Gaveled in 12:22 PM · Albany, New York · 2015–16 session
NEW YORK STATE SENATE
THE STENOGRAPHIC RECORD
ALBANY, NEW YORK
January 21, 2015
12:22 p.m.
REGULAR SESSION
SENATOR JOSEPH GRIFFO, Acting President
FRANCIS W. PATIENCE, Secretary
P R O C E E D I N G SACTING PRESIDENT GRIFFO:The Senate will come to order.
I ask all present to please rise and join with me as we recite the Pledge of Allegiance to our Flag.
(Whereupon, the assemblage recited the Pledge of Allegiance to the Flag.)
ACTING PRESIDENT GRIFFO:In the absence of clergy, I ask that we all bow our heads in a moment of silent prayer and reflection.
(Whereupon, the assemblage respected a moment of silence.)
ACTING PRESIDENT GRIFFO:The reading of the Journal.
THE SECRETARY:In Senate, Tuesday, January 20th, the Senate met pursuant to adjournment. The Journal of Sunday, January 18th, was read and approved. On motion, Senate adjourned.
ACTING PRESIDENT GRIFFO:Without objection, the Journal stands approved as read.
Presentation of petitions.
Messages from the Assembly.
Messages from the Governor.
Reports of standing committees.
Reports of select committees.
Communications and reports from state officers.
Motions and resolutions.
Senator LaValle.
SENATOR LaVALLE: Mr. President, on behalf of Senator Marcellino, on page number 4 I offer the following amendments to Calendar Number 11, Senate Print Number 1314, and ask that said bill retain its place on the Third Reading Calendar.
ACTING PRESIDENT GRIFFO:The amendments are received, and the bill shall retain its place on Third Reading.
SENATOR LaVALLE: Mr. President, I move that the following bill be discharged from its respective committee and be recommitted with instructions to strike the enacting clause. That's Senate 1482, on behalf of myself.
ACTING PRESIDENT GRIFFO:It is so ordered.
Senator LaValle.
SENATOR LaVALLE: Mr. President, pursuant to Rule 8, Section C, Senator Skelos hands up the following alternate committee members for January 21, 2015, and asks that such assignments be filed with the Journal.
ACTING PRESIDENT GRIFFO:So ordered and so filed.
Senator LaValle.
SENATOR LaVALLE: There will be an immediate meeting of the Rules Committee in Room 332.
ACTING PRESIDENT GRIFFO:There will be an immediate meeting of the Rules Committee in Room 332.
Senator LaValle, will we continue with resolutions and introductions?
SENATOR LaVALLE: Mr. President, with unanimous consent, I'd like to recognize Senator Espaillat to address the body.
ACTING PRESIDENT GRIFFO:Without objection, Senator Espaillat will be recognized.
However, I'd ask everyone to move quietly to -- the members of the Rules Committee who will be meeting in Room 332.
I'd ask the chamber to please come to order for the purposes of recognizing Senator Espaillat.
Senator Espaillat.
SENATOR ESPAILLAT:Thank you, Mr. President. I rise to welcome a group of distinguished New Yorkers that are here today with us once again. Every year for the last 18 years, they come before us, the State Legislature, to recognize Juan Pablo Duarte, who was the founding member of the Dominican Republic. He's our founding father. And today they celebrate his legacy. And also this week they've held events throughout the City of New York and the State of New York recognizing the legacy of Juan Pablo Duarte. And this initiates Dominican Heritage Month, which starts in February. And they come every year.
We have with us Cesar Romero, who is the president of the Instituto Duartiano. He's with us today. Also from the Dominican General Consul, we have two vice-consuls, Gregorio Malena and Nelson Pimentel. And also three other members of the Instituto Duartiano: Teresa Cuevas, Felix Grant, and Ramona Terrero-Santos.
So they come every year. We have a resolution on the floor recognizing this important event, the 202nd anniversary of Juan Pablo Duarte Day here in New York State. So thank you, Mr. President, for allowing me to introduce them, and I hope that they are extended the courtesies of this house.
Thank you so much.
ACTING PRESIDENT GRIFFO:Thank you, Senator Espaillat.
Senator Díaz.
SENATOR DIAZ:Thank you, Mr. President.
I rise just to join my colleague Senator Espaillat in welcoming my friends from the Dominican Republic and the president of the Instituto Duartiano, Mr. Cesar Romero, and Teresa Cuevas, Felix Grant, and Ramona Terrero-Santos, Gregorio Malena, and Nelson Pimentel.
These are leaders of the community, these are members of our community that have distinguished themselves fighting and creating and maintaining the Dominican culture in our state and our city. Today I'm honored to welcome them and honored to join Senator Espaillat.
And by the way, I don't know if you know that the new census, the new census says that more Dominicans reside now in the Bronx than in Manhattan. So on behalf of the people of the Bronx and the residents of the 32nd Senatorial District that I represent, I welcome them. And knowing that from now on the big family of the Bronx is now the Bronx salsarengue, they call it. The Bronx is now the county of the salsa and the merengue, calling it salsarengue.
