Min. wage hike, tax break features of NY budget

Posted at 12:14 PM, Mar 31, 2016
and last updated 2016-04-02 08:10:26-04

Minimum Wage Increase

Minimum wage is going up across New York State, but the State Legislature could suspend that wage hike if economic conditions take a turn for the worse after 2019.

Governor Andrew Cuomo presented highlights of his 2016-2017 budget on Thursday, including the much-talked-about wage increase that Cuomo has been championing for months. On Thursday, it was officially announced that the hike will vary across the state.

Here's what minimum wage will look like across the New York:

New York City: $15/hour by end of 2018 (large business), $15/hour by end of 2019 (small business)

Upstate New York: $9.70 by end of 2016, then another $0.70 each year until reaching $12.50 by end of 2020 - after which will continue to increase to $15/hour on an indexed schedule to be set by the Director of the Division of Budget

Further, the bill provides a "safety valve" for the increases.  Beginning in 2019, the government will conduct an annual economic analysis in each region to determine whether a temporary suspension of the wage increase is necessary.

It is estimated that 2.3 million people will be affected by these minimum wage increases.

Middle class tax cut

Also included in the budget is a tax cut for middle-class income earners.  

Beginning in 2018, a drop in the personal income tax rate will be phased in, ultimately dropping to 5.5%.

While details had not been fully released as of Thursday night, Governor Cuomo says these new tax breaks will save New Yorkers nearly $6.6 billion in the first four years, with annual savings reaching $4.2 billion by 2025.

Paid family leave

The State is offering paid family leave as part of the 2016, 2017 budget.

The leave will be funded by employee contributions.

Benefits are expected to be 2/3 of what the paycheck was.

Leave can last up to 12 weeks, which is the longest in the Nation.

Investment in education

Included in the budget is an investment in education. The state is investing 24.8 billion dollars in education, which Governor Cuomo says is the largest single investment in education ever in New York State history.

The investment in education is expected to eliminate the GEA (gap elimination adjustment) within one full year. 100 million dollars will be allocated to schools that are "failing."