Five Big-Ticket Items to Watch in New York's Budget Debate
(Bloomberg) -- New York lawmakers are racing to forge an agreement on the state’s budget before the fiscal year begins on April 1. At stake in the negotiations over Governor Andrew Cuomo’s proposed $175 billion spending plan are issues that could be felt widely around the Empire State, including a permanent cap on property-tax bills, a ban on single-use plastic bags and a congestion fee on motorists driving into Manhattan’s traffic-clogged streets.
New York City could become the first major city in the U.S. to charge fees to those who are driving into its crowded center, as cities including London, Stockholm and Singapore have. Both Cuomo and Mayor Bill de Blasio support it. The fee -- which in the past has been recommended at $11.52 -- is seen as a way to raise cash for the Metropolitan Transportation Authority, which runs a subway system in need of major repairs. Idling in Manhattan’s streets also wastes fuel and worktime.
With political pressure mounting over equipment failures and breakdowns that have plagued the New York City subway system, lawmakers are also working to decide how much money to allocate to the MTA, which also runs bus and commuter rail lines. Cuomo’s budget for the 2020 fiscal year called for the MTA to receive $5.3 billion from the state, a $287 million increase over 2019.
New York may become the second U.S. state to ban disposable plastic grocery bags, following California. If enacted, residents will have to bring their own bags to the grocery store or pay a fee for paper bags after March 2020. It would go a considerable way toward reducing waste: New York City alone tosses out 71,000 tons of plastic bags annually, according to the Citizens Budget Commission. Cuomo has said the budget is an effective vehicle to enact policies that might otherwise be difficult to pass the legislature in isolation, and the plastic bag provision is an example.
Lawmakers are nearing an agreement to permanently cap property tax increases at 2 percent, a policy that’s been in effect for six years and is up for renewal. The continuation would provide relief for some residents whose federal tax bills have risen because of the new $10,000 limit on state and local tax deductions. It has also led local governments across the state to hold their spending growth below 2 percent, according to Moody’s Investors Service.
The governor proposed extending the state’s top 8.82 percent income-tax rate for the richest residents through 2024, a move that should sail through the Democratic controlled legislature. The extension would raise an additional $771 million in the next fiscal year.
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