FRIDAY, JUNE 24, 2011 1:47 P.M.

ACTING SPEAKER P. RIVERA: The House will come to order. In the absence of clergy, let us pause for a moment of silence. (Whereupon, a moment of silence was observed.) Visitors and members are invited to join members in the Pledge of Allegiance. (Whereupon, Acting Speaker P. Rivera led members and visitors in the Pledge of Allegiance.) A quorum being present, the Clerk will read the Journal of Thursday, June 23rd. Mr. Canestrari. MR. CANESTRARI: Mr. Speaker, I move to dispense 1 NYS ASSEMBLY JUNE 24, 2011 with the further reading of the Journal of June 23rd and ask that the same stand approved. ACTING SPEAKER P. RIVERA: Without objection, so ordered. Mr. Canestrari. MR. CANESTRARI: In terms of the schedule for the foreseeable future, the members have on their desks the main Calendar and the A-Calendar. I move at this time to advance the A-Calendar. ACTING SPEAKER P. RIVERA: Without objection, the A-Calendar is advanced. MR. CANESTRARI: I understand there are introductions. If you have any introductions and housekeeping, I believe there was to be one, maybe it hasn't materialized. All right. If there are no introductions or housekeeping, we will go directly to the A-Calendar and begin consenting the bills. Thank you. ACTING SPEAKER P. RIVERA: Proceeding to Page 3 of the A-Calendar, Rules Report No. 621, the Clerk will read. THE CLERK: Bill No. 4643-A, Rules Report No. 621, Burling. An act to amend the Real Property Tax Law, in relation to establishing a residential-commercial exemption program in certain counties; and providing for the repeal of such provisions upon the expiration thereof. ACTING SPEAKER P. RIVERA: On a motion by Mr. Burling, the Senate bill is before the House. The Senate bill is advanced. 2 NYS ASSEMBLY JUNE 24, 2011

Read the last section. THE CLERK: This act shall take effect immediately. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Mr. Burling to explain his vote. MR. BURLING: Yes, please, to explain my vote, Mr. Speaker. I want to thank Sandra Galef for moving this bill out of her committee. There's an article in one of our papers about what's going on with Mount Morris and this Village. Greg O'Connell was a retired detective from New York City. He got into the real estate business. He did a project in Red Hook and in Brooklyn. He's going to do the same thing in Mount Morris. He buys up properties -- this is a tax abatement. He buys up properties that are rundown, that are depleted. He refurbishes them and then he brings people in with small businesses at low rents and he's revitalized different areas. This is a true economic resurgence in Mount Morris and, to be honest with you, this would make a great model bill for the whole State of New York to take a look at. But, I thank my colleagues and everyone who was involved. I thank the Speaker. This is very significant and it's going to really help a small community that needs it. Thank you very much. ACTING SPEAKER P. RIVERA: Are there any other votes? 3 NYS ASSEMBLY JUNE 24, 2011

The Clerk will announce the results. (The Clerk announced the results.) The bill is passed. THE CLERK: Bill No. 6309-A, Rules Report No. 622, Abbate. An act to amend the Education Law and the General Municipal Law, in relation to allowing school districts the option of amortizing future payments to the New York State Teachers' Retirement System. ACTING SPEAKER P. RIVERA: On a motion by Mr. Abbate, the Senate bill is before the House. The Senate bill is advanced and the bill is laid aside. THE CLERK: Bill No. 6766-C, Rules Report No. 623, Brennan, Maisel, Benedetto, Rosenthal, Weisenberg, Colton, Paulin, Jacobs, Meng, Stevenson, Cahill, Weprin, Linares, Millman, Robinson, Schimel, Scarborough, Castro, P. Rivera, Kavanagh, Crespo, Jeffries, Lancman, Clark, Moya, Abinanti. An act to amend the Executive Law, in relation to a prohibition on diversion of resources from dedicated funds derived from taxes and fees that support the Metropolitan Transportation Authority or the New York City Transit Authority and their subsidiaries in certain instances. ACTING SPEAKER P. RIVERA: On a motion by Mr. Brennan, the Senate bill is before the House. The Senate bill is advanced. Read the last section. THE CLERK: This act shall take effect immediately. ACTING SPEAKER P. RIVERA: The Clerk will record 4 NYS ASSEMBLY JUNE 24, 2011 the vote. (The Clerk recorded the vote.) Mr. Brennan to explain his vote. MR. BRENNAN: Yes, thank you, Mr. Speaker. This bill is supported by a coalition of organizations in New York State called the Empire State Transportation Alliance, which ranges from the straphangers to the New York Building Congress and would protect future mass transit funding from sweeps by the Division of the Budget and require an impact statement upon enactment of any further sweeps, impact on mass transit and mass transit service in the metropolitan area of the City of New York. I want to thank the organizations involved in assisting my office and Senator Golden's office in producing this legislation and I certainly prefer the debate we've just had to last night's debate. Thank you so much. ACTING SPEAKER P. RIVERA: Ms. Malliotakis to explain her vote. MS. MALLIOTAKIS: Thank you very much, Mr. Speaker. I rise to, number one, commend the sponsor of this legislation. I think this is a very, very good piece of legislation and I was proud to join you as a co-sponsor. You know, in 2009, when the State Legislature voted to take away funding that was dedicated for transit funds and moved it to the General Fund, I thought that was a wrong move. As a result of that, the people in my district, who I didn't represent at the time, lost eight buses designated in their community between Bayridge and 5 NYS ASSEMBLY JUNE 24, 2011

Staten Island. That was eight buses either completely lost or service cut. So, I think that this is a very important measure to make sure that money that we allocate for certain things stay there and are used for those things and not taken for other purposes. So, again, I commend the sponsor and I'm proud to see that there are all green lights on the board. Thank you. ACTING SPEAKER P. RIVERA: Ms. Malliotakis in the affirmative. Are there any other votes? The Clerk will announce the results. (The Clerk announced the results.) The bill is passed. THE CLERK: Bill No. 8424, Rules Report No. 624, Crouch, Finch. An act to authorize the County of Broome to offer an optional 20-year retirement plan to Deputy Sheriffs Richard Merrell and Frederick Akshar. ACTING SPEAKER P. RIVERA: On a motion by Mr. Crouch, the Senate bill is before the House. The Senate bill is advanced and there's a home rule message at the desk. Read the last section. THE CLERK: This act shall take effect immediately. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Are there any other votes? 6 NYS ASSEMBLY JUNE 24, 2011

The Clerk will announce the results. (The Clerk announced the result.) The bill is passed. THE CLERK: Bill No. 8456-A, Rules Report No. 625, Weprin. An act to amend the Penal Law, in relation to preventing certain people from lawfully possessing certain rifles, shotguns, and firearms. ACTING SPEAKER P. RIVERA: On a motion by Mr. Weprin, the Senate bill is before the House. The Senate bill is advanced and the Senate bill is live. Read the last section. THE CLERK: This act shall take effect on the first day of November next succeeding the date on which it shall have become a law. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Mr. Weprin to explain his vote. MR. WEPRIN: Thank you, Mr. Speaker. I would like to be excused from voting to explain my vote. This bill will close a loophole in the law which will save lives. Under current law, felons can legally possess certain muzzle loader guns and antique guns which actually have been fitted to shoot. There have been two incidents of State Troopers being shot in the last couple of years with these legally-possessed guns. I just want to thank the Speaker and the Codes Chair, Joe Lentol, and our Counsel, Jim Yates, for their work on this, as 7 NYS ASSEMBLY JUNE 24, 2011 well as the New York State Troopers' Association, who has been very strongly advocating this bill for a number of years due to the two incidents where two State Troopers were shot with one of these weapons. I vote in the affirmative. ACTING SPEAKER P. RIVERA: Mr. Castelli to explain his vote. MR. CASTELLI: Thank you, Mr. Speaker. I rise in support of this legislation. As you know, it was predicated, as the sponsor mentioned, by the shooting of two State Troopers by black powder weapons. As a strong supporter of the Second Amendment and the NRA, I want all my colleagues to realize that this is not an assault on the Second Amendment; rather, it is a protective measure to close the loophole that exists in the Penal Law under Section 265, criminal possession of a weapon, to preclude people who are convicted of felonies from possessing a black powdered-type firearm, which they already would have been prohibited from possessing, were it a cartridge-type firearm. So, I am in support of this. I know the State Police are in support of this. I thank them for their assistance. I want to compliment the sponsor and I am voting in the affirmative. Thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: Mr. Saladino to explain his vote. MR. SALADINO: Thank you, Mr. Speaker. I wish to thank the sponsor and all of our members on both sides of the aisle for 8 NYS ASSEMBLY JUNE 24, 2011 this very important legislation. This bill is being forwarded and passed now by true leaders, all of you, working together to correctly protect our State Troopers and all in law enforcement. These men and women are true heroes who protect us on our streets and everywhere from dangerous felons. Also, the thoughtfulness in having legislation that is complete is so important. So, I, again, thank our sponsors and I thank people on both sides of the aisle who continue to fight for the rights of hunters and gun owners, but recognize that it, too, is very important that our legislation protects those people who protect the rest of us. So, thank you to all of you and I appreciate all you have done on this legislation, especially at the harried time at the very end of Session. I will be voting in the affirmative. ACTING SPEAKER P. RIVERA: Mr. Saladino in the affirmative. Mr. Joel Miller to explain his vote. MR. J. MILLER: Thank you, Mr. Speaker. It's wonderful; it's wonderful, all you guys voted for this particular thing, as did I. And to think that black powder guns are, of course, the most dangerous things, I join with my colleague in thanking every one of you from the bottom of my heart. I truly do. It is absolutely a terrific day in Albany, a great day in New York and certainly, for all of those people who face the dangers of felons running around with guns, this is absolutely ridiculous -- important. 9 NYS ASSEMBLY JUNE 24, 2011

Thank you very much, Mr. Speaker. ACTING SPEAKER P. RIVERA: Mr. Miller in the negative -- I mean, in the affirmative. (Laughter) Mr. Gottfried to explain his vote. MR. GOTTFRIED: I just thought it would be appropriate to note that Mr. Bing is also voting for this bill. (Laughter) ACTING SPEAKER P. RIVERA: Are there any other votes? The Clerk will announce the results. (The Clerk announced the results.) The bill is passed. THE CLERK: Bill No. 8516, Rules Report No. 627, Lavine. An act to amend Chapter 474 of the Laws of 1996, amending the Education Law and other laws relating to rates for residential health care facilities, in relation to utilization of certified public expenditures for certain payments to public general hospitals. ACTING SPEAKER P. RIVERA: On a motion by Mr. Lavine, the Senate bill is before the House. The Senate bill is advanced and the Senate bill is live. Read the last section. THE CLERK: This act shall take effect immediately. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. 10 NYS ASSEMBLY JUNE 24, 2011

(The Clerk recorded the vote.) Are there any other votes? The Clerk will announce the results. (The Clerk announced the results.) The bill is passed. Mr. Canestrari. MR. CANESTRARI: Mr. Speaker, my colleagues, we will now go back to Page 3 of the A-Calendar, Rules Report No. 622 directly on debate, Mr. Abbate, please. ACTING SPEAKER P. RIVERA: Proceeding back to Page 3 of the A-Calendar, Rules Report No. 622, the Clerk will read. THE CLERK: Bill No. 6309-A, Rules Report No. 622, Abbate. An act to amend the Education Law and the General Municipal Law, in relation to allowing school districts the option of amortizing future payments to the New York State Teachers' Retirement System. ACTING SPEAKER P. RIVERA: Mr. Abbate, an explanation is requested. MR. ABBATE: Sure, Mr. Speaker. This bill would allow school districts to amortize future payments to the Teachers' Retirement System. I know there are some questions, so I'll go into more detail, but right now it's very similar to what we did two years ago for the counties. ACTING SPEAKER P. RIVERA: Mr. Hayes. MR. HAYES: Thank you, Mr. Speaker. Will the sponsor yield for a few questions, please? 11 NYS ASSEMBLY JUNE 24, 2011

