define "serious."

VendRep Survey

The Business Council has submitted detailed comments to the Office of State Comptroller on their most recent version of a proposed “VendRep” survey. This draft survey is part of the OSC's efforts to develop a centralized database for use by state agencies in assessing the “responsibility” of vendors that bid on state contracts.

The Business Council's most significant concerns regarding the VendRep questionnaire include an excessive breadth of inquiry – requiring submission of information on all business divisions and affiliates, for example, as well as information on violations of a wide array of federal, state and local laws, regardless of their significance. The Business Council's comments included a number of specific recommendations on making the draft survey more focused, more relevant, and less burdensome on potential bidders.

Legislature Caps Sales Tax on Motor Fuel; Governor's Signature Due by May 26

The Assembly and Senate passed and sent to the Governor on May 15th, A.11331 Tonko, et al. (S.7909 Wright). The bill converts the State Sales and Use Tax on motor fuels (including diesel) from four percent of the product price (less State and local Sales and Use Tax and Motor Fuel Tax) to eight cents per gallon. The bill also converts the (twelve-county - New York, Bronx, Richmond, Kings, Queens, Nassau, Suffolk, Westchester, Putnam, Dutchess, Rockland, Orange) Metropolitan Commuter Transportation District Sales Tax from three-eights of one percent of the product price (less Sales and Use and Motor Fuel Taxes) to three-fourths cents per gallon.

Governor Pataki's signature (or veto) is due by May 26; the State and MCTD Sales and Use Tax reductions would begin June 1, 2006.

For motor fuel currently selling at $2.999/gallon in a county having a four percent local sales tax rate within the MCTD, A.11331 is expected to save purchasers 2.774 cents per gallon State sales tax and 0.26 cents per gallon MCTD sales tax as follows:

 
Current Law
New Law
Savings/Gallon
Product Price
$2.69342
$2.69342
State SUT
.10774
.08
$0.02774
MCTD SUT
.0101
.0075
.0026
Local SUT
.10774
.10774
Motor Fuel Tax
.08
.08
Pump Price
$2.999

A.11331 authorizes localities to convert their local Sales and Use Tax on motor fuels from their local tax rate percentage times the product price to a cents-per-gallon basis, rounded to the nearest cent, calculated at their local tax rate percentage times two or three dollars. In the example above, if the local government voted to convert and chose two dollars, then the purchaser would save an additional 2.774 cents per gallon; if the local government voted to convert and chose three dollars, then the purchaser would pay an additional 1.226 cents per gallon.

U.S. Supreme Court Unanimously Rejects Petitioners Challenge of Ohio's Investment Tax Credit

The U.S. Supreme Court on Monday unanimously ruled in DaimlerChrysler Corp. v. Cuno and Wilkins v. Cuno that the Cuno plaintiffs, who challenged Ohio's Investment Tax Credit (ITC) on Commerce Clause discrimination grounds, lacked standing to bring their suit in the Federal courts. 547 U.S. ___ (May 15, 2006). The Supreme Court vacated the portion of the Sixth Circuit Court of Appeals' decision in Cuno that had invalidated Ohio's ITC, and the Court remanded the cases for dismissal.

Seven justices joined in an opinion written by Chief Justice Roberts (and Justice Ginsberg in a separate concurring opinion) said that the plaintiffs (who had prevailed at the Federal trial level) did not meet the necessary standing requirements to seek remedy in Federal court and vacated the Sixth Circuit Court's decision. Since the case was dismissed by the Supreme Court on standing, no decision was necessary on the merits of the case, id. est., the constitutionality of Ohio's Investment Tax Credit. The plaintiffs' lead attorney said he will try to refile in Ohio state court. The Federal Sixth Circuit decision had not affected New York's Investment Tax Credit (and similar credits of other states outside the Sixth Circuit); however, the U.S.Supreme Court decision does. The decision makes it highly unlikely that similar legal action seeking to overturn a state's investment tax credit will be entertained in the Federal courts.