Thiele Helps Pass Early State Budget That Helps Hardworking New Yorkers

Budget increases minimum wage and education funding, creates jobs and cuts taxes for middle-class families and small businesses

April 1, 2013

Assemblyman Fred W. Thiele, Jr. (I, D, WF-Sag Harbor) announced the passage of the 2013-14 state budget, which closes a $1.4 billion budget gap and increases the state’s minimum wage, bolsters education funding, invests in critical job creation programs and cuts taxes for middle-class families and small businesses. The spending plan totals $141.3 billion, which includes federal funds for Superstorm Sandy cleanup and the adoption of the Affordable Care Act. Absent the federal funding, the budget totals $135.1 billion, an increase of $1 billion, which is below 1 percent spending growth. “This is another early adoption of the state budget, providing a balanced spending plan that delivers for hardworking New Yorkers,” Assemblyman Thiele said. “The budget addresses fundamental issues facing our families, including the Assembly Majority’s longtime commitment to increasing the state’s minimum wage and providing our schools the necessary funding for our children to receive a quality education. Also, by stimulating job creation and bringing tax relief to middle-class families and small businesses, we are ushering in a stronger, more successful economic recovery throughout New York.” Investing in our children’s educational future The 2013-14 state budget increases school aid by $436 million over the executive’s budget proposal, or a $936.6 million increase over last year. The spending plan also increases community college base aid by $150 per-FTE student for the second year in a row. “A community is only as strong as its schools,” Thiele said. “By increasing school aid we will be able to provide our children and young adults with a quality education, hold property taxes in check and keep the dream of a college degree alive for more working families.” The budget provides $20.8 billion in total Formula Base Aids for the 2013-14 school year, a $936.6 million increase over the 2012-13 school year. The budget also includes $25 million for full-day and half-day pre-kindergarten grants. This new investment will allow for more full-day pre-K programs across the state and additional half-day pre-K slots. “Giving our children an earlier start to education better prepares them for the future,” Thiele said. “The Assembly Majority has been a major supporter of pre-K funding because studies show it helps children get ahead.” Supporting higher education The budget increases support to $2,422 per-Full Time Equivalent (FTE) student at SUNY community colleges. The base aid increase is $150 per-FTE student, which is the second consecutive increase in community college base aid. “New York has one of the finest higher education systems in the nation,” Assemblyman Thiele said. “It’s vital that we continue to grow our higher education system and improve infrastructure so students have quality places to learn.” The budget provides a 3 percent increase in funding for college opportunity programs, including:

$25 million to the Higher Education Opportunity Program (HEOP), an increase of $728,040;
$21.7 million to the Educational Opportunity Program (EOP), an increase of $632,430;
$12.9 million to the Liberty Partnerships Program, an increase of $376,250;
$11.1 million to the Science and Technology Entrance Program (STEP), an increase of $324,030; and
$8.4 million to the Collegiate Science and Technology Entry Program (CSTEP), an increase of $245,520.

Increasing the state’s minimum wage The 2013-14 state budget increases the state’s minimum wage to $9.00 per hour by 2016. The wage will gradually increase over the next three years from $7.25 to $8.00 per hour on Dec. 31, 2013; to $8.75 on Dec. 31, 2014; and then to $9.00 per hour on Dec. 31, 2015. “New Yorkers overwhelmingly support raising the minimum wage because it is the right thing to do morally, and it will help jumpstart consumer spending and spur the economy,” Assemblyman Thiele said. “The Assembly Majority has led the fight to raise the wage, and soon, the thousands of hardworking families who depend on it will have a little more money in their pockets. This is a huge victory for not only minimum-wage employees, but workers across the state.” The increase to the minimum wage will directly benefit 925,000 New Yorkers currently earning below $9.00 an hour, which is over 10 percent of the state’s employed population.¹ The Assembly Majority has led a strong fight to increase the minimum wage, voting last year to increase it to $8.50 per hour and voting twice again this year to raise it to $9.00 per hour. The issue has become a hot-button topic nationally, and with over 80 percent of New Yorkers showing their support for an increased minimum wage,² the Assembly delivered the results that hardworking families expect and deserve, Thiele noted. Keeping NY affordable for millions of hardworking families To continue providing a fairer tax system in New York, the 2013-14 state budget extends the current tax rate first implemented in 2012, locking in the lowest tax rate for middle-class families in 60 years. Approximately 4.4 million taxpayers, more than 99 percent of those filing statewide, benefited from $690 million in tax relief stemming from the tax restructuring, which is why this multi-year extension is so critical for hardworking families, Thiele noted. The budget extends this middle-class tax cut for three additional years and pays for it by requiring those making over $2 million per year – less than 1 percent of all New York residents – pay their fair share. “By implementing a more progressive tax structure, we can continue to keep New York affordable for millions of families statewide,” Assemblyman Thiele said. “Asking the wealthiest among us to pay their fair share goes a long way to ensuring low- and middle-income New Yorkers a more secure future for years to come. Quite simply, it’s the right thing to do.” Tax credits signal NY means business In a continued effort to make New York a friendlier place to do business and create jobs, the budget provides tax relief measures to the business community that will:

