This Week in New York

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1 This Week in New York This Week In New York/Page 1 Covering New York State and City Government A Publication of Pitta Bishop Del Giorno & Giblin LLC February 26, 2010 Edition In the News New York State Hey Buddy, Can You Spare $1.4 Billion? Governor David Paterson plans to delay $1.4 billion in March payments to prevent New York from running out of operating funds at the close of the fiscal year, according to State Budget Director Robert Megna. Speaking at the annual Economic and Revenue Consensus Forecasting Conference, Mr. Megna said the Division of Budget has not specified what funds will be held back. Possible options include a second delay in payments to school districts and local governments, as well as delays in state income tax refunds. According to the Division of Budget (DOB), plan details will be developed in the coming weeks. The possibility of delaying State income tax refunds was floated last week and has received much legislative criticism. On Tuesday, Senate unanimously approved a resolution asking the Governor to reject this option. The Senate Republicans have put forth legislation that would require the State to remit refunds within 30 days after filing, or provide a reason for any delay. In December, Governor Paterson withheld $750 million in scheduled payments to schools and local governments. A lawsuit filed by education groups protesting the Governor s action is still pending. Payments were made to the school districts and localities in January. Since January, the State s estimated deficit has increased by $750 million and it is now estimated to reach $8.2 billion by March 2011, according to DOB. The Senate s budget report (released at the conference) estimated that General Fund revenue projections are $403 million below the Executive s for SFY Additionally, the Senate projects $340 million less for SFY than the Governor has estimated. Governor Ends Re-election Bid Governor David Paterson ended his re-election campaign today, opting to focus solely on the business of the State. "(T)here s more work to do, and up until the last few days I was looking forward to participating in that work in a full four-year term," Governor Paterson said during a press conference at his Manhattan office, his wife, First Lady Michelle Paige Paterson, by his side. "But I am being realistic about politics. It hasn t been the latest distraction it has been an accumulation of obstacles that have obfuscated me from bringing my message to the public."

2 This Week In New York/Page 2 "Therefore, there are times in politics when you have to know not to strive for service but to step back. And that moment has come for me." "Today, I am announcing that I am ending my campaign for governor of the State of New York. It has become increasingly clear to me in the last few days that I cannot run for office and try to manage the state s business at the same time and right now New York State needs a leader who can devote full-time to this service." (Source: The Daily Politics) In the News New York City IBO Releases Cost Comparison of Traditional Schools versus Charter Schools Charter Schools Operating in Public School Buildings Have Financially Advantageous Arrangements At the request of Patrick Sullivan, the Manhattan Borough President s appointee to the Panel for Education Policy, the Independent Budget Office developed a comparison of the per student public financial support received by charter schools in New York City with per student funding for the city s traditional public schools. Utilizing data from the school year, the IBO found: Per student general education spending at traditional public schools totaled $16,678. While public support per student at charter schools was less than at traditional public schools, the size of that difference depended on whether the charter school was located in a public school building or in private space. For charter schools located in public school buildings, public support was $305 less per student than at traditional public schools and totaled $16,373. For charter schools located in private space the shortfall was a more substantial $3,017 per student and public support totaled $13,661. According to IBO, more than two-thirds of charter schools in New York City are located in public school buildings. For charter schools housed in public school buildings, the arrangement is financially advantageous, as IBO estimates that the value of the savings for these charter schools on facility, utility, and school safety costs is $2,712 per student. IBO found that using the most comparable per pupil costs, which excludes special education spending, per capita public support for charter schools located in DOE buildings as more than two-thirds

3 This Week In New York/Page 3 of New York City charter schools are is slightly lower than the per capita public support in traditional public schools by $305 (1.8 percent). Charters operating in their own space do not receive in-kind assistance for their space such as custodial services from the education department and, therefore, the public support they receive is $3,017 (18.1 percent) per pupil below that of traditional public schools. Charter schools received $310 million in direct operating funding from the New York City Department of Education (DOE) for the last school year ( ) and the budget for this year has grown to $418 million as the number of charters in the city expanded from 78 to 99. Speaker Silver Announces Passage Of Legislation To Bring Federal Funding To Rutgers Houses For Security & Building Improvements Assemblyman Sheldon Silver announced the passage of legislation that would authorize the New York City Housing Authority (NYCHA) to take steps that would enable state- and city-developed housing projects - including Rutgers Houses - to be eligible for federal funds for operations and major repairs (A.9487-A multisponsored by Assemblymembers Lopez, Silver et al/s6430-a sponsored by Senator Squadron). "This legislation will bring vital funding to Rutgers Houses to make long overdue improvements in building security and sorely needed repairs to broken elevators, leaky roofs and individual apartments," said Speaker Silver. "This bill will make Rutgers Houses a safer place to live and raise a family." Rutgers Houses encompasses five 20-story buildings and houses approximately 1,675 residents on the Lower East Side and is one of 21 city and state financed housing developments operated by NYCHA that do not receive direct federal funding from the U.S. Department of Housing and Urban Development. Through the passage of this legislation, NYCHA will be allowed to enter into mixed-finance transactions, making these developments eligible for federal funding. The legislation allows for the financial reorganization of all or part of the residential buildings within state and city financed projects owned by NYCHA, with the approval of the Commissioner of the Division of Housing and Community Renewal. In addition to Rutgers Houses, the legislation authorizes the NYCHA to sell or lease all or part of the projects commonly known as Marlboro Houses, Chelsea Houses,- Castle Hill Houses, 344 East 28th Street, Amsterdam Addition, Bushwick Houses, Stephen Wise Towers, Arthur H. Murphy Houses, Baychester Houses, Jonathan Williams Plaza, Drew-Hamilton Houses, Independence Towers, Stapleton Houses and Manhattanville Houses. The bill will be sent to Governor David Paterson for consideration.

