Lake On­tario shore­line is de­clared dis­as­ter area

Trump OKs funds for f lood re­cov­ery

The Buffalo News - - FRONT PAGE - By Jerry Zrem­ski and Thomas J. Pro­haska

Pres­i­dent Trump on Tues­day de­clared Lake On­tario’s New York shore­line a dis­as­ter area, open­ing up fed­eral fund­ing for re­cov­ery ef­forts from flood­ing that oc­curred be­tween May 2 and Aug. 6.

State, lo­cal and tribal govern­ments, as well as some non­profit groups, will be el­i­gi­ble to ap­ply for fed­eral money for emer­gency work and the re­pair or re­place­ment of fa­cil­i­ties dam­aged by flood­ing in Ni­a­gara, Or­leans, Oswego, Wayne, St. Lawrence and Jef­fer­son coun­ties.

Also un­der the pres­i­dent’s dec­la­ra­tion, the state is el­i­gi­ble for fed­eral fund­ing on a cost­shar­ing ba­sis for haz­ard mit­i­ga­tion ef­forts.

How­ever, the dis­as­ter dec­la­ra­tion, is­sued by the Fed­eral Emer­gency Man­age­ment Agency, said the re­gion’s ap­pli­ca­tion to al­low in­di­vid­u­als to ap­ply for as­sis­tance re­mains un­der re­view.

The dis­as­ter dec­la­ra­tion was good news not just for the re­gion’s mu­nic­i­pal­i­ties, but also for Rep. Chris Collins, R-Clarence, who has been press­ing for the fed­eral aid for months.

“We have wit­nessed aw­ful dev­as­ta­tion along the shore­line and have stayed per­sis­tent in our fight to se­cure fed­eral as­sis­tance,” Collins said. “My

ers from New York and New Jer­sey. They are among the states that could be hurt the most by a House pro­posal to limit the state and lo­cal tax de­duc­tion to the first $10,000 of real es­tate taxes paid, and a Se­nate pro­posal to elim­i­nate the SALT de­duc­tion en­tirely.

Cuomo has ar­gued that the pro­posal could force New York­ers to pay $16 bil­lion more in fed­eral taxes. He is­sued a re­port last week that said 91,041 tax­pay­ers in Erie County alone would suf­fer un­der the House’s pro­posal to cut the SALT de­duc­tion, with the av­er­age tax­payer pay­ing $2,884 more an­nu­ally.

Asked to ex­plain the move, Mul­vaney ar­gued that the ex­ist­ing SALT de­duc­tion hurts tax­pay­ers in his home state – be­cause, liv­ing in a low-tax state, South Carolini­ans have less to deduct and there­fore pay higher fed­eral taxes.

“If our lives are en­tirely ex­actly the same … but you live in New York City and I live in South Carolina, why should I pay more fed­eral tax than you do?” he asked. “Be­cause that’s the way the world works right now. And I think you could make an ar­gu­ment that that’s sim­ply not fair; it’s not right … that the folks who live in the low-tax ju­ris­dic­tions are ac­tu­ally sub­si­diz­ing the folks who live in the high­tax ju­ris­dic­tions.”

New York has tra­di­tion­ally got­ten far less back in fed­eral ben­e­fits than it pays in fed­eral taxes. In 2015, U.S. Cen­sus Bureau fig­ures show that fed­eral tax col­lec­tions per capita in New York were $13,659 – far greater than the $10,552 in per capita fed­eral ben­e­fits.

Mean­while, the sit­u­a­tion was re­versed in South Carolina, a low-wage state where the av­er­age tax­payer con­trib­uted $4,921 to the fed­eral gov­ern­ment, while per-capita fed­eral ben­e­fits of $10,791 were greater than in New York.

In re­sponse to Mul­vaney’s com­ments, Cuomo stressed New York’s role as a “donor state” that gives the fed­eral gov­ern­ment much more than it gets back. “Mul­vaney should know bet­ter, and he does,” Cuomo said. “I’ll make it sim­ple: Just give New York the $48 bil­lion we send to Wash­ing­ton that makes us the No. 1 donor state in the na­tion, and he and the pres­i­dent can do what­ever they want with state and lo­cal tax de­ductibil­ity.”

