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New York Agrees to Congestion Pricing, Mansion Tax and Plastic Bag Ban in $175 Billion Budget Deal New York Agrees to Congestion Pricing, Mansion Tax and Plastic Bag Ban in $175 Billion Budget Deal
(about 5 hours later)
ALBANY — After weeks of intraparty bickering, the New York State Legislature and Gov. Andrew M. Cuomo agreed to a $175 billion budget early Sunday morning, packed with a bevy of progressive programs, including changes to the cash bail system, a new tax on high-end homes and a novel plan to charge motorists to drive into Manhattan’s busiest stretches. [What you need to know to start your day: Get New York Today in your inbox.]
In typical fashion for a State Capitol known for its peculiar and sometimes dysfunctional habits, the deal was announced after midnight via a five-page news release. But that rollout belied both the significance of some of the changes in policy agreed to in Albany, as well as the size of the state’s spending, second only to California. ALBANY — After weeks of intraparty bickering, the New York Legislature and Gov. Andrew M. Cuomo agreed to a $175 billion budget early Sunday morning, approving several progressive initiatives, including changes to the cash bail system, a new tax on high-end homes and a groundbreaking plan to charge motorists to drive into Manhattan’s busiest stretches.
In typical fashion for a State Capitol known for its peculiar and sometimes dysfunctional habits, the deal was announced after midnight via a five-page news release. But that rollout belied both the significance of some of the changes, as well as the size of the state’s spending, second only to California’s.
Lawmakers were set to vote on the budget later Sunday.Lawmakers were set to vote on the budget later Sunday.
Chief among the new policies was congestion pricing, the first such plan in the nation, and one that is likely to affect the habits of millions of New Yorkers and tourists who work and play in Manhattan. Under the plan agreed to on Sunday, vehicles traveling beneath 60th Street will be subject to a toll, revenue that will be funneled into the city’s beleaguered subways and other regional transportation needs. The budget included major victories for the resurgent left wing of the Democratic Party, which in November had helped Democrats win control of the State Senate for the first time in a decade. Newly elected lawmakers had pledged to get big money out of politics, raise taxes on the wealthy, rescue the city’s subway system and overhaul a criminal justice system that disproportionately targets minority communities.
The agreement also calls for an overhaul of the agency that oversees New York City’s bus and subway system, the Metropolitan Transportation Authority; the agency has been scapegoated in recent months by Mr. Cuomo, a third-term Democrat who effectively controls the authority and has been heavily criticized for the subway’s shoddy performance. As part of the budget deal, the authority’s policies will be changed to encourage speedier capital projects and increase oversight. But the deal also showed the limits of those campaign promises. Activists criticized a plan to empower small campaign donors as halfhearted. A measure to tax luxury homes was refashioned at the last minute. And, perhaps most significant, hopes for legalizing the recreational use of marijuana were dashed, though lawmakers could still approve that separately later in the legislative session.
The budget, which is due April 1, also typically contains many nonfiscal policies, and this year was no exception, including a raft of changes to the state’s criminal justice system. Legislative leaders seemed to acknowledge as much. Andrea Stewart-Cousins, leader of the Senate Democrats, said in a statement that the state had taken “historic steps” toward its longstanding goals.
Under a deal struck late last week, the state will eliminate cash bail for most misdemeanors and nonviolent crimes, though it will not be completely eliminated as sought by some of the legislature’s more liberal members. Lawmakers and Mr. Cuomo also agreed to a number of changes to discovery — allowing defendants more access to evidence that prosecutors intend to use against them — and processes to ensure speedy trials. Chief among the new policies was congestion pricing, the first such plan in the nation, and one that is likely to affect the habits of millions of New Yorkers and tourists who work and play in Manhattan. Under the plan agreed to on Sunday, vehicles traveling below 60th Street will be subject to a toll, revenue that will be funneled into the city’s beleaguered subways and other regional transportation needs.
The agreement also calls for an overhaul of the Metropolitan Transportation Authority, the agency that oversees New York City’s bus and subway system.
The authority has been scapegoated in recent months by Mr. Cuomo, a third-term Democrat who effectively controls the authority and who has been heavily criticized for the subway’s shoddy performance. As part of the budget deal, the authority’s policies will be changed to encourage speedier capital projects and increase oversight.
The budget, which is due April 1, typically contains many nonfiscal policies, and this year’s, which includes a raft of changes to the state’s criminal justice system, was no exception.
Under a deal struck late last week, the state will eliminate cash bail for most misdemeanors and nonviolent crimes, though it will not be completely eliminated, as some of the legislature’s more liberal members had hoped it would be.
Lawmakers and Mr. Cuomo also agreed to a number of changes to discovery — allowing defendants more access to evidence that prosecutors intend to use against them — and processes to ensure speedy trials.
The compromise on bail, which came after law enforcement officials expressed concerns about the total elimination of such a system, is one of many that appear in the budget.The compromise on bail, which came after law enforcement officials expressed concerns about the total elimination of such a system, is one of many that appear in the budget.