4 This Week In New York/Page 4 In Brief NYS Tax Department Proposes Regulation to Address Issue of Tax-Free Sales of Cigarettes to Indians New York State Department of Taxation and Finance Acting Commissioner Jamie Woodward this week proposed regulations that would limit the quantity of tax-free cigarettes that may legally be supplied to the Indian nations or tribes. The regulations would ensure that an adequate quantity of tax-free cigarettes would be available for purchase for the use of each Indian nation or tribe and for personal consumption by the nation's or tribe's members. At the same time, they would prevent the unlimited flow of tax-free cigarettes to Indian reservation retailers. The regulations require that cigarette manufacturers may sell cigarettes to a licensed cigarette stamping agent only when the agent certifies that the sale is in compliance with the Tax Law. In addition, a methodology is provided to calculate the amount of tax-free cigarettes that may be sold by agents to each Indian reservation. Licensed agents are prohibited from selling quantities of untaxed cigarettes to a reservation in excess of this amount. The complete text of the regulations, and how the public can contact the Department, can be found on the Department's website, Wayne Ozzi Nominated to Court of Claims Governor David A. Paterson this week announced the nomination of Wayne M. Ozzi to the Court of Claims. Mr. Ozzi is currently the principal Law Clerk to Justice Robert J. Gigante, a position he has held since From 1982 to 1999, he was a Court Attorney-Referee and Supervising Court Attorney for the New York State Supreme Court in Richmond County. From 1981 to 1982, he was a law assistant to Hon. John Cannizzaro. From 1980 to 1981, he was a staff attorney at the National Association of Securities Dealers. From 1979 to 1980, he engaged in the private practice of law and in 1978, he was an Assistant District Attorney in Suffolk County. Mr. Ozzi received his Bachelor of Arts from Queens College in He received his J.D. from University of Dayton School of Law in 1978 and his LL.M. from New York University School of Law in CSEA Wins Temporary Restraining Order CSEA won a temporary restraining order this week, preventing layoffs the State had planned at Bernard Fineson Developmental Disabilities Services Office in Queens and other downstate Office of Mental Retardation and Office of Mental Health facilities. Supreme Court Judge Thomas J. McNamara delayed the layoffs pending the outcome of a lawsuit filed by the union. The suit claims the layoffs were in clear breach of Governor David Paterson's agreement, reached with the union last July, not to lay off employees through Dec. 31, CSEA agreed not to stand in the way of recently enacted Tier V retirement legislation in exchange for the Governor's promise of no layoffs.

5 This Week In New York/Page 5 Coming Up New York State Wednesday, March 3 rd New York State Agency Use of Temporary Employees Assembly Committee on Governmental Employees Chancellor's Hall, State Education Building, 89 Washington Avenue, Albany, 10 am. Reform of Article 15-A Senate Majority MWBE Task Force Van Buren Hearing Room A, Legislative Office Building, 2nd Floor, Albany, 10 am. Friday, March 5 th City Charter Revisions Assembly Committee on Cities Assembly Hearing Room, 250 Broadway, Room 1923, 19th Floor, New York, 10:30 am. The Reauthorization of the Older Americans Act and its Impact on New York State Senate Standing Committee on Aging Senate Hearing Room, 250 Broadway, Room 1920, 19th Floor, New York, 1 to 4 p.m. New York City Monday, March 1 st Committee on Community Development, 250 Broadway - Hearing Room, 14th Fl., 1 pm. Oversight Update on the Use of Community Development Stimulus Funds for New York City Committee on Public Housing, 250 Broadway - Hearing Room, 16th Fl., 1 pm. Oversight The New York City Housing Authority s Mixed-Finance Modernization Plan for the City and State Developments Committee on Economic Development, Council Chambers - City Hall, 10 am. Oversight - Impact of Stimulus Funding on NYC: How Were the Funds Spent; Where Are the Jobs; What is the Impact When the Funds Are Gone? Committee on General Welfare, 250 Broadway - Hearing Room, 14th Fl., 3 pm Update on the impact of the Federal Economic Stimulus Package on New York City: Focus on social services issues Tuesday, March 2nd Committee on Immigration, 250 Broadway - Hearing Room, 14th Fl., 10 a.m. Int : Requiring the Administration for Children s Services to review strategies and create a plan of action to protect children who qualify for Special Immigrant Juvenile Status