So {in Spanish}.
ACTING PRESIDENT GRIFFO:Is there any other member that wishes to speak?
(No response.)
ACTING PRESIDENT GRIFFO:Well, we want to thank Senator Espaillat and we want to extend our warmest courtesies to the members of the Dominican delegation that are here from the consul general's office, from the institute.
Thank you so much for being here today. We appreciate your presence, and we welcome you to these chambers. Bienvenido.
(Applause.)
ACTING PRESIDENT GRIFFO:Senator Skelos.
SENATOR SKELOS:Mr. President, if we could stand at ease pending the return of the Rules Committee.
ACTING PRESIDENT GRIFFO:The Senate will stand at ease pending the return of the Rules Committee.
(Whereupon, the Senate stood at ease at 12:29 p.m.)
(Whereupon, the Senate reconvened at 12:52 p.m.)
ACTING PRESIDENT GRIFFO:The Senate will come to order.
Senator LaValle.
SENATOR LaVALLE: Mr. President, may we return to reports of standing committees.
ACTING PRESIDENT GRIFFO:We will return to reports of standing committees.
Senator LaValle.
SENATOR LaVALLE: I believe there's a report of the Rules Committee at the desk.
ACTING PRESIDENT GRIFFO:There is a report of the Rules Committee before the desk.
The Secretary will read.
THE SECRETARY:Senator Skelos, from the Committee on Rules, reports the following bills:
Senate Print 1172, by Senator Seward, an act to amend Chapter 324 of the Laws of 2014;
Senate 1514, by Senator Griffo, an act to amend the Social Services Law;
Senate 1515, by Senator Nozzolio, an act to amend the Education Law;
Senate 1516, by Senator Griffo, an act to amend the General Business Law;
Senate 1517, by Senator Felder, an act to amend the Social Services Law;
Senate 1518, by Senator Felder, an act to amend the Social Services Law;
Senate 1519, by Senator Gallivan, an act to amend Chapter 329 of the Laws of 2009;
Senate 1692, by Senator Ortt, an act to amend Chapter 332 of the Laws of 2014;
Senate 1693, by Senator Hannon, an act to amend the Public Health Law;
Senate 1694, by Senator Ranzenhofer, an act to amend Chapter 439 of the Laws of 2008;
Senate 1695, by Senator Marchione, an act to amend Chapter 429 of the Laws of 2014;
Senate 1697, by Senator Griffo, an act to amend the General Business Law;
Senate 1698, by Senator Ranzenhofer, an act to amend Chapter 154 of the Laws of 1921;
Senate 1790, by Senator Seward, an act to amend the Real Property Tax Law;
Senate 1806, by Senator Ortt, an act to amend the Executive Law;
Senate 1807, by Senator Gallivan, an act to amend the Executive Law;
Senate 1808, by Senator Griffo, an act to amend the Banking Law;
Senate 1809, by Senator Valesky, an act to amend the Agriculture and Markets Law;
Senate 1810, by Senator Valesky, an act to amend the Agriculture and Markets Law;
And Senate 1976, by Senator Golden, an act to amend the Tax Law.
All bills reported direct to third reading.
ACTING PRESIDENT GRIFFO:Senator LaValle.
SENATOR LaVALLE: Mr. President, I move we accept the report of the Rules Committee.
ACTING PRESIDENT GRIFFO:The Rules Committee report is the before the house. All in favor signify by saying aye.
(Response of "Aye.")
ACTING PRESIDENT GRIFFO:Opposed?
(No response.)
ACTING PRESIDENT GRIFFO:The report is accepted.
Senator LaValle.
SENATOR LaVALLE: Mr. President, on the noncontroversial calendar I'd like to bring up Calendar Number 17, by Senator Golden, Senate Print 1976.
ACTING PRESIDENT GRIFFO:The Secretary will read Calendar Number 17, Bill 1976. The Secretary will read.
THE SECRETARY:Calendar Number 17, by Senator Golden, Senate Print 1976, an act to amend the Tax Law.
SENATOR GIANARIS:Lay it aside.
ACTING PRESIDENT GRIFFO:Lay it aside.
Senator LaValle, that completes the request of the reading noncontroversially of Bill Number 1976.
SENATOR LaVALLE: Mr. President, can we now move forward with the controversial reading of Calendar Number 17 by Senator Golden.
ACTING PRESIDENT GRIFFO:The Secretary will ring the bell.
The Secretary will read.
THE SECRETARY:Calendar Number 17, by Senator Golden, Senate Print 1976, an act to amend the Tax Law.
ACTING PRESIDENT GRIFFO:Senator Gianaris, why do you rise?
SENATOR GIANARIS:Mr. President, I believe there's an amendment at the desk. I ask that the reading of the amendment be waived and that I may be heard on the amendment.
ACTING PRESIDENT GRIFFO:Senator Gianaris, there is an amendment before the desk. Upon review of the amendment, in accordance with Rule 6-4(b), I rule the amendment nongermane.
SENATOR GIANARIS:Mr. President, I'd like to appeal the decision of the chair and ask that I be heard on the appeal.
