ALBANY – New York lawmakers reached a landmark deal Thursday to raise the state minimum wage in a series of steps to $15 per hour downstate, reaching that rate on Long Island by Dec. 31, 2021.
The agreement also includes a tax cut for households earning $300,000 or less annually, a 6 percent increase in K-12 education aid, a tuition freeze at the State University of New York and a “paid family leave” initiative that won’t kick in till 2018. It would reduce income-tax rates for couples earning $300,000 or less annually; individuals under $150,000.
The budget for fiscal 2016-17 comes in at $156 billion (which includes $9 billion in federal aid for superstorm Sandy and Obamacare). That would be a $9 billion increase over the 2015-16 plan.
The fight over the minimum wage was the key to the settlement. Assembly Democrats had made a higher minimum wage a key priority for years and Gov. Andrew M. Cuomo joined them this year, making it his priority this year. New York would become the second state to commit to the wage rate, after California.
Under the agreement, the wage would be raised in a series of increments and reach $15 in New York City by Dec. 31, 2018; Long Island and Westchester County would reach that level three years later. Upstate, the wage would eventually reach $12.50 per hour on Dec. 31, 2020, but then would be indexed and reviewed before possible increases with the goal of eventually reaching $15 per hour, lawmakers said. The Democrat called the three-tiered minimum wage the “smartest, safest way to go about it, in my opinion.”
“Working families need a raise,” Cuomo said.
The fractured approach also reflected a concession to political reality: upstate and Long Island lawmakers, especially Republicans, either opposed the steep wage hike or wanted it slowed down. Cuomo had proposed that the wage become effective everywhere in the state by July 1, 2021.
Unions praised the wage hike. One liberal group said it shortchanged upstate workers. Business groups denounced it.
The New York Farm Bureau said its Long Island members would be hurt the most — as would their customers.
“Farms, especially those on Long Island, will face extremely serious economic challenges as they will be forced to pay the dramatically higher wage rates mandated by this agreement,” Farm Bureau President Dean Norton said. “In turn, their business costs will skyrocket as their products become less competitive, and fresh locally grown food products will be more expensive and less available.”
Some Republicans said Cuomo had threatened to go around them and impose the steep increase administratively, through a state-appointed “wage board,” a route the governor used in 2015 to implement the $15/hour wage for fast-food workers.
The last-minute negotiations came as the state Senate and Assembly rushed to finalize and adopt massive budget bills by midnight, the beginning of the state’s fiscal year. But they were poised to blow past that deadline — as they did last year — even if still on track to close out the budget this week.
The governor, Senate Majority Leader John Flanagan (R-East Northport) and Assembly Speaker Carl Heastie (D-Bronx) announced the deal even before bills were printed and rank-and-file lawmakers were briefed on the final details, legislators said.
Among other key elements, the spending plan would include a $1.5 billion (6.5 percent) increase in K-12 funding, a large, but not record increase.
That includes $434 million to fully restore a type of school aid cut following the 2008 stock market meltdown. Known as the Gap Elimination Adjustment or “GEA,” the restoration means about $117 million to Long Island schools.
Money earmarked for charter schools would grow 3 percent on a per-pupil basis.
The budget will cut income-tax rates for couples earning less than $300,000 a year — an initiative pushed by Senate Republicans.
Employees would fund the paid family leave program through “nominal” payroll deductions so it costs businesses “nothing,” the leaders said. Employees would be eligible for up to 12 weeks of paid leave — however, benefits would be capped at 50 percent of a worker’s wage during the first three years of the program (2018-20) and 67 percent thereafter.
Legislators began slogging through the bills Thursday afternoon. If the final votes are not completed by midnight, the state budget will be technically late for the second time since 2010.
Total state operating funds (which do not include federal aid) would increase 2 percent — Cuomo wanted to keep it at that or lower.
As voting got underway, members of the Republican minority in the Assembly complained loudly that the budget was being shoved through with barely any time to read and analyze the thousands of pages that make up the document.
Questioned at one point about minimum wage, Assembly Ways and Means Chairman Herman “Denny” Farrell (D-Manhattan) told Republicans, “the newspapers” had the details about the proposed compromise — which infuriated the GOP.
“You want me to read the newspapers to find out what’s in the budget?” Assemb. James Tedisco (R-Scotia) said, his voice rising. “That’s beyond the pale!”
Here are some highlights of the 2016-17 New York State budget agreement:
- Overall spending is approximately $159 billion (including federal aid for superstorm Sandy, Obamacare), an increase of $9 billion.
- The minimum wage would increase from $9 per hour to $15 per hour in a series of steps, reaching the mark in New York City in 2018 and on Long Island by Dec. 31, 2021. Upstate, the wage would increase to $12.50 but be subject to reviews and adjustments.
- A $1.5 billion increase in K-12 education funding, a 6 percent bump.
- A freeze on State University of New York tuition but no extra operating funds to offset it.
- A deal in which Nassau County would transfer authority to operate 1,000 video slot machines to Aqueduct Racetrack in Queens for annual payments that total $43 million in the first three years. It comes after a Nassau proposal to install the machines at Belmont Park met local opposition.
- A plan to allow “paid family leave,” which would be funded by employees and the state workers’ compensation fund. It would become effective in 2018.