Cutting the cost of living is on the minds of local legislators as they head back to Albany with plans to fight inflation. From high energy prices to burdensome taxes, regulations, and fees, New York is the most expensive place to live in the nation and has the worst business climate. These factors are driven by government policy, and the lawmakers are pushing for change.
Senator Dean Murray is heading to the capital with a plan that would save billions. Rallying a coalition of Republican legislators from across the state, Murray has appealed to Gov. Kathy Hochul to eliminate the dreaded UIAS—Unemployment Insurance Assessment Surcharge—a state mandate that is draining $10.2 billion from New Yorkers.
During the COVID-19 lockdown, the Unemployment Insurance Trust Fund was depleted thanks to thousands of New Yorkers not being allowed to work. To throw them a lifeline, the state took a loan from the federal government and is forcing employers to pay it back. They’ve ponied up $5.7 billion so far and are still on the hook for another $4.5 billion.
“Doing away with this massive expense will allow businesses to pass their savings on to consumers by reducing the costs of goods and services,” explained Murray, the ranking minority member of the Commerce, Economic Development, and Small Business Committee. “This benefits businesses and consumers, bringing true, long-term relief to all New Yorkers.”
According to another legislator behind the plan, Senator George Borrello, “Instead of following the commonsense approach of other states and using some of the billions in federal COVID aid to pay down the unemployment debt, the governor unfairly shifted the burden to New York’s businesses and employers through the UIAS. Since the deficit stems from the government-mandated shutdown during the pandemic, it is only fair that employers are not left to shoulder these costs.”
Anyone who produces a paycheck is charged for the loan, which cost taxpayers $250 million this past year in interest alone. The debt could have been avoided had the Democrats who control New York better managed the $19.1 billion the state received under the CARES Act and other grants, on top of the $33.5 billion received by New York City and $2.4 billion to local governments. The federal COVID largesse has contributed substantially to the country’s monstrous $36.3 trillion national debt, a $323,000 burden on every taxpayer that will affect generations to come. As President Donald Trump takes office, the battle to repair the economic damage from the Biden-Harris administration and bring spending down to pre-pandemic levels will be at the top of his agenda.
“The state must take full financial responsibility for its unemployment insurance debt to the federal government and end this burden on our small businesses and family farms,” said Senator Pamela Helming, another coalition member. “If we truly want to help our employers grow and protect local jobs, we must reduce the cost of doing business in New York State. Our economic success depends on it.”
In their letter to the governor, the senators stated: “We would strongly encourage you to remove this massive added expense on businesses and employers by immediately paying off the balance of the money borrowed from the Federal Unemployment Insurance Fund.
Paying off the loan will eliminate the need for the UIAS that is currently costing employers hundreds of millions of dollars a year. This will not be a one-shot savings, but instead, will help New Yorkers save on an ongoing basis every time they go shopping for those goods or services.”
Taking this approach, the senators said, “will also send a strong message to New York businesses that we do care and we want to help them succeed.” Taxpayers hope that this year’s state legislative session will produce results that help stop the record outmigration of New Yorkers to states that better manage their money.