Officials: Tax the rich
Some legislators say taxation will close the budget gap but critics cry foul.
Gov. Andrew M. Cuomo has remained steadfast in his pursuit of federal aid to close the state’s multi-billion-dollar deficit, but state legislators are urging a return to session before the New Year to pass revenue raisers — including taxes on the wealthy — and financial relief for struggling New Yorkers.
Dozens of senators and assembly members on Thursday called on the state Legislature to return to Albany to pass taxes on wealthy
New Yorkers as well as approve several bills that would provide relief and protection to vulnerable New Yorkers, like those at risk of eviction when the statewide moratorium expires on Jan. 1.
“What we are seeing in this moment is an executive that is lacking the courage and the ability to stand up for working class individuals,” Assemblyman Khaleel Anderson,
D - Queens, said. “We have 14 proposals right now that can move folks forward, 14 proposals that ask the wealthy among us to pay just a little bit more. If the executive does not have the courage to do that, then we will.”
While Cuomo acknowledged in his latest briefing that tax increases, borrowing and layoffs will be necessary if lawmakers in Washington, D.C. do not provide any aid to state and local governments, he did not say what a tax increase would look like or if it would focus on the wealthy.
“I’m not willing to say that Washington shouldn’t do what is fair and right and just help us with this financial crisis, especially when it’s in the nation’s best interest to get the economy going,” Cuomo said Wednesday. “If Washington doesn’t provide enough funding, I believe taxes and tax increases are going to happen. The question, though, is how much.”
Cuomo and state Budget Director Robert Mujica have warned that increasing taxes on wealthy New Yorkers would not be enough to close the state’s multi-billion-dollar deficit and could prompt those residents to move elsewhere.
A federal stimulus package that includes aid to state and local governments has been a point of contention among Washington lawmakers, with Republicans reluctant to give aid to “blue states” that they say have mismanaged their finances for years.
New York Republican Party Chairman Nick Langworthy echoed those sentiments in a statement released Thursday afternoon criticizing Cuomo for considering tax increases to address the budget deficit. He said taxing wealthy New Yorkers, “our revenue generators,” will accelerate the “exodus of our critical financial industry.”
“New York’s fiscal problems have not come from a lack of revenue — they are the result of Democrats’ tax and spend policies that have driven millions of jobs and New Yorkers to other states,” Langworthy said in the emailed statement. “Federal aid to deal directly with the COVID emergency is necessary and fair, but it’s not the solution to cover up years of bad fiscal policies that made New York the highest taxed, least-business friendly climate in the nation. Neither is taking more money from overburdened New Yorkers.”
The state has reduced spending by about $4 billion to address the deficit, including instituting a hiring freeze and deferring pay raises for some 80,000 employees, although Cuomo has made a number of hires in his office.
New York has also frozen new state contracts and withheld roughly 20 percent of payments to current contractors.
Those withholdings have primarily hit social service organizations that provide supportive housing and programs for people with developmental disabilities; substance abuse treatment; and some localities that receive state aid.
The latest criticism comes from the New York State Conference of Mayors, which was informed recently that state Aid and Incentives for Municipalities payments slated for 55 cities across the state on Tuesday will be reduced by 20 percent.
“It’s very disappointing that New York state has chosen to withhold 20 percent in much needed state aid to 55 cities, many of which are closing out their year-end budgets,” said NYCOM President and Binghamton Mayor Richard C. David. “Thirty-seven million dollars is a drop in the bucket for the state budget. Unfortunately, the end result is that these municipalities that provide essential public safety services, among other critical services, will experience more short-term fiscal pain in the middle of a surging pandemic.”
Despite state officials warning school districts for months about reduced state funding, Mujica said Wednesday the districts have not yet been impacted by any withholdings. Without federal relief before the end of the year, however, the institutions could see reduced state funds, he said.
“As of today, we have not been withholding 20 percent from school districts on these payments so far, but we will in the absence of (federal) payments,” Mujica said.