For roughly 570,781 businesses in New York State, September 30 arrives “COD” in the form of a $95 million interest payment due to the Federal government! On September 30, New York must repay $95 million in interest to the Federal government in the form of an “Unemployment Insurance Interest Assessment Surcharge.” The surcharge, levied by the State Department of Labor, will cost Empire State job creators $21.25 per employee for any worker making over $8,500 annually, which is a majority of New Yorkers employed by small businesses.
In a non-partisan effort to protect New York’s job creators from this hidden tax, Assembly Minority Leader Brian M. Kolb (R,I,C-Canandaigua) and Long Island Assemblyman Dean Murray (R,C-East Patchogue) recently wrote to Congressman Tim Bishop and President Barack Obama asking the Federal government to extend interest-free loans to spare New York from the looming $95 million surcharge.
“New York’s job creators are working harder than ever in this tough economy – the absolute last thing they need is another hidden tax on top of all the other taxes, fees, surcharges and assessments they already endure. Since July, I have been working to spare job creators from the surcharge but time is running out – the bill is due September 30, and it’s time for the Federal government to step in and prevent this nickel-and-diming of our job creators,” Leader Kolb said.
“Raising taxes during a recession flunks Economics 101. If we want businesses to start hiring again then we must give job creators economic certainty, not another backdoor tax hike. Leader Kolb and I have written Governor Cuomo asking that he intervene. We are now making our case to Congressman Bishop, and President Obama, asking that the Federal government take steps to offset the surcharge and prevent another hit to our economy,” Murray said.
Leader Kolb and Assemblyman Murray wrote Congressman Tim Bishop and President Barack Obama seeking an extension of the interest-free loans for New York State that had previously been renewed by the Federal government. Such an extension of Federal interest-free loans would effectively offset the surcharge that is due in less than two weeks’ time. In their correspondence (attached), Leader Kolb and Assemblyman Murray had requested the following:
“Accordingly, we are requesting your direct assistance in this effort to spare New York’s small businesses from the $95 million Unemployment Insurance Interest Assessment Surcharge. We are asking that you do the following:
1.) Support federal legislation that would rectify this situation, specifically H.R. 650 and S.1513 – introduced by Congressman Peter Welch and Senator Charles Schumer, respectively – initiatives that would amend title XII of the Social Security Act to extend the provision waiving certain interest payments on advances made to states from the federal unemployment account in the Unemployment Trust Fund;
2.) Urge Congress to support this non-partisan effort to extend the federal government’s interest-free loans to spare small businesses from the financial pain of the $95 million surcharge. Particularly, we are hopeful that you, and others, can encourage those serving on the Congressional “Super Committee” to recognize that extending the interest-free loans would spur increased revenues to the federal coffers by helping small businesses continue operating; and
3.) Contact Governor Cuomo and ask that he reconsider his opposition to utilizing a portion of the state’s fiscal surplus to offset the costs imposed by the $95 million surcharge.”
Leader Kolb and Assemblyman Murray had contacted Governor Cuomo earlier this summer requesting that the Administration consider utilizing a portion of the state’s first quarter fiscal surplus to offset the surcharge that would otherwise be paid by businesses.
“With the Federal deadline for the $95 million Unemployment Insurance Surcharge a mere eight days away, we need to ensure private sector job creators are not hurt by what amounts to a $95 million tax. Coming from the private sector, Leader Kolb and I are well aware of the enormous challenges to New York’s job creators. We are hopeful that Congress and the President will take action and remedy this situation before September 30 so we can remove one of the many obstacles to growing the private sector,” Murray concluded.