ACTING SPEAKER P. RIVERA: Mr. Abbate? MR. ABBATE: Sure. MR. HAYES: Thank you. Mr. Abbate, you know, in looking at this legislation, I have a couple of questions because it is setting, to some degree, a precedent, a new and very dangerous precedent, I believe, and so I want to make sure that we get on the record a couple of key facts about this legislation. But, let me first begin by saying I think you and I both agree that it's important to try to do everything we can to help our school districts and, through them, the taxpayers who support public education in this State and that you and I are on the same page about that. Would you agree with me that that's the overriding goal? MR. ABBATE: That's what we're trying to do with this legislation. MR. HAYES: Okay. I agree with that very much, except I don't believe that what's contained in this legislation actually will help our school districts. What are the estimated costs to the local school districts who would opt in to a borrowing process such as this? Is there any indication of the additional interest costs that would be added, the costs for bond counsel, the underwriting expenses of these bonds? What is the actual estimate of the premium that will be added to the pension payment as a result of this borrowing scheme? MR. ABBATE: We assume with the market rate it would be about five percent. MR. HAYES: Five percent. Now, this is at a time when 12 NYS ASSEMBLY JUNE 24, 2011 the municipal market pays interest on municipal bonds much, much, much lower than five percent because of their ability to offer bond investors tax-exempt interest payments. So, the bond that gets offered to those particular investors would take into account the fact that they don't have to pay State or Federal income tax on that bond interest, but these bonds are taxable; is that what you're telling me? MR. ABBATE: These bonds are taxable, but this is no different for ERS and the police and fire that we did on the county level about 18 -- well, two years ago now. It's the same rate at five percent. MR. HAYES: So, we're going to take the exorbitant amount of increase in the pension costs that school districts are going to face, we're going to add to that underwriting costs, costs of bond counsel, all the costs of going into the bond market and borrowing this money, analogous to somebody who goes and takes out a mortgage and pays closing costs, then we're going to ask the school districts to come up with a five percent coupon in interest to pay to the individual bondholders who buy this, and this cost will then amount, at the end of the day, after the 15-year term, to be, what, double the cost that would initially be assessed on the contribution? MR. ABBATE: First of all, Mr. Hayes, we're not asking the school districts to do anything. They have an option to go into this program, and they have to decide when they look long range -- of course, the pension payments are supposed to spike in maybe another two or three years. It's their determination whether they want to enter into this at all. We're not telling them they have to do it. And there is support. I 13 NYS ASSEMBLY JUNE 24, 2011 mean, the bill came to us by the Big Five school districts asking for this legislation. It didn't come from anywhere else. They're asking; I'm sure some school districts will opt in, other school districts will not opt in. We assume that they have the appropriate people working at the school boards to make decisions on a local level whether they should do this and whether it helps the children in the school district, whether it helps the taxpayer in the district, which way to go. So, we're just giving them an option to do it. If it's not a good idea for them, they shouldn't do it. MR. HAYES: And under normal circumstances, if the school board or the local governing board decided that they were going to go out in the bond market and take on indebtedness, that would be subject, in a school district, to a mandatory referendum. I know every year I get called out to go vote on a bond issue that's put out by my local school district to buy a bus, to rehabilitate the cafeteria, to build an addition on to the library. They ask me, as the taxpayer who's on the hook for making these interest and principle payments, what I think about it. But this particular bill would allow school districts to go into the bond market and attain this indebtedness over a 15-year period without voter approval; is that right? MR. ABBATE: That's correct. And I assume, and I'm not so sure, but since it was supported by the Big Five school districts, I think they were looking, you know, how it was done in other areas and in New York City, maybe they were going to copy that because in New York City they do not have to have a vote on that. So, I'm assuming that's where they came up with this language to do it that way. 14 NYS ASSEMBLY JUNE 24, 2011

MR. HAYES: Well, for the majority of the school districts that are outside of New York City that would see the new precedent set by this, I'm sure that the taxpayers in those districts would see the precedent-setting nature of this, where operating costs of a school district were bonded out over a 15-year term without voter approval, I believe that most of those citizens would see this as a step backward into back-door borrowing, that heinous practice that the State has employed over many decades, and I'm not sure we want to set that precedent at the local level with school districts. And since we both agree we want to help school districts, isn't it true that legislation that was adopted in last year's budget already allows school districts, if they choose, to amortize their pension contributions to the system without going into the bond market and paying that kind of interest rate over 15 years? They already have the option to do this against the pension system; isn't that right? MR. ABBATE: I'm being told that they do not fully have it all. They do in some instances, not all, and they want a clarification so they can do that now. You mentioned that, you know, this is new and done. I mean, what we're trying to do this year -- and we've had some success and hopefully in the next day we'll even have greater success. You know, this is something new and different. We're about to do a tax cap. Some people support it wholeheartedly. This is the first time in the State in New York that we're trying something like that. We are trying to give relief and mandate relief to our counties. As a matter of fact, there was some discussion, when you talk about mandate relief, that this might have been put in the mandate relief bill, but since 15 NYS ASSEMBLY JUNE 24, 2011 the bill wasn't done yet, it was brought up on a single piece of legislation. So, I think people are looking at this as some mandate relief. MR. HAYES: Well, it seems ironic that only in Albany would a bill to increase the costs over 15 years exorbitantly on a school district be sold to them as, in fact, mandate relief and something helpful. We agreed we want to help the school districts; I disagree with you that this would be something helpful. And it seems particularly ironic that a bill like this would come before the House before the ink is even dry on the agreement between the Speaker of this House, the leader in the other House and the Governor on a two percent tax cap legislation. We're just hearing now that that agreement is set in concrete. One has to wonder if this bill is being rushed before us in order to do an end run or to circumvent the intent of what Governor Cuomo has said to us that every municipality and school district has to do in this State, and that is what every business and every family has had to do, and that's to find a way to streamline their costs, not simply put it on another new credit card. So, it seems, you know, strange to me the timing of this and the fact that this would be sold to school districts as an attempt to help them, because the opportunity that we've already given them, information I have says that very few, only 57 municipalities out of the 3,000 or so municipalities in the State, took advantage of the opportunity afforded to them in last year's budget to amortize these costs. I think the local-level people are looking at it, they're closest to the people, they have to answer to them when they see them in the grocery store and in the drugstore and they're not opting for this. They're telling the State this 16 NYS ASSEMBLY JUNE 24, 2011 is not helpful to us to be able to do this. MR. ABBATE: Mr. Hayes, that is exactly what I said before. We're giving them the local option to do it. If they do not want to do it, that's fine. Some areas need it. I know there's been a lot of requests from the City of Yonkers and the Mayor of Yonkers who actually put it in his budget for next year. So, if a locality -- if only a handful of school districts opt in to this, that's fine. But for those handful of districts, it might be helpful. For other districts, you know, it might not be helpful, they do not have to opt in to it. I think you made a good point there, that 56, you said, opted in to it. So, obviously, 56 localities thought it was important for them to do it. Hopefully, the rest of those counties are getting their house in order and figure they don't need to do this right now. MR. HAYES: Well -- and, hopefully, it's not a millstone that got thrown to them rather than a life raft because, certainly, I think that there are those of us who are very concerned about what that actually means in added costs to them. It may be a short-term relief, but long term it's going create all kinds of more difficult problems that will come back to the taxpayer or come back to this Body and have to deal with. I want to ask you, are you aware of what the rate of increase is expected to be in pensions going forward over the next year or the next two years, local pension contributions in the TRS system? MR. ABBATE: Sure. If I'm not mistaken, the employee contribution increase, it will be from 8.62 in 2010-2011, to 11.11 in 2011 and 2012. 17 NYS ASSEMBLY JUNE 24, 2011

MR. HAYES: And predicted the year following to be over a 15 percent increase? MR. ABBATE: Yes. MR. HAYES: Okay. Thank you very much, Mr. Abbate. Mr. Speaker, on the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. HAYES: Mr. Speaker, for all the wrong reasons, this legislation is disguised as assistance to our local school districts. This comes at a time when everyone in the State, from the average rank and file property taxpayer straight up to our Governor of this great State, has said municipalities and school districts have got to reform, they've got to save money, they've got to find a way to right size their budgets to what taxpayers can afford. I fail to see how issuing a brand-new credit card and holding up in front of a distressed school district is something that's going to help them, the children that they are serving or the taxpayers who, ultimately, will have to foot the bill. If the State really wants to help our school districts, we can get to the real business of mandate reform and stop all of the cost increases that are being baked into pieces of legislation that come from this Body and from the other Body that heap cost after cost after cost onto the localities and the school districts. The answer is not to simply give them a bright, shiny new credit card, and for that reason, Mr. Speaker, I will be voting against the bill and I encourage my colleagues to do the same. Thank you. 18 NYS ASSEMBLY JUNE 24, 2011

ACTING SPEAKER P. RIVERA: Mr. Molinaro. MR. MOLINARO: Thank you, Mr. Speaker. Will the sponsor yield for a few questions? ACTING SPEAKER P. RIVERA: Mr. Abbate? MR. ABBATE: Yes. MR. MOLINARO: Thank you, Mr. Abbate. I want to follow forward from where Mr. Hayes kind of left off in the area of how this compares to other borrowing and how this compares to what this Legislature did two years ago. And I want to do that because in answering his question, and I'm sure you meant well, there's a little bit of gray there. MR. ABBATE: We always try to keep it gray. MR. MOLINARO: Well, that's nice. In this case, though, what this bill does is significantly different than that which we approved two years ago. Two years ago, three years ago, this Legislature approved a policy that would enable municipal entities to amortize their pension contributions and your side of the aisle argued to level off or smooth off the contributions; isn't that correct? MR. ABBATE: Correct. MR. MOLINARO: Okay. So, in that particular case, we enabled municipalities to borrow against the fund, amortize their payments, without any limit. In fact, they could do it year after year after year after year until this Legislature revokes that policy; isn't that correct? MR. ABBATE: That's correct. MR. MOLINARO: Okay. And in that particular case, 19 NYS ASSEMBLY JUNE 24, 2011 when we allow those municipalities to do that, that was not at all subject to the same approval process that borrowing under New York State Finance Law for municipalities, school districts, what have you, would require. A municipality in that case could merely pick up the phone and say to the Comptroller, "We're going to amortize our payments;" isn't that correct? MR. ABBATE: That was correct. MR. MOLINARO: Okay. But this bill, though, enables for two years a school district to actually -- well, subsequent year, year one, year two -- to go out into the open market and bond, actually approve a 15-year bond to pay their pension costs; isn't that the case? MR. ABBATE: Yes. It's a little vague. And I want to tell you, you say two years. I'm not sure if it's just two years. MR. MOLINARO: They could do it forever and ever? MR. ABBATE: They can do it in a bond process. There is an amount that they could borrow, at 125 percent. They can borrow a little less one year, a little more, you know, bond out the next year. So, it can be stretched out. It's the point, it might not be two years. But I know what you're -- MR. MOLINARO: I understand that, and that actually is another reason for concern because they can borrow 120 percent -- MR. ABBATE: 125. MR. MOLINARO: -- 125 percent of the actual costs. But what I'm trying to get at is this distinctly different. This is a school board approving a bond, not merely amortizing their payment. They're 20 NYS ASSEMBLY JUNE 24, 2011 actually approving a bond, a debt mechanism, that they can then use to pay 125 percent of their pension costs over the course of 15 years; isn't that correct? MR. ABBATE: That's correct. MR. MOLINARO: Okay. So, isn't that different than merely amortizing a percentage of one's pension costs? This is actual indebtedness. MR. ABBATE: I don't know if it's indebtedness. It's a different way of doing it, but... MR. MOLINARO: Not under New York State Finance Law. Under New York State's Finance Law, for municipalities or otherwise, in this case a school board would be empowered to vote to actually get a bond and pay for operating costs. MR. ABBATE: Right. And I think I explained before that when they drafted the legislation and presented it to us, I think they might have been trying to mirror what the New York City School Board -- School District -- School Board does now. So, it is different in a sense, it's just a different way. MR. MOLINARO: I wonder why, and the amortization plan that this Legislature approved was probably almost worse, but I wonder why we didn't afford the same process in this case that we did for those. At the very least, at the very least, what we did two years ago was to enable amortization only on a small portion of pension costs. This allows a municipality, the school district, to borrow all of their pensions costs. 21 NYS ASSEMBLY JUNE 24, 2011

