Senate proposes tax breaks and pre-K, dodges disagreements

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ALBANY— After days of deliberations, the State Senate’s governing coalition released a 55-page resolution outlining their budget priorities, with proposals to halt rising property taxes, and modify Governor Andrew Cuomo's plans for estate taxes and renter credits.

The resolution outlines $2.7 billion in funding over five years for a universal pre-k and after-school programs at levels requested by New York City’s mayor Bill de Blasio, but does not include the mayor’s proposed tax on high-income city residents.

De Blasio, who has softened his insistence on the tax in recent days, declared victory on Thursday, after news reports that the Senate plan would fund the programs with $540 million a year.

The Senate budget would allocate $340 million for pre-K in New York City in 2014-15, as well as $200 million to fund after-school programs in the five boroughs—funding that's actually $10 million more than what de Blasio aimed to raise with his tax proposal.

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The Senate proposal would also bolster charter schools, with provisions to increase per-pupil tuition that public schools must pay to charters, guarantee that charter schools won't have to pay rent to use public school buildings, and allow charter schools to offer pre-kindergarten.

The resolution also requires New York City to offer facilities aid to charter schools that are expanding or that lose public space.

The resolution was also notable for what it didn't include.

The proposal did not address the DREAM Act, and included only one vague sentence about public financing of campaigns, saying the chamber would "modify" the governor's plan.

Disagreements over both issues delayed the resolution's release.

The Independent Democratic Conference, a five member group of breakaway Democrats who share power with Republicans in the Senate Chamber, had expressed support for both the DREAM Act and public campaign financing. Senate Republicans opposed both initiatives. 

The resolution also preempts a number of plans in Cuomo's own budget, on taxes, free college courses for prison inmates, and spending authority over federal health care funds. 

Among the proposals outlined in the Senate’s resolution was a new property tax relief program, dubbed “Freeze Plus.”

That plan would replace a circuit breaker program Cuomo proposed in his own budget, which many lawmakers criticized as detrimental to municipalities and school districts already struggling under the weight of a two-percent property tax cap passed into law in 2012.

“Freeze Plus” would deliver an estimated $1.4 billion in tax relief over the next two years, and would make permanent the state’s existing two-percent property tax cap. That plan would cost the state $200 million in this budget year and $400 million in the next fiscal year, the resolution said.

Under the proposal, municipalities and school districts that stay within the two-percent cap would then be eligible for a certain amount of aid to lower their tax levy to prior year levels in the program’s first two years. In later years, municipalities would have to stick to the cap, and would be required to submit efficiency plans for state approval to show how they plan to continue saving money in order to receive further aid, Senate officials said.

Municipalities could offer plans that show how they would accomplish savings, shared services or consolidations beginning in 2012, and could also show how they would achieve similar savings or consolidations in later years.

The resolution would alter or eliminate roughly a half-dozen of Cuomo’s other proposed changes to the state’s tax code, eliminating a proposed renters’ tax credit and modifying a plan to merge bank and corporate franchises taxes to ensure the merger wouldn’t cost state taxpayers any money. The Senate also rejected a repeal of taxes on boxing and wrestling exhibitions.

The resolution took direct aim at Cuomo's recently announced program to offer free college courses to inmates in the state's prison system, which the governor has said he would implement through executive order. That plan was roundly criticized by Republican lawmakers, and the Senate's resolution would "prohibit any State funds for services and expenses associated with providing college education to inmates."