ACTING PRESIDENT GRIFFO:Senator Gianaris, you may be heard on the appeal of the chair.
SENATOR GIANARIS:Thank you, Mr. President.
The amendment I'm putting forth is directly germane to the underlying bill because it deals with the critical issue of funding our schools. And the bill put forward by Senator Golden would provide public monies for private schools, charter schools, as well as other institutions, but our public schools have been suffering due to being starved of funding over the last several years due to the Gap Elimination Adjustment.
This amendment would repeal the Gap Elimination Adjustment, thus providing an extra billion dollars of funding to our public schools so that they will not be harmed if and when Senator Golden's proposal gets enacted by having public monies diverted to private institutions.
I don't think there's a member in this chamber who is not familiar with the needs of our school districts and the fact that they've been damaged by lack of funding. There is a CFE decision that has been hovering over this state for many years that has yet to be adhered to in the budgets that we have been passing.
And so, Mr. President, I believe that this is germane because it deals directly with the issue we're dealing with today. It would provide our public schools with the funding they do need so that we can then adequately consider whether to also provide public monies for other institutions of learning.
Thank you, Mr. President.
ACTING PRESIDENT GRIFFO:Thank you, Senator Gianaris.
The vote will be on the ruling of the chair, a procedural vote. So all those in favor of overruling the chair signify by saying aye.
(Response of "Aye.")
ACTING PRESIDENT GRIFFO:Opposed?
Senator Gianaris.
SENATOR GIANARIS:Show of hands, please.
ACTING PRESIDENT GRIFFO:May we have a show of hands of those who favor overruling the chair.
(Show of hands.)
ACTING PRESIDENT GRIFFO:Mr. Secretary?
THE SECRETARY:Ayes, 23.
ACTING PRESIDENT GRIFFO:The ruling of the chair stands.
The bill before the house is Calendar Number 17. The Secretary will read the last section.
THE SECRETARY:Section 12. This act shall take effect immediately.
ACTING PRESIDENT GRIFFO:Call the roll.
(The Secretary called the roll.)
ACTING PRESIDENT GRIFFO:Senator Krueger.
SENATOR KRUEGER:I'm sorry, I would like the sponsor to yield to some questions, please, Mr. President.
ACTING PRESIDENT GRIFFO:Sorry, Senator Krueger, we will allow that.
Senator Krueger has the floor.
SENATOR KRUEGER:Will the sponsor yield?
ACTING PRESIDENT GRIFFO:Senator Golden, do you yield?
SENATOR GOLDEN:Yes, I do, Mr. President.
ACTING PRESIDENT GRIFFO:Senator Krueger.
SENATOR KRUEGER:Thank you, Mr. President.
SENATOR LaVALLE: Mr. President.
ACTING PRESIDENT GRIFFO:Senator LaValle, why do you rise?
SENATOR LaVALLE: I think if we need to go forward, we would have to withdraw the roll call. We were on a roll call.
ACTING PRESIDENT GRIFFO:Yes, Senator LaValle, that is accurate. Sorry for that. We had some issue at the desk.
So we'll withdraw the roll call. And the bill is before the house controversial. Senator Krueger has the floor. She's asked Senator Golden to yield. Senator Golden has agreed to yield.
Senator Krueger.
SENATOR KRUEGER:Thank you, Mr. President.
If the sponsor could tell me how much this would cost the state in the following three years, I believe it's 2016, 2017, and 2018.
SENATOR GOLDEN:I believe the bill is structured as a tax credit, and the tax credit would cost approximately $150 million the first year, $225 million the second, and in the last year $300 million.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:I do, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:Thank you.
So we have a bill that will cost us well over $600 million or perhaps $700 million over three years. Unlike other tax credits, how will you apply to get this tax credit? Do you simply file your taxes and check off a box on your taxes?
SENATOR GOLDEN:They would have to file an application with Tax & Finance, and that would be the start of the tax credit. And that's what makes this different than the other tax credits.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR GOLDEN:Yes.
SENATOR KRUEGER:What criteria does Tax & Finance use to decide Liz who's applied can get a tax credit, but Marty who's applied can't get a tax credit? What's the process there?
SENATOR GOLDEN:In the first month, January, all the applications would be submitted. And there are two phases. That would be Phase 1. Phase 2 would be February through December 31. Phase 1 would have to be notified that they've received the tax credit by February 20th. After February 1st, they would be notified within five business days.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:I do.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:So it's a first come, first serve? Or is there a basis for Tax & Finance to say no? Or is it the biggest get or the littlest get? How is that determined?
SENATOR GOLDEN:It would be first come, first serve, except for the first month. And if the first month it exceeded the cap, then they would be prorated.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor will continue to yield.
SENATOR GOLDEN:I do.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:Thank you.
So this bill seems to differ from earlier versions in that it is not a committee or organization authorized by the state or through the Regents who determine what these monies are used for. Will the sponsor please explain to me what the process will be for -- let's say Liz gets a tax credit -- for Liz deciding where that money goes?
