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What you need to know for 10/19/2017

There's gems (and duds) in state budget for business leaders

There's gems (and duds) in state budget for business leaders

Agriculture sector scored some victories
There's gems (and duds) in state budget for business leaders
An artist's rendering of the proposed Schenectady train station.
Photographer: Provided

There’s something for everybody in the newly enacted state budget, but nobody got everything they wanted. 

On Monday, the New York business community was sifting through the overdue 2017-18 budget enacted over the weekend, finding parts they liked, parts they didn’t like and things on their wishlists that were missing.

Among the budget lines of greatest relevance to the business community:

  • $2.5 billion for water infrastructure projects.
  • $750 million for a seventh round of Regional Economic Development Council grants.
  • $200 million to create the Empire State Trail, expected to generate recreation and tourism spending.
  • $120 million to continue upgrades to state parks, a source of recreation and tourism spending.
  • $70 million for tourism promotion.
  • $15 million for a new train station in Schenectady’s thriving downtown.

Other things of interest to the business community came without a specific price tag:

  • Authorization for ride-sharing services such as Uber and Lyft to operate outside of New York City as early as July.
  • Comprehensive workers’ compensation reform.
  • Creation of I Love New York welcome centers to drive tourism to surrounding communities.
  • Elimination of caps on industrial hemp cultivation and processing.
  • Reprivatization of the New York Racing Association, center of the summer economy in Saratoga Springs.

There’s a lot to like in the budget, said Mark Eagan, CEO of the Capital Region Chamber of Commerce, which represents 2,600 area businesses.

“Last year’s budget we didn’t love, but this year’s budget has a lot of good in it,” he said.

Three priorities for the Chamber that were approved: Increased school aid, ride-sharing, and workers’ comp reform.

Spending on water projects and other infrastructure is also good for the upstate business climate, Eagan said.

“We have witnessed it locally. Our infrastructure, particularly the cities, is in major need of repair," he said.

Eagan saw negatives in the budget, as well: particularly the failure to change the Scaffold Law. New York remains the only state in the nation with unconditional employer liability for falls from elevated places, regardless of circumstance. This raises the cost of doing business.

“Every New Yorker would save money,” Eagan said.

Also happy with the state budget is Ray Gillen, leader of development efforts in the Schenectady area: and not just for the obvious inclusions, like continuation of state development subsidies and funding for the new train station.

He sees free resident tuition at state colleges as a major boost for Schenectady County Community College, which he said has been a major partner in economic and community development.

Gillen said the boost in state education aid also is important, as it will allow cuts in the taxes that put a damper on development.

“The big story in the budget is the ability of the school district to get their fair share of aid,” he said. “It looks like the school district did very well, and that is really important. That’s our biggest issue in the city: to continue our work by driving down the tax rate.”

Gillen is also excited about filling in gaps in the Mohawk-Hudson bike-hike trail that traverses the county.

“The trail does bring people into the county, and it’s a great resource for county residents, as well,” he said.

New York’s agriculture sector scored some victories in the new state budget as well, including:

  • A $50 million allocation to help manage animal waste and comply with new state regulations on feedlots.
  • Funding for numerous programs that support research, promotion and economic development of the agricultural community.
  • Funding for the Food to Farm Bank Bill, which will give farmers tax credits for donations of food for the needy.

“Farming is important to New York state, and that sentiment is reflected in the final New York state budget,” New York Farm Bureau President David Fisher said in a prepared statement. “At a time when farm income is down due to low commodity prices, the investments in agriculture are especially needed.”

The Farm Bureau did not get all the tax credits on its wish list, but it expressed gratitude for what came through.

The Retail Council of New York State had just one item on its wish list: a sales tax on transactions by independent retailers through online sites such as Amazon. (Items that Amazon itself sells to New Yorkers are taxed, but items sold by its partners are not.)

Gov. Andrew Cuomo put the tax in his budget proposal, but it was removed during negotiations.

“We saw that as a great leveler of the field,” said Retail Council President Ted Potrikus. “We’re extremely disappointed that this did not see the light of day. Unfortunately, New York’s main street is the one that loses as a result.”

Was there anything good for retailers in the state budget? Probably, he said, but it’s overshadowed by the tax not being enacted.

“This (the Amazon tax) was more or less our singular focus," Potrikus said. "Speaking for brick-and-mortar retailers: thumbs down.”

Another trade group criticized the state’s efforts toward economic development, and noted this budget does nothing to change that. 

“We dole out $9 billion a year in economic development funds ... and rarely do we have transparent measures of success,” said Mike Durant, state director for the National Federation of Independent Business. “You have to question, especially upstate, if this is a good use of taxpayer dollars.”

However, the NFIB is excited about workers’ comp reform. The current definitions of medical impairment used by the board when reviewing claims are decades old and do not reflect advances in diagnosis and treatment the medical field has made since the old rules were enacted.

A new draft policy will be created, reviewed by interested parties, reworked as necessary, shared with the public, and finally enacted in January 2018. NFIB is optimistic the result will be favorable to businesses.

Durant noted New York has the third-highest workers’ comp costs in the nation.

The Business Council of New York State also made workers compensation reform its No.1 priority this year and credited two Assembly Democrats from the Capital Region, Carrie Woerner and John MacDonald, for their advocacy for the measure. It said businesses should save hundreds of millions of dollars a year once the changes are enacted.

Other pluses in the budget were ride-sharing, infrastructure spending and extension of middle-class tax cuts, the Business Council said; a negative was extension of the so-called Millionaire’s Tax, an income tax surcharge for top earners.

Business Council President Heather C. Briccetti said in a statement: 

“No document or process is perfect, and there are certainly items we do not support. However, when taken as a whole, this year’s budget shows lawmakers heard our call to get back to business. We look forward to continue working together the rest of this session to pass legislation which will grow our economy and improve the lives of all New Yorkers.”

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