Governor Pataki has vetoed a bill that would have added an estimated 52,000 workers to the state payroll and could have threatened some $300 million in federal aid.

The Council had urged the Governor to veto the bill earlier this month.

The bill, which was passed by the Senate unanimously in March and by the Assembly in late April after a lobbying campaign led by the United Federation of Teachers, declares that home day-care providers who earn at least some of their income from public subsidies will become state employees, subject to the state's Taylor Law.”

“It is our understanding that, if Governor Pataki approves this legislation, it would be the first-ever statutory application of the Taylor Law to individuals who are not employees of a government agency," Business Council President Daniel B. Walsh wrote in a May 30 letter to Richard Platkin, counsel to the Governor. "Such a precedent would ill serve the interests of the taxpayers of New York State.”

Unions promised that the bill, if signed into law, would have raised day-care workers' salaries and benefits--increases that could easily cost taxpayers $75 million or more a year.

"New York already has significantly more public employees, in relation to population, than most other states," Walsh said. "That’s one reason our political culture often serves the interests of those who get paid to provide public services, more than it does the people who are the ostensible beneficiaries of such services."

If the bill becomes law, Walsh said, further expansions of the Taylor Law "will be virtually certain."

The Governor cited the Council’s arguments when vetoing the bill.

“While I am always eager to find innovative ways to improve the delivery of child care services in New York, I am constrained to disapprove this bill because it would inappropriately classify the private sector employees as public employees and could undermine the delivery of child care services by jeopardizing federal funds,” the Governor said in his veto message.