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Long IslandPoliticsSpin Cycle

Skelos calls utility surcharge a 'new tax,' rejects renewal

The state Legislature’s top Republican Tuesday called Gov. Andrew M. Cuomo’s proposal to extend a tax on utilities a “new tax” that hurts ratepayers and New York’s attempts to lure new businesses.

Senate co-leader Dean Skelos (R-Rockville Centre) said the tax, known as the “18-a” surcharge, was imposed on utilities in 2009 in the aftermath of the stock market meltdown and is slated to expire at the end of the 2013-14 fiscal year. He said the fee was imposed to help fund the Public Service Commission, which oversees utilities, and that the charge is no longer needed.

“This surcharge was supposed to be temporary and let’s keep it that way,” Skelos said at a State Capitol news conference, joined by several business lobby groups.

Cuomo proposed renewing the surcharge for another five years. Republicans said doing so would cost businesses and consumers nearly $3 billion, including $236 million in the fiscal year set to begin April 1.

“It’s an extension beyond the expiration date,” Skelos said of Cuomo’s proposal. “So I think that’s a new tax.”

A Cuomo official said the administration “would be happy to” discuss how to replace the utility-tax revenue in the state budget.

The proposal is part of Cuomo’s $142.6 billion budget proposal. Lawmakers hope to adopt a spending plan by March 21, before the fiscal deadline.

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