SENATOR GOLDEN:The DTF would, upon notification to the person applying for the tax credit, would be sending that tax credit to the school, whether it would be a public or private or parochial school, and they would be notified that that has been accepted. That could go to a public school, a public school district, school improvement organization, local education funds, or the educational scholarship organizations, who would make the determinations on how that money would be spent.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:I do, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:So the taxpayer getting approved for the credit doesn't determine what school or what purpose this tax credit is used for?
SENATOR GOLDEN:When they make their application to Department of Tax & Finance, they appropriately mention which group they would want to send that money to -- which school, which district, which educational scholarship organization, which local education fund, and what school improvement organization.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:I do, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:So the taxpayer can get permission to not pay taxes but to take that amount of money and say where they would wish that to go, and then through that organization it gets sent to that school, that scholarship fund, that educational activity; is that correct?
SENATOR GOLDEN:That's the same way credits work now, yes, Mr. President.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:I do, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:Your response was that's the way credits work now. What credit model do we have in law in New York State that works like that now?
SENATOR GOLDEN:-- makes a determination on how those tax monies are going to be spent and other organizations as well.
SENATOR KRUEGER:Through you, Mr. President, perhaps I didn't understand. What agency now determines where your preapproved tax credit is being sent, under current law?
SENATOR GOLDEN:There is none. There is none that's -- where it is actually -- you have the Economic Development, which makes determinations as to where that money will be spent going forward. This is a tax credit from an individual or a corporation. That money is given to Department of Tax -- the application is made to the Department of Tax & Finance, and they will send that application to the school, school district improvement organization, or the local education fund or educational scholarship organization. And the Excelsior credits work like that as well.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:Yes, I do, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:Thank you.
How large a credit might an individual, a corporation or an LLC be eligible for under this law per year?
SENATOR GOLDEN:Up to a million dollars for a corporation, minus 10 percent for costs.
SENATOR KRUEGER:Sorry, I didn't hear him, excuse me. Minus 10 percent --
ACTING PRESIDENT GRIFFO:Would you repeat that, Senator Golden?
SENATOR GOLDEN:Up to a million dollars, which would be a million-one. There is -- the million would go for the tax credit and 10 percent would be used for administration.
SENATOR KRUEGER:Through you, Mr. President, I just want to make sure I'm reading the bill right. The way I read the bill, it can be up to a million dollar tax credit but no more than 90 percent of what you actually owe the state. Am I reading it correctly or incorrectly?
SENATOR GOLDEN:Yes, you are reading it correctly, Senator Krueger.
SENATOR KRUEGER:Thank you. And through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:Yes, I do, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:And it's regardless of whether I'm an individual or a corporation or an LLC, the same rule would apply?
SENATOR GOLDEN:Yes.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:Yes, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:And the sponsor answered a question that I hadn't asked yet, but perhaps he was reading my mind, when he talked about $1.1 million. Is he referencing a calculation of the fact that when you get a million-dollar tax deduction, 100 percent tax deduction in New York State, the way this bill is written you would even get a kickback back from the federal government to increase the value of your tax deduction above and beyond the $1 million? Does the sponsor agree with me on that analysis?
SENATOR GOLDEN:This is a state tax return, which has nothing to do with the federal tax return. There is -- it's a nonrefundable tax credit.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:I do, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:So when the sponsor earlier said the $1.1 million, what did he mean?
SENATOR GOLDEN:Ninety percent of 1.1 million is 1 million.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:Yes, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:Thank you.
It is correct this is a state bill. But would the sponsor agree with me that the way the federal charitable deductions are calculated, you could also be eligible to apply this for federal deductions as if it is a charitable contribution even though it is a 100 percent tax credit?
SENATOR GOLDEN:No, they would have to add that back, Mr. President, at the state level, and they would not be able to double-dip, if that is the question.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:I do, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:So actually I think it's two questions. And thank you, sponsor, for answering the next follow-up question.
So I actually believe that the way this is designed, you could actually draw down a federal reimbursement on giving the tax credit money to this educational entity such that on your million-dollar contribution, up to 90 percent of your total's tax bill in the state, you would also get federal money back, making your contribution worth up to $1.1 million to you.
But I believe that the sponsor's last answer was to the next question. He must have my questions in advance. Previous versions of this bill deny the taxpayer's ability to claim both a New York State itemized deduction and a New York State tax credit simultaneously when filing their return, so the taxpayer could only claim either the credit or an itemized charitable deduction, but not both.
Where in this bill does it prevent the double-dipping? Can I get the citation of the section of the bill that would prevent that double-dipping?
SENATOR GOLDEN:The Department of Taxation & Finance would deny that.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
SENATOR GOLDEN:Yes, Mr. President.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR KRUEGER:They would only deny it if there's a section of this bill saying it can't be done both ways. Can I find the reference in the bill language that says you may not take both credits?
SENATOR GOLDEN:Section 8, Senator Krueger.
(Pause.)
ACTING PRESIDENT GRIFFO:Senator Krueger?
