Albany strikes deal on a budget that Subverts Trump's tax plan

Particularly the federal tax plan — a centerpiece of his State of the State and budget addresses in January, and in speeches ever since.

“We’re under attack by the federal government,” Cuomo said Friday night, sitting in the ceremonial Red Room in the state Capitol.

The governor singled out a cap on deductibility of state, local and property taxes, a major issue in his high-tax state, and something he referred to as “an arrow aimed at the economic heart of New York.”

Cuomo’s enthusiastic description belied the more muted reality of the budget language. It provides for an optional employer-side payroll tax to replace an employee-side state income tax, and the creation of two state charitable funds for health and education, with New Yorkers’ donations to establish them deducted from their federal and state tax returns.

Cuomo seemed to acknowledge that his maneuvers could do only so much, saying his priority going forward would be to overturn the tax deduction cap.

“This provision hurts every New Yorker, period,” he said. “The ultimate solution is repeal.”

Indeed, many of the elements in the $168 billion budget deal were scaled-back versions of promises Cuomo had laid out over the past few months.

As budget negotiations — which are conducted behind closed doors among the governor and three top legislative leaders, out of sight of even other lawmakers — unfolded over the past week, it became increasingly clear that the Legislature would punt policy issues such as gun control or bail reform to after the budget’s April 1 deadline, in favor of financial considerations.

Republicans in the state Senate had fought hard against any new taxes and fees and were able to claim a win on that account, as well as on many deferred social policies.

Still, the spending plan had much to celebrate for the governor, coming in on time amid a $4 billion state deficit and the prospect of additional federal cuts.

The Legislature began passing the key bills late Friday and into Saturday morning, before the looming deadline on a holiday weekend.

Inside the budget deal are some critical practical — and political — demands from Cuomo.

Tax experts had viewed Cuomo’s proposed workarounds with skepticism, warning that many of the ideas were purely academic and had never been tried in practice.

Others worried that the payroll tax workaround would be unpopular with New Yorkers, as it would result in lower gross pay, even if their take-home pay would ultimately remain the same.

Still, the new tax policies — while limited — will allow the governor a credible argument that he is fighting for New York in the face of the White House and Republicans in Washington.

The governor also secured $250 million in new funding for the troubled New York City Housing Authority, making good on a promise he had loudly and repeatedly declared over the past few weeks.

After three visits to public housing projects, he vowed not to sign the budget unless it included a “real remedy” for repairs at NYCHA, where residents have faulted Cuomo’s intraparty rival, Mayor Bill de Blasio, for deteriorating conditions.

On an issue of vital local importance, the budget also includes $26.7 billion in school funding — a higher figure than either Cuomo or the Republican-controlled Senate had proposed in their own preliminary budgets.

Cuomo is facing particular pressure to burnish his progressive credentials: The actress and education advocate Cynthia Nixon, who is challenging him for the Democratic nomination for governor, has blasted him for what she called his “massive disinvestment” in schools and in other areas that affect black and Hispanic residents.

On that account, Friday was a mixed success for the governor, with pledges to introduce early voting, end cash bail for low-level offenses and codify the Supreme Court ruling that legalized abortion all failing to make it into the final budget deal.

One major exception was reforming language on sexual harassment, a rare shared priority among both Democrats and Republicans and a political demand during the national reckoning known as the #MeToo movement.

The new language, which would ban most nondisclosure agreements and mandatory arbitration clauses, extended to both the public and private sectors. But the policies still drew criticism, with some women’s rights advocates and employment lawyers calling their scope too narrow.

Another policy agreement would ease state oversight of yeshivas, despite concerns among education advocates that the schools for ultra-Orthodox Jews, which offer both secular and religious education, leave their students with poor to nonexistent English and math skills.

Assembly Democrats, who opposed easing state control, had cast the issue as the only one holding up a budget deal. The Assembly speaker, Carl E. Heastie, on Friday morning accused Sen. Simcha Felder, who represents a large Orthodox Jewish constituency in Brooklyn, of essentially holding the negotiations hostage.

Felder, a Democrat who caucuses with the Republicans and therefore allows them to sit in the majority in the Senate, often wields disproportionate influence in the Legislature.

The final compromise allowed for yeshivas, and other nonpublic schools, to argue that long hours of instruction — no matter the topic — could be used to satisfy state educational requirements.

Assembly Democrats, meanwhile, had secured the governor’s promise of another commission to consider a possible pay raise, a long-standing issue of contention for lawmakers who have not had a raise in nearly two decades.

Hopes for a congestion pricing plan, which has long been floated as a possible source of long-term funding for the sputtering subway system, were largely dashed. While Cuomo had commissioned a task force to develop a framework for charging cars that drive into the busiest parts of Manhattan, Friday’s budget deal included only the first phase: a $2.75 fee on for-hire vehicles and a $2.50 fee on yellow cabs below 96th Street.

Lawmakers may still address issues that were left out of the budget, such as new protections for victims of childhood sexual abuse, during the remainder of the session, which runs through June. But the budget process is often regarded as the time of maximum urgency and leverage, when the continued operation of state government — and legislators’ continued paychecks — hang in the balance.

Still, Cuomo defended introducing even those social or policy measures that failed to gain traction during the budget process — including any major ethics changes, despite the recent conviction of his former friend and aide, Joseph Percoco, on federal corruption charges — saying he wanted to “start the conversation” on things like early voting.

The pressures of an election year, when officials are wary of alienating key lobbyists and constituencies and seek to balance fiscal responsibility with flashy campaign promises, may also soon be brought to bear.

A special election in April is also looming, which could allow Democrats in the Senate — where Republicans rule thanks to a collaboration with Felder and a group of eight rogue Democrats — to take a numerical majority. Cuomo has said in the past that he would work to unify Democrats to rule the Senate.

But on Friday night, he demurred on that promise, too, until after the Senate votes on the budget.

“Let’s talk politics after the votes are taken tonight,” he said.

This article originally appeared in The New York Times.

Albany strikes deal on a budget that Subverts Trump's tax plan

The agreement, coming after several days of negotiations with little noticeable progress, was a measured victory for Cuomo, a Democrat, who is rumored to have presidential aspirations, and who made his scorn for President Donald Trump’s policies.

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