6 This Week In New York/Page 6 Committee on Lower Manhattan Redevelopment, 250 Broadway - Hearing Room, 16th Fl., 10 a.m. Oversight - The Status of 130 Liberty Street (the former Deutsche Bank Building): Progress on its Demolition and Discussion of the Future of the Site Committee on Consumer Affairs, 250 Broadway - Hearing Room, 16th Fl., 1 pm. Int In relation to process servers. Committee on Education & Oversight and Investigation, Council Chambers - City Hall, 1 pm. Oversight - DOE s Proposed School Closings Committee on Technology, 250 Broadway - Hearing Room, 14th Fl., 1 pm. T Streamlining approvals for environmentally beneficial technologies, design and construction techniques, materials and products. Committee on Waterfronts, 250 Broadway - Hearing Room, 14th Fl., 1:30 pm. Int In relation to increasing fines for violations of the law for illegal dumping along waterfront property into New York City waterways. Committee on Parks and Recreation, 250 Broadway - Hearing Room, 14th Fl., 2 p.m. Int Replacement of trees. Wednesday, March 3rd Committee on Higher Education, 250 Broadway - Hearing Room, 14th Fl., 10 a.m. 10 am Preliminary Budget Hearing - Higher Education Oversight New York City Council Mayor s FY 10 Preliminary Management Report & Agency Oversight Hearings 12:00 pm City University of New York 1:30 pm Public Committee on Finance, Council Chambers - City Hall, 10 a.m. City Council Stated Meeting, Council Chambers - City Hall, 1:30 pm. Thursday, March 4 th Committee on Contracts & Finance, Council Chambers - City Hall, 10 am. Preliminary Budget Hearing - Finance Oversight New York City Council Fiscal Year 2011 Preliminary Budget, Mayor s FY 10 Preliminary Management Report and Agency Oversight Hearings 10:00 a.m. Office of Management and Budget Capital Budget Expense Budget Revenue Budget 12:45 pm Contract Budget 1:15 pm Department of Finance 2:15 pm Department of Design and Construction 3:15 pm Comptroller 3:45 pm Independent Budget Office

7 This Week In New York/Page 7 Friday, March 5th Committee on Sanitation and Solid Waste Management, Council Chambers - City Hall, 10 am. Preliminary Budget Hearing - Sanitation & Solid Waste Management Oversight New York City Council Fiscal Year 2011 Preliminary Budget, Mayor s FY 10 Preliminary Management Report and Agency Oversight Hearings Disclaimer: The materials in this This Week in New York report are provided for informational purposes only and are not intended to be a comprehensive review of legislative or governmental or political developments, to create a client-consultant/lobbyist relationship, or to provide consulting, lobbying or political advice. Readers are cautioned not to attempt to solve specific problems on the basis of information contained in this This Week in New York. If consulting, lobbying or government relations advice is required, please consult a professional expert in such matters. The information contained herein, does not necessarily reflect the opinions of Pitta Bishop Del Giorno & Giblin LLC, or any of its partners or employees or its clients. Neither Pitta Bishop Del Giorno & Giblin LLC, nor its partners or employees make any warranty, expressed or implied, and assume no legal liability with respect to the information in this report, and do not guarantee that the information is accurate, complete, useful or current. Accordingly, Pitta Bishop Del Giorno & Giblin LLC is not responsible for any claimed damages resulting from any alleged error, inaccuracy, or omission. This communication may be considered an advertisement or solicitation. To Our Clients: If you have any questions regarding any of the matters addressed in this newsletter, or regarding any legislative, government relations or political or consulting or related issues in general, please contact the Pitta Bishop Del Giorno & Giblin LLC professional with whom you usually work. To Our Clients and Friends: To request that copies of this publication be sent to a new address or fax number, to unsubscribe, or to comment on its contents, please contact Theresa Cosgrove at tcosgrove@pittabishop.com or at (518) This Week in New York is a publication of Pitta Bishop Del Giorno & Giblin LLC, 120 Broadway, 28 th Floor, New York, New York