phase out the 18-A utility assessment surcharge; by fiscal year 2017-18, the savings for utility customers will reach $500 million; and
provide a veterans’ tax credit for businesses that hire veterans. For taxable years 2015 and 2016, this credit would be worth 10 percent of the wages paid to a qualified veteran during the first full year of employment or 15 percent of the wages if the veteran is disabled.

“By providing small businesses throughout the state with much-needed tax credits, we’ve sent a clear message: New York means business. This state budget puts money where it’s needed, giving small businesses already operating in New York more breathing room, and giving new businesses a reason to call New York home,” Assemblyman Thiele said. Transportation funding for infrastructure projects creates jobs To promote job growth while rebuilding our crumbling infrastructure, the state budget includes $438.1 million for the Consolidated Local Street and Highway Improvement Program (CHIPs). This 21 percent increase is the first in five years and $75 million more than last year. It will be a welcome relief to local taxpayers and municipalities as well, noted Thiele. The budget also authorizes $39.7 million annually for the Marchiselli Highway Improvement Program. “With the added benefit of creating good-paying jobs in the construction industry, increased CHIPs funding ensures that protecting the safety of New Yorkers remains a top priority,” Assemblyman Thiele said. “Roads maintained by local municipalities shoulder 87 percent of all travel in New York. We need to protect our families on the road and CHIPs puts the money directly where it’s needed most.” Protecting unemployed workers and reducing costs for businesses The 2013-14 budget gradually increases the weekly unemployment benefit from $405 per week to 50 percent of the state’s average weekly wage by Oct. 1, 2026. “With our economy still making its way out of the worst recession since the Great Depression, protecting workers and those who can’t find work is incredibly important,” Thiele said. Additionally, the budget adopts the federal expansion of the Shared Work Program, which helps prevent employees from losing their jobs by providing employers with an alternative to laying off workers, Assemblyman Thiele noted. To save businesses money and further jumpstart our economy, the budget reforms the Unemployment Insurance (UI) system to make it solvent in 2016. Employers will immediately save $446.5 million annually and once the UI fund is solvent, there will be three additional benefits to businesses:

UI Interest Assessment – businesses will no longer pay interest on the federal UI loan once the fund is solvent;
Contribution Schedule – businesses will pay contribution rates that are up to 25 percent lower than they pay now; and
Federal Unemployment Tax Act (FUTA) Reduction – businesses will see the federal unemployment tax rate cut in half.

“The Assembly Majority is continuing its commitment to lower costs for businesses and spur job growth,” Thiele said. “We’ll continue looking for ways to free up money so businesses can hire.” Creating jobs through NYSUNY 2020 The 2013-14 state budget contains $55 million in capital funding for a third round of NYSUNY 2020 Challenge Grants. “Through the collaboration of our colleges and local businesses, the NYSUNY 2020 program has been successful in spurring innovation and creating jobs,” Thiele said. “A third round of grants will build on the success we’ve already established.” Offering tax credits that spur hiring of veterans The 2013-14 state budget includes tax credits to boost employment among veterans, many of whom are suffering from joblessness. A newly established veterans’ tax credit would be offered to businesses that hire veterans. For taxable years 2015 and 2016, this credit would be worth 10 percent of the wages paid to a qualified veteran during the first full year of employment or 15 percent of the wages if the veteran is disabled. “We have an obligation to help take care of the veterans who honorably served our country,” Assemblyman Thiele said. “Veterans are among the groups hardest hit by unemployment. Theses tax credits will help them get back to work.” Investing in vital health care programs The 2013-14 state budget restores $18 million across 89 critical public health programs, including tobacco prevention programs, family planning services and school-based health centers. Further, the budget restores funding for other critical health care programs, including:

$2 million for spinal-cord injury research;
$1.1 million for HIV/AIDS-related programs;
$1 million for infertility programs;
$557,000 for school-based health centers; and
$550,000 for women’s health initiatives.

