Assembly Passes Spending Plan; Schools Hit by Aid Disparity; Sales Tax Exemptions

March 21, 2011
This past week in Albany proved to be eventful, once again. There was a good deal of progress made on budget negotiations. For the first time in two years, joint conference committee meetings were held. These committees enable lawmakers from both sides of the aisle to confer on budget categories, including transportation, education and social services, as well as many others. I took part on the Higher Education committee and I am the Assembly minority’s spokesperson on this particular committee. I am pleased these meetings are being held. Previous leaders evaded the law and shut out the full Legislature from this important process.

Last week, the Assembly Majority passed what’s considered their response to the Governor’s budget. It was fraught with more spending and taxes. I voted against this plan, which will be considered during budget deliberations. For one thing, it included extending the “Success Tax,” which is scheduled to sunset on Dec. 31, 2011. This tax applies to successful residents who have high earnings. History has shown that taxing our wealthier residents discourages economic growth. These folks are typically the ones who create jobs. They are also the ones who find it easiest to flee New York when their tax burden becomes too great. What’s more is it’s another tax. Period. We have lost thousands of residents to other states due to taxes like these.

We need to work within our means. For the past two years, taxes and fees increased by $10 billion. We need to reduce these taxes for people—no matter who they are or what their income. The Governor gave us a good starting point with his budget proposal. We should not respond by adding taxes. Taxes and fees were the reasons I opposed previous budgets as well. I voted against health care taxes, energy taxes and increases on Department of Motor Vehicle fees, just to name a few, throughout the last two years.

School Aid Reform

The comptroller came out with a report this week, which reinforced what I and many others from Central and Upstate New York have been saying for some time: Disparities exist in the state aid distribution for school districts. His report looked specifically at school districts’ ability to compensate for state aid cuts with reserve funds. It found that districts in Central New York as well as the Finger Lakes have the least ability to tap into reserves. It also explained that low-need districts are far less affected by cuts in state aid than high-need districts. If we restructure the state aid formula so that higher need districts receive more state aid, we could provide a more equitable education. To see this report, visit the State Comptroller’s web site at http://www.osc.state.ny.us/.

Sales Tax Reprieve on Clothing

Effective April 1, New York State will stop collecting its 4% sales tax on clothing or footwear sold for less than $55. Residents will continue to pay local sales tax on these items. It used to be that the state exempted items costing less than $110 from sales tax. The Legislature eliminated the exemption late last year to help close the state’s budget gap. The exemption is set to return to the under-$110 level on April 1, 2012.

If you have any questions or comments on this or any other state issue, or if you would like to be added to my mailing list or receive my newsletter, please contact my office. My office can be reached by mail at 200 North Second Street, Fulton, New York 13069, by e-mail at barclaw@assembly.state.ny.us or by calling (315) 598-5185. You also may friend me, Assemblyman Barclay, on Facebook.