Payroll Tax Repeal Passes State Senate; Assembly Chances 'Depressing'

As state legislators in Albany grapple with a host of issues before their session ends on Friday, one issue all East End legislators agree on is rolling back the MTA payroll tax, a measure passed by the state senate on Thursday morning and currently standing before the assembly's Ways and Means Committee.

Despite the 40 to 22 vote in the state senate on Wednesday to repeal the tax in the long run in Suffolk County and immediately exempt school districts and small businesses with 25 or fewer employees, Assemblyman Dan Losquadro, R-Shoreham, said on Thursday that the chances of the Assembly passing the bill are "depressing."

"There is a great deal of reluctance from individuals from the city to let this happen," said Losquadro, who co-prime sponsored the bill along with Thiele and six other Assembly members, including Democrat George Latimer, from Rye. When asked to gauge the chance the bill has of passing the lower house, on a scale from one to 10, Losquadro responded with a "depressing three."

"What we need to do is try and build coalitions across party lines, among legislators with similar interests," Losquadro said. "This is a prime example, and I think this is a good compromise."

South Fork Assemblyman Fred W. Thiele Jr., I-Sag Harbor, a member of the 35-member Ways and Means Committee, said in an email on Friday that, "getting the bill out in the Assembly will be an extremely difficult lift given the opposition of NYC members and the fact that NYC dominates leadership roles in the Assembly. We are doing all we can to get the bill passed."

The bill creates two regions: New York City and the seven remaining counties currently taxed 34 cents for every $100 of payroll, a measure instituted in the middle of 2009 to aid the struggling MTA. The bill proposes to phase out the tax in those seven counties incrementally by Jan. 1, 2014. It would decrease to 23 cents on every $100 of payroll in New York City following the same date.

A spokesman for the chair of the Ways and Means Committee said he was unsure what the bill's chances are to make it to the Assembly floor.

Suffolk County state Sens. Ken LaValle, R-Port Jefferson; Lee Zeldin, R-Shirley; and John Flanagan, R-East Northport, co-sponsored the Senate bill, along with nine others.