The BenCen Blog

Informing Public Discourse in the Hudson Valley and Across the State

Category: Sales Tax

Paying for Medicaid: A Good Idea Whose Time Has Not Yet Come

Gerald Benjamin, SUNY New Paltz, and Thomas Gais, Rockefeller Institute of Government

 

Republican Congressmen John Faso wants the federal government to require that New York State assume all of the nonfederal share of Medicaid costs incurred outside of New York City. He conditioned his support for the previous, failed efforts to repeal and replace Obamacare on inclusion of this requirement in the federal law; the Graham-Cassidy bill is said to include the requirement.[1] New York City and the counties now pick up 13 percent of the total state tab ($58.8 billion in Fiscal Year (FY) 2015). The cost for New York City is $5.2 billion.[2] The total at stake for counties outside the city is $2.3 billion.[3]  Not chump change.

The proposal outraged Governor Andrew Cuomo. He called it a “political Ponzi scheme,” evidence that the congressman violated “his oath of office to represent the interest of the people of the state of New York.…”

Neither Cuomo’s rage nor the failed GOP takedown of Obamacare has deterred Faso. He has vowed to find another path to force full state assumption of the nonfederal share of Medicaid costs in upstate New York. Indeed, the Sturm und Drang of zero-sum national partisan politics aside, the congressman’s idea may be good public policy, or at least a start towards good policy. But there remain a number of big, unanswered questions. If full state assumption is good for counties outside New York City, why not also for the city itself? Should the national government be dictating the financial relationships a state has with its local governments? And if so, why just for New York?

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Winning the Battle, Losing the War: How Sales Tax Renewal Thwarts Constitutional Home Rule

This post, written by Dr. Gerald Benjamin, was originally published on the Rockefeller Institute of Government’s blog.  It is reposted here with permission, click here for the full text.

On March 27, 2017, the Ulster County legislature unanimously passed Resolution 97 authorizing its chairman “… to request the New York State Legislature to commence the process of extending the Ulster County additional sales tax rate of one percent … for at least the twenty-four month period commencing December 1, 2017.” At stake: estimated annual revenue of $23.8 million for the county, $3.2 million for the city of Kingston, and $835,000 for the county’s towns. For the county and the city, these are big numbers. The potential loss of this revenue if the additional taxing authority were not extended would leave a gaping hole in annual operating budgets.

The county’s request was forwarded to eight state legislators with some part of Ulster County in their districts: Senators George A. Amedore, John J. Bonacic, William J. Larkin, Jr., and James L. Seward; and Assemblypersons Kevin A. Cahill, Brian D. Miller, Peter D. Lopez, and Frank K. Skartados. In response, Senator Amadore introduced a bill (S5568) on April 13, 2017, and Assembly Cahill introduced a companion bill (A7409) on April 25, 2017, as requested, to extend additional sales tax collection authority for another two years.

Shortly thereafter, the Ulster County Legislature in Kingston passed a second resolution (Resolution 222) specifically requesting enactment of the Senate and Assembly bills. The county legislature is closely divided politically, but again sponsorship was bipartisan, and the vote was unanimous. County Executive Michael Hein signed off immediately, and the results were sent to both state legislative houses the next day.

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