Citing “stubborn” economic and social problems that have “persisted for decades,” Gov. Andrew Cuomo has proposed two separate minimum wage hikes for workers—one for the state and a more ambitious increase for New York City—and tax relief for small businesses as well as several more economic-related initiatives he hopes to have passed as part of this year’s budget.
Under Cuomo’s proposal, the state’s minimum wage would be raised to $10.50 by the end of 2016. In New York City, Cuomo is proposing hiking the minimum wage to $11.50 because of the higher cost of living in the city compared to other areas in the state. If these hikes are approved, New York would have the highest state minimum wage in the country.
“It’s too easy to say, ‘Get a job,’ ” Cuomo said on Sunday. “You need to get a job, which means you need to have the training and skill to get the job, which means the job has to exist. When you get the job, the job has to pay enough that you can pay the rent, and you can pay for food, and it’s a sustainable wage.”
The wage hike is one part of Cuomo’s so-called 10-point plan to combat poverty and inequality.
His initiative also includes student loan relief, doubling funding to tackle high unemployment in minority communities, investing nearly $500 million in affordable housing and more than $200 million in homeless services, and $4.5 million to battle hunger. The governor also proposed reducing the income tax rate for small businesses from 6.5 percent to 2.5 percent. The tax cut would drop over a three-year period starting in 2016. Small businesses that file under the corporate franchise tax would be eligible.
“That is the lowest level in 100 years for small businesses,” Cuomo said of the proposed tax cut, “and we believe that’s going to be a real shot in the arm for the labor market.”
The minimum wage hike and small business tax cut announcement comes days before Cuomo delivers his fifth State of the State address, when he’ll officially lay out his roadmap for 2015. His anti-poverty campaign is expected to be on the list of issues he’ll discuss.
But looking at his legislative prospects in Albany, the governor may face his biggest battle over the minimum wage hike.
In November State Sen. Dean Skelos (R-Rockville Centre) shot down a potential minimum wage hike, noting that the Legislature had previously passed an hourly wage hike as part of the 2013-2014 budget, increasing the minimum wage to $9 per hour by the end of 2015. The Republican majority leader also nixed helping children of undocumented immigrants acquire citizenship rights through the Dream Act and opposed campaign finance reform involving public funds.
“There will be a discussion, I’m sure,” Skelos said, according to Capital New York. “We’re not doing Dream Act, we’re not doing minimum wage, we’re not doing taxpayer financing. If there are other reforms we can come up with, then I’m for it.”
Cuomo explained that despite the passage of the earlier hike, a second increase was necessary. “The wage gap is continuing to grow,” he said.
The state’s current minimum wage is $8.75.
Addressing concerns of college graduates drowning in debt, Cuomo proposed a “get on your feet” loan forgiveness program for graduates who attended a college in New York and continue to live in the state, earn less than $50,000 per year and participate in the federal Pay As You Earn Repayment Plan (PAYE). For those graduates, the state will pay the difference between what the federal government covers and the graduate’s total monthly loan payment.