MR. ABBATE: No. MR. MOLINARO: Yes. MR. ABBATE: Only -- again, we're projecting -- let me just get the numbers so I get it right again. MR. MOLINARO: Peter, I want to be correct. MR. ABBATE: The 8.26 percent, only the amount over that they can borrow. MR. MOLINARO: Yes, right, but this is an actual letting of a bond and not merely picking up the phone, contacting the Comptroller. I wonder if we wised up from two years ago and the reason we don't want to do that is because technically we've enabled municipalities to borrow against the fund with the program we approved two years ago. Secondly, though, and I think more importantly, the distinct difference between what New York City school districts -- New York City can do in the case of letting bonds for this particular kind of purchase or expenditure, as Mr. Hayes mentioned, every other municipality, including city school districts across the State, if they wish to borrow for capital expenditures, that borrowing is subject to permissive referendum, isn't it? MR. ABBATE: Not the Big Five. MR. MOLINARO: But everyone else? MR. ABBATE: Everyone else. MR. MOLINARO: So, everyone else in the State of New York, if they wish to borrow money, that borrowing, if you're a 22 NYS ASSEMBLY JUNE 24, 2011 school district, is subject to mandatory referendum, isn't it? MR. ABBATE: Right. MR. MOLINARO: And in this case there is no such requirement. MR. ABBATE: That's why, as I keep saying, the legislation was brought to us by the Big Five. MR. MOLINARO: I understand, but this is going to empower every school district in the State, should they wish -- MR. ABBATE: And the school -- MR. MOLINARO: -- to indebt their community, circumventing what is the mandatory referendum process that we require if they buy a truck, if they buy a bus, if they borrow for six years, they have to go to the public for referendum. This does not require that. MR. ABBATE: It's only pension. It's not buying a truck or -- MR. MOLINARO: Peter, I want to be clear. If it was for anything else, a school district would have to subject that bond -- MR. ABBATE: Correct, okay, on that. MR. MOLINARO: -- to a mandatory referendum. This circumvents that requirement. MR. ABBATE: I don't know if it circumvents it. MR. MOLINARO: This doesn't have that requirement. The public has no say. MR. ABBATE: No, the public has a say. They elect the school board members. You would put trust. They elect you, they elect 23 NYS ASSEMBLY JUNE 24, 2011 me. MR. MOLINARO: I know, 13 percent of my voters show up to vote in a school board election. But nevertheless -- so, in that particular case we circumvent that process. And isn't it true that even for town and village governments, should they wish to borrow for greater than five years for a purchase, that that's at least subject to permissive referendum? MR. ABBATE: I'm being told that they do not have to put it out for a vote, that the local Body can vote on it. MR. MOLINARO: They're wrong. I respectfully disagree with your counsel and your staff. If a municipal entity borrows money for a capital purchase and they wish to borrow for five years or greater or greater than five years, it is subject to permissive referendum. There is no option unless it's a school district that wants to beautify its buildings. That happens to be the language in New York State Finance Law. MR. ABBATE: And he's saying the local Body, you know, local Body can vote on it. MR. MOLINARO: Has he served on a village board? I'm sorry, I'm telling you, based on what is New York State law, we believe -- unless you can quote otherwise. Point to the -- MR. ABBATE: I think he is a legislator. MR. MOLINARO: My point being that in every other case, respectfully, a municipal entity -- MR. ABBATE: Yeah. 24 NYS ASSEMBLY JUNE 24, 2011

MR. MOLINARO: So why we would not subject this borrowing, which is for an operating expense, why we we not subject this to permissive referendum or mandatory referendum, especially, Mr. Abbate, if this is being done to accommodate a tax cap, if a municipal entity wishes to exceed the tax cap, a school district, it goes out to the public for consideration. Why we would not offer them the same right? MR. ABBATE: And I think, as I said earlier in the debate, that this year we were trying a lot of new procedures and things, first-time tax cap, a lot of other procedures. We are trying to experiment with ways to see how we can help, help the children and the school districts. MR. MOLINARO: This bill is being adopted before or after we've considered a tax cap? Have we voted on a tax cap? MR. ABBATE: We haven't voted on one yet. MR. MOLINARO: Okay. So, this bill attempts to establish relief for something that doesn't yet exist. It's an interesting step. Let me ask one last question. MR. ABBATE: No, no. I think this -- MR. MOLINARO: Does the bill in any way change the pension system? Does it offer any relief other than the ability of a school district to borrow money? Does this bill change the way in which school districts pay to the fund, any other way? MR. ABBATE: No. MR. MOLINARO: No. And if a school district already 25 NYS ASSEMBLY JUNE 24, 2011 is amortizing its payments for its non-teacher employees, are they prohibited from borrowing for their teacher employees? MR. ABBATE: No. MR. MOLINARO: No. So, they can amortize limitlessly for their non-teacher employees and this bill would enable them to borrow for 15 years their operating expense and put it out to the taxpayer for 15 years. MR. ABBATE: As I said earlier, they would have to make the decision if it was prudent do that. MR. MOLINARO: I appreciate -- MR. ABBATE: If it was not, they shouldn't do it. We heard my colleague say that when we did the legislation two years ago that 56 localities thought it was a good idea to do, others didn't. On this it might be a handful of school districts that would do it and others would say, you know, let's see how it works to see before we make a decision. What we're doing here at the request with of some of localities, almost like a home rule, people are asked -- you know, school districts are asking for an option to do it. We're giving them that option. If it's a bad idea, I'm sure most of my colleagues here are very active with the local school boards in their district, they should be at some of the meetings when this is discussed and people should listen and see if they think it's a good idea in their area. Maybe if you look at it and you think it might be a bad idea, I think you should give your opinions at the school board level and let people know, you know, if it's a good idea or a bad idea. MR. MOLINARO: Thank you, Mr. Abbate. 26 NYS ASSEMBLY JUNE 24, 2011

On the bill, Mr. Speaker. ACTING SPEAKER P. RIVERA: On the bill. MR. MOLINARO: To suggest that we're offering this as a potential relief because the next step is a property tax cap and then to suggest that only a few school districts might take advantage of it is not an argument that makes a lot of sense. The truth of the matter is, it seems to me, that this is bad public policy. It is worse than what we did two years ago. What we did two years ago was to enable entities to borrow against the fund. Not only does that indebt future generations of taxpayers, but it weakens the solvency of the retirement fund. This on top of that is bad public policy. We are enabling, through this legislation, the ability for a school district to circumvent public consideration and indebt their taxpayers for 15 years to pay for an operating cost, to pay for a pension cost instead of truly getting to the heart of the problem, which is we have a State government and a State system that is outmoded, antiquated and costly. Instead of focusing on real mandate relief, we're merely enabling school districts to indebt their taxpayers, ultimately weakening their own financial stability in order to pay for an operating cost that we continue to avoid, a cost that rises year after year after year because we won't confront the problem. And what this will do is, ultimately, force school districts to borrow money when they shouldn't be borrowing it. If there's a tax cap coming, and I hope that we get to vote on such a big or little ugly, this will ultimately force school districts to borrow money, to borrow and borrow and borrow again while they continue to borrow 27 NYS ASSEMBLY JUNE 24, 2011 against the fund. It's bad public policy, it's bad finance and, ultimately, it takes this Legislature off the hook when it comes to substantive, comprehensive mandate relief and for that reason, I'll be voting in the negative and urge my colleagues to do the same. ACTING SPEAKER P. RIVERA: Mr. Gantt. MR. GANTT: Thank you very, very much, Mr. Speaker. Through you to Peter, if he will allow me to ask a couple of questions. ACTING SPEAKER P. RIVERA: Mr. Abbate? MR. ABBATE: Yes. MR. GANTT: Peter, who does this bill cover? Does it cover just the Big Five or does it cover all -- MR. ABBATE: It covers all school districts except New York City. MR. GANTT: And does this bill require that all of them vote on whether or not the bonds go out? Let me tell you the reason I ask you that. The reason I ask the question, I know the Big Five does not raise the money in their districts where they are where some of the central school districts, they do. That's why I have a real problem with that which is being done because I know my mayor has -- has the mayor a letter of support? MR. ABBATE: I don't have a letter of support. MR. GANTT: Did any of us ask the Big Five mayors whether or not they wanted this? MR. ABBATE: Not that I'm aware of. 28 NYS ASSEMBLY JUNE 24, 2011

MR. GANTT: So, this bill came in -- MR. ABBATE: The Yonkers Mayor did send a letter of support. MR. GANTT: Yonkers sent a letter of support? MR. ABBATE: Yes. Now, whether the mayors wanted to or not... MR. GANTT: I can almost tell you that I don't think my mayor was ever contacted. As you know, there was just a big discussion, argument on this floor yesterday about sales tax from Monroe County versus some other stuff and school districts that do the wrong things and all of that stuff. And I think this particular bill here is just another way for those who sit on the school board to get around the mayor and the city council, by the way, who has to raise the money in order to get this done. This is a sham. We ought not have this bill on the floor and I particularly am going to vote against it. And the reason that I say that -- MR. ABBATE: David, before you go any further, excuse me. I'm just saying that before the school board can issue the bonds, they do have to get the approval of the mayor. MR. GANTT: They have to get the approval of the mayor. So, do they have to get approval of the mayor for that issue which was right here on this floor yesterday and that was called the maintenance -- MR. ABBATE: Whatever. MR. GANTT: -- maintenance of effort bill and also the school reconstruction bill. I can tell you that the school board members 29 NYS ASSEMBLY JUNE 24, 2011 go out, they make obligations that people have to pay, whatever, after talking to them, and even though in my town they had an $80 million hole, they were still willing to go out and do it. I think we have a responsibility to stop that sort of irresponsible spending that school districts do, given the fact that somebody else is going to get caught with it. The mayor and the city council are going to get caught with raising taxes on those people who were there. I can tell you, the city council also and the mayor has a $50 million hole. How is it that we can allow people to go out and borrow money on issues like this rather than pay up-front? You and I cannot do that. You see Governor Cuomo doing it, you see Governor Christie doing it, you see the people in Colorado doing it. Everybody's trying to get spending under control today, yet, we would allow those individuals -- I'm talking about the Big Five in particular because I don't know enough about the smaller school districts, but the Big Five in particular, we allow them to put somebody else on the hook for it. I happen to be a big taxpayer in my city and you know what? I don't get a chance to vote on that which they will do. And you can say that, hey, the city council can vote on it and the school board can vote on it. But guess what? I, as a taxpayer, don't get a chance to vote on it and I'm tired of obligations that people are putting on me and, as I said, the city council and the mayor because even when they disagree with them, the best they can do is send it back to them and then they just send it right back. So, we ought to stop this. I suggest to you that maybe we ought to just table this bill until we talk to the other councils and/or 30 NYS ASSEMBLY JUNE 24, 2011 their mayor to see whether or not they're on board with this particular bill. I suggest to you also that the reason Yonkers may have signed on, there's a special reason that walk these halls every day, and we ought not allow them to obligate all the other districts in this State under this kind of sham, and it's not because I'm telling you you put the sham in, but I believe it's a sham, and we ought to just stop it. We ought to be responsible. The Governor's trying to do it, we're trying to do it, the Senate's trying to do it. We're saying that, you know, we can no longer afford this stuff and that's probably the reason they're trying to put the sham in, but I think you're heading down a road that will allow people to do the wrong things in this State and I would hope that you would at least table this bill until you can get some other things. Mr. Speaker, on the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. GANTT: It's my intention, fellow legislators, to vote no on this bill. It's not often that I agree with my colleague on the other side of the aisle, but this is where we agree. While school districts may be different in terms of how it gets there, the fact is it still gets there and there's an obligation that's being put on all of us to pay bills. We see across this country people today saying hey, enough is enough already and the taxpayers and the voters are saying that to all of us. It's not just a few, and we ought not let people hide, particularly Big Five people, hide behind the fact that they can go out and do this kind of stuff and give away money all the time. I can tell you that one of the things that I've asked the Comptroller and others to do is to look at the 25/25 -- I mean, 31 NYS ASSEMBLY JUNE 24, 2011

$25,999. What that simply means is I give away a million-dollar contract and I give away a slot to $25,999. The board does not even know what's going on within those school districts. Now, if we don't stop it, nobody else is going to stop it. We have to make sure that people manage money well. You can be poor and manage money and get very wealthy at it. I know some people in this Chamber who have done exactly that. But we're never going to get there. Our districts are never going to get there. Our taxpayers are never going to be happy as long as we continue to push bills out like this that allow other people to sham us. And my suggestion, Mr. Abbate, is that we ought to do exactly that. We ought to pull this bill down, we ought to contact my mayor in particular and my city council to see whether or not they are on, along with the other Big Five. Yonkers is a different story, and I think we all understand why Yonkers is there. So, Peter, thank you very much. Mr. Speaker, I vote in the negative. ACTING SPEAKER P. RIVERA: Mr. Murray. MR. MURRAY: Thank you, Mr. Speaker. Would the sponsor yield, please? ACTING SPEAKER P. RIVERA: Mr. Abbate? MR. ABBATE: Yes. MR. MURRAY: Boy, where to begin with this one. A couple of questions. First, just to clarify, what school years are we talking about? MR. ABBATE: '11-12, '12-13. MR. MURRAY: Okay, so a two-year period. Now how 32 NYS ASSEMBLY JUNE 24, 2011 much over that period? How much are we talking about money wise? MR. ABBATE: What do you mean, "money wise"? For each district? MR. MURRAY: No, no, no, overall, how much are we talking about? We're bonding out. How much would we be bonding out over a two-year period? MR. ABBATE: Nothing. Each district, school district, would decide what they want to bond out. We don't, you know, so there's no -- MR. MURRAY: That's kind of my point. My point is that we have no idea, because we don't know if every school district would participate, we don't know -- I've heard estimates that if every school district did participate, to cover the increases that are projected we would be talking somewhere in the area of a billion dollars, possibly a little bit more. But right now we have absolutely no idea because we have absolutely no idea who would participate. Am I off base? MR. ABBATE: Yeah. MR. MURRAY: How am I off base? MR. ABBATE: I just don't understand it. MR. MURRAY: How am I off base? MR. ABBATE: We don't know, you're saying if everyone does. This is giving a school districts an option if they want to borrow. MR. MURRAY: Right. MR. ABBATE: We're doing legislation to give them the 33 NYS ASSEMBLY JUNE 24, 2011 option, not how much it is going to be, how much they want to do. We want to give them local authority to do it. MR. MURRAY: Right. MR. ABBATE: So, when you come up with numbers -- if no one does it, it costs nothing. MR. MURRAY: You see, I'm kind of thinking in terms of I have to look at the worse case in case everybody does because I and all of my constituents and everyone in this room, everyone in the State of New York is going to be on the hook to pay this bill. So, my point is we have absolutely no idea. MR. ABBATE: Not everyone in the State. Only those localities that opt in to it. Not everyone in the State is going to be -- you know, we can go on, you know. MR. MURRAY: We can, because we don't have an actual number and that's my point. It's a bit irresponsible to do this when we have absolutely no idea of what number we're going to be talking about when we're adding to debt. MR. ABBATE: Okay. MR. MURRAY: So, you know, again -- let me move on from that. Let's move on from that because -- MR. ABBATE: Good idea. MR. MURRAY: -- we've been talking about tax cap and you actually brought up the tax cap issue in your explanation and the Speaker's tax cap bill actually carved out an exemption for anything over 2 percent regarding pensions, correct? 34 NYS ASSEMBLY JUNE 24, 2011