Another is the so-called pied-à-terre tax, an annual recurring tax on second homes worth $5 million or more. Although the tax had the backing of state leaders, it evaporated under pressure from real estate interests and legal concerns. In its place, lawmakers and Mr. Cuomo agreed to a “mansion tax,” a one-time levy that would be charged at the point of sale on multimillion-dollar homes; the tax rate would top out at 4.15 percent on the sale of properties worth $25 million or more. Another is the so-called pied-à-terre tax, an annual recurring tax on second homes worth $5 million or more.
Although the tax had the backing of state leaders, it evaporated under pressure from real estate interests and legal concerns. In its place, lawmakers and Mr. Cuomo agreed to a “mansion tax” coupled with a real estate transfer tax, two one-time levies that would be charged at the point of sale on multimillion-dollar homes. The tax rate would top out at 4.15 percent on the sale of properties worth $25 million or more.
A plan to ban plastic bags in the state was also included in the budget, but it makes a fee on paper bags optional, which some environmentalists worry will lessen the popularity of reusable bags.A plan to ban plastic bags in the state was also included in the budget, but it makes a fee on paper bags optional, which some environmentalists worry will lessen the popularity of reusable bags.
Mr. Cuomo trumpeted several other accomplishments, including a permanent property tax cap of 2 percent, something he had said was nonnegotiable. At the same time, the state was to establish a “consistent framework for the collection of required sales taxes by internet marketplace providers.”Mr. Cuomo trumpeted several other accomplishments, including a permanent property tax cap of 2 percent, something he had said was nonnegotiable. At the same time, the state was to establish a “consistent framework for the collection of required sales taxes by internet marketplace providers.”
Mr. Cuomo, who was been criticized for participating in big-money fund-raisers, also announced a commission to study and implement the idea of providing up to $100 million annually in public financing for campaigns for legislative and statewide offices, including his own. What exactly that program would look like will be up to the commission, whose report is due on Dec. 1. Mr. Cuomo, who has been criticized for sponsoring big-money fund-raisers, also announced a commission to develop a plan to provide up to $100 million annually in public financing for campaigns for legislative and statewide offices, including his own.
The negotiations over the budget were the first of Mr. Cuomo’s more than eight years in office in which he dealt with an all-Democratic Legislature, and came at a time of increased financial stress for the state, which saw its income tax revenue dip sharply in recent months. That stress, and the new power dynamic, created significant intraparty tension as Mr. Cuomo and other members of his administration repeatedly accused lawmakers of having unrealistic expectations and a lack of experience. A small-donor matching program was a central demand of many of the new legislators who won seats last year by defeating better financed incumbents. That demand erupted into confrontation last week, when several legislators accused Mr. Cuomo of hypocrisy for calling for public financing while hosting high-dollar fund-raisers.
Under such programs, candidates can collect government assistance for their campaigns as long as they meet certain criteria. Such programs are usually intended to encourage small contributions, and don’t offer a match for large ones.
And while the inclusion of public financing in Sunday’s budget seemed like a victory for proponents, many remained unsatisfied. The budget plan included language that guaranteed a matching program, but the details, such as the ratio of match and contribution limits, remain undetermined — leading some activists to worry that the commission’s recommendations would be weak.
Past commissions in Albany have been derided for allowing lawmakers to claim action on topics while bogging them down in bureaucracy. A commission in 2013, for example, had recommended introducing public financing — the same topic now being delegated to a commission for further study.
Another commission recommended last year to legalize marijuana.
The public financing commission’s recommendations would be legally binding unless the Legislature convened specifically to overrule them.
If New York adopts a 6-to-1 matching system modeled after New York City’s, it would become the first state in the nation to match small donors’ contributions by a ratio of more than 1 to 1, according to Lawrence Norden, deputy director of the democracy program at New York University’s Brennan Center for Justice. (Hawaii matches donations 1 to 1.)
It would also be the first state to pass a public financing program since Citizens United, the 2010 Supreme Court decision that allows virtually unfettered spending in political campaigns.
What exactly that program would look like will be up to the commission, whose report is due on Dec. 1.
Notably absent from the deal was recreational marijuana, which Mr. Cuomo vowed in December to legalize. While the idea had won support from a broad array of stakeholders, from well-financed medical marijuana companies to progressive activists, lawmakers ultimately could not agree on a framework for legalization, which many had demanded include social justice provisions.
A parallel effort in New Jersey collapsed last week. Lawmakers promised to try for legalization separate from the budget, in the remaining three months of session, but many seemed skeptical of its prospects.
The negotiations over the budget were the first of Mr. Cuomo’s more than eight years in office in which he dealt with an entirely Democratic-controlled Legislature, and came at a time of increased financial stress for the state, which had its income tax revenue dip sharply in recent months. That stress, and the new power dynamic, created significant intraparty tension as Mr. Cuomo and other members of his administration repeatedly accused lawmakers of having unrealistic expectations and a lack of experience.