This Week in Government Affairs
August 24, 2012


State Supreme Court Rules MTA Payroll Tax Unconstitutional. A state supreme court justice in Nassau County, Judge R. Bruce Cozzens Jr., struck down the state Payroll Mobility Tax this week, a measure passed in 2009 that imposes a tax levy on certain businesses and self-employed individuals within the Metropolitan Commuter Transportation District, which includes all of New York City and seven surrounding counties. This law was challenged by a coalition of municipal governments including Nassau, Suffolk and Westchester counties, which had argued that the law was passed in violation of the home-rule provisions of the state Constitution. That provision requires that any law that has a special effect on a given municipality in the state must be approved by two-thirds of the local government's legislative body. Opponents of the tax charge that it unfairly burdens communities in the MTA region with the costs of sustaining transit that primarily serves only certain suburbs and the city. The Metropolitan Transportation Authority, which derives roughly $1.5 billion annually from the levy is expected to be appeal the ruling. A copy of the decision is available here.

Voters Guide. The Business Council of New York State, Inc. released its 2012 Voters' Guide this week. It is a key measure of lawmakers' commitment to promoting fiscal reform and economic growth in New York. With all 212 seats up for re-election in November, the guide provides an opportunity for voters to review individual legislators' records. In addition, The Business Council will be using its combined 2011-2012 rankings and other factors in making endorsements in advance of the November legislative elections. Our press release is available here; the full 2012 voters guide is available here.


Consulting Contract Legislation Vetoed. The Business Council successfully argued for a gubernatorial veto of S.7782/A.10781, legislation that would have imposed new procedural requirements on state consulting contracts valued at more than $500,000. This bill was of concern to many Council members with state personal service contracts, as it would impose a new, largely duplicative contract evaluation mandate, adding time and uncertainty to an already extensive state procurement process. Specifically, the bill would have required state agencies to determine whether services can be provided by state employees at equal or lower cost. Unfortunately, the bill contained no provisions requiring an assessment of the relative quality of services to be delivered, whether the same quality of service can be provided through equal or lower costs, or whether the contracted services were needed to increase the agency’s implementation of programs or projects. Veto number 150 was issued on August 17.

SSN Legislation Approved. Governor Cuomo has approved S.6608-A/A.8992-A, which creates reasonable standards for and limits on businesses and other non-governmental entities requesting individuals to provide their social security number. Generally, this would be allowed only where required by federal, state or local law; is required for a credit-related transaction initiated by the individual; for purposes of employment, such as administration of a benefit or claim; and where the individual consents to such disclosure. This legislation, approved on August 18, takes effect 180 days thereafter. A more detailed summary of the bill is available here.


Reportable Business Relationship. The Business Council submitted comments to the Joint Commission on Public Ethics in response to JCOPE’s draft guidance on “reportable business relationships,” a new disclosure mandate included in the 2011 ethics reform legislation. In short, that statute required registered lobbyists and their clients to disclose business relationships with public officials valued at more than $1000. Our comments focused on three areas of concern: their improper extension of reporting requirements to a business’ key employees; an overly broad definition of “compensation” paid to public officials; and the need for a “safe harbor” in determining whether public officials are associated with entities with which lobbyists and/or clients have contractural relationships. Our initial discussions with JCOPE staff suggests they are considering amending each of these provisions in response to public comments.

Thruway Authority Toll Proposal. The Business Council has submitted written testimony to the Thruway Authority opposing its proposed 45 percent increase on tolls for certain commercial vehicles, as it would impose significant new costs on business’ transportation costs, and is contrary to the state’s “open for business” objectives. We also urged the Thruway Authority to implement improved management and administrative cost savings, as identified in their third party audits, and for the state to reconsider using Thruway Authority revenues to subsidize the state canal system, before making final decisions on any toll increases. Our testimony is available here.

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