Monthly Archives: November 2013

Bloomberg hands de Blasio a balanced budget

Crain’s New York Andrew Hawkins is reporting that Mayor Bloomberg is prepared to hand Bill de Blasio a balanced budget.

Bloomberg announced last week that the city has closed the $2 billion budget gap due to lower health care expenses, public bidding of school bus contracts and the implementation of other cost control measures.  Tax revenues were about $500 million more than projected.

Read the full story on the Crain’s New York website.

Lawmakers push back on Moreland Commission

Karen DeWitt of New York Now, a PBS government affairs show, is reporting that state lawmakers plan to fight Governor Cuomo’s ethics commission (The Moreland Commission) subpoenas in court.

Assembly Democrats and Senate Republicans are asking a State Supreme Court Judge to dismiss subpoenas demanding they reveal details of private law clients who pay them more than $20,000 a year arguing that it is unconstitutional for the governor to investigate the legislature.

Read the full story on the New York Now website.

Pataki to push for tax cut

The Wall Street Journal is reporting that former New York Gov. George Pataki, co-chairman of the New York State Tax Relief Commission, is proposing a plan that would reduce the state’s personal-income taxes (PIT).  The paper quotes an anonymous source as saying, “He will push to bring the PIT down faster than the current plan.”

The source also said he would seek to make some middle-class tax changes implemented in December 2011 permanent.

The tax commission, which includes Heather C. Briccetti, Esq., president and CEO of The Business Council of New York State, was charged by the Governor with making recommendations to cut property and business taxes.  The Commission is led former Governor Pataki and former state Comptroller Carl McCall.

Read more on the Wall Street Journal’s website.

Princeton healthcare economist says reform will fall to states if Obamacare fails

Princeton healthcare economist Uwe Rienhardt predicts that if the Affordable Care Act — commonly referred to as Obamacare by both sides of the aisle — fails, those seeking a federal solution will wander in the healthcare desert for at least another 20 years while individual states assume the role of expanding health insurance coverage to reduce the number of uninsured, and the more critical effort to rein in health care costs.

New York would be among the states that are better prepared to enact meaningful health care reform, Rienhardt told an audience of about 500 at a lecture at the University at Albany, sponsored by Business Council member CDPHP.

“Since the political middle ground is disappearing, if Obamacare fails, don’t count on anything from the feds for at least 20 years,” Reinhardt said in his speech. “The burden, then, falls on states and communities. Assume the feds won’t help you.

“Albany can do that,” Reinhardt added. “You can be the wave of the future. The status quo is not acceptable. You just need community leaders and the elite to do this. The average person cannot do this.”

He said that is because the state already has a relatively small number of uninsured, due to existing programs including a Medicaid program with relatively high income thresholds, and a tradition of regional health system planning. During the 1970s and 80s, several regions of the state, including Rochester, had strong community health care planning programs with employers, providers and community leaders working to restrain health care costs, by negotiating fees, determining the need for new facilities and controlling the medical technology “arms race.” Reinhardt said regional planning efforts could again be effective at controlling costs.

Responding to Reinhardt’s comments, John Bennett, MD, president and CEO of CDPHP, says it’s urgent that employers help bring down the cost of health care.

“Employers are sorely needed in this debate, because they pay the bills. They need to demand of us better value,” Bennett says.

“The competitive market has not lowered costs. Do we need a new hospital building every five years? No. Do we need a CT scanner on every corner? I think not,” Bennett says. “But we don’t even have that discussion today.”

Reinhardt presented an overview of the changes in medical spending that led to the need for reform. Health care spending grew at unsustainably high rates from the late 20th century into the early 2000s. Recent rates of increase have been tempered by the recession. The weak job market has enabled employers to make cost-saving changes to their health benefit plans that would not be possible if employees were able to easily change to other jobs at employers with more generous benefits.

Reinhardt said there is a good chance that, the online health insurance marketplace that is at the center of federal health insurance reform, will not be fully functional by the November 30th date promised by the administration. “When you start working in January and you need something to work in October, you are almost guaranteed failure.” The economics professor assigned the Obama administration a grade of “F’ for the Web site implementation, “because there is no grade of F-minus.”

About the people who provided the poor engineering behind, he said, “They are all, like me, geeks. [We are brilliant], but we can’t manage a damn thing, that’s for sure,” he said. His suggestion is that the Obama administration should have brought in a retired health insurance CEO, “someone with a willingness to chew through slacking employees before lunch,” he said.
He assigned New York’s online portal a grade of “A.”

“If the federal one had worked like New York, we would be in good shape,” Reinhardt said.

On the up side, he said, relatively few people are affected by the online marketplaces, or exchanges, and they are just one part of the federal health law, which has made progress in areas like payment reforms and electronic medical systems.

“To say all of Obamacare is a failure is not right,” Reinhardt said.