Asked about New York’s sta­tus as a donor state, Mul­vaney said: “The sys­tem is not set up so that states get back the same amount of money they put in.”

And he stressed that if a South Carolinian earned the same amount as a New Yorker, the South Carolinian would likely pay more in fed­eral taxes just be­cause the New Yorker would ben­e­fit more from the SALT de­duc­tion. “All things be­ing equal, if I am pay­ing more fed­eral tax than you are, I am sub­si­diz­ing your high-tax ex­is­tence,” he said.

Mul­vaney also cast doubt on an­other ar­gu­ment that Cuomo and other ad­vo­cates of the cur­rent sys­tem make: that by with­draw­ing the de­duc­tion, the fed­eral gov­ern­ment would, in essence, be tax­ing state and lo­cal tax ben­e­fits, which would do far more dam­age in a high-tax state such as New York.

“I’ve heard the folks say, ‘You know, it’s re­ally dou­ble tax­a­tion,’” he said. “But I’m, like, ‘No, we’re only tax­ing you once. Some­body else just hap­pens to be tax­ing you, but we’re only tax­ing you once.’ ”

In ad­di­tion, Mul­vaney ac­cused Cuomo of ex­ag­ger­at­ing the im­pact of the pro­posed changes to the SALT de­duc­tion. The bud­get di­rec­tor noted that with the stan­dard de­duc­tion nearly dou­bling to $24,000 for a fam­ily of four, far fewer peo­ple would need to item­ize – and would get a tax break even with the loss of other de­duc­tions.

“The gov­er­nor of New York said this is go­ing to be a tax in­crease on ev­ery sin­gle per­son in New York,” Mul­vaney said. “That’s just not right.”

Mul­vaney also said he was con­fi­dent that the GOP tax­over­haul plan – which aims to lower rates for many in­di­vid­u­als while cut­ting the cor­po­rate tax rate by 43 per­cent – would pass when the House votes on its bill later this week.

“The at­mos­phere is pretty pos­i­tive,” he said, con­trast­ing the tax ef­fort with the GOP’s failed at­tempt to re­peal and re­place the Af­ford­able Care Act. “I could not say the same thing when we were at this point in the process about health care. I think health care was a piece of leg­is­la­tion that was look­ing for a way to fail. Tax re­form is a piece of leg­is­la­tion look­ing for a way to suc­ceed. I think it’s an en­tirely dif­fer­ent dy­namic.”

Con­gres­sional Repub­li­cans have vowed to pass tax-over­haul leg­is­la­tion by the end of the year, but they still face ob­sta­cles.

First and fore­most, there’s the dif­fer­ence be­tween the House and the Se­nate bills over what to do about the SALT de­duc­tion. In hopes of re­solv­ing that dif­fer­ence, Sen. Rand Paul, R-Ky., said Tues­day that he will in­tro­duce an amend­ment to the Se­nate bill ac­cept­ing the House pro­vi­sion al­low­ing de­duc­tions of up to $10,000 in prop­erty taxes.

“This will help en­sure House ac­cep­tance of the Se­nate plan as lead­ers there have stated they will not ac­cept a plan with no state and lo­cal de­ductibil­ity,” Paul said on Twit­ter. He also said on Twit­ter that such a change would en­sure that, un­der the bill, many more Amer­i­cans would get a tax cut.

Repub­li­cans will also have to re­solve sev­eral other dif­fer­ences be­tween the House and Se­nate ver­sions. The GOP will also prob­a­bly have to over­come unan­i­mous Demo­cratic op­po­si­tion, which is why Schumer sug­gested that the GOP start its tax­over­haul ef­fort all over again.

“The Trump ad­min­is­tra­tion and our Western New York rep­re­sen­ta­tives in Congress should go back to the draw­ing board and work with us in a bi­par­ti­san way to pass real tax re­form that will ben­e­fit the mid­dle class and grow our econ­omy – be­cause this plan will do nei­ther, even while it cru­elly ham­mers New York,” Schumer said.

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