SENATOR KRUEGER:I'm just reading Section 8. "The amount of any federal deduction for contributions made for which a taxpayer claims a credit." That's federal deduction, Mr. President.
To clarify my question, what in this law prevents you from counting it twice in your state taxes?
SENATOR GOLDEN:In both Section 3 and Section 8, the federal deduction is added back to the state.
SENATOR KRUEGER:I'm just looking for section 3, Mr. President.
Through you, Mr. President, that section also references federal tax code and the IRS. So my question is for state tax purposes, what would prevent you from double-dipping to claim it as a credit under this law and also as a charitable deduction under New York State charitable deduction law?
SENATOR GOLDEN:It reads as it is in the document. You have to add back the federal deduction. I can't make it -- it's right there in black and white.
SENATOR KRUEGER:Through you, Mr. President. The federal law --
ACTING PRESIDENT GRIFFO:Senator Krueger, are you on the bill or are you still asking questions?
SENATOR KRUEGER:I think I'm on the bill. I'll go back to questions, thank you.
ACTING PRESIDENT GRIFFO:Senator Krueger on the bill.
SENATOR KRUEGER:Under federal tax law, there are various deductions you are allowed to take. Under state tax law, there are various deductions you are allowed to take. I agree with the sponsor, in these two sections it references what you can and cannot do vis-a-vis applying it with your federal taxes. But my question was where is the section of this bill that prevents you from simultaneously claiming this new credit and also itemizing it for charitable deduction purposes under New York State charitable deduction law? There may be many examples where the feds do or don't let you do something and the state does or doesn't let you do something under our tax obligation law.
Through you, Mr. President, having clarified, may I ask the sponsor again to yield?
ACTING PRESIDENT GRIFFO:Senator Golden, do you yield?
SENATOR GOLDEN:If I can, I will gladly yield. But the federal tax is added back to the state -- to the federal -- they're not allowed to get both deductions. And it's obvious in the bill. And that's the way it is, that we start with the federal tax, then we go to the state tax. Federal tax takes the deduction, you get to the state tax, you will not be allowed to take the federal and the state at the same time.
Yes, Mr. President.
ACTING PRESIDENT GRIFFO:Senator Krueger.
SENATOR KRUEGER:Through you, Mr. President, if the sponsor would continue to yield.
ACTING PRESIDENT GRIFFO:The sponsor yields.
SENATOR GOLDEN:I do.
SENATOR KRUEGER:So there's discussion of this money being applied for scholarships to various schools. What is the income limit of a child receiving a scholarship under this program?
SENATOR GOLDEN:Five hundred thousand dollars, Mr. President.
SENATOR KRUEGER:Through you, Mr. President. Do we know of any other programs in New York State where you can take a 100 percent tax credit to -- a 100 percent exemption to get a tax credit up to a million dollars to give money to families who have $500,000 in income? Can I have another example from law?
SENATOR GOLDEN:Well, first of all, Mr. President, if that's the question, they're not giving it to families, they're giving it to scholarship funds and to public school districts. And those public school districts and those scholarship funds are giving it out to the individuals that attend those facilities.
Now, I got to tell you, I added 10,000 classroom seats into my district in the past 10 years. And 10 years ago they told me that I would be okay today. Well, guess what? I'm still, in District 20, one of the most severely overcrowded school districts in the city. I don't have pre-K because I have no place to put it.
Giving the options for people to make these donations to our organizations gives us the ability to reduce that overcrowding and to get pre-K into my schools and to get them across not just my district but across the districts from Brooklyn to Buffalo.
And there are a number of scholarships that are done up and down the State of New York, whether it's the $16 million in the Children's Scholarship Fund, which has a limit of $31,000 in income for 211 different schools, or if it's the Bison Fund in Buffalo, with 1900 scholarships, or if it's the Brooklyn-Queens Diocese with 14,000 students, where 70 percent of the households are below the poverty line and 93 percent are minority and 36 percent are non-Catholic. It's remarkable what's going on today in our Catholic schools with a 98 percent graduation rate.
So we need to be able to reduce the overcrowding, get pre-K that was so important to all of us last year, it's definitely that important this year. And when it came to funding, I believe we funded the most money that we've ever funded to city and state schools this last year. And just in the city alone I think we gave $340 million for pre-K, $400 million for operating, another $108 million for after-school programs, on top of everything that we have done in the past, $22 billion.
So we believe that that is a good credit, that million-dollar tax credit for the so-called rich that you say, the corporations, and the $500,000 limit on the individual child.
SENATOR KRUEGER:Through you, Mr. President, on the bill.
ACTING PRESIDENT GRIFFO:Senator Krueger on the bill.
SENATOR KRUEGER:Well, I share the sponsor's concern about the overcrowding in our schools. I think my school district is still rated the second most overcrowded in the City of New York. We also don't have pre-K, and for a while we had kindergarten wait lists. I think we might have resolved that.
I agree we need more money for our educational systems. I constantly argue for and support more money for education. In fact, my conference attempted to propose a billion dollars additional money for education just today as an amendment to this bill coming to the floor.