MR. ABBATE: Right, but it's been brought up a number of times, the tax cap. This has nothing to do with the tax cap. Actually, this legislation was proposed before there was even talk of a tax cap. There was talk last year on this and all. We're doing something like this. So, I don't understand the bearing on the tax cap. MR. MURRAY: Once again, you're absolutely right. It has nothing to do with the tax cap because, again, what we're doing here is we're setting up a reserve fund, correct? MR. ABBATE: I don't know if it's a reserve fund; is it? Okay. Staff is saying it can be. MR. MURRAY: It's a reserve fund. 125 percent in the reserve fund to cover any increase over the 8.62 percent. Now follow me here. The 8.62 percent is the baseline right now, so that is not covered under any tax cap that would come in the future because we're only talking about a tax cap on increases, correct? MR. ABBATE: Correct. MR. MURRAY: Okay. The estimated increase from '10-11 to '11-12 is 2.49 percent. So, without an exception for pensions, if it were a hard line 2 percent tax cap we would be talking about .49 percent or half a percentage point, basically, that would be above the tax cap. MR. ABBATE: They would have to include 2 percent of the growth into the cap if it were enacted. MR. MURRAY: But what we're doing now with this bill is we're setting up a reserve fund so anything over the baseline, the 35 NYS ASSEMBLY JUNE 24, 2011

8.62 percent right now, any increase on pensions for those will be paid by the reserve fund, thus bypassing any tax cap whatsoever. MR. ABBATE: No. The repayment would be within the cap. MR. MURRAY: No, the repayment, once we start getting the interest and the bond debt that we have to pay there, that would start a year down the road, but what I'm saying is this first year we would completely bypass any tax cap whatsoever with teacher pensions. MR. ABBATE: I don't think the cap's going to start this year. I don't think the tax cap begins this year, so they're both going to be in line, if enacted, they'll both be at the same time. MR. MURRAY: Okay. Not this year. Let me rephrase it. The first year, because the first year we wouldn't be paying the debt obligation, correct? MR. ABBATE: There will be no tax cap. MR. MURRAY: So, we're getting a pass on the first year. The second year we start kicking in, but that goes into the whole bundle of the 2 percent increase anyway. MR. ABBATE: But that would be the first year of the tax cap. MR. MURRAY: And we're only talking about the debt obligation that we would be paying, not the total increase of pensions, correct? MR. ABBATE: Correct. MR. MURRAY: So, it's a fraction anyway. So, what 36 NYS ASSEMBLY JUNE 24, 2011 we're doing, as my colleagues have said previously, we're kicking the can down the road. We're stretching this thing out to fit this if, if we get a tax cap this will fit to circumvent it. MR. ABBATE: Let's leave the tax cap out for a second. But you're right, it is stretching it out. I agree to that. And if it's done properly, the payoff on time, there is nothing wrong. If it's not done properly -- and we might disagree on it -- but if it's done properly and the people making the decision in that locality think it's going to help them to get over some short-term problems they're having, then it would be a good idea. If it's -- that's all I'm saying. MR. MURRAY: Here's the thing. No, I'm not going to forget about the tax cap because I wouldn't still be standing here if we weren't talking about a tax cap. This has taken forever to put this thing together. We had better come up with a tax cap because close of 80 percent of New Yorkers want a tax cap this year and they want -- MR. ABBATE: I'm not saying not to be for it, I'm just saying it has nothing to do with this. MR. MURRAY: Yes, it does, and I'll tell you why: Because the taxpayers are saying, "Stop kicking the can down the road." They're saying bring costs under control and the way they want us to do it is in the form of a tax cap. What we are doing here with this bill is we are circumventing that, circumventing the will of the taxpayers by saying, "You know what? We're going to amortize it, we're going to stretch it out, we're going to put us further in debt and it's going to cost us 15 years down the road." My grandkids will be paying for it. I mean, come on. 37 NYS ASSEMBLY JUNE 24, 2011

We're doing exactly what the taxpayers don't want us to do. MR. ABBATE: I just don't see it that way. I watched the vote last night. Most of my colleagues, our colleagues in the other House, are big supporters of the tax cap and they voted on this bill. MR. MURRAY: With all due respect to my colleagues in the other House, I'm worried about the people I represent, I'm worried about this House. MR. ABBATE: But some of those represent the same people you represent, so I wouldn't say it's trying to circumvent. I don't think they thought it was circumventing it when they voted on it. MR. MURRAY: With all due respect, it's absolutely circumventing it because it's setting up this reserve fund so we can get around any tax cap that we would put in place anyway, so we're giving them a pass on this. You had mentioned that the school districts had requested this from you, correct? MR. ABBATE: Correct. MR. MURRAY: Okay. Did they request any kind of pension reform? I mean, were they -- I guess my point is they're asking for this because they needed pension relief, but were they asking it to avoid pension reform? Because we've got to reform it. MR. ABBATE: I would assume that the same people at the school board, the Big Five and the other school boards, and I know they have, have put in memorandums in support or opposition to a number of bills and especially on the Tier VI proposal and mandate 38 NYS ASSEMBLY JUNE 24, 2011 relief. So, they're looking for mandate relief. They're looking for relief on pension costs and they're also looking for this. So, they're basically one in the same people looking for different ways to help themselves out down there. MR. MURRAY: Absolutely. MR. ABBATE: They're not different groups, so it's the same people that you're talking about that want the tax cap, who want pension reform, mandate relief, that want this. It's the same people that want all of those. MR. MURRAY: Of course they do because they've backed themselves into a corner right now with a pension system that's been bloated and needs to be reformed desperately. So, what we're doing here is we're not even tackling. You had mentioned Tier VI, you had mentioned some of these things. Why isn't that on the floor? Why aren't we debating that right now? Why aren't we talking about true pension reform before we talk about a bill that's allowing them to circumvent that and kick the can down the road again? MR. ABBATE: Because I think this bill was put out, like I said, over a year ago and we have had time to look at it, staff has worked on it, spoke to people. The Tier VI bill that the Governor put out three weeks ago, we didn't have enough time to look at it and all. Something like this that's been out there and analyzed and studied, got some opinions back and forth and the reason they're saying Tier VI, it just came a little bit too late in Session. It's something you can't do in three weeks. You know, when you're doing a tier system -- and I'm getting off, 39 NYS ASSEMBLY JUNE 24, 2011 but when you're doing a tier system, you know, we can't do it as a budget amendment every year and that's what the tiers are becoming, budget amendments. If we're short money -- but that's another day. MR. MURRAY: You know what? You bring up a funny point, because you say that we can't do it in three weeks and we can't keep doing budget amendments. This is what we've been doing anyway, and we keep putting Band-Aids on bullet wounds instead of fixing the problem. The problem, as my colleague had said earlier, this didn't sneak up on us. This has been building up. We knew what was coming but we're still not even taking steps, we're still not bringing true pension reform to the floor for we date. We're talking about another Band-Aid for the school districts but, unfortunately, this is an extremely expensive Band-Aid to the taxpayers because we're stretching it out over 15 years and the interest we're going to pay on that. Where are we 15 years from now when we're backing doing the same thing because we didn't reform the pension system, asking for more Band-Aids? I shouldn't even say 15, I should say two years from now. MR. ABBATE: As the tier -- on the pension system, that's for another day, and you can't do it. I've got to tell you, I don't put things out here that are done in three weeks. If you look at some of the bills that have come before this House on pension legislation, they're in their second and third and fourth year before they get passed or not passed. Very few things come up on pension legislation or something like this that's really done on a month or three-week basis. It's a little more technical and complicated to get something like that done, or this, 40 NYS ASSEMBLY JUNE 24, 2011 in three weeks. MR. MURRAY: Mr. Abbate, listen, I appreciate it. I know you put a lot of hard work into this. I know this isn't something that you just threw together at the last minute. I know you put a lot of hard work in and I do appreciate and I respect your point of view. We disagree on this because I think this is the wrong approach, but I do thank you. Mr. Speaker, on the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. MURRAY: As I said, I appreciate the hard work and everything you put into it. I know you're standing up for something that you think might help, but I don't think this helps. This is the same exact thing we continue to do. We're kicking the can down the road, we're increasing our debt, we just continue to do this. When does it stop? When do we say enough is enough? And probably the biggest problem I have with this is exactly what we were saying about the taxpayers and not having a referendum on this. This will be a bond issue where we're just ramming it down their throat, like it or not. It's that simple. We're giving the total decision to the school districts on whether or not we are going to take on this debt to relieve the pensions that many believe are a bit out of control right now. So, by circumventing the taxpayers, by circumventing the tax cap, I think we're doing the exact opposite of what we need to be doing here. The taxpayers, as I said before, 70 to 80 percent of New Yorkers say they want a tax cap. The tax cap is relief. What they're 41 NYS ASSEMBLY JUNE 24, 2011 really saying is we just want relief. This is the exact opposite of what they're asking for by adding to the debt. So, for that reason and just a host of others, but mainly for that reason, I'm voting against this bill and I urge my colleagues to do the same thing. Take a stand and say enough is enough. Thank you. ACTING SPEAKER P. RIVERA: Mr. Cahill. MR. CAHILL: Thank you, Mr. Speaker. Will the sponsor yield to a couple of quick questions? ACTING SPEAKER P. RIVERA: Mr. Abbate? MR. ABBATE: Yes. MR. CAHILL: Peter, Mr. Speaker, Peter, this legislation is not a permanent bill, is it? It has a sunset? MR. ABBATE: No. The other one wasn't either. MR. CAHILL: For how long? MR. ABBATE: Well, we're talking two years. The amount that they can borrow, they're going to hit a point where they cannot borrow as much. MR. CAHILL: So, it's a two-year proposal? MR. ABBATE: Yes, two years. But I would say it could probably go to three or, tops, four. I want to be very honest about it. It says two. MR. CAHILL: Peter, is there anything unusual about this particular period of time that would lead us to have to give this extraordinary power to these school districts? MR. ABBATE: Yes. This is the time where we assume 42 NYS ASSEMBLY JUNE 24, 2011 that the pension costs will spike up, so we're trying to get them over that hill. So, once they start going down it will be a lot easier for them. MR. CAHILL: Thank you. Peter, just to clarify a point that was raised by a couple of people in a previous portion of this debate, I'm not in a big city, Big Five or Big Four, in this case, city school district, but are you familiar with the means by which Big Four school districts borrow money? Does it go before the voters? MR. ABBATE: I'm being told it does not. MR. CAHILL: It does not go before the voters. It goes before the city council, correct? MR. ABBATE: Correct. MR. CAHILL: And would this circumstance also require the school districts to go before the city council and seek that approval? MR. ABBATE: Yes, it does. Like I explained to our colleague Mr. -- well, my colleague from Rochester. MR. CAHILL: And it would also be subject to executive mayoral approval, correct? ACTING SPEAKER P. RIVERA: Mr. Gantt why do you rise? MR. GANTT: I rise to make a correction. ACTING SPEAKER P. RIVERA: Mr. Gantt, you can't do that. You have to ask Mr. -- MR. GANTT: That's fine. That's fine. Thank you. I'll do it later. 43 NYS ASSEMBLY JUNE 24, 2011

