Charles J. Fuschillo Jr.

May 14, 2009

 Photo caption: Senator Fuschillo discusses how the MTA payroll tax will harm taxpayers by raising costs on local governments. He is joined by (l-r) Senator Carl Marcellino, Senator Kemp Hannon, Legislator Ed Mangano, Legislator John Ciotti, Senator Dean Skelos, Legislator Francis Becker, and Supervisor Kate Murray.

State Senator Charles J. Fuschillo, Jr., together with State Senate Republican Leader Dean Skelos and Senators Kemp Hannon and Carl Marcellino, was recently joined by County legislators, village mayors, town supervisors, and other municipal officials to denounce the MTA Payroll Tax and its devastating effect on municipalities and taxpayers.

The $1.5 billion payroll tax, which is the biggest money raiser to bailout the MTA, is hitting local governments hard.   Municipal officials have said this will force them to cut more services and/or raise property taxes to pay these new costs.

Based on the state comptroller’s most recent report on Financial Data for Municipal Governments, Nassau County expects to hand over more than $3 million while the payroll tax’s impact on the county’s 64 villages will be close to $1.9 million.  The Village of Freeport, one of the County’s larger villages, will see a tax of approximately $98,213.

The Towns of Hempstead and Oyster Bay are expected to be billed around $522,725 and $314,901 respectively.  Tack on thousands more for water, sewer and sanitation districts. 

School Districts in Nassau County will see an initial $13.3 million tax.  While there is intent to reimburse the schools, the law does not guarantee it. 

The Republican Senators voted against the payroll tax drafted by Senate Democrats because they said it will raises taxes, cost jobs, close businesses and the school tax reimbursement is not guaranteed.  There is also no sunset provision in the law. 

The payroll tax is retroactive to March 1, 2009 for municipalities and all others required to pay it (except for school districts which must begin in September, 2009).  The first payment is due with the year’s 2nd quarterly filing in June unless the municipality or business pays electronically which is monthly. 

Senator Fuschillo (R-Merrick) said, "While it is crucial that we support our mass transit system, this MTA bailout plan fails everyone on Long Island. The payroll tax amounts to a costly unfunded mandate on every Long Island business, non-profit, local government, library, hospital, and school. Ultimately, this tax will be passed onto Long Island’s families who are already overburdened with high school taxes and a bad economy."

Nassau County Legislative Minority Leader Peter J. Schmitt said, “This tax will cost the County over $3 million.  That money should be used to restore the funding for youth and senior programs being cut or eliminated in Nassau due to the current fiscal crisis. Additional taxes will only worsen the economic situation here in Nassau and intensify the burden on our small businesses.”    

Supervisor John Venditto said, “The impact of the payroll tax is nothing short of devastating to Long Island’s economy. In the current fiscal climate, it places an unnecessary additional hardship on already hard-pressed businesses, municipalities, school districts, charitable and non-profit organizations, the self-employed and, ultimately, on taxpayers, because the cost will be passed on to them in the form of higher taxes and prices for goods and services. No good will come of this tax because it does not address the long-term viability of the MTA and threatens the financial viability of those employers forced to pay it. Making the tax retroactive to March 1 only adds insult to injury. This oppressive tax should be repealed immediately!”

Hempstead Town Supervisor Kate Murray said, "The MTA Payroll Tax is a 'job killer' in a time when we should be creating opportunities for our working families. During these tough economic times, this tax will push companies out of our region to more business friendly locations."