A representative group of The Business Council's Directors discussed The Council's top legislative priorities with Governor George Pataki at a meeting January 19.

Business Council President Daniel B. Walsh and Board members briefed the Governor on The Council's top priorities for 1999: tax cuts, health care cost containment, tort reform, and workforce development.

"We had a good, candid, substantive discussion of these issues, and we left encouraged about the possibility that Governor Pataki's second term will be at least as good for New York's business climate as his first term," Walsh said.

That same day, Robert King, director of the state Division of the Budget, told The Council's Government Affairs Council to "expect a different dynamic" in budget negotiations this spring.

The Governor's commitment to spending restraint and his call to leave the state's surplus unspent and in a reserve for future tax cuts may alter budget negotiations, he said.

King noted that the impact on revenues of New York's historic tax cuts enacted in the last four years has been "masked" by income growth and the addition of 400,000 private-sector jobs that are producing new tax revenues.

If growth slows in the next two years, the effect of tax cuts on revenues may become more stark-perhaps prompting calls to slow or even reverse the tax cuts, he warned.

To offset this pressure, he said, business should strongly and clearly reinforce to the Legislature its support for spending restraint and tax cuts.