ACTING SPEAKER P. RIVERA: Continue, Mr. Cahill. MR. CAHILL: Thank you, Mr. Speaker. That was really just a point of clarification on -- I know, and I was not referring to the colleague from Rochester's comments on his school district, I was talking an earlier part in the debate where it was indicated that borrowing always goes before a vote. My understanding was it does in the smaller city school districts but in the big city school districts it does not. That was -- so, we agree on that. Peter, you also indicated that there are spikes occurring in the pension. Why are there spikes occurring in the pension at this point in time? MR. ABBATE: Well, what's happened -- well, that goes to the whole system itself. What's happened over the years, because of the recession we were in and the return on the investments on the market led to circumstances where the percentage paid has gone up and it's based, usually, on a five-year amortization. Hopefully, as we saw last year, the market, and if the market does good, the projections are that it will be going down after that period of time. MR. CAHILL: Thank you, Peter. Mr. Speaker, on the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. CAHILL: This may seem a little bit of a stretch, but I think we can connect this to something we did a lot of over the past couple of days. Many, many of our colleagues have presented before this Body legislation to temporarily increase the sales taxes in their 44 NYS ASSEMBLY JUNE 24, 2011 communities, to temporarily increase the mortgage taxes in their communities, to temporarily increase or maybe in the case of hotel taxes, to permanently increase them. The justification given for those taxes was that there was some budget anomaly that had to be addressed, that there was some circumstance that required attention and fiscal relief for a temporary period of time so that the local government could get their fiscal house in order and everything would be okay in a while. That's the argument that's made. That argument was made almost 20 years ago, in my experience, on some of these taxes and those temporary taxes continue to this day. Something that was put in place to take care of something temporary became something permanent in the government. So, if I were one of these school districts right now that was anticipating a pension problem down the road and a tax cap down the road, maybe what I would do, as quick as I could, is go out there and try to increase my budget as much as I could to cover this cost for the future, or what I would do is go ahead and pierce that cap or come back to this Legislature next year and talk about how it bankrupted us and I need some tool to increase my budget, for all intents and purposes, permanently, permanently to address a temporary problem. And this is a temporary problem. Local governments and school districts got a free ride on the pension for over a decade, just as we did in State government. They didn't contribute. The only entities contributing were the people who were earning that pension. That came to a halt about a decade ago, a short time ago. Pension costs are reflective of experience and that 45 NYS ASSEMBLY JUNE 24, 2011 experience includes a wave of retirements and we are seeing a wave of retirements right now. It's not a fact that we're making up for the purposes of this debate, it's an experience that we're having across this country, and we're seeing a spike, the spike that our colleague mentioned earlier, in the number of people that are retiring at a very high rate of pay. Now, we've put in place since this group retired a number of different pension reforms, a number of new tiers to reduce that exposure, most recently just in the last year or two. So, we have every reason to believe that these pension costs will level out. So, the cost side is spiking upwards. The expense -- the way we pay for it, in addition to the contributions, is that investments are made and we've since seen some pretty shaky ground on the investment front over the past decade, and particularly over the past couple of years. Really great years, really bad years, really bad years, unprecedented bad years. The closest we've seen was the Great Depression. So, the investment side of the equation has seen an anomaly that needs to be addressed. So, we have a choice here today. One of those choices is not ignoring the problem, that pension costs have temporarily spiked literally out of control for some municipalities given the circumstances that we're in in some school districts, given the circumstances that we're in. And we can address it one of two ways: We can give those school districts and local governments a permanent tax increase to pay for it, in which case they'll come back next year and find some other way to spend that money, it will become the new base higher up, or we can give them a temporary tool to patch over this once and for all, get through it and then 46 NYS ASSEMBLY JUNE 24, 2011 get back to normal. Will it cost a few dollars more? Yes, it will. ACTING SPEAKER P. RIVERA: Mr. Hayes, why do you rise? MR. HAYES: Would Mr. Cahill yield for just one question? ACTING SPEAKER P. RIVERA: Mr. Cahill, will you yield? MR. CAHILL: Absolutely. MR. HAYES: Mr. Cahill, are those the only two options we would have to give to school districts either to permanently have a force of increased revenue or this option to temporarily borrow? Are those the only two options? MR. CAHILL: No, Jim, that's certainly not the only two. MR. HAYES: Because you presented it to the House that as if it was an either/or proposition. I'm just wondering, would you include the possibility of streamlining the budget expenditures of the various municipality in that choice we would give them? MR. CAHILL: There's no question about it that that should also be something we should be doing separate and apart -- MR. HAYES: Thank you very much. MR. CAHILL: Separate and apart from this discussion, we should continue the discussion about how we streamline, how we contain costs, how we make our education system, in particular, more affordable. But, we're talking specifically about this unusual cost and 47 NYS ASSEMBLY JUNE 24, 2011 how do we deal with it. And in the case of this unusual cost and in the case of the -- in the Big Four school districts that I was talking about earlier, some of those folks don't really have a lot of room to cut. There's not a lot of places to cut without having a 40- or a 50-student classroom, without abandoning the idea of educating our children all together. So, we have two options: Give them a permanent tool to increase their budgets permanently or give them a temporary tool to overcome this expense. I suggest this is an entirely rational approach, this is in the best interests of the taxpayers because, rest assured, if we don't do it, it's going to be just like those temporary sales taxes that we pass -- temporary. Temporary, my foot. Every two years they'll come back to us because they will not fix that problem. We will have given them a means of -- MR. MOLINARO: Mr. Speaker, would Mr. Cahill yield for a question? ACTING SPEAKER P. RIVERA: Mr. Cahill, will you yield to Mr. Molinaro? MR. CAHILL: Sure. MR. MOLINARO: Has this Legislature approved a sales tax increase this year for any municipality, an increase, or have we approved extensions of existing sales taxes? MR. CAHILL: Well, gee, Mr. Molinaro, I don't know. About a month-and-a-half ago I heard an argument that we were going to be increasing the tax on millionaires because we wouldn't let the millionaire's tax expire. MR. MOLINARO: I'm happy to listen to the rhetoric. 48 NYS ASSEMBLY JUNE 24, 2011

I'm asking you a simple question. MR. CAHILL: I'm not talking about rhetoric either. MR. MOLINARO: I'm just asking a question. MR. CAHILL: I'm talking about apples and apples. I'm answering your question. I'm talking about apples and apples. MR. CANESTRARI: Mr. Speaker, can we remind our colleagues to give each other a chance to answer each other's questions and proceed accordingly? ACTING SPEAKER P. RIVERA: Very well taken, Mr. Canestrari. MR. CAHILL: Thank you, Mr. Speaker. So, if a sales tax expires and this Body is called upon to start it up again at the point of the expiration of that term, I fail to see the distinction between that and the expiration of a tax on millionaires that we want to continue. MR. MOLINARO: Does a single county in New York State have the ability to permanently establish that sales tax increase? MR. CAHILL: I believe they do not. MR. MOLINARO: Right. And why is that? MR. CAHILL: Because the Legislature has chosen to not give them that authority. MR. MOLINARO: Thank you. MR. CAHILL: So, Mr. Speaker, in conclusion, in conclusion, I suggest that we be rational and reasonable and give our school districts a temporary tool to deal with a temporary problem, not a permanent tool to deal with a permanent problem that will come back to 49 NYS ASSEMBLY JUNE 24, 2011 bite us in years to come. I urge colleagues to support this legislation. ACTING SPEAKER P. RIVERA: Mr. Joel Miller. MR. J. MILLER: I love when we compare apples to apples, especially when one apple is an orange and then we pretend it's a grapefruit. I could assure you there is no correlation between the sales tax that we just heard about and this particular thing, and why is that? Because the sales tax in these counties have remained level year after year after year, including that increase. It hasn't been a sudden thing, but, even more importantly, it's not because county governments have been raising their expenses to the point where they can't really afford anything, they're just asking for the tax revenues to at least stay the same. It's totally different. And let me ask Mr. Abbate a question on this. ACTING SPEAKER P. RIVERA: Mr. Abbate, do you yield? MR. ABBATE: Yes. MR. J. MILLER: Is it at all possible that considering that pension costs will be levied against school districts in almost every year because the exceptions that happened to pass probably will not happen again, that they pay a pension cost every year, is it at all possible by adding debt service to what is an annual cost that we are going to do this without raising the cost to the taxpayer? Every year it comes back and now you've got to add debt service on top of it. MR. ABBATE: Right, but the cost -- since we intend it 50 NYS ASSEMBLY JUNE 24, 2011 to spike in the next few years, as the pension costs go down, all right, they might be paying the debt service, but the pension costs have gone down and in that instance, I think that the taxpayer will not get an increase in taxes. MR. J. MILLER: Are you familiar with the reports that come out of Washington at the beginning of the month? They say the economy is improving, everything is getting better, we're getting out of this recession. At the end of the month they say we were wrong on all of those forecasts, unemployment is going up, that the deficit is growing, that the economy is slinging. You've read that on a regular basis. Are we really going to bet everything on a quick and easy increase in our economy when we don't manufacture nearly anything? Everything we buy comes from China. There's unemployed people that are not paying taxes and now we're going to borrow money? So, let me ask you, the money that we're pretending to save -- because unless the price goes up -- but the money you're pretending to save or the burden you're removing from the school districts, where is the rest of that money going to go or are they going to have no money? In other words, they have a budget and they're supposed to pay their pension, but they're not going to pay the pension, the increase in the pension, which will probably be larger next year, they're going to borrow. MR. ABBATE: They're going to borrow to pay a portion of their pension cost over the year, over a period of time. MR. J. MILLER: Right. And then the next year they're 51 NYS ASSEMBLY JUNE 24, 2011 going to have another pension cost. MR. ABBATE: Which, hopefully, in a number of years will be lower. MR. J. MILLER: Hopefully. Hopefully. MR. ABBATE: Well, according to statistics right now, the pension costs, as I said, it was amortized over five years, the projections, the projections are that the costs will be going down. MR. J. MILLER: Are the salaries of the people working in the schools increasing at an inordinate rate? The original projection for school inflation used to be 7.5 percent, total budget. Now it's down to 5 or 6 percent, only four times the CPI. When 85 percent of that budget is salaries, it's impossible that the other 15 percent rose by 30 percent, so it's salaries. If the salaries keep going up and the pension is based on the salaries and no one wants to cut the number of teachers in the school -- and I'll give you an example. In the last ten years, in spite of the fact that we lost 240,000 students in our school system, there are 25,000 more people employed by our school districts around the State, and all of them are earning bigger and bigger salaries and they all come under this pension system. How is the pension cost going to decrease if we're constantly paying more and more money to our staff and increasing the number of people in the staff? MR. ABBATE: Well, the responsibility on the school boards -- and as you've seen through this year, that increases are not coming forth, not only to teachers, but not to State workers over the next several years. 52 NYS ASSEMBLY JUNE 24, 2011

MR. J. MILLER: And how does that fit in with the fact that we are in this particular problem today, in spite of the fact that we knew it was a problem last year, we knew it was a problem the year before and people complain about their school taxes every year, yet, those responsible school board members, what, their heads were in the sand or even worse, somewhere else, and so they continued to do this? I mean, at what point do they stick their head out the window and say it's raining? But I mean, these are people who, "I wanted to go on the school board because my kid didn't get in a play." "I wanted to get on the school board because my kid wasn't allowed on a football team." "I wanted to go on the school board because I don't want them to spend anything." "I was supported by the teachers' union, they gave me everything I needed to run, so I'm -- " this is the responsible board that has failed year after year after year and suddenly, this is the same board that's going to go out and borrow money to pay their current costs and you're calling that getting more responsible ? MR. ABBATE: Well, I wouldn't characterize -- I don't know your local school boards, but I wouldn't like to characterize all the boards throughout the State, and I don't know if your colleagues would say their school boards are made up of people like you just said. You would hope there would be competent people on the school boards throughout the State and they would make a reasonable decision. If they're not and they're in your community, I would hope that the local officials in that community would speak up and say something about them. 53 NYS ASSEMBLY JUNE 24, 2011

