From: Susan Lipman, NYS PTA President and Lana Ajemian, NYS PTA Vice President
Subject: MTA Payroll Tax
Date: March 26, 2009
In June of 2008 Governor Paterson appointed the 13-member Commission on Metropolitan Transportation Financing to consider options that would address an expected $1.5 billion shortfall in the 2009 -10 New York City Metropolitan Authority budget. The commission returned a report in December recommending a payroll tax on all employers in the twelve county New York City metro area of 33 cents on every $100 of payroll. Imposing such a tax on employers, including public, private non-profit and self-employed, outside of New York City, requires State legislative approval. As of today, since the legislature has not yet agreed to approve this recommendation, the MTA has announced plans to increase subway, train and bridge fees by anywhere from 24-29% effective June 1st. The payroll tax, however, is still very much on the table and could still be approved.
This tax proposal has received a great deal of attention in the 12 counties surrounding New York City where, among other effects, the public school impact would be enormous. The plan would raise taxes on school districts in these 12 counties by more than $170 million dollars per year. The issue, however, has gotten almost no attention upstate. Why is this important and why should you be concerned if you live outside the New York metro area?
The heart of the matter is that the payroll tax, if adopted, would set a dangerous precedent whenever the MTA or any other governmental or quasi-governmental authority in any part of the state needed a bailout. By vote of the legislature, a State tax could be imposed on just about anyone the legislature chooses to fund such a bailout. Such moves could leave schools, businesses and others in one community vulnerable to taxes imposed to relieve funding problems that were created by and which, until now, have been the responsibility of other communities. Additionally, it is the basic policy of New York State PTA to ensure that federal, state and local funds designated for elementary and secondary education are used to support our public schools.
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