The big question that will determine Obamacare’s success or failure, he said, is whether young adults enroll in health plans rather than go without insurance and face penalties under the law. If they don’t sign up, then insurance companies will need to raise premiums to cover the costs of older, sicker people. Higher premiums will further drive young people away. And then premiums will go up further, marking the beginning of what Reinhardt called “a death spiral.”

Free legal services for small businesses affected by Sandy

Governor Andrew M. Cuomo announced a $1 million award to the Disaster Recovery Clinic at the Maurice A. Deane School of Law at Hofstra University to help families and small businesses in Nassau and Suffolk Counties affected by Superstorm Sandy. The award will expand the pro bono counseling services at the clinic to an additional 250 homeowners and businesses.

The funds were made available through the State’s Community Development Block Grant Disaster Recovery (CDBG-DR) program funded by the U.S. Department of Housing & Urban Development. The award to Hofstra Law’s Disaster Recovery Clinic will allow for continuing services until at least May 2015.

ReCharge NY in action in Rochester

Governor Andrew M. Cuomo today announced that his ReCharge NY (RNY) low-cost power program is supporting a Rochester high-tech printing company. With low-cost energy from the RNY program, the company is able to retain and create a total of 302 jobs and invest more than $20 million for capital improvements and an expansion of its operations.

The Governor launched RNY in 2011 to help businesses and other enterprises lower their operating costs and spur economic development. The program offers contracts of up to seven years for lower-cost power, and reserves at least 350 MWs for upstate businesses and institutions, 200 MWs for business attraction and expansion, as well as up to 100 MWs for not-for-profit organizations.

More than 1,200 applications were reviewed by NYPA staff, in consultation with the Governor’s 10 Regional Economic Development Councils for the initial allocations.

Read more on Governor Cuomo’s website.


New York State job numbers released

The New York State Department of Labor released job numbers for September and October 2013 yesterday.  The New York State economy added 33,800 private sector jobs during this time period for a growth rate of 0.5%. The increase of 9,000 jobs in October and September’s gain of 24,800 jobs raised New York State’s private sector job count to 7,490,100, an all-time high.

While the increase in private sector jobs is generally good news, the numbers released still represent unbalanced growth. Job growth over last 12 months was concentrated in 10 county New York City region with the majority of jobs concentrated in the health and education sectors. New York state, especially upstate, continues to lag the nation in job growth.

Small businesses to be impacted by Health Care tax

The Wall Street Journal is reporting that small businesses may be impacted by an annual ‘fee’ imposed on health-insurance companies by the Affordable Care Act.  It is expected the fee will total as much as $8 billion next year and as much as $14.3 billion by 2018.

The Congressional Budget Office and industry experts say the expense will be passed on to small businesses and consumers who buy their own policies.

The new health-law tax is projected to raise premiums for small businesses by an average of 1.9% to 2.3% in 2014.

Read more on the Wall Street Journal website.

Online booking services must charge NYC hotel tax

The state’s top court says New York City can impose its nearly 6 percent hotel occupancy tax on booking services.

The Court of Appeals says state lawmakers in 1970 gave the city broad authority to enact the tax, rejecting arguments by Expedia, Priceline and other third-party travel marketers that their service fees don’t constitute room rent.

In a 5-2 ruling Thursday that reverses a midlevel court, the higher court’s majority says the city measure taxes payments for occupancy, which includes those fees.

Dissenters say the fees paid to the travel companies for helping find a room and facilitating the booking aren’t the same as room rent, and the city lacks additional authority to tax them.

Brownfield to Green Energy Hub: new plan for Buffalo’s Republic Steel site

The Cuomo administration is committing $225 million – the biggest single investment by the state in a new business venture in the Buffalo-Niagara region – to try to turn Western New York into a Silicon Valley for green-energy companies.

The massive investment, which accounts for nearly a quarter of the funds pledged through the Buffalo Billion initiative, is part of an effort by Gov. Andrew M. Cuomo that would build a pair of state-owned high-tech facilities, containing state-of-the-art equipment that clean energy firms covet but can’t afford on their own.

At the heart of Cuomo’s plan is a six-building hub for clean-energy research, development and manufacturing that will be built on 90 acres of a 200-acre brownfield site of the former Republic Steel plant.

The idea is similar to the approach used by the state at the College of Nanoscale Science and Engineering (CNSE) in Albany: Create a cluster of green-energy businesses – all drawn to the site by the coveted resources inside the state-owned facility – that will build on itself, becoming a powerful magnet that will attract other businesses in the same industry.

There is also private investment in the plan the Governor announced yesterday in Buffalo. The Buffalo News profiles the two California companies that have committed to move into the center’s first two buildings, pledging to invest $1.5 billion of their own money in a venture expected to bring 850 jobs to the site. That brings the entire investment in the project, including the state’s portion, to $1.7 billion. State officials said almost 800 of the positions are expected to be filled by new hires from Buffalo Niagara or by those who move here from elsewhere.