By Steve Levy
New York State ranks among the most highly taxed states in America. Unaffordability continues to resonate as the state’s most pressing issue, leading to an exodus of over 400,000 people in 2024 alone.
The way to reverse higher taxes is to first identify the primary causes of the exponential rise in spending over the past few decades and to promote legislation to reverse course.
Our Center’s white paper highlights the Dirty Dozen laws contributing to the affordability crisis. They include:
- Overtime beefing up pensions. Government workers put in an extraordinary amount of overtime hours in their last years to inflate the base pay upon which their pensions are set. This OT pension escalator will cost taxpayers $50-80 billion over the next two decades. Workers also receive defined benefit contributions, in which taxpayers guarantee the same monthly payment, regardless of stock market fluctuations, unlike private-sector defined contribution systems, which rise or fall with the market.
- Full coverage of healthcare benefits for many employees and retirees. Some public retirees contribute zero to their health care packages and have their Medigap and Medicare Part B costs covered by taxpayers, resulting in a long-term obligation of $360 billion for overall public sector healthcare in New York.
- Mandatory arbitration that hikes police salaries to unsustainable levels. Pay for many veteran Suffolk police officers exceeds $225,000. Unions have no incentive to extend givebacks, given that they can always get favorable rulings through the arbitrator.
- The Triborough Amendment for public employees provides step salary increases, even after the contract expires, making negotiations difficult for management. A step — extra salary for just existing another year — may be 2% to 4% above the negotiated annual increases.
- Retirement after 20 years of service. Taxpayers might pay four different people for one law enforcement position. When the original officer turns 82, taxpayers will be paying for his retirement and that of three others for that position,
- Inefficient school spending. New York pays almost twice the national average per pupil (over $30,000), yet it is surpassed in student performance by about half of the other states. The state’s Excelsior program provides free college tuition, not just for working-class students, but for the upper-middle-class students as well. Free public school lunches are now provided for the children of millionaires. Pre-school programs, which have not shown a correlation in improving scores, continue to expand at alarming costs. New York City imposed a 20-student-per-class cap, which is so expensive that it had to be delayed. Cost-efficient charter schools, which provide better student outcomes, have been capped in New York.
- Expansion of the nonworking population and the Medicaid program. Government welfare programs have led to four in ten eligible workers staying home instead of working. Meanwhile. One in three New Yorkers is now on Medicaid.
- The Scaffold Law holds building owners 100% liable should any workplace injury occur. The mandate adds $785 million spent unnecessarily on the construction of buildings in the state.
- Disability abuse allows an employee to sit at home collecting up to 100% of his salary tax-exempt, making more money than if he went back to work. Retirees with accidental disability will still be eligible to receive 75% of their income at retirement, also tax-free. According to the Empire Center in 2022, approximately 60% of all firefighters had retired with a disability pension.
- The Wicks Law requires multiple contractors to be used for plumbing, gas, ventilation, and electrical work for public buildings with costs exceeding $500,000. A U.S. Department of Housing and Urban Development rep claimed the law often added 10% to cost estimates for city projects.
- Illegal alien expenses. The state spent over $4 billion caring for asylum seekers, while the city budgeted approximately $10 billion from 2022 to 2026. Illegal immigrants obtain state health benefits through various sources. Those hitting 65 are entitled to state Medicaid coverage, while undocumented children get the Child Health Plus program and pregnant undocumented women get prenatal care. The costliest is the care for the undocumented at emergency rooms. State leaders must seek to amend the state’s constitution to clarify that taxpayers will not be responsible for housing and feeding illegal aliens. In the meantime, state and local leaders should end sanctuary designations and provide the bare minimum to satisfy any existing constitutional requirements.
- Sick day abuse. New York State’s Retirement and Social Security Law permits public employees to receive credit for their unused sick days at retirement, effectively allowing them to retire with payments sometimes amounting to hundreds of thousands of dollars, something unheard of in the private sector.
Steve Levy is Executive Director of the Center for Cost Effective Government, a fiscally conservative think tank. He served as Suffolk County Executive, as a NYS Assemblyman, and host of “On the Right Side Podcast.” Costeffectivegov@gmail.com.