WASHINGTON — Long Islanders and other New Yorkers have one more long-shot chance to influence the tax legislation before it becomes enacted into law — and topping their wish list is restoration of the state and local tax deduction.
The list also includes hopes that the writers of the massive overhaul will keep tax-exempt private activity bonds, reject repealing the requirement that people obtain health insurance and preserve student loan interest deductions.
That one last opportunity will come next week, when lawmakers begin hammering out differences between the Senate Republicans’ $1.4 trillion bill passed early Saturday and the House Republicans’ $1.5 trillion version passed Nov. 16 to create a final bill.
It will take several days just to sift through the nearly 500-page Senate bill to determine exactly what measures are included, said Rep. Peter King (R-Seaford), who voted against the House bill.
“There could be a hundred other examples in the bill that we don’t know about,” he said. “These guys are changing the bills with ballpoint pens on the floor of the Senate the other night.”
Still, saving the state and local tax deduction remains the top priority for Long Island’s delegation to Congress, business groups such as the Long Island Association and the Association for a Better New York, and even hospital and higher education associations.
“We’re still going to be fighting and still making noise to bring as much attention as possible,” King said. But he also acknowledged, “It’s going to be very difficult.”
King said that Sen. Susan Collins (R-Maine) was the best hope to restore those deductions in the Senate bill, but she accepted the Senate Republican leaders’ decision to add to their bill the House measure to allow homeowners to deduct only up to $10,000 in property taxes.
Representatives of two major economic forces on Long Island — health care and higher education — are lobbying to block key changes to the tax code in both bills.
Local governments and nonprofits including hospitals and colleges hope that the final legislation omits a measure in the House bill that would end the exemption for tax-exempt bonds, which they use to build facilities.
Kevin Dahill, president of the Suburban Hospital Alliance of New York State, pointed to provisions he hopes are removed from the final version.
One is the House bill’s elimination of deductions for medical expenses exceeding 10 percent of income, and the other is the Senate bill’s elimination of Obamacare’s health insurance mandate for individuals, which the Congressional Budget Office said would raise premiums 10 percent a year and result in 13 million more people going without health insurance.
Dahill said the Obamacare insurance exchange has worked well on Long Island, and he would hate to see it get destablized by elimination of the mandate. “It would be such a setback,” he said.
Mary Beth Labate, president of the Commission on Independent Colleges and Universities of New York, urged Republicans to reconsider parts of both the House and Senate bills that seek to end exemptions and add taxes to private nonprofit colleges.
“Preserving tax deductibility for student loan interest and higher education savings options, and keeping tuition and employer-based tuition benefits tax-free are all in our common interest,” Labate argued earlier this month.
The House version ends those benefits, but the Senate retains student loan interest deductions, which were taken by more than 130,000 Long Island taxpayers in 2015, IRS data shows.
Senate Minority Leader Chuck Schumer and other New York Democrats argued that both the House and Senate Republican bills should be scrapped and that Republicans should work with Democrats to come up with a bipartisan tax overhaul bill.
But that is not going to happen, Senate Majority Leader Mitch McConnell (R-Ky.) and House Speaker Paul Ryan (R-Wis.) said last week.
Instead, Republicans from the Senate and House will seek to compromise on the differences in the two bills with one overriding consideration: Creating a final bill that will satisfy a majority of their members and pass in both chambers before Christmas.
Said Dahill: “What we become concerned about is this: In their effort to move this along quickly, will the House just accept the Senate bill?”