Spitzer unveils $126.5B budget; Proposes changes to Empire Zones and closing loopholes
BYLINE: Adam Sichko
Gov. Eliot Spitzer unveiled a proposed state budget Tuesday of $126.5 billion, which is slightly larger than year's, and he's relying partly on businesses to help close a $4.4 billion dollar budget deficit.
Spitzer proposed some savings, particularly for small businesses. But he also intends to generation $740 million by adding or raising fees as well as closing certain "loopholes" on HMOs, nonprofits and others.
Spitzer's budget, which is 5 percent higher than last year's, is balanced. The final budget is due by April 1, the start of the state's 2008-08 fiscal year. Governors traditionally low-ball some measures so that the state Legislature can add on and make its mark on the budget process.
Spitzer called for several new reforms, including tougher eligibility requires for the state's Empire Zone program. He also intends to kick out businesses that are not meeting their pledges, creating an estimated savings of $50 million.
The governor also proposed fee changes for limited liability companies and other corporations and partnerships that will generate $75 million annually. Spitzer's budget includes several sales tax changes, including new requirements for nonprofits to charge taxes for online retail sales and other actions.
Several other initiatives laid out in the budget were refrains of earlier calls to action from Spitzer. He proposed new reforms to the state's brownfields law, including new caps on tax credits for cleaning up hazardous sites for development. Spitzer also renewed a call to reform Wicks Law, which governs contracts in public construction contracts. Spitzer had a deal to do just that last summer but it stalled amid bitter partisan disputes between him and legislative leaders.
Spitzer's budget added several new details to a proposed $1 billion upstate economic development fund, which he first announced in his State of the State address earlier this month. The fund will include $30 million to improve the reliability of railways between upstate and New York City.
Spitzer also proposed several education initiatives but said he does not want to increase tuition at SUNY schools this year. His plans include a 5-year $9 billion plan to pay for capital projects and energy conservation projects at SUNY schools.