Government Affairs Albany Update
March 18, 2011
Confirmation Hearings – The State Senate will take action on two additional gubernatorial nominees next week, including Kenneth Adams as Commissioner of the Department of Economic Development and President and CEO of Empire State Development Corporation. The Senate will also be acting on the Governor’s nomination of John Dyson as Trustee of the New York Power Authority. Background information on the Governor’s nominees are available on our web site here. The Senate Finance Committee meeting will be 1:00 p.m. on Tuesday, March 22 in Room 124 of the State Capitol.
Both the State Senate and Assembly have introduced amended versions of the Governor’s $132.9 billion Executive Budget proposal, and have adopted one house budget “resolutions” that set the stage for final negotiations on the Fiscal 2011-12 state budget. Our detailed review of major legislative changes is available here. An overview of major changes includes the following:
The Senate’s proposed budget included $132.5 billion in total spending, about $400 million, or 0.5% less than the Executive Budget. The Senate Republicans accept the Governor’s recommended caps on future Medicaid and education spending, which is in line with previous Senate Republican calls for passage of a State spending cap.
The Senate budget makes $280 million in school aid restorations, and by their calculation, adopts $2.755 billion of the $2.9 billion in reductions and reforms recommended of the Governor's Medicaid Redesign Team. It also would give counties the authority to opt out of optional Medicaid services. The Senate has not accepted the Governor’s Excelsior program reforms, and continues to work on alternative economic development proposals.
The Senate also proposes several significant tax and fee reforms, including: permitting deferred business tax credits earned from 2010 to 2012 to be treated as refundable overpayments in 2013; accelerating the sunset of $700 million per year in “Section 18-a” energy assessments by two years; and proposing a package of tax credits targeting communities affected by correctional facility closures.
The Assembly’s proposed budget includes $133.0 billion in total spending, virtually the same level as proposed in the Executive Budget.
It restores $467 million in education aid for the 2011-12 school year, including $200 million for general support to public schools. It accepts most of the Executive Medicaid Redesign Team recommendations for Hospitals, Nursing Home, Home Care and Pharmacy, but rejects the medical malpractice reforms as proposed by the Team.
The most significant change proposed to the Governor’s budget is the Assembly’s proposal for a one year extension and modification of the upper income personal income tax surcharge, affecting taxpayers with taxable income over $1 million for the 2012 tax year. This is expected to raise $700 in Fiscal 2012 and $2.6 billion in Fiscal 2013.
It generally accepts the Governor’s proposed amendments to the Excelsior Jobs program, and the Executive Budget’s capital funding to be directed by the proposed regional economic development councils.
The Business Council strongly opposes Senate bill 262, which would impose a fifty-percent franchise tax on business-owned life insurance benefits. This bill is currently on the Senate Investigations and Government Operations Committee agenda.