Zack Hutchins
Director of Communications

For Release — October 21, 2009

Business Council tells Assembly hearing to enact Governor's deficit reduction plan

ALBANY— “New York State's economy simply cannot afford new or increased taxes to balance the state budget,” said Kenneth Adams, president & CEO of The Business Council of New York State, Inc. in testimony before the Assembly Ways and Means Committee hearing on the current budget deficit.

Adams pointed out that the current budget included $6 billion in new or increased taxes and the state has imposed a $1.5 billion payroll tax in the 12-county MTA region. Those taxes have failed to produce the projected revenue and placed the state's economy under even greater stress.

“The Business Council supports Governor Paterson's proposed deficit reduction plan,” added Adams. “Reductions in local assistance spending are essential, since local assistance accounts for the vast majority (78 percent) of all state taxpayer-financed spending. With less than half of the current fiscal year remaining, it would be difficult if not impossible to eliminate the deficit by relying on cuts in state agency spending alone.”

“While the DRP provides necessary first steps, we are concerned that more will need to be done to close this year's budget gap, and it seems certain that additional actions will be necessary to bring the FY 2011 budget into balance. Among other measures, such as restructuring school aid and Medicaid, we will need to reduce the size and cost of the state government workforce,” said Adams.

"A hard hiring freeze should be imposed, and the Governor and legislature should explore other ways to reduce personnel costs, including pension and health insurance costs for government employees.”
The Business Council also called for a real property tax cap, state spending cap, repeal of the Wicks Law and state debt reform.

The full testimony is available here.