Last Friday evening, the Assembly gave final approval to the state’s 2016-17 budget. While the state budget should technically have been in place before April 1, most observers consider this year’s budget to have been enacted “on-time.”

Once again, state lawmakers have imposed new burdens on employers, instead of taking steps to make New York more business friendly and grow the economy. The “big ticket” items in the enacted state budget are an unprecedented minimum wage increase and a new employee paid leave program.  While some have argued that these steps will help workers, we are convinced that they will ensure that New York’s business climate will remain one of the worst in the nation, even as our tax burden remains among the highest in the nation.

But we also acknowledge that as bad as this agreement will be for Upstate businesses and taxpayers, the Governor’s original minimum wage proposal – going to $15 per hour throughout the state — would have been far worse.

Unshackle Upstate thanks those lawmakers, especially members of the Senate Republican Conference and Upstate Assembly members, who fought for small businesses, farmers and taxpayers in the face of intense pressure from powerful special interests. We also acknowledge their efforts to include much-needed tax relief as part of this agreement.

Our leaders in Albany should spend the rest of this legislative session working to enact positive measures that will put Upstate New York on a path to long-term prosperity.”

The most significant elements of New York State’s 2016-17 enacted budget include:

  • Tax Reductions: beginning in 2018, state personal income taxes will be reduced annually for those taxpayers earning between $40,000 and $300,000 per year. We would have liked to have seen a more significant tax cut and one that was put in place sooner, but it is a small step in the right direction.
  • Minimum Wage Increase: the state will increase the minimum wage to $15 in New York City by the end of 2018 and in Westchester and Long Island by the end of 2021; and to $12.50 in the rest of the state by the end of 2021 with future increases determined by a state formula. The law requires studies to be undertaken to determine the impact on the higher minimum wage on the economy, and the Governor would have the ability to delay the minimum-wage increases if the economy tanks. We plan to monitor the progress of the state’s economy very closely, and ensure that if the minimum wage increase does end up destroying existing jobs, that the Governor and the public know it.
  • Paid Family Leave: the state will create a paid-family leave program beginning in 2018. The program, which will be paid for by employees, will start at 8 weeks of paid leave, before increasing to 10 and finally 12 weeks when fully enacted. It is not clear what the program will cost employees, but the Governor has suggested that it will initially cost about 70 cents per week. This is another program that we will be watching closely, and holding lawmakers to their promise that the costs of this program will not be placed on employers.
  • Sixth Round of Regional Economic Development Councils: The enacted budget includes funding for a sixth round of Regional Economic Development Councils (REDCs).
  • Transportation Infrastructure: the budget allocates, over five years, $27.14 billion for state Department of Transportation (DOT) and Thruway Authority programs, and $27.98 billion for Metropolitan Transportation Authority (MTA) programs. We supported the effort to ensure that there was “parity” in terms of transportation spending between Upstate and the New York City area, and we prevailed on this issue.

Read Governor Cuomo’s announcement regarding the budget agreement here, and watch his budget press conference from Thursday night here. Read the Senate Majority’s press release on the budget here.