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New laws deal with minimum wage, tax workaround, lawmakers' pay

But a judge has temporarily suspended another law effective Jan. 1 - charging riders of city taxis and ride-sharing services more to travel south of 96th Street in Manhattan.

The State Capitol building in Albany. New laws

The State Capitol building in Albany. New laws taking effect Jan. 1 will give most minimum-wage workers a raise of about 10 percent and state legislators a raise of 38 percent. Photo Credit: Bloomberg/Ron Antonelli

ALBANY — Most minimum-wage workers will get about a 10 percent raise in the latest annual increase, some high-wage, highly taxed New Yorkers will get a special workaround to avoid a federal tax hike and state legislators will collect a 38 percent raise under new laws taking effect Jan. 1.

But a state judge has temporarily suspended another wide-reaching law that's also effective Jan. 1.

The law creates a variation of congestion-pricing that will cost riders of taxis and ride-sharing services more to travel south of 96th Street in Manhattan. Uber and Lyft riders will pay a $2.75 fee, while taxicab riders will pay $2.50. Passengers in pooled rides will pay 75 cents.

A judge on Dec. 20 delayed the fee as he considered a lawsuit by the New York Taxi Workers Alliance. The alliance blames ride-sharing services and the congestion pricing increase for a spike in bankruptcies, homelessness and suicides among taxi drivers whose city medallions to operate cabs have decreased in value.

The fee is expected to raise $525 million a year for repair of city subways and other means of transit.

Come Jan. 1, the state minimum wage on Long Island and in Westchester County will rise to $12 an hour, from $11 this year. The regional rate will rise to $15 over the next three years.

Large employers in New York City with more than 11 workers will hit the $15 minimum wage on Jan. 1, up from $13. That is a 36 percent increase since 2015, when phased-in raises began. Employers in the city with 10 workers or fewer will have to pay at least $13.50 an hour, up from $12.

In the rest of the state, the minimum wage will rise to $11.10 an hour, up from $10.40.

“Many low-income workers will have much to celebrate as the state continues to phase in minimum wage increases,” said Ron Deutsch, executive director of labor-backed Fiscal Policy Institute think tank.

“We are beginning to see the minimum wage impact across the state as New Yorkers in the bottom quintile are finally starting to see increases in their incomes," Deutsch said. "This is good for the economy because when low-income workers have more income they spend it at businesses in their communities.”

The bump comes as the state unemployment rate is 4 percent, the lowest on record. Low unemployment also drives up wages as the employers seek to attract workers.

Other measures taking effect in 2019 include a state proposal aimed at easing the burden of the new federal tax bill for some highly taxed New Yorkers.

So far, 262 companies have registered for the Employer Compensation Expense Program created by Gov. Andrew M. Cuomo, a Democrat, and the State Legislature after Republican President Donald Trump signed the federal tax law last December.

The law capped the deduction for state and local taxes at $10,000, so that local property taxes and state income taxes paid above that level are no longer deductible. The result is that many high-income workers in states including New York will pay higher federal income taxes.

The new New York program allows companies — primarily law firms, physicians groups and other professional groups — to join a new payroll tax system.

Under a complex formula that includes tax credits, neither the employer nor the employee would pay more than they would have if the federal law hadn’t been enacted, according to state officials.

“The new federal tax laws have a disproportionate and negative impact on the tax system and economy of New York, and the state is doing everything it can to protect our residents from the adverse impacts of the law,” said Morris Peters, Cuomo’s budget spokesman.

“The fact that hundreds of employers have registered for the alternative Employer Compensation Expense Program shows that the business community is taking this federal tax threat seriously and many are taking this step to protect their employees,” Peters said.

The tax plan will phase in beginning Jan. 1. The state won’t identify the companies that have signed up or where they are located, citing privacy and tax laws.

Also on Jan. 1:

  • Raises for state lawmakers and other top officials begin a three-year phase-in. Salaries for state lawmakers will increase to $110,000, up from $79,000, rising to $130,000 by 2021. The governor's pay will rise from $179,000 in 2018 to $200,000 on Jan. 1, rising to 250,000 in 2021. Elected and appointed officials in state government also will get raises.
  • Paid family leave that began in 2018 continues to phase in, with richer benefits. In 2019, qualified workers will be able to take up to 10 weeks of leave at 55 percent of their average weekly wage. By 2021, the law will allow 12 weeks of paid leave at 67 percent of employees' average weekly wages.
  • The Drug Take Back Act takes effect. Consumers will see on-site collection systems at chain pharmacies with more than 10 stores. The system will include prepaid envelopes to mail unwanted medications to proper disposal sites.
  • Volunteer firefighters will get access to tax-free disability and death benefits if they are diagnosed with diseases including melanoma and cancers of the lung, prostate, and breast after they become firefighters. Diseases of the lymphatic, hematological, digestive, urinary, neurological and reproductive systems also are covered. Dr. Jacqueline Moline, chairwoman of the Firemen’s Association of the State of New York, said firefighters "are exposed to an enormous variety of toxins and carcinogens in the line of duty and consequently are more likely to develop cancer than the general population. It is necessary to offer additional benefits and protections to all firefighters so that if they do develop cancer, they are not left alone.”
  • The thousands of companies doing business with the state will need to have sexual harassment policies in place. The contractors also will have to document that they provide annual employee training on combating sexual harassment. The program is part of a broader sexual harassment law passed earlier this year. Most of the statute is in effect.

NEW LAWS IN NEW YORK

On Jan. 1:

  • The state minimum wage on Long Island and in Westchester County rises to $12 an hour, from $11 this year. 
  • Salaries for state lawmakers increase to $110,000, from $79,000, and will rise to $130,000 by 2021. The governor's pay rises from $179,000 in 2018 to $200,000, increasing to $250,000 by 2021.
  • A state plan aimed at easing the burden of the new federal tax bill for some highly paid New Yorkers begins to phase in. So far, 262 companies have registered for the Employer Compensation Expense Program created by Gov. Andrew M. Cuomo, a Democrat, and the State Legislature after Republican President Donald Trump signed the federal tax law that capped the deduction for state and local taxes at $10,000.

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