New York Governor Andrew Cuomo recently visited Rochester for a ceremonial signing of the 2013-14 New York State budget. I attended the event with other business, community, and government leaders where Governor Cuomo gave away commemorative hockey pucks to mark the “hat trick” of three consecutive on-time budgets under his leadership. While the three-year streak, which hasn’t happened in nearly 30 years, is commendable, this year’s New York State budget provided much less excitement for the business community than the previous two spending plans.
The past two years we have had real reason to celebrate the New York State budget. This year, not so much. Closing the $1.3 billion budget deficit, paying off the state’s unemployment insurance debt to the federal government, and securing a third round of regional economic development competition funding are all praiseworthy accomplishments. However, our state leaders need to return to a much more vigorous reform agenda focused on reducing the burdensome mandates and regulations that make New York uncompetitive. Fortunately, there is still time in this legislative session to make a difference.
Extension of the 18a energy surcharge led the list of budget items this year that contribute to New York’s already heavy burdens on business. 18a, which impacts anyone who pays an energy bill, was scheduled to expire next year. The state has now extended this surcharge, which you can find plainly listed on your monthly utility bill, into 2018. This fee will cost energy consumers, including businesses, governments, and taxpayers, $236 million in 2014 and a total of $2.8 billion over its scheduled life.
The increase of New York’s minimum wage to $9 an hour in an already challenging economy without mandate relief for employers will not spur job growth. A recent study for the National Federation of Independent Business found that raising New York’s minimum wage could result in the loss of 22,000 jobs over 10 years. Cornell University’s Industrial and Labor Relations Review reported last year that the state’s last minimum wage increase led to a 21 percent decline in employment of younger and less educated individuals. Employers faced with this wage increase, without corresponding mandate relief from the state, will likely be forced to throttle back employment and raise the prices they charge for goods and services. This cost increase directly impacts all New Yorkers.
As stated earlier, time remains in the current post-budget legislative session to get some work done to benefit New York businesses.
Repeal of the unnecessary Wage Theft Prevention Act, reform of the archaic Scaffold Law, and passage of the Unfunded Mandate Reform Act sit high on the list of issues RBA and UU plan to address with legislators prior to the June 20 end of session. All of these mandates threaten economic growth, job creation, and the ability to attract and retain talent.
As always, RBA, Unshackle Upstate, and our other business partners will also need to play defense as the session wraps up and throughout the year. We’ll stay vigilant in our opposition to new health insurance and worker’s compensation mandates and labor laws that increase regulations and the cost of doing business.