Additionally, the budget includes $34.3 million to protect the right of spousal refusal, ensuring that seniors with ailing spouses who are in need of long-term care services are protected against losing assets that are critical to their well-being, Thiele noted. “It’s imperative that we continue to fund these essential health care services so many families depend on,” Assemblyman Thiele noted. Much-needed funding for family planning services In an effort to protect essential family planning and women’s health care services for all New Yorkers, regardless of income, the 2013-14 budget provides $750,000 to support family planning services. “With women’s reproductive rights under attack across the nation, this funding for family planning services is a reminder that New York is a leader in protecting a women’s right to choose,” Assemblyman Thiele said. “Securing this vital funding helps ensure that women can gain access to the critical health services they need.” Improving the state’s criminal justice system The 2013-14 budget restores $1.3 million in supplemental support for Alternative to Incarceration (ATI) programs. Further, the budget provides:

$2.65 million in civil and criminal legal services grants;
$1.1 million in additional support for Prisoners’ Legal Services;
$600,000 for the Indigent Parolee program;
$500,000 for the purchase of safety equipment for correctional officers; and
$450,000 for immigrant legal services for students and families.

The budget restores $1 million to the New York State Defenders Association, $1 million for Edward Byrne Memorial Justice Assistance Grants (JAG) and $1.2 million to domestic violence-related civil and criminal legal-service providers. It also provides $2.7 million for law enforcement, drug, violence and crime control and prevention programs, along with $3 million for Operation SNUG to help combat gang violence and improve public safety for young adults. “Gun and gang violence rips families and communities apart,” Thiele said. “By continuing these critical services, we can provide at-risk young adults with alternatives to gang violence and incarceration, giving them a chance at a brighter future, rather than one behind bars.” Safeguarding the Environmental Protection Fund To protect the state’s environmental conservation efforts, the budget includes $153 million for the Environmental Protection Fund (EPF), a $19 million increase over last year’s funding, Thiele added. “This budget maintains our longstanding commitment to environmental protection throughout the state,” Assemblyman Thiele said. “Safeguarding this critical funding will help us combat the destruction of our environment and allow our families to enjoy the beauty of our natural surroundings for many years to come.” Holding utility companies accountable In an effort to hold combination gas and electric companies more accountable and more responsive to regulators and customers, the budget strengthens the Public Service Commission’s (PSC) oversight and enforcement capabilities and:

establishes a “failure to reasonably comply” standard for violations of Public Service Law;
requires that civil penalties can only be remitted directly to and for the benefit of ratepayers;
authorizes the PSC to evaluate the continued operation of a power corporation; and
allows the PSC to revoke a corporation’s operating certificate.

“Strengthening the PSC will enable the commission to more effectively oversee and crack down on utility companies that come up short on the services customers are paying for,” Thiele said. “These new penalties will give the commission greater authority over the state’s utilities and work to keep them in line, making sure our families receive the services they deserve and pay for.” Stabilizing pension costs for local governments and schools In an effort to combat ballooning pension costs, the budget allows local governments and school districts to opt into a pension stabilization program that benefits taxpayers. Under this plan, local governments could pay a stable rate of 12 percent for civilian employees or a stable rate of 20 percent for uniformed employees for the first two years. This plan allows that rate to be adjusted by up to a half a percentage point the following year and allows for repayment over 12 years, instead of 10. For school districts, the budget allows districts to defer payment of a portion of pension costs for up to seven years. The rate for the first two years would start at 14 percent and could gradually increase to a maximum of 18 percent for the following years. Repayment will begin in FY 2018-19 and span a five-year period. If the overall funded ratio of the pension system drops below 80 percent, the stable rate plan for school districts will end. “By affording our local governments and school districts the option to stabilize their pension costs, they will be able to better plan for these costs in the future,” Assemblyman Thiele said. “This will allow municipalities and school districts to free up funds for other important services that our families depend on.” Supporting the state’s agricultural industry “When our farmers succeed, our economy does better,” Assemblyman Thiele said. “Providing funding for agricultural programs will go a long way in making sure our farmers have the resources they need to grow their businesses, helping boost our economic recovery.” Specifically, the budget restores $125,000 for the Maple Producers Association and $100,000 for the Tractor Rollover Protection program, and provides $3.9 million in increased funding to support various agricultural programs, including:

$200,000 for the Long Island Farm Bureau; and
$1 million for the New York Wine and Grape Foundation ($287,000 increase).

1. www.assembly.state.ny.us/ssspolicy/2013minwage.pdf
2. Quinnipiac University Polling Institute, January 31, 2013