MR. J. MILLER: In my district, the teachers' union picks three people to run each year, and as was pointed out before, a very small percentage of people come out to vote and they didn't come out to vote because the budget that would be put in place if they didn't vote was only $3 less, and so they didn't do that. The contingency budget system was a joke. But, it is not just my school that saw that rate of inflation. According to the Commissioner of Education, throughout the State the average cost of school inflation was 7.5 percent. So, don't -- you know, let's not single out my school district. You're going to include 700 school districts in this plan; not just five cities, but 700 school districts where people should have been allowed to vote and in all cases, their school boards were running an inflation rate in education that was three and four times the rate of the CPI and you're telling me only in my district they were irresponsible and in the rest of the State they were responsible? MR. ABBATE: No, you said they were. You brought it up. MR. J. MILLER: No, you did. You did. You said you hoped that that was the experience I had and you said if you ask the people in the rest of the room they would have another story. MR. ABBATE: No, Mr. Miller, you mentioned that you had somebody who ran for the school board because their kid didn't get on a team, someone ran for this reason. I didn't bring them up and I said we hoped they wouldn't. MR. J. MILLER: Yes, but the main issue was they have no capacity to run $170 million, a $70 million or $50 million program 54 NYS ASSEMBLY JUNE 24, 2011 and the proof in the pudding is that the problems that my property taxpayers have are the same problems that the property taxpayers have everywhere in the State, except where the State pays 80 and 90 percent of the taxes. But you're the one who is saying the school boards are responsible and I'm saying to you there is a plethora of evidence to show that they have never been responsible. MR. ABBATE: Mr. Miller, first I want to clarify, I did not, you know, again, say that your school board was incompetent. I was just responding to the three or four examples of people who, I assume you were saying, ran for the school board in your area. You also said that three members are put up by NYSUT to run each year. Now, I'm not that familiar anymore with school board elections in New York City, since that was done away with, but I know when there were school board elections in New York City, and if you had a point of view like I did, there were members that we ran for the school board that, I felt, that I supported that were competent at the time. So, if that's a problem you can run more competent people. MR. J. MILLER: I am not concerned with New York City alone. The 700 school districts that are outside New York City that are run by school boards that I have described have increased the cost of education to an unbelievable extent. On the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. J. MILLER: Mr. Cahill was questioned about whether or not two different types of tax increases or two different types 55 NYS ASSEMBLY JUNE 24, 2011 of expense, one temporary and one permanent, were the really only answers to the problems. I would suggest that now that school teachers' salaries on an annual basis, on an hourly basis, is approaching $50 an hour, more than physicians make in my area, and they don't have to pay for health insurance, they don't have to -- well, a minimal amount for health insurance. Their retirement is covered, whereas other professionals have to really put money aside. Their continuing education is covered. These are people who, as important as they are, are bankrupting this State with salaries that the taxpayers can't afford and pensions that no one can afford. And it seems to me that we've had years to think about this. This didn't just suddenly happen yesterday. And with years to think about it, the only solution we have come up with is to borrow more money. Mr. Abbate said that they have been looking for relief from the pensions, and I will say that the relief they have been looking for is to have the State pick up that cost. You know, we talk about local control, but it's kind of funny. These school boards come up with budgets that they know they cannot afford. They absolutely know they can't afford them. They increase teachers' salary at a rate they know they can't afford and then they turn to the State and say, "Give us the money." Well, that's not truly local control. We don't ask our kids to determine their weekly allowance. And when someone said "responsible," you know, the idea that if you put a kid in a candy shop, that kid is going to eat all the candy they can, whether it's healthy or not. School boards will take advantage. When we had our late budgets, when we had our late 56 NYS ASSEMBLY JUNE 24, 2011 budgets, one year we advanced September's payment to June, making school boards more flush with cash than they had ever been, and a whole bunch of school districts went out and borrowed money and the excuse for borrowing money to get it passed was that, after all, the State budget is late. Well, yes, the State budget was late, but your payment was made early and they still went out and borrowed money. They are not responsible. If they had been responsible we would not be where we are today, and I think this is a very dangerous precedent. The United States pays $500 billion a year in debt service. The estimate is by 2040 the entire budget, if it stays the same, will be debt service. New York State pays $9 billion a year in debt service. Debt service can kill you. Ask the people who use credit cards. The the idea of making it this easy to borrow more money to add that expense to what's already expense is a ludicrous idea, and if we really want to protect the people from people who spend their money, this bill is not the way to do it. Thank you. ACTING SPEAKER P. RIVERA: Mr. Brennan. MR. BRENNAN: On the bill, Mr. Speaker. ACTING SPEAKER P. RIVERA: On the bill. MR. BRENNAN: Let's talk about education for just a moment. In the State budget this year we cut education spending by $1.3 billion, and as we look ahead to next year, the implementation of this property tax cap of 2 percent will conflict with the two-year spike in the employer contribution, the school district employer contribution, related 57 NYS ASSEMBLY JUNE 24, 2011 to the downturn in the stock market which is going up from 8.62 percent to almost 15 percent over the next two years. As a result of that, the property tax cap that we presumably will be enacting shortly will have some portion of pension costs exempt from the cap, but not the entire thing, meaning that the pressure to continue to cut education, to cut the workforce, to lay off teachers, to reduce programs and services for the school children of this State will continue both next year and the following year. And so, in an effort to allow for the smoothing of these pension costs in order to reduce the pressure on school district budgets next year and the following year, we are proposing to enact this piece of legislation. It's a rational and intelligent approach to a very significant problem involving a conflict between the property tax cap and the spike in the pension contribution. This legislation is very limited in its scope. It has a cap of 125 percent of the pension costs for the '12-13 school year. Any school district can take advantage of it or not, and limits that borrowing to this two-year spike. So, I should just mention that over the past several weeks we have authorized with a nearly unanimous vote, several towns that were being hit by court judgments, litigation that resulted in very substantial judgments against some of our municipalities, and I believe the legislation, or those particular bills, were being brought to our House by members of the other side where we were allowing those communities to borrow money to deal with a major spike in their costs that would otherwise harm the services available to the particular people in those towns. And so, we permitted those towns to borrow money. And 58 NYS ASSEMBLY JUNE 24, 2011 similarly, school districts are facing serious financial issues related to the -- ACTING SPEAKER P. RIVERA: Mr. Lopez, why do you rise? MR. V. LOPEZ: Will the speaker yield for one question? MR. BRENNAN: Yes. MR. V. LOPEZ: Jim, many of us have concerns about the 2 percent cap and its impact and it's tied into this bill that people are talking about, the big ugly. But can you explain something to me? If we have difficulty with a 2 percent cap -- and I know this is not related to the cap -- but let's assume we're going to do that bill, because if we don't do it, we can think ahead. How in the world, since most of us feel you can't live within that 2 percent cap and even the teachers' union feels it's an impossible cap. So, now what we're going to be doing, based on this bill, and I understand the concept, I'm not too sure what I'm going to do, but we're going to add a burden, right, an additional burden? So, right now if I'm School District A, I amortize two years and I have to pay it back. The debt service will then be part of, I assume, that 2 percent obligation; is that correct? MR. BRENNAN: I don't know if you're -- the way you're describing the math is correct, but yes, there will -- MR. V. LOPEZ: No, I'm saying, if you borrow money, if I'm School District A, I borrow, you know, up to two years, or I lay out the payment for 15 years, then I have to pay it back, right? I think I do. 59 NYS ASSEMBLY JUNE 24, 2011

MR. BRENNAN: Yes. MR. V. LOPEZ: And then when I pay it back every year, I assume that's part of the 2 percent. So, doesn't that somehow run contrary to our arguments that it's impossible to live within the 2 percent right now -- fuel, teachers' salaries, expenses? So now what the districts will do is borrow up-front, pay the debt service, increase their, I assume -- and I'm not a lawyer, you are -- that that obligation probably takes precedent over any other, so how do we manage that? How do we manage a 10 percent debt payment per year, or 8 percent, and that being part of the additional financial burden, and that lies within that 2 percent, right? MR. BRENNAN: Yes, that's true. But, generally speaking, the amounts of money in debt service that the school district would have to pay are relatively minimal in relation to the savings that they would get from the spike in the pension contribution over the next two years. That's why this legislation is intelligent and rational, because the amounts of money involved are so disproportionate versus the cuts that might have to take place if we didn't do this legislation. MR. V. LOPEZ: But stay with me, because I've heard arguments from people like yourself, and legitimate ones, that it's impossible to live within the 2 percent. It's very difficult. And even the unions that might want this are arguing against the 2 percent cap and they've come to me. So -- but now, even if it's minimal, we're going to add an obligation to that 2 percent cap that everyone feels is impossible to meet. Now, Peter, very smartly -- and he is very intelligent, I mean, 60 NYS ASSEMBLY JUNE 24, 2011 he's from Brooklyn -- said let's not talk about the tax cap because it isn't in place yet, but in an hour it will be, and thinking -- or two hours, God, hopefully -- MR. BRENNAN: Mr. Lopez -- MR. V. LOPEZ: -- we will have a cap and we'll increase, because I know Peter will pass this bill, we will have then in certain communities with their full support, an additional burden that these groups are obligated to for 15 years, I think. So, even if it's nominal, doesn't that hurt? MR. BRENNAN: Mr. Lopez, you are our Housing Chairman and very shortly, presumably, you will be defending the renewal of the rent laws and the affordability component of the rent laws in a piece of legislation which will also include the real property tax cap. MR. V. LOPEZ: Right. MR. BRENNAN: Can I expect that you will be voting in favor of that piece of legislation that you will be defending on the floor shortly? MR. V. LOPEZ: I will be defending the rent regulation piece of it. MR. BRENNAN: Yes, but you'll be voting yes on the property tax cap because it will be included. MR. V. LOPEZ: Well, the issue here is -- that's a good point you make, but you can't trap me. I have a bill that has five or six components to it and so -- and it's very smart that there are five are or six components because I can't vote for -- 61 NYS ASSEMBLY JUNE 24, 2011

ACTING SPEAKER P. RIVERA: Mr. Molinaro, why could you rise? MR. MOLINARO: I love these two speakers very much, but I'm not sure if we've stayed on the reservation or perhaps gone a little bit beyond the topic at hand. ACTING SPEAKER P. RIVERA: I think Mr. Lopez -- MR. MOLINARO: Point of order, Mr. Speaker. Are we beyond the issue at hand? ACTING SPEAKER P. RIVERA: I think Mr. Lopez was bringing it back. MR. BRENNAN: Mr. Speaker, I refuse to yield further to Mr. Lopez. MR. MOLINARO: Time out, time out, Mr. Speaker. Point of order. Are we debating the bill before the House or an issue beyond -- ACTING SPEAKER P. RIVERA: Yes, we're debating the bill before the House. MR. MOLINARO: Really? MR. V. LOPEZ: Yes, we are. MR. MOLINARO: Thank you, Mr. Speaker. MR. V. LOPEZ: Boy, oh, boy. Again, let me say this, touche. From the streets of Brooklyn, what goes around comes around because people better stay within their subject matter because my point is, you know, very much -- with due respect to the other party, maybe I might be more on topic than some of the other people. I don't want to 62 NYS ASSEMBLY JUNE 24, 2011 personalize it. I'm talking about the impact of the 2 percent and us paying increased debt obligations and that will have an impact on a very small, limited number. I think that's very clear. I did it reasonably well and I take exception to that point of order. But, since I'm just, you know, an individual member, I'll move on. I believe this: What you're defending is problematic to the point of the conflict with the limitation of the 2 percent. If someone said to me here that if we did do this, the districts that do that will be allowed the difference, even if it's .3, .4 percent, that it would be in addition to their 2 percent cap, then there would be some reasonable logic behind it. But we're eating that 2 percent, or whatever that figure is, because the bill isn't yet out, but we're eating it away and, hopefully, there's not another bill that comes up that takes another piece of that 2 percent. That's my argument. You know, you have a difference of opinion. I yet can't figure that out. So, if someone later on could help me out. The only subject I was good in wasn't English, but it was math. And that's on the topic, because this is 2 percent, that if we add a burden to the district, and that's an obligation, this is an additional obligation, I believe it has to have an impact on that 2 percent limit. So, if some other time someone could explain that it doesn't, I would appreciate it. ACTING SPEAKER P. RIVERA: Thank you. MR. BRENNAN: Thank you. ACTING SPEAKER P. RIVERA: Mr. Losquadro. MR. LOSQUADRO: Thank you. Maybe we can actually ask the sponsor a question. 63 NYS ASSEMBLY JUNE 24, 2011

Would the sponsor yield? ACTING SPEAKER P. RIVERA: Mr. Abbate. MR. ABBATE: Yes. I was about to leave. MR. LOSQUADRO: Just a quick question. Did any local school board outside of the big districts, did any local school board request this ability? MR. ABBATE: There was some that were inquiring about it, not... MR. LOSQUADRO: Inquiring? MR. ABBATE: Yes. What would it do, how would it work, how would it affect them, you know, but... MR. LOSQUADRO: But none of them actually requested that this be put forward? MR. ABBATE: I've got to tell you, not only on this, but very rarely on any legislation does an individual school, a school district -- the school board -- MR. LOSQUADRO: You answered the question, sir. Thank you. MR. ABBATE: The School Board Association is neutral on it right now. But, very rarely do they come up and -- they should, maybe. MR. LOSQUADRO: Question asked and answered. I actually don't have any other further questions for the sponsor. On the bill. ACTING SPEAKER P. RIVERA: On the bill. 64 NYS ASSEMBLY JUNE 24, 2011

