The proposed reinstatement of a commuter tax on Long Island residents who work in New York City was the topic of discussion at a recent hearing sponsored by Suffolk Assemblyman Thomas F. Barraga, the ranking Republican on the Assembly Ways and Means Committee, and his colleagues in the Assembly Republican Long Island Delegation. The hearing was held in Northport on Jan. 23 and was attended by several local elected officials.

The commuter tax was originally instated in 1966 as a temporary tax on New York State residents who work in New York City but live outside the five boroughs. Back then, the tax was .025 percent on wages and .375 percent on net earnings for the self-employed. The "temporary" set of rates were increased to .45 percent on wages and .65 percent on net earning from self-employment in 1973. In 1999, over 30 years after the tax was instated, Governor George Pataki signed into law legislation which eliminated the tax, saving commuters from Nassau County approximately $77 million a year and the total of all New York commuters about $210 million. Nassau County commuters were paying approximately 21 percent of the tax revenues and Suffolk was paying about eight percent.

Last year, New York City Mayor Mike Bloomberg, in figuring out his budget, proposed to not just reinstate the commuter tax, but to increase it to 2.7 percent for city non-residents. At the same time, which puzzles many officials, he said he planned to lower the income tax for city residents.

Included on the hearing panel with Assemblyman Barraga (R,C,RTL-West Islip), were Assemblymembers James D. Conte (R-Huntington), Steve Labriola (R-Massapequa), David McDonough (R,C,I-Merrick), Maureen O'Connell (R,C,I-East Williston), Andrew Raia (R,C-East Northport), Michael Fitzpatrick (R,C-Smithtown), Patricia L. Acampora (R,I,C-Mattituck) and Fred W. Thiele, Jr. (R,I,WF-Sag Harbor).

"This public hearing concerning the reinstatement of the New York City commuter tax is an important issue for this 2003 Legislative Session. The reinstatement of this piece of legislation will negatively affect many of the families who call Long Island home," said Labriola.

Many assemblymembers agreed that the reinstatement of the tax would be extremely detrimental to both city non-residents and city businesses. They stated that jobs may even be lost because companies would say that the cost of doing business and keeping employees would be too great a burden. In addition, they felt that non-residents already contribute a great deal of cash flow to New York City.

Conte noted that it's important for residents to understand that the mayor isn't really looking for a reinstatement of the commuter tax, but that he's actually trying to enact an income tax which would be at a rate of 2.7 percent.

"When we look at the budgets of Nassau County, New York City and New York State, I think what all levels of government have to do is not try to pass the buck onto either its neighbors or to a lower level of government," Conte said.

If the tax were to be enacted at the proposed 2.7 percent rate, a person with an annual income of $30,000 would pay $810 a year. A person with an annual income of $50,000 would pay $1,350, and a person with a $70,000 yearly income would pay $1,890 in taxes.

"The good part is that the governor didn't include [the commuter tax] as part of his overall state budget and I would hope that the Legislature continues to agree with that position," Conte added. "New York City has a lot of other avenues to raise revenue - they don't need it from the people who are providing jobs."

Overall, assemblymembers agreed that the hearing basically affirmed that residents and public officials alike are against the tax.

"We voted to repeal the commuter tax in 1999 because it unfairly penalized Long Island taxpayers for not living in New York City," Barraga said. "I expect this to be a big issue this upcoming session, and as the ranking member of the Assembly Ways and Means Committee, I will have considerable input during the debate process that takes place before the bill is sent to the Assembly floor for a vote. This hearing will give me the opportunity to obtain first-hand evidence of how this tax will affect local governments, businesses and organizations."

Many local public officials gave testimony during the hearing, including representatives for Suffolk County Executive, Town Councilmembers from Suffolk County, Nassau Deputy Presiding Officer Roger Corbin, and a representative for Senator Carl Marcellino. Representatives from numerous local businesses also provided testimony, including Mitch Pally of the Long Island Association and Warren Tackenberg of the Village Association of Nassau County. Members of Suffolk government gave the majority of the testimony, speaking about the fact that the tax would just be an additional cost on top of taxes that they have to impose locally.

"I think [the hearing] gave people the opportunity to reaffirm what they've been hearing from their constituents - because most of them were elected officials," Conte noted. "They spoke truly in favor of the commuter who doesn't have time to go to a hearing. We understand that they're already pressed here at home, they don't need an additional burden just because they need to travel to [the city]."