LEGALcurrents®

Just before midnight last night, the U.S. Senate unanimously passed the Coronavirus Aid, Relief and Economic Security (CARES) Act.  The bill now goes to the House for a vote, which is expected to happen sometime tomorrow.  Once that happens, the bill will be sent to the President for his signature.  The bill is extensive and contains many significant provisions.  We will be reviewing those in the coming days.

As was noted yesterday, the Governor thought that the federal stimulus legislation shortchanged New York.  He had reached out to New York’s House delegation asking them to prioritize more funding for New York.  House Speaker Pelosi stated that the House won’t be able to change the Senate bill but noted that there will be more bills to come that can address government funding.

In his briefing today, the Governor again reiterated his disappointment in the federal legislation.  He pointed out that states are grappling with increased expenses coupled with a loss of revenue.  He noted that the federal action failed to meet the needs of governments around the country.  The Governor noted that this failure will impact the state budget talks that are happening now.  The budget is due by next Wednesday, April 1.

Given that the money New York will receive is not sufficient to cover the expenses and loss of revenue expected, the Governor said two things had to happen in this budget.  First, the projected state revenue projections must be adjusted downward.  Second, we must look at doing a budget that would contemplate budget adjustments throughout the year based on the revenue that the state is receiving.  Something like this has never been done before.

While it is anticipated that the federal government will do another bill with funding directed to governments, this cannot be counted on at this time.  Also, there is no way to know what revenue the state would receive in a future bill.  The Governor is contemplating that the budget adjustments would be reviewed quarterly by the Division of Budget and those that rely on government funding would receive funding information at different points throughout the year.

The Senate and Assembly are still reviewing this proposal, but Senate Majority Leader Stewart-Cousins did indicate in an interview this morning that while she understands the need for flexibility in light of the current situation, she is not in favor of giving wide latitude on budget decisions without involvement from the legislature.  As the budget negotiations continue over the next few days, we will hopefully get a better sense of what the plan for the next year will be.

During his briefing today, the Governor also indicated that he wanted to get as much done in the budget as possible because we don’t know if or when the legislature will be back.  He is still hoping key policy items can be negotiated.  However, he did acknowledge that the effort to reclassify gig economy workers is off the table because it is a complicated issue that cannot be addressed in time for the budget deadline on Tuesday.

In addition to the funding and policy issues that need to be addressed, another issue that is now being considered as part of the budget negotiations are extensions of 244 laws that are set to expire by the end of the year.  While most anticipate that the legislature will be back in the Fall, many feel that it is better to do the extenders now in case this pandemic lasts longer than anticipated and impacts the legislature’s ability to return to Albany.


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