09/29/2008
Governor's veto pen falls on small business healthcare bill
Gov. David Paterson has vetoed a number of bills in the last several weeks, among them legislation backed by NFIB.
Chief among these legislation sponsored by Assemblyman Joe Morelle and Sen. Jim Alesi that would have increased small business access to basic, affordable health insurance by repealing the 12-month waiting period on the state's Healthy-NY program. Its passage was a top priority for small business in this year's session.
The good news is that the governor's veto was not based on the merits of the bill, but rather the state's dire fiscal condition. We appreciate the gravity of the financial and fiscal crisis confronting the state, and admire the governor's determination to tackle it. However, with recent studies showing that health insurance premiums have more than doubled since 1999, small businesses are facing a crisis of their own as they struggle to afford health insurance.
For more than 20 years, NFIB members have identified the cost of health insurance as their top concern. We remain committed to taking steps to increase their access to affordable health insurance, and look forward to continuing to work with the governor and Legislature on this legislation and other measures that will get us there in the future.
Outdoor recreational business legislation vetoed as well
The governor also a bill that would have created a commission to study the fairness and impact of competition between government-run and privately-owned outdoor recreational facilities -- namely golf courses, ski centers and campgrounds. We believe this legislation confronts an important issue, as in many ways public facilities operate at a significant advantage over privately owned facilities, which already contend with the second highest cost of doing business in the nation.
Public facilities do not pay property taxes. Privately owned facilities do, struggling with the highest property tax burden in the country. Public facilities are also able to purchase goods, services, utilities and employee benefits at much lower rates which are unavailable to private businesses. For those public facilities which operate at a deficit, their operating losses are covered by government. Private facilities operating at a loss simply go out of business. The problem goes beyond private facilities being placed in unfair competition with publicly owned facilities. As taxpayers, these private facilities are underwriting the very competitors who are hacking away at their bottom lines. We remain committed to working with the legislature and the executive branch on solutions to address this problem.
NFIB victory
One bright spot: The governor this week did approve NFIB-backed legislation to fix a major flaw in the tax law that was forcing ferry boat operators to pay significant amounts of sales tax from which they should have been exempted. Existing law automatically gave an exemption to ferry operators in New York City, and extended the same exemption to operators elsewhere in the state if they received a "certificate of public necessity" from the state Department of Transportation. Except, of course, the Department of Transportation did not have the authority to issue such a certificate, meaning that these businesses could not access the exemption intended for them. NFIB members led the charge to fix this problem, and with the governor's signature, it has become law. Although this legislation only impacts a small number of businesses, it makes a big difference to those it does. Among these are NFIB-member ferry companies across Long Island, including the South Ferry Company, NFIB/New York's oldest member, which has been operated by the Clark family since 1797.
Senate Majority Leader Dean Skelos unveils job creation plan
Senate Majority Leader Dean Skelos has offered a new economic development plan that includes job-creating tax cuts for small businesses and manufacturers.
The Senate plan would tie tax credits to the creation of new jobs; would reduce unnecessary, costly and burdensome government regulations, provide tax credits and interest-free loans to students who stay in New York State, reform the Empire Zone program to make it more effective and accountable, encourage new investments in community revitalization and reduce the high cost of health insurance.
NFIB/New York State Director Mike Elmendorf said Majority Leader Skelos should be commended for unveiling a new job plan that strengthens the small business sector. The package takes on many of the core issues challenging New York's entrepreneurs and job creators, and is a breakthrough proposal focused on lowering New York's second highest in the nation cost of doing business.
Additional information on the Senate's job creation plan can be found here.
Gov. Paterson hangs tough on state budget
Over the last six months, the governor has taken a series of extraordinary actions to start the process of getting New York's fiscal house in order. In March he asked state agencies to seek and identify ways to reduce their operational spending by 3.35 percent within the current budget year. In July, he asked agencies to seek an additional 7 percent reduction. Together, these cuts produced a total current-year savings of $1.1 billion. In August, the governor called for an emergency special session of the legislature, which passed an unprecedented $1.0 billion, mid-year spending reduction plan.
Despite these historic savings actions, the governor is calling for implementation of even stronger measures to confront the difficult task of closing a 2009-10 budget deficit that already totals more than $5.4 billion, and could very likely increase if our struggling economy continues to worsen. He has directed all state agencies to put forward a zero growth budget for the 2009-10 fiscal year and has requested that they advance creative proposals for reducing costs, streamlining their operations, and increasing productivity. He has also imposed a state hiring freeze.
In a letter to state agencies, the governor stated that "In these difficult times, our state simply cannot afford another 'business as usual' budget process. Our government has used that approach far too often in the past. Spending, borrowing, and taxes have increased at unsustainable rates, limiting our ability to provide for our citizens and damaging our business climate. Combined with the impact of high property taxes and a declining manufacturing base, the result has been that millions of our former neighbors have left the state in search of the jobs and opportunities they cannot find here at home."
NFIB has long argued that New York State government spends and taxes too much, driving us to have the nation's second highest cost of doing business. We applaud the governor's firm commitment to taking steps to fundamentally change these dynamics.