I don't believe the way to think we're getting money to education is to give enormous tax reductions and exemptions to the wealthiest taxpayers and hope they'll direct them to the neediest schools and the neediest children. Because in fact research shows just the opposite.
So basically we'll be allowing, over three years, $700 million that would otherwise come to us as tax revenue and potentially be used to address the concerns of education and high-needs districts all over the State of New York. We're taking that off our books so that we can't spend it as the government is supposed to determine the best use of tax dollars are, and instead we're allowing I believe a subuniverse of people who are the highest-income -- because they're going to need fancy tax accountants to make sure they get their applications in in January-February and follow up. This is not the kind of tax deduction lower-income people get to take when they file their taxes.
So we're going to allow the wealthiest New Yorkers to reduce their tax bill and to decide where they want to put the money, at the price of the State of New York not having $700 million over three years to provide for public education.
This is a wolf in sheep's clothing. I do support more money for education. I do recognize charitable giving is an important thing to support, ideologically and philosophically. We have significant tax deductibility in our tax code, federal and state. But to jump from the existing standard to up to a 100 percent deduction for up to a million dollars to up to 90 percent of wiping out your tax bill, so that you can decide where you want to put that money, including charitable scholarships for families who already have incomes up to $500,000 personally? That's not charitable giving. That's tax avoidance, and allowing those with excess resources to be allowed to determine where tax money is going as opposed to the elected representatives of the State of New York.
There is much we can do around the issue of funding education in this Legislature through the budget process, through our prioritizing the need for additional funds in high-needs areas of public education. There are things we can do to address the educational needs within the parochial school system as long as it is done in a way that is not for religious teaching and meets the constitutional test of church and state separation.
There's far more we can do, much better ways we can do it. I would urge my colleagues do not vote for this bill.
Thank you, Mr. President.
ACTING PRESIDENT GRIFFO:Senator Hoylman.
SENATOR HOYLMAN:On the bill.
ACTING PRESIDENT GRIFFO:Senator Hoylman on the bill.
SENATOR HOYLMAN:You know, Mr. President, one of our new colleagues asked earlier today why there wasn't a hearing on this bill before us. You'd think a bill this momentous, important -- innovative, some might argue -- would be worthy of a public hearing, a discussion, a debate. But no.
So I ask, Mr. President, how we are to expect the Governor or the other house to take this legislation seriously if we haven't fully vetted it.
And I oppose it, Mr. President, basically for two fundamental reasons, because I think it really undermines two great American traditions. One is free universal public education. And the second is I think this bill skirts very dangerously to violating separation of church and state.
In terms of free universal public education, I think it's pretty clear, Mr. President, that this bill very well could siphon off money from the General Fund that arguably could be used in support of our traditional public schools.
We heard earlier that the Campaign for Fiscal Equity, that decision that said every New York kid deserves, is entitled to a sound, basic education, is $5 billion short. Five billion dollars short. Yet we're planning new tricks of the trade to siphon off that money and make certain that those kids don't get that $5 billion.
Secondly, you know, we as New Yorkers should respect each of our religious differences. But I'm under no obligation, nor is anyone else here, to fund those differences. And I think that's what this bill does.
Also, Mr. President, the bill doesn't help poor families send their kids to private schools or parochial schools or charter schools, it helps the funders of those entities out. And it helps those funders even if they're corporations.
So let's call it what it is, Mr. President. This is a corporate giveaway. If you're an LLC, if you're an S corporation, you can get that 100 percent tax credit if you donate not just to a private school, not just to a charter school, but also parochial schools.
And let's talk about the private schools. You've got your Brearleys, you've got your Trinitys. You've got Avenues, which is in my district. Charges $40,000 a year for tuition, 40,000, one of the most expensive in the nation. Well, if they set up the appropriate entity, donors to that very, very expensive private school could get a 100 percent tax break.
So, Mr. President, I think that the incentives already exist in the federal and state tax code. It's called a 501(C)(3) charitable deduction. We're just permitting a lot of corporations to double-dip, to give money away that they should be reinvesting -- we should be reinvesting into our traditional public schools.
So I'll be voting no.
ACTING PRESIDENT GRIFFO:Seeing and hearing no other Senator that wishes -- Senator Rivera.
SENATOR RIVERA:Thank you, Mr. President.
I want to thank Senator Krueger and Senator Golden for having the discussion that we had earlier on the floor --
ACTING PRESIDENT GRIFFO:Senator Rivera, are you on the bill?
SENATOR RIVERA:I am on the bill, yes, Mr. President.
ACTING PRESIDENT GRIFFO:Senator Rivera on the bill.
SENATOR RIVERA:So again, I want to thank Senator Krueger and Senator Golden for having the conversation that they had here on the floor. To underline Senator Hoylman's point, we should have had this discussion within a couple of hearings, a conversation within the committee itself, the Education Committee, which is where this bill should have been considered, as opposed to the Rules Committee and straight to the floor very last minute.
I will be voting in the negative on this bill, Mr. President, for many reasons. And they have been pointed out by my colleagues, but I will underline a few.
First of all, just to make sure that this it is stated clearly and for the record so that later on people might not accuse me of not being supportive of schools that are parochial schools and schools that serve some kids in my district, unfortunately fewer and fewer, as there are parochial schools that have closed in my district in the last few years and some that might close in the near future.
I support those kids. And I support those parents and I support those schools. But what we're seeing here is not something that is going to help those schools. It certainly could. It's a possibility. But when we look at the details of the legislation, then we see that it is only a possibility, it is only a hope, and ultimately I believe it is a false hope. And ultimately I believe that this is a voucher by another name.
We're providing tax credits, which are ultimately tax breaks, for wealthy individuals that are going to choose where this money goes. So, Senator Golden, I was very glad to hear that you pointed out all the different millions of dollars that potentially would go, through this program, to public schools or other types of schools in the City of New York. But we have no guarantee of where that money is going to go.
Furthermore, because we are taking what amounts to $675 million over a three-year period from the General Fund that could arguably go to help some of the public schools that just in my district in the Bronx serve 81 percent of the students that are in the Bronx.
This is a problem. You're giving a tax break, you're letting wealthy individuals choose where this money goes. And ultimately because of the way that it is structured, it might potentially be an investment. You might actually have individuals being able to put money to take away some of their tax burden and then be able to get some money back, while millions of these dollars do not go to the kids in my district. I cannot be supportive of this.
And as Senator Hoylman also pointed out, we over the last couple of years -- I've been in the Senate for four years, many of my colleagues have been here for far longer -- have been arguing for the Campaign for Fiscal Equity, arguing that as the courts have ordered us, as a state we owe billions of dollars to schools in the City of New York, to millions of kids in the City of New York which we have not made good on.
So as opposed to talking about how we could actually put that money in there, which is, by the way, what Senator Gianaris pointed out in the amendment that he proposed, we're instead saying let's take more money away from the General Fund and create some sort of false hope for schools that currently do not have funding but potentially could maybe get this.
Lastly I will say because it is capped, because we only are doing a certain amount of it a year, as also has been pointed out by my colleagues, some individuals, wealthy individuals who have very good tax attorneys working for them, will be able to line up first. Certainly an individual that says I'm going to give $250 and get a $250 credit, that person is not going to get it because there are already going to be people having hundreds of thousands of dollars that are in front of them asking for the tax credit from the state. And with knowledge of how to get this tax credit.
So ultimately we are giving a tax break to individuals -- and to corporations, let's not forget -- that we're giving them a tax break, we're taking money away from the General Fund and ultimately not getting it to the students that really need it. Which is certainly the kids that I serve.
So it is unfortunate that we didn't have the opportunity to discuss it more at length in a committee meeting the way that we should. But I am glad that we at least had this conversation here, and I'm encouraging all of my colleagues to consider all the facts that have been brought about, and some that my colleagues might bring about afterwards, and vote no on this bill. I will be voting in the negative.
Thank you, Mr. President.
ACTING PRESIDENT GRIFFO:Senator Sanders.
SENATOR SANDERS:Thank you, Mr. President. On the bill.
ACTING PRESIDENT GRIFFO:Senator Sanders on the bill.
SENATOR SANDERS:My colleagues have spoken well on this bill, but there are one or two issues that I'd like to raise.
A report was recently put out saying that more than 50 percent of all of the kids going to public school in this nation are now in poverty. However, this bill does not attempt to address those issues, I would argue. I would say that this is more trickle-down tax policies that will only aid the largest corporations, who have the best lawyers, who can get to this money first before anyone else does. And by the time that any John Q. Public citizen comes up and says he wants to do anything, that money is long gone.
This is also a type of false philanthropy, where in true philanthropy you're not really looking to get everything back, you're not trying to, that's not your purpose. Your purpose is to do good because it is good, instead of to do good because it is good for your bottom line, for your bank account.
We need to really replace the money that we took out of the public school system during the recession. During the recession, of course we had to make hard decisions, and we took billions away from the public school system. And that has not been put back. As a matter of fact, according to the New York State School Boards Association, more than 50 percent of our school districts are receiving less now than they had at the beginning of the recession. So seemingly before we take any more money out of the budget, we need to put back what we took before.
New York State of course is not complying with court orders that said we have to defend the children and their education and make sure it's fair. We're more than $5 billion behind in that one. And we are a billion dollars short in the Gap Elimination Adjustment fund.
Mr. President, there are far better ways to aid even the religious schools, which I believe should be aided according to the law, of course. There are far better ways of doing this, and this is not it. And perhaps if we had had that discussion earlier that my colleagues had been requesting, we would have found those ways.
So I too must vote no on such a bill.
Thank you, Mr. President.
ACTING PRESIDENT GRIFFO:Seeing and hearing no other Senator who wishes to be heard, the debate is closed and the Secretary will ring the bell.
Read the last section.
THE SECRETARY:Section 12. This act shall take effect immediately.
ACTING PRESIDENT GRIFFO:Call the roll.
(The Secretary called the roll.)
ACTING PRESIDENT GRIFFO:Senator Panepinto to explain his vote.
SENATOR PANEPINTO:Regarding this bill, this bill in my opinion is nothing more than a tax break for the rich and for LLCs and S corporations. My daughters attend public school in the City of Buffalo. City Honors School is one of the top 10 public schools in the country. They have a private foundation which I could donate to under this bill. I own an LLC as a law firm. We could write down, you know, $400,000 in our state tax by giving to the City Honors Foundation.
That's just not right. It's not fair to the other kids in the Buffalo public schools for my children alone and our school to benefit because we've got an LLC that has somebody that attends that school.
I'm voting in the negative, and I encourage my colleagues to do so.
ACTING PRESIDENT GRIFFO:Senator Panepinto to be recorded in the negative.
Senator Montgomery to explain her vote.
I'm going to remind everyone of the two-minute explanation period.
SENATOR MONTGOMERY:Absolutely.
ACTING PRESIDENT GRIFFO:Senator Montgomery.
SENATOR MONTGOMERY:Thank you, Mr. President. I rise to explain my vote.
I'm voting no on this legislation. I sat in a school in my district on Saturday for about two hours listening to parents, and that auditorium where we were was freezing cold because they had no heat. There are problems in the building. And I listened to parents from across that school district talk about some of the issues in relationship to their schools.
And furthermore, none of those parents -- nor does this bill cover individual parents in terms of a tax credit. It's simply only refers to corporations.
And so I am voting no on this, and I hope that we can find a way to come up with the kind of funding that is necessary to fix schools like the one, P.S. 67, where I sat Saturday listening to parents, and to actually have them be eligible and be in the line for capital funding and other funding that they so sorely need.
I vote no, Mr. President.
ACTING PRESIDENT GRIFFO:Senator Montgomery to be recorded in the negative.
Senator Savino to explain her vote.
SENATOR SAVINO:Thank you, Mr. President.
I'm voting in favor of this bill. And I want to just briefly explain why I feel that it is important that we pass the education tax credit.
And by the way, for those of you who have wondered why we didn't have a hearing on this, this is not a new issue for this body. We have passed this bill or supported this bill in some way, shape or form for the past five years, many of us in this chamber appearing at rallies in support of it.
Now, I am proud to say that I am a Catholic school girl. I never set foot in a public school until I took a civil service test. Kindergarten through university. I believe in the Catholic school system.
But the narrative that is being put forward that if you support parochial education somehow you are opposed to public education is a false one. I am just as strong a supporter of public education as many of us in this room are. This is not the choice.
But I just want those of you who are new to this process to think about this. In the past five years that this house and the Assembly have been trying to figure out how do we pass an education tax credit so that we can preserve parochial and private education alongside our thriving public school education, 75 Catholic schools have closed in the archdiocese and the Brooklyn-Queens diocese, 12 in Buffalo last year.
Those children are entitled to the same due consideration that every other child is. We need to find ways to preserve our private parochial education system alongside our public education system. We can do both. This is not a choice between them. We all support all of our kids.
And I will tell you, I vote on this with a heavy heart. Because as I stand here, the school that I went to in Astoria, it's in Senator Gianaris's district, Most Precious Blood, a school that my grandfather contributed money to build and his name is on a plaque, is on the list for closure. So I'm fighting the fight not just for my own school that I went to but for every other Catholic school girl in the state, and every other yeshiva girl, and every other public school student in the State of New York. We can do right by all of our students.
Thank you, Mr. President.
ACTING PRESIDENT GRIFFO:Senator Savino to be recorded in the affirmative.
Announce the results.
THE SECRETARY:In relation to Calendar 17, those recorded in the negative are Senators Breslin, Espaillat, Gianaris, Hamilton, Hoylman, Krueger, Montgomery, Panepinto, Peralta, Perkins, Rivera, Sanders, Serrano, Squadron and Stavisky. Also Senator Comrie.
Ayes, 44. Nays, 16.
ACTING PRESIDENT GRIFFO:The bill is passed.
Senator LaValle.
SENATOR LaVALLE: Mr. President, lay aside the rest of Calendar 3A.
ACTING PRESIDENT GRIFFO:The remainder of Calendar 3A will be laid aside for the day. Lay it aside.
SENATOR LaVALLE: Before I make a motion, just an announcement.
ACTING PRESIDENT GRIFFO:Can I have some order, please, in the chamber.
Senator LaValle.
SENATOR LaVALLE: Members may assemble by the Concourse Security if they wish to be guided to the State of the State address by the Sergeant-at-Arms.
My motion, there being no further business, I move we adjourn until Thursday, January 22nd, at 11:00 a.m.
We will now proceed to the Empire State Plaza Convention Center for the Governor's State of the State address.
ACTING PRESIDENT GRIFFO:Members are instructed to proceed to the Concourse to the Empire State Convention Center, for the message of the Governor on the State of the State and Budget.
The Senate stands adjourned, on motion, until Thursday, January 22nd at 11:00 a.m. The Senate stands adjourned.
(Whereupon, at 1:38 p.m., the Senate adjourned.)
Highest impact first.