Prepared by the staff of The Business Council January 14, 2000


Governor Pataki announced Tuesday a proposed new state budget that would cut energy taxes on manufacturers retroactive to January 1, provide other new tax cuts, and restrain the growth of state debt.

The Governor emphasized the importance of limiting new debt in the coming year. His budget proposal includes steps to pay down some of the state's existing debt; to reduce the level of new borrowing from previously estimated levels; and to enact legal limits on future debt while restricting it to capital purposes.

Total spending would increase 4.3 percent under the Governor's budget, not counting the money the state will spend on the STAR school-tax refund program.

State-funded spending (total expenditures minus federal funds) would rise by 3.5 percent, again excluding the STAR program. Including the school-tax refunds, the overall budget would rise by 5.5 percent, and state-funds spending by 5.1 percent.

The Executive Budget's financial plan projects a year-end State surplus of $625 million for the fiscal year ending March 31, 2000. The Budget calls for all of this surplus to be earmarked for the following specific fiscal reserves: $75 million to the State's Tax Stabilization Reserve Fund (the "rainy day" fund) in 1999-2000; $250 million to the State's Debt Reduction Reserve Fund; and $300 million to help ensure that the newly proposed tax cuts included in the Executive Budget will be paid for and implemented as scheduled.

Following are the specific budget summaries by means of issue area.


Alcoholic Beverage Tax

Corporations and Utilities Taxes (Article 9)

Corporation Franchise Tax (Article 9-A)

Metropolitan Commuter Transportation District Surcharge

Petroleum Business Tax

Sales and Use Tax 



Governor Pataki's Schools 2000 agenda includes a number of reforms that include:

Providing Safe and Secure Schools

Other issues

Meeting Higher Standards

Expanding School Choice


Improved Accountability



New Economic Development Initiative - The Executive Budget proposes a number of new tax credit, tax reduction and financing initiatives to promote economic development and job creation. These include:

The Executive Budget proposals regarding core economic development programs included:



Comment - The Business Council strongly opposes the new hazardous waste program fee surcharges proposed by the Governor, which top off at $360,000 for generators of more than 10,000 TPY. All generators of greater than 1,000 TPY would be subject to surcharges of at least $85,000 per year. At the other end of the spectrum, small to mid-sized facilities (generators of 15 to 100 TPY) would be subject to increases of up to nineteen times their current assessments.

Brownfield tax credits would be available to non-responsible parties only, and would apply both to remediation and redevelopment costs. The Business Council is concerned with "recapture" provisions that are tied to remediation agreement reopeners.

Comment - The brownfield funds provided by the CCA bond act are for municipally-owned sites, only.

Comment - This refers to the overall Division of Air budget. There is no proposal to increase Title V permit fees in the new budget. They will remain fixed at $45 per ton.

Comment — Licence fees on major oil storage facilities were doubled as part of last year's budget, to $.08 per barrel. Oil Spill Fund expenditures in the proposed budget reflect these increased revenues.

Comment - This is an annual appropriation to finance the database created by the 1997 Pesticide Use and Reporting Act.



Highlights of the 5 year DOT capital plan include:

The new five-year capital plan provides transportation with $2.34 billion to support transit capital programs. This State assistance would fund bus acquisitions, maintenance facilities, subway improvements and commuter rail enhancements. Specifically, the plan includes:

Also of note is the proposed;


Two areas of note in the Budget as they relate to construction are the Wicks Law as it applies to school districts and school district access to the Dormitory Authority for construction management.

Also, in relation to construction are;


The following are all new initiatives included in the Governor's Executive Budget.



In addition, the 2000-01 Executive Budget provides:

January14, 2000