Silver Introduces “Courtesy” Pricing Bill, Wants a Millionaire Tax

Assembly Speaker Sheldon Silver introduced a congestion pricing bill yesterday, but was quoted as saying "we have a long way to go" before it clears his chamber.

The Times reports that Silver, introducing the plan "as a courtesy to the new governor," agreed not to "block" it "in exchange for some version of the new tax on anyone making more than $1 million." But some Republican lawmakers who might otherwise support congestion pricing are opposed to the "millionaire tax" (as is Mayor Bloomberg).

And Assembly Democrats were peeved when Governor David Paterson seemed to dismiss the prospect of legislative pay raises in today’s Times story, according to the Daily Politics.

One lawmaker deemed it "disingenuous" for the new governor to come around praising Democrats at a time when he needs their support very badly – not the least of which for Mayor Bloomberg’s congestion pricing plan – and not mention that he plans to tank something that is of utmost importance to them.

"It puts another chill on enthusiasm for the new governor – beyond all the other letdowns and setbacks we’ve seen already," the lawmaker said.

Assembly Speaker Sheldon Silver didn’t mention the pay raise issue, either, the lawmaker said.

The City Council has yet to pass the home-rule message needed to
place pricing in Albany’s hands, though Speaker Christine
Quinn says she is "optimistic" the votes will be there.

  • Larry Littlefield

    All in all, I’d much rather see congestion pricing go down at the state level than the city level.

    Because when the MTA goes bust and consequences are felt, you want the anger directed where it is most deserved, and you don’t want the state legislature saying “we would have done congestion pricing and other funding measures for transit but NYC was opposed.”

  • Niccolo Machiavelli

    Chill with the negative vibes Larry, the clock is still ticking. This is probably just Shelly playing down to the last shot.

  • Larry Littlefield

    “Chill with the negative vibes Larry, the clock is still ticking. This is probably just Shelly playing down to the last shot.”

    Shelly knows what he has to do. But this may be one case where the sheep actually revolt and upset the applecart.

    In any event, he’ll get his tax increase, and not just on the rich, and massive service cuts, all while the debts and pensions get paid. He just needs to wait until after November.

    If it were me, of course, I would raise taxes by an extra 2.0% on all income over $200,000 this year, and not spend a dime until May 2009. Get some revenues from the Wall Street bonuses that were already paid in the first quarter of 2008, and set it aside for 2009 and 2010 when Wall Street profits and bonuses will be scarce.

    But they’ll raise taxes next year, when there is no income to tax. On wages, not on retirement income.

  • Larry Littlefield

    (If it were me, of course, I would raise taxes by an extra 2.0% on all income over $200,000 this year, and not spend a dime until May 2009.)

    Just in case I wasn’t clear, the taxes should rise this year temporarily, and fall next year — in time for the federal tax increase. This year’s bonuses have already been paid, and no one will move away if they are stuck with a tax that is going to disapper.

    If people know an increase is coming next year, in contrast, those who can (the better off) will just shift income into years the tax is not in effect.

  • momos

    Larry’s right. It’s much better that the problem be clearly seen as residing in Albany, since it is Albany that is most responsible for the mess the MTA is in.

    But I’m with you, NM. I’m feeling optimistic about CP.

  • Hilary

    But is anyone optimistic that CP will reduce traffic? It’s great to get the revenue for transit, but it would be nice to accomplish its other goal. Hard to see that happening with the current PA offset formula. I guess it’s a start.

  • momos

    People who study public finance understand something that nobody else seems to get: the number one most important determining factor for businesses deciding where to locate is NOT tax rates, but whether there’s an accessible local labor pool with the right skills.

    That means the priority above all for local government should be to invest in education, health and transportation.

    And that means government should tax at whatever rate is necessary to keep the local labor pool competitive. Shelly’s proposal is a sound one: enact CP, and keep state gov’t in healthy shape by increasing taxes on those who can afford it.

    There will be no mass exodus from New York because of a marginal tax hike. But there will be if schools close, subways fail and health care falls out of reach of most New Yorkers.

  • Larry Littlefield

    “There will be no mass exodus from New York because of a marginal tax hike. But there will be if schools close, subways fail and health care falls out of reach of most New Yorkers.”

    We’ll have both, as a result of the debts, pensions and retiree health care from the past. CP revenues would make it less bad. And who knows, if the charge forces more of the powers that be to ride the trains, perhaps they’ll have an incetive to prevent disaster — if it is still possible.

  • Ombud

    Hilary obviously lives on the West Side, since all she cares about is traffic from NJ. Obviously it’s simple supply/demand logic that imposing an $8 fee on currently free East River Bridges and on the trip from Bronx/Upper Manhattan will reduce car trips from Brooklyn/Queens and north.

  • Hilary

    Jeffrey Zupan’s study showed that the greatest source of projected traffic growth is west of Hudson. It is also the least price-elastic, as it has no alternatives. The PA is being permitted to control the price (and amount of offset) in order to maximize its revenue for the sake of its bondholders. All I am saying is that this is no way to adjust NYC’largest traffic valve. It seems there are several alternatives:
    1) Have PA raise its tolls and EVEN KEEP ALL OF IT to the level where it produces a reduction in traffic by 7%.
    2) De-couple the tolls from the CP fees.
    3) Eliminate discounts for the EZ Pass users, since they are the heaviest commuters. Let well-marked, separated lanes for a single cash toll (identified from a mile away) be the disincentive to using cash. It’s enough.

    Yes I live on the west side, but congestion, like air pollution, disperses far and wide.

  • Dave H.

    “It puts another chill on enthusiasm for the new governor – beyond all the other letdowns and setbacks we’ve seen already”

    Have I missed something? What are these other letdowns? That he admitted having affairs?

  • Ombud

    New Jersey may be a more dynamic housing market but it’s not the largest traffic valve – it is by far the most capacity-constrained. Look at a map.

    I would wager Zupan’s analysis was about *travel* demand, which can be met to some degree with projects like ARC and a 2nd Lincoln Tunnel bus tube (further constraining general vehicle capacity), not car traffic flow.

    Also, the PA did eliminate the E-ZPass discount with this month’s toll increase.

  • Shemp

    Paterson also smoked some dope and tried cocaine in his day, unlike any of us.

  • momos

    But Shemp: unlike Paterson, the guardians of morality in Albany have never had affairs.

  • Hilary

    Ombud, Good to learn about the elimination of the EZ pass discount. I hadn’t heard. Nevertheless, don’t you agree that the toll and offset formula should be used to reduce traffic through these PA conduits, not just raise revenue? If not, it has nothing to do with reducing congestion, and is just robbing Peter to pay Paul (assuming both Peter and Paul are using those revenues to improve transit and not, say, investing in real estate). On the East River crossings, we should be looking for an overall reduction of the same percentage (e.g., 7%, the federal goal), which will be accomplished by a redistribution of the toll burden among those drivers and some diversion to other routes. I just think it’s important to keep our eyes on the goal of reducing traffic. Otherwise we run the danger of creating another revenue source for transit that is auto-dependent. We will never be free.

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