ALBANY — Joined by a brigade of labor leaders, Gov. Andrew Cuomo is pressing New York’s congressional delegation to help reel in $59 billion in federal bailout money for state and local governments whose revenues have been crushed in the pandemic.
A letter from Cuomo and the union executives to the representatives puts a $30 billion estimate on what state government needs now. Local governments would get $3 billion, while most of the remaining money, if allocated, would go to New York City, its airports and the downstate mass transit system.
Cuomo, in a conference call with reporters, painted a picture of the state’s finances that was so dire that he said not even tax increases could fill the gaps.
“If we do not receive federal funding, there is no way that the states and the local governments can cover the deficit,” Cuomo said. “There is no combination of savings, efficiencies, tax increases that could ever come near covering the deficit.”
Cuomo, a Democrat nearing the midway point of his third term, contended the federal government would be responsible for the consequences when deep cuts are made to public transportation and other services to address the deficit.
In Washington, Democrats and Republicans have been bickering about their competing ideas for a second stimulus package. Democrats are promoting a $2.2 trillion measure, nearly double the size of the GOP proposal. House Speaker Nancy Pelosi said last week the two sides are at a “tragic impasse.”
The federal legislation would be a followup to the federal CARES Act, which sent some $2 trillion to Americans after it was passed in March and signed into law by President Donald Trump.
Trump, in May, suggested that federal bailouts for what he called “mismanaged’ states under Democratic control would be unfair to Republicans. He contended that any negotiation for a second stimulus package should be tied to his effort to eliminate sanctuary city policies that provide havens to undocumented immigrants, the scrapping of payroll taxes and more business-friendly policies.
Cuomo’s wish list, meanwhile, includes the proposed restoration of allowing taxpayers to fully deduct their state and local tax payments on their federal returns.
The letter from the labor leaders and Cuomo argues the lack of a major infusion of federal aid jeopardizes transportation projects. And if local governments have to lay off workers and trim services, it will ultimately create additional challenges for national economic recovery efforts, it said.
“We saw that with the last fiscal crisis in 2007-2009, and we know that it will play out again,” the letter stated.
Among the labor leaders to sign the letter were Andy Pallotta, president of the New York State United Teachers, and Mary Sullivan, president of the Public Employees Federation.
County and municipal government leaders have already urged congressional representatives to ensure that any stimulus money intended for their communities go directly to the local governments rather than be passed through state government.
Some unions have joined progressive Democrats in urging Cuomo to embrace their proposal for increase state taxes on the income of New York’s highest earning taxpayers. But the governor has rejected that idea, saying he would prefer he federal government to adjust its tax rates, because more wealthy New Yorkers would leave the state if Albany raises their taxes.
Joe Mahoney covers the New York Statehouse for CNHI’s newspapers and websites. Reach him at email@example.com