Government Affairs Albany UpdateDecember 21, 2007
- Business Council Budget Testimony
- Business Council/Department of Labor Discuss Employee Misclassification
Staff Contact: Ken Pokalsky
Business Council President Kenneth Adams argued for spending restraints and further tax reform in testimony delivered this week to the New York State Division of Budget. Over the past two weeks, the Division has held hearings on education, real property taxes, housing and economic development issues, as its completes its work on the Executive Budget proposal for Fiscal 2009.
Key findings and recommendations in our testimony included:
- State revenues are up significantly, with state tax collections up by $11 billion over the past three years. The state's projected deficit is a function of excessive spending growth, based on a $5.5 billion, or nearly ten percent, increase in General Fund spending next year.
- Spending growth should be targeted to the rate of inflation. If we had applied this standard over the past three years, we would be entering FY 2009 with a budget surplus.
- New York needs to adopt additional tax reforms supporting new capital investment, and new economic growth in New York State, with an emphasis on the innovation economy, and the crucial need to promote new growth in Upstate.
- High property taxes continue to adversely impact business, and are a drag on economic growth. In conjunction with STAR rebates, the state should adopt significant mandate reform and cap on local property tax levies in order to assure real property tax relief.
These concerns were echoed by other hearing participants. Rochester Business Alliance President Sandy Parker, speaking on behalf of the Unshackle Upstate Coalition, argued for several initiatives targeting upstate, including a five year phase out of corporate franchise taxes for all business operating in Upstate, for an expanded “shovel ready sites” program, and for brownfield program reforms.
Economic Development Council President, Brian McMahon, also argued for spending constraints; for preserving key economic development tools, such as Empire Zones and Industrial Development Agencies; and for increasing the role of Empire State Development Corporation's regional offices in supporting regional development efforts.
- The Business Council's full testimony is available on line
testimony provided at the
four Division of Budget
hearings is available online
The Business Council met with Department of Labor representatives this week to discuss Executive Order 17, which establishes a Joint Enforcement Task Force on Employee Misclassification. Members include the Commissioner of Labor, Attorney General, Commission of Taxation and Finance, Chair of the Workers' Compensation Board, Workers' Compensation Fraud Inspector General, and the Comptroller of the City of New York. The Executive Order was created to respond to concerns that employers in New York and elsewhere are improperly classifying individuals as“independent contractors.”
The Task Force is examining ways to better coordinate and implement enforcement of employers' legal obligations under the federal and state labor; employment and tax laws including minimum wage, overtime, prevailing wage, unemployment insurance, workers' compensation insurance, temporary disability insurance, wage payment and income tax.
The Business Council emphasized to the Department that some claims of worker misclassification are not indicative of employer wrongdoing. The Department agreed to work with the Business Council to address these and other employer concerns. The Task Force is scheduled to release a report to the Governor on February 1. The report will provide details about investigations and enforcement actions.