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COLUMN: Budget ‘robs Peter to pay Paul’

— Last week I talked about the State Budget in this column and this week I wanted to expand on some elements in the budget. We passed a $141.2 billion spending plan before the April 1 deadline, but it wasn’t without its problems. One of the biggest problems for me was the “sweeps” that took place. While “sweeping” is nothing new to New York, this year the budget used a bigger broom and swept more money from various funds into the general fund. When taxes are collected for a certain purpose, they should be used for that purpose. When money is not used as intended, it’s referred to as a sweep. This is inherently problematic.

One of the biggest sweeps involved the State Insurance Fund of $2 billion. This is tied to the Worker’s Compensation Fund. Employers are required to purchase Worker’s Compensation Insurance to cover on-the-job employee injuries. The State Insurance Fund is the leading provider of worker’s compensation insurance. In an attempt to lower premiums and oust our state’s dubious honor of having the highest worker’s compensation rates in the nation, reforms were passed this year that created more equitable rates for employers. These were good measures and ones that businesses pushed for. However, at the same time, leaders swept $2 billion in overpayments that businesses made, and put it in the general fund. If we are trying to improve our business climate, wouldn’t it make more sense to return the money to the businesses that overpaid? The budget also swept money from the Power Authority collected from energy bills to the tune of $90 million to help balance the budget as well. Sweeps typically occur from this fund as well. This year, the budget swept even more from this fund.

Investment in more auditors

Rather than trim spending or refund money to businesses and all of us who pay for our utilities, our leaders in Albany are constantly trying to figure out ways to find more money. This budget allocates $9.1 million more than last year to hire 200 additional auditors and collectors. I’ve heard stories from constituents of our Department of Tax and Finance using questionable and aggressive tactics to collect taxes owed. By having more auditors, presumably there will be more taxes collected. While businesses should follow the law and pay taxes owed, and our state has a responsibility to enforce tax laws, this plan seems aggressive. Instead of penalizing businesses, we should create incentives and partner with them—not make them feel unwelcome or as if they’re doing something wrong. No business is comfortable with an audit. While I understand the need for random audits, allocating that much more money to pay for that many more auditors makes me wary of our state’s intentions and does not sound like our state is Open for Business, as the current state advertising motto suggests. It sounds like we’re, once again, looking for revenues to help with our spending problem.

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