MR. LOSQUADRO: Thank you. We've heard lengthy debate over this and I don't want to repeat too many points because I thought the Band-Aid on the bullet wound analogy was one that was fantastic. One that I thought of was one I've heard in this Chamber many times, which was it's not the fault of the homeowner, it was the banks that lent the money to them in the first place. They shouldn't have been the predatory lenders. Well, we are giving people the ability to borrow, throwing a life preserver to people in a pool that the State created in which they are drowning. I cannot fathom that we are going to continue to go down a road that we know leads to failure. TARP, ARA, monies that were poured into failing efforts that we are going to be on the hook for as a nation, as a state, for decades; numbers that cannot even calculated accurately at this time and when and if we are going to be able to pay off that debt service and how is it going to cripple the future of this country. The fact that we are going to go down that same road and give a local district the ability to borrow and not give them any solution to the actual problem is unfathomable. I urge my colleagues to listen to some of the comments, some of the very rational comments that have been made by members on both sides of the aisle. This is the wrong approach. We need to offer solutions. We don't need to offer short-term -- not fixes, short-term punts, to use a football analogy. Kick it out two years, hope things get better. Well, you know what? I served as a county legislator for seven years, and when we first saw this downturn, all the forecasts said it will be short term, borrow some of that money up-front, use your cash 65 NYS ASSEMBLY JUNE 24, 2011 reserves. We were fortunate. We had strong cash reserves in Suffolk County. We used our cash reserves up-front and said we're going to weather this storm. Well, guess what? It didn't get any better and we are banking on the fact that these forecasts, which have not come to fruition, are somehow now magically going to get better in the short term. It's not going to happen. This is not a solution. We need to put forward real mandate relief and a real ability for schools to manage their own expenses. If we do not do that, we do that at our own peril because we're all taxpayers paying for each of these individual school districts. I strongly urge a no vote. ACTING SPEAKER P. RIVERA: Mr. Spano. MR. SPANO: Thank you, Mr. Speaker. On the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. SPANO: You guys know how much I love getting up. I thought it was important to get up to speak a little bit about how this bill would directly affect the 25 students that attend the Yonkers City School District. You know, this has been a year about making hard choices, and I know that. We stood shoulder to shoulder when we went and we passed the Governor's budget and we made substantive change. We also did a budget that didn't borrow, didn't raise taxes and we made the cuts we needed to make and we did it together. We made rational choices, and I believe that this bill is a rational choice. Let me explain. You know, the Mayor of Yonkers came up to see me, the Superintendent of Schools came up to see me and he said, "Let me tell you what's going 66 NYS ASSEMBLY JUNE 24, 2011 on in Yonkers so you can understand. Loss in Federal aid and State aid, $30 million to the school district. Pension cost spikes, health care costs rising, a growing population." The Yonkers City School District grew this year by 1,500 kids and we, at the State level, did not give one red cent towards those increases. As you know, the cost is about $20,000 per child in the City of Yonkers. So, as a result of everything I just described to you, the City School District is faced with an $80 million problem, an $80 million problem, and I have to tell you what that means to the local property taxpayers -- probably a 25, 30 percent property tax increase if we were to try and just deal with it, or make major cuts to the School District. What does that mean? The cuts or this: We eliminate pre-K, we go to a half-day kindergarten program, we eliminate all after-school programs, every single after-school program is gone. Every sporting event and all sports in the School District are gone. Now this is the City School District where we will look at our children. Most of our children are children of color. Most of our children are in the lower part of the economic range. We will look at our children and say, "Well, you know what? Make ends meet. Make the cuts." And then what do we do? So, the Mayor came to us and his first proposal was this: He said, "I want to do a transitional finance authority which would allow the City of Yonkers to borrow money for operational expenses." Well, we rejected that. We told the Mayor, "Go back to the drawing board. We are not going to allow you to borrow money for today's expenses. We're not going to let you do it." The Comptroller was with us and the rest of the delegation. We rejected it and we told the Mayor to go back 67 NYS ASSEMBLY JUNE 24, 2011 and figure out what you're going to do, with the Superintendent. Now mind you, 700 layoffs, 30 percent of the school district employees, is what we're faced with here. So we asked the City to sharpen their pencil, to figure out a way to redesign how they offer education in our City. They came back with a different proposal. In part, will be this smooth-over, which will mean about $5 million in borrowing for the City School District. But, as a result of this legislation passing, we will restore at least a half-a-day pre-K program. We will go back to a full-day program of kindergarten. We will still lose sports. We will still lose after-school programs and we will still lose 400 City employees. Four hundred people will still get laid off who right now work in the City School District. Now you say let's cut the fat. Last year Yonkers cut 450 positions out of the Yonkers City School District, 450 positions. That's close to 1,000 positions when our enrollment has gone up 1,500. What else do you tell the people of this City? What else can I tell them? Property taxes are going up this year 5 percent. That's $400 for every single homeowner in the City of Yonkers. So, what I'm asking for is a rational approach. I'm asking for a little help. It's not going to solve the problems of the City. What it will do is provide Yonkers with a little bit of a softer landing. They still have a lot of work to do to bring their fiscal house in order, but this $80 million problem will be reduced to us dealing with this $5 million amortization. That's why I'm asking for your help. I know the road is long. I know we have a lot of work to do and I know we will expect our localities to live within their means. I bought into that 100 68 NYS ASSEMBLY JUNE 24, 2011 percent, but they can't do it all now and they can't do it in one year. So, I'm asking for your support on this bill because with this it will at least allow the school district to operate, not exactly where we want to operate. Again, our kids won't have sports and our kids will not have after-school programs, but at least they'll have a full-day pre-K. With your help and your support we can see that happen. That's all I need to say about the bill. I'm just asking that you support it. Thank you. ACTING SPEAKER P. RIVERA: Mr. Montesano. MR. MONTESANO: On the bill, Mr. Speaker. ACTING SPEAKER P. RIVERA: On the bill. MR. MONTESANO: A couple of comments were made as far as giving the school districts the different tools they need to help themselves through these financial crises but, you know, most recently -- and then I'll go back to some of the other stuff -- we heard all the complaining that went on with the recent school budgets, and a lot of the school districts, especially on Long Island, had to make some tough decisions. They incorporated into their budget the reduction of personnel, some changes in curriculum offerings and likewise. Now that the budgets have passed, in the last two weeks in the Nassau and Suffolk newspapers we have the reports that all the superintendents have now gone to their school boards to seek their raises, and in more than several cases these superintendents have now received raises because of the fantastic job they did in the passed budget vote. In my school district, the arrogance of the superintendent 69 NYS ASSEMBLY JUNE 24, 2011 there was to give every teacher a 3.5 percent raise, a 2.9 percent STEP increase, not reduce staff, not reduce any personnel, raise the budget 2.87 percent to a total tax increase of 4 percent. There's nothing that ever goes on in these school districts that persuades them that they have to take affirmative long-step action. Once the crisis passes, they're back to their old routine. I served on a school board, a served as a president and a vice president, I oversaw bonding issues that went out to expand the school district, to expand our buildings. Every time and time again the question of salaries -- the budget in our school district for this year, 87.5 percent of the budget is dedicated to salary and benefits alone. Only the rest of it goes to curriculum and to the students. This is a problem that is ongoing. If the five big school districts need this help -- because they are very large, they have very large enrollments, they're different than the out-of-borough school districts -- then this bill should be just for them and should carve out all of the school districts because you cannot deprive the voters of the referendum on this bond the way this statute does. In the past, a lot has gone on with the pension problem. Most notably is the salaries that are paid, the benefits that are allowed to be added in, the selling of sick time back to the district, unused vacation and everything else that they get to inflate the pension, but most notably it's been the State in past years when times were very good that gave them all a pass to the municipalities and school districts. You don't have to make your contribution this year, the pension fund is doing phenomenal. Don't even send in your payment. Use it for something 70 NYS ASSEMBLY JUNE 24, 2011 else. And we allowed that to go on for several years. You know, there was the boom and now there's the bust and we're stuck with it. But, to allow them to take out loans of the magnitude they're going to have to take out, the cost of the bonding and everything else that goes with it, the 5 percent carrying charge a year, is going to put them in more debt than they're ever going to dig themselves out of, and the taxpayers are going to be continually responsible for it. The school superintendents, if there's one thing they do, they do very well and they're very creative in their expenditures and their budget creations. They can hide things. They can move things from line to line, they give it a different name. And after the budget is passed they just shuffle the shells and reallocate the money. While there are some school districts that are in dire need of help, this is not the way to give it to them. The five large districts very well may need the help. Mr. Spano laid out a dire situation in the Yonkers School District and problems need to be addressed there. So, we should leave this bill just strictly to those large school districts. Also, a lot of these schools incur larger expenses because they far exceed the requirement offerings that they give to the students and their curriculum that's set forth by the State Education Department. They give triple the amount of cost that they need, triple the amount of electives. They hire the extra teachers. They provide for many different programs that are not necessary to give a student the core education needed to go on to college. So, there's a lot of cost trimming they could do in the district. There are a lot of ways to bring down the 71 NYS ASSEMBLY JUNE 24, 2011 pension contribution and that's to stop the padding in the pension and the increase in the salaries. So, as was noted by one of our colleagues before, we should listen to everything that was discussed today. Maybe the sponsor would consider carving out the other school districts or just let this bill be limited to the five big ones that need it, since the other local school districts haven't asked for this. The New York State School Boards has not entered into a position into this and, surprisingly, we haven't heard from NYSUT on this matter and we should just leave it to the Big Five. So, I will be voting in the negative on this and would ask my colleagues to consider doing the same. Thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: Mr. Lavine. MR. LAVINE: Will the sponsor yield? ACTING SPEAKER P. RIVERA: Mr. Abbate? MR. ABBATE: Yes. MR. LAVINE: Peter, in the part of New York that I represent, which is northeast Nassau County -- MR. ABBATE: Is this the question you asked me when you were sitting next to me? MR. LAVINE: This is a little different because I don't want to make it too easy. But, in the district that I represent, which is northeast Nassau County, and I share the North Shore District that my colleague from the 15th District just discussed, which happens to be a magnificent school district. In my district, I have a very interesting mix 72 NYS ASSEMBLY JUNE 24, 2011 because I have some of the wealthiest school districts in the country, including Jericho and Syosset, and I also have districts that struggle to get by, including my own district in Glen Cove where half of our kids are on free or reduced lunch, and Westbury, which has been struggling for years because of the lack of an economic base. So, I have this dichotomy. I have got the very wealthy and the very challenged. You know, for the life of me I can't imagine why any one of the wealthy districts that I represent would ever want to take advantage of this kind of a plan or proposal to amortize the payments for the pensions that are going to come due over the next three years. And am I mistaken? Can you think of any reason why the wealthier districts of the 800 or so that we have in New York would want to get involved in this? MR. ABBATE: No. I think it would be districts who didn't have to borrow wouldn't be borrowing. If they were a wealthy district I don't see the need from them to avail themselves of this option. MR. LAVINE: And obviously, those that are -- MR. ABBATE: The poorer districts, you know, trying to get over for a short period of time and some people call it a quick fix or something, but as my colleague from Yonkers said, it's important to some areas that would really need this for a couple of years. MR. LAVINE: Thank you, Mr. Abbate. On the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. LAVINE: There's no text without context. We didn't get into this predicament in our struggling districts, except for the 73 NYS ASSEMBLY JUNE 24, 2011 fact that we face a grave economic crisis. And if I'm not mistaken, when I was involved in local government in the early 2000's we were overjoyed that we wouldn't have to make as great pension contributions for our employees as we had before the year 2000. So, this was just great. It was, in essence, "Fat City" for us in local government. Now, major changes to the pension contribution plans in New York State occurred in the year 2000. And I have to say that for the free market, the true free market advocates, and many are my colleagues on the other side of the aisle, that they alone were not responsible because this was a bipartisan screw up of monumental proportions. In 2000 we changed the rule that had required those who paid into their pension plans, public employees -- ACTING SPEAKER P. RIVERA: Mr. Miller, why do you rise? MR. J. MILLER: Would Chuck yield for a question? ACTING SPEAKER P. RIVERA: Mr. Lavine? MR. LAVINE: No, I will not. MR. J. MILLER: Thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: That's for you. MR. LAVINE: So, those who had been in the system used to pay. Now, in 2000, a year in which the State made remarkable improvements, remarkable improvements, to PEF public pension plans which were pushed not only by the Republicans, but by the Democrats as well, we ended that at 10 years. So, public employees stopped making their contributions after 10 years. So, everything was fine as long as the economic boom was continuing. And those were the same years in 74 NYS ASSEMBLY JUNE 24, 2011 which we used to hear people say how very important it would be because everyone's 401(k) was skyrocketing, that how important it will be that we change Social Security to a 401(k) plan. That we don't hear too much anymore, and nor should we hear it because economic reality has hit us all very, very, very hard. Now, here's the situation: If this bill will help those districts which are going to be -- those down-and-out districts which are going to have a monstrous, monstrously difficult time complying with the tax cap that we will be imposing at some point in the next -- probably in the next hours -- if this bill will help them to get by the requirement that we have to make enhanced contributions to our pensions over the course of the next few years, then I don't see any problem with it. I don't see any need for hysteria in suggesting that every district in the State of New York is going to take advantage of this; in fact, it will be very, very few. Those who will will need it and they will need our help. And to end my comments, we will soon debate a tax cap bill. It's going to cause profound change to the way New York State has funded its public schools and its municipalities over the course of our history, and I have a real fear. The fear is that those districts that have, those districts that are wealthy, will have no problem whatsoever passing school budgets that are in excess of 2 percent with a 60 percent override, and those that do not have will never come close because those are the districts that have a tough time passing their budgets right now. So, my fear is that the gap between the haves and the have-nots is going to continue to grow, and I would hope that we will each in this room 75 NYS ASSEMBLY JUNE 24, 2011 recognize that the only way that we will be able to temper that expanse from developing into dangerous proportions will be by pledging to make sure that New York State funding is there to help fill the gaps in those districts, to help fill the needs of the disadvantaged districts, and I will be voting for this bill for those reasons. ACTING SPEAKER P. RIVERA: Mr. Fitzpatrick. MR. FITZPATRICK: Thank you, Mr. Speaker. Before I start, I would like to ask that the air conditioning be cranked up because of all this hot air that I'm hearing in defense of this legislation. I say that half in jest, but full in earnest, because when we talk about haves and have-nots in the State of New York with regard to education, the haves are the members of the teachers' unions. The have-nots are the taxpayers. There's one reason why this bill is being pushed today. We hear a lot of noise in this building coming from the other side because all the attention is diverted to a particular issue. And what a great opportunity to ram something like this through that would force taxpayers to pay for a borrowing. You never borrow to pay retirement costs. Never. And, yet, we did two years ago and we're going to do it again today. And we're not going to give the voters, the school districts taxpayers, the opportunity to vote whether they want to be saddled with this debt or not. This bill is being passed because the teachers' union does not want to contribute to the economic well-being of this State and of the districts in which they work. That's why this is happening today. This is an organization that wants unfettered access to every wallet and pocketbook of every taxpayer in this State. It's wrong. It should not be 76 NYS ASSEMBLY JUNE 24, 2011 passed. Our Governor's credibility is at stake if he signs this bill, in my opinion. This should not be happening, and it's happening at the end of the Session. I was going to say "in the dark of night," but it's during the day, at least, thank goodness. But, this is the wrong way to deal with this problem. People expressed concern about increased class sizes and layoffs and things like that. Well, let's give the school districts the tools they need to solve these problems. They asked for Wicks reform. They asked for relief from the Triborough Amendment. They asked for pension reform. Let's give it to them. Then you don't have to worry about those other concerns. And the tax cap, it will work just fine because it's going to force those players to the table to start having a serious discussion about dealing with these very serious structural problems. Borrowing is never the answer. Thank you, Mr. Speaker. I urge a no vote. Thank you. ACTING SPEAKER P. RIVERA: Mr. Abinanti. MR. ABINANTI: Thank you, Mr. Speaker. I, too, represent the City of Yonkers and I have had an opportunity to observe what is happening to that school district and I share Mr. Spano's concerns. We must remember that the purpose of school districts and the purpose of schools is to educate kids. Kids go through the school system only once. It's not fair, it's not right and it's immoral to say to any generation of kids, "You're not going to get as educated as well as any of the others or any of those in the future because for whatever reason, the money is not available today." And I agree that bonding costs like this 77 NYS ASSEMBLY JUNE 24, 2011 are a terrible way to solve the problem, but I'm more concerned about the kids who are in those classrooms today and making sure that they get the basic, sound education that they're supposed to have, and it's the obligation of this Legislature to make sure they get it. And if we're going to cut the monies out of the budget and not give them the monies they deserve, then we have got to at least let the local school districts have the flexibility to do what's necessary to give those kids the education they have to have. I am surprised to hear so many of my colleagues who all talk about let's give the local government the options, let's give them the flexibility. But here we are saying we don't want to give them the options. We don't want to give them the flexibility. We created this problem and now we don't want to give them the tools to get out of it. It is our Comptroller that is assessing the costs on these school districts. We are cutting the monies to these school districts. We are constantly putting mandates on these school districts. That's the fact. This is where we are today. We have got to find a way to let them get by this problem. And if you take a look at what's going on in the economy today, that's what's special, that's what's unique. This is not about whether we like our local school districts, whether we think the people who are running those school districts are stupid or if we have had past experiences with them. This is about the kids that are there today and giving the local governments, the local school districts, the options to get out of this mess. There's one other thing. There's a misimpression out here, and that is when we talk about the pension increases being very 78 NYS ASSEMBLY JUNE 24, 2011 small, we go from, what was it, 8 to 11 or something, like it's a 3 percent increase. That's not a 3 percent increase, that's 3 over 8. You've got to look at the actual numbers. Those are very significant increases to budgets that are not geared to take these heavy increases at this time. So, we have got to give them an opportunity to get by this very bad time so that in the future we can deal with the structural problems. I'm speaking in favor of this, Mr. Speaker, and I urge all of my colleagues to pass this to help our local school districts to get by. And by the way, it's not just the City of Yonkers and the big school districts. I have got some numbers here from one of my wealthier school districts where they're talking about very significant increases because of the mandated costs that they have, the structural costs. I have a school district with a $50 million budget, $56 million. This year, pension, health insurance, unemployment and contract obligations totaled $2.1 million. It's not the same big problem that Yonkers has, but it's a wealthy school district and a small school district. They had to cut and they came out with a 1.2 percent increase in their budget. To get to that they had to cut out some $2 million, which came out of education, the types of things that you would use every day to teach kids. So, these fixed costs are hurting not just the City of Yonkers, but they're also hurting the small school districts in the nearby communities. So, I urge that we pass this temporary measure and give them a chance, give them some breathing room until, hopefully, we get to better times. Thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: Mr. Hanna. 79 NYS ASSEMBLY JUNE 24, 2011

MR. HANNA: On the bill, Mr. Speaker. ACTING SPEAKER P. RIVERA: On the bill. MR. HANNA: Thank you. One of my colleagues from Yonkers painted a little while ago a very grim picture of what's going on in Yonkers with their school budget there, and he listed a whole series of remedial steps that had to be taken to try to bring the numbers in order, after-school sports going away, pre-K being eliminated, kindergarten going to half-days and so on and so forth. But in that entire list, one thing that was noticeably absent was any reference to concessions by the teachers or the teachers' unions. Didn't even mention it. As was alluded to earlier, the overwhelming majority, in some cases 87 percent, of school budgets are comprised of teacher salaries and teachers' pensions costs. You cannot bring the numbers in line unless and until you get those costs under control and, to date, the Majority in this House has been unwilling or unable to stand up to the teachers' union and say, "Look, you have to come to the table. You have got to be part of the solution." Mr. Abinanti expressed great concerns for the kids in the districts. We cannot serve the children in our school districts and we cannot serve the taxpayers as long as we continue to yield without exception and without reservation to every demand advanced by the school teachers' unions. Those are the costs that have to be brought under control. And this bill, if and when it's passed, will only delay the day of reckoning. It is going to push it down the road. It is going to allow school districts to continue to ply teachers and teachers' unions with more and more benefits, with more and more costs at the peril of our 80 NYS ASSEMBLY JUNE 24, 2011 kids and at the peril of our taxpayers. This is not something that should go forward. It's something that we really need to defeat this afternoon because if we keep going down this road, there will be no turning back. Thank you. ACTING SPEAKER P. RIVERA: Mr. Joel Miller. MR. J. MILLER: Let me tell you, if we really didn't bring these stupid bills to the House, I wouldn't have anything to say. (Laughter) One of my colleagues talked about the children, the children, the children. It's not stupid school boards. We have to worry about the children. When, if ever, have you heard the teachers' union threaten to strike over overcrowding in a school? When did you ever see them threaten to strike over bad textbooks? When did you ever see them threaten to strike over no technology? When did you ever see them threaten to strike over violence? The only thing they're willing to strike over is their salary, and it has nothing to do with the kids. And built into their contracts are contact minutes. I cannot be forced to be with a child more than so many minutes a week. And when we have teachers, really good teachers who, in fact, are worried about the kids and they have offered tutoring during the day, the teachers' union quickly puts a kibosh on it unless they're being paid. No, the teachers' union has no consideration for the kids. They worry about themselves. In fact, we had a group of kids getting on the elevator during the budget, and they wore signs saying, "support education" and I asked them, they were high school kids, and I said, "Where do you think the money is going to go if 81 NYS ASSEMBLY JUNE 24, 2011 we give you more money?" And they said, "To the teachers, and we're not supporting that either." Two-hour delays if there's a snowflake in Dutchess County, but don't you dare bring your kid to school, even though there's nothing in our contract that says we don't have to take them in, but don't you dare. That's an agreement we have that's not in the contract, sort of our off-budget budgets. No, the school districts don't care about the kids. The City of Beacon, which is a small school district, just hired a temporary superintendent at $700 a day. Yeah, they're fiscally responsible. The Wappingers School District in their contract was supposed to give school teachers up to an 8.5 percent annual pay raise this year. That's being fiscally responsible. The Arlington School District gave a 6.7 percent increase in pay to their teachers at the very worst of this economic downtown. Yeah, that's fiscally responsible. I have schools who now have placed the second artificial turf field on the football field only five years after they did it before. Yeah, that's being really responsible. Maybe the most important thing is for the kids to be on the artificial turf because they're certainly not putting their effort into teaching. $10,000 for a magic board. Oh, it's fun. Education wasn't supposed to be fun. Do you ever remember sitting around and being entertained and laughing all day while you were in school? No. You were in school. That was your job. Your job was to learn and you did it. Now the teachers want it to be entertaining and they have all kinds of things so they can sit in the room. That $10,000 magic board was designed by someone who learned on a blackboard. That person learned. 82 NYS ASSEMBLY JUNE 24, 2011

So, when I hear this stuff about, oh, we have to help these school districts because we care about the kids, no. The people who are taking the money only want the money. Now, I feel badly for the five major city school districts and I, too, believe that this bill should have been crafted to provide that kind of assistance to them. But, I will tell you and you just heard a member of a school board tell you that school boards are not that competent. They don't really care and they make major mistakes. So, I've put my hip boots on. I brought my shovel. I'm trying to clean this stuff away from my desk, but let's not pretend that's what we're doing is going to help the kids one iota. And I will tell you it's not just the poor districts that are suffering, but the wealthier districts have had it up to their eyebrows. They don't want to pay any more. And the only other comment I want to make is when these localities were given the gift of not having to pay for the pension plan, why is it that those taxes didn't go down? In fact, they started going up and going up. So, you know, it's kind of interesting. It's sort of like the gas station. The price goes up immediately and almost never does the price come down at the same rate. But, yes, that's really good that we had this gift but the taxpayer did not get a gift in return. It just gave those localities more money to spend. Thank you. I will be voting in the negative and, frankly, if there ever was a bad choice, this certainly is one. Thank you. ACTING SPEAKER P. RIVERA: Mr. Gantt. MR. GANTT: Thank you very, very much, Mr. 83 NYS ASSEMBLY JUNE 24, 2011

Speaker. Will Mr. Abbate yield for just a couple of questions? ACTING SPEAKER P. RIVERA: Mr. Abbate? MR. ABBATE: Yes. MR. GANTT: He and I both should be home by now. Mr. Abbate, can you tell me how long that you have had this bill? MR. ABBATE: A version of this was put in last year and we have had this from the beginning of this Session. MR. GANTT: Can you tell me how many of those Big Five school districts can use the resources of this bill? MR. ABBATE: How many can use the resources of this bill? MR. GANTT: Of the Big Five. MR. ABBATE: All of them could partake of it except New York City. MR. GANTT: Except for New York City. Can you tell me how many of those Big Four then asked for this bill? MR. ABBATE: The representatives from their association had asked for this bill. So, I would assume that each of the four of them had their representative come, and there was nothing negative from the one that's excluded, New York City. MR. GANTT: Right, but you said the representative of that -- MR. ABBATE: Which, I assume, were probably employees of -- MR. GANTT: The Big Five association? 84 NYS ASSEMBLY JUNE 24, 2011

MR. ABBATE: Yes, which I assume were probably their employees. MR. GANTT: Do you know whether or not my school district was in support of this bill? MR. ABBATE: I do not know if they are or not. MR. GANTT: Do you know whether or not my mayor is in support of this bill? MR. ABBATE: I do not know if he was or was not. I was trying to reach him during the last hour-and-a-half. MR. GANTT: Or the city council? MR. ABBATE: No. But, remember again, Mr. Gantt, that if the school board wants it, the city council and the mayor would have to give their approval. So, they're not excluded. MR. GANTT: Okay. I'm glad you made that comment. The fact is that's probably true. But, I can also tell you just a couple of years ago the city school district sent a budget over the city council, the city council said, "We disagree with that and we think you need to make some cuts." They sent it back to the school district. The school district sent it back as was and is. They have no power over the school district. What you're telling me is my school district didn't ask for it, my mayor didn't ask for it, my city council didn't ask for it and I know most of those people who sit there. But, yet, and I -- MR. ABBATE: Excuse me. I'm not saying they didn't ask for it. I would assume they probably told their representatives they were for it or their representatives shouldn't have been up here saying -- 85 NYS ASSEMBLY JUNE 24, 2011

MR. GANTT: But you don't know that. MR. ABBATE: I would assume they did. I mean, they work for them. MR. GANTT: Well, I assume they didn't since I know most of the school board members and I know most of the city council and I know the mayor, and I never heard of this before. So, I would like to know where this is coming from and when, in fact, it came aboard. Now, I don't have a problem with -- if Yonkers has a problem then I think we should be dealing with a bill that's simply deals with Yonkers. We should not put everybody else in jeopardy, given attitudes of school boards across the State, and teachers' unions, by the way, okay? So, let me see what other questions I have for you. We have heard -- I'm fine, Peter. On the bill, Mr. Speaker. ACTING SPEAKER P. RIVERA: On the bill. MR. GANTT: We have heard across this Chamber about how it is that all these school districts are in trouble, including, but not limited to Rochester. And it would seem to me at least in my household if I have a problem in my budget that I have to make cuts. That's not to say that I agree with the Republican strategy of always cutting everything. I either have to make cuts or I have to raise some revenue somewhere so that we make that even. But, I can tell