State Senate Passes 2013-2014 Budget That Delivers Tax Relief For Businesses And Families

Mark Grisanti

March 27, 2013

The New York State Senate today concluded its passage of the 2013-14
state budget that delivers on priorities outlined by the Senate Republican
Conference to provide much-needed tax relief for middle-class families,
help businesses create jobs, and, for the third consecutive year, the
budget keeps spending growth below two percent, which is consistent with
the local spending cap that applies to school districts and local

        The budget includes direct tax relief for middle class families in
the form of a $350 Family Tax Relief credit, increased tax breaks for small
businesses and includes most elements of the Senate Republican’s “Blueprint
for Jobs” plan, including the reduction and elimination of the utility tax
surcharge beginning next year. The budget also increases state school aid
by almost one billion dollars to ease pressure on property taxpayers.

        “This is a business-friendly and family-friendly budget because it
emphasizes the Senate Republican’s priorities to help businesses create new
jobs and provide tax relief to struggling middle-class families,” Senate
Republican Conference Leader Dean G. Skelos said.  “Our responsibility is
to respond to their needs and to make sure that our economy grows in the
years to come and, in this budget, we achieved these important goals.”

        “For the third year in a row, we have negotiated a fiscally
responsible, on-time budget in a bi-partisan fashion. The final budget will
help to control spending and also offer tax cuts to the middle class and
businesses, assist in job creation, and invest in education, health care
and infrastructure,” said Senator John A. DeFrancisco, Chair of the Senate
Finance Committee.


        “Middle class families are struggling because everyday costs keep
going up, the cost of raising children is rising and now the federal
government is taking more taxes out of people’s paychecks,” Senator Skelos
said.  “Middle class families in New York deserve relief and, thanks to the
efforts of Senate Republicans, this budget gives them much-needed tax

        Over the next three years, each New York family with at least one
dependent child and a household income between $40,000 and $300,000, will
receive a Family Tax Relief credit in the amount of $350.  The total tax
relief for Middle Class families will be $1.23 billion over three years,
beginning in 2014.

        In addition, the budget extends the middle class personal income tax
rate reductions enacted in 2011, which were due to expire in 2014.  The tax
rate reductions provide 4.4 million taxpayers with $707 million in tax
relief per year. The PIT rates are currently at the lowest level in 60

        The budget will also continue the inflation indexing approved in
2011, in order to provide taxpayers with a hedge against inflation, and to
avoid unintended tax increases that could otherwise happen as a result of
normal income growth.  The indexing provision will save taxpayers $230
million next year.

                      TO CREATE NEW JOBS FOR  YORKERS

        Early in the budget process, Senate Republicans issued a detailed job
creation plan called “Blueprint for Jobs,” a comprehensive plan to expand
the state’s economy and make businesses more competitive by cutting taxes,
reducing costs, making targeted economic investments and expanding job
training opportunities.  The 2013-14 state budget includes most of the
elements of the Senate Republicans’ Blueprint for Jobs plan, including:

> Small Business Tax Relief – The budget includes almost $600 million in
tax relief for New York businesses over the next three years, including a
reduction in personal income taxes on business income ($60 million) for
hundreds of thousands of small businesses that pay personal income taxes;
> Tax Relief for Manufacturers – The budget reduces the Corporate Tax on
manufacturers, helping them reduce costs and compete more effectively.
> Reducing Energy Taxes – Senate Republicans rejected the Governor’s
proposal to fully extend the 18a energy tax surcharge on all business and
residential ratepayers for five years.  Instead, the surcharge will be
reduced and eliminated over three years starting next year, reducing energy
bills for all business and residential ratepayers.
> Helping Our Heroes – The budget creates a tax credit to any business that
hires a veteran returning home from military service. The credit will equal
10 percent of wages paid -- increasing to 15  percent of wages if the
veteran is disabled;
> Tax Credit for Teen Employees – The budget includes a refundable tax
credit for businesses that hire people under the age of 20, saving
businesses $112 million over three years.
> New York State Incubator Program – The budget includes $1.25 million to
provide operating support for the state’s business incubators and to create
or designate 10 high-tech business incubators at locations affiliated with
higher education institutions with tax benefits for tenant businesses.
> Expanded Job Training programs - The budget creates the Next Generation
Job Linkage Program that is based on the successful “ready-workforce”
programs used in a number of states.  This Senate Republican initiative
will help attract and retain tens of thousands of jobs by providing
comprehensive, targeted training that is specifically tailored to meet the
needs of individual employers.  The budget includes $5 million for this new
>  Workers’ Compensation and Unemployment Reform – Businesses will save
$1.3 billion as a result of reforms to modernize and simply the state’s
workers’ compensation and unemployment insurance programs.  The savings do
not impact workers’ benefits.
> Expanded Agriculture Marketing – The Senate Republicans’ “Grown in New
York” plan to strengthen the state’s agriculture industry called for
expanded marketing efforts to promote New York-made foods and produce such
as maple products, apples, grapes, etc.  The budget creates the new
Market-NY initiative to better market New York-grown farm products.
> SUNY 2020, CUNY 2020 Economic Development programs – Two years ago,
Senate Republicans pushed for the creation of the SUNY 2020 program to
bolster economic development efforts at SUNY colleges.  The 2012-14 state
budget includes $55 million to fund a third round of competitive grants for
the SUNY 2020 economic development program and $55 million to create a
similar program for CUNY schools.

> The budget increases statewide aid to education by almost one billion
dollars over last year.  State school aid will be distributed fairly among
every region of the state.
> The budget raises community college base aid by $150 per student.
> Local libraries will receive a state aid increase of $4 million.

> For the first time in five years, local aid for road and bridge
improvement projects will be increased.  Senate Republicans fought for a
$75 million increase (21 percent) in funds for the Consolidated Highway
Improvement Program (CHIPS).
> The budget includes a two-year transportation capital program of $3.7
billion for highway and bridge construction and repair projects.
> Non-MTA transit services, such as local bus operations, will receive an
increase in capital funds of $21 million, as a result of efforts by Senate
> Local governments and school districts will have the option to take
advantage of pension reforms included in the budget that would give them
short term relief from rising employee pension cost.
> The budget will give county governments an advance of federal aid from
the Affordable Care Act of $80.6  million this year.
> Villages will receive a total of $1.5 million in aid to municipalities.

> The budget includes a record amount of property tax relief under the STAR
program, a total of $3.4 billion, a $143 million increase over last year.
> Of the $3.4 billion, $912 million goes to enhanced STAR property tax
relief for senior citizen homeowners.
> New York City residents who pay property taxes will receive $611 million
in tax relief through STAR.

> The budget increases the Environmental Protection Fund by $19 million for
a total of $153 million.
> The budget includes $40 million in additional NY Works funding for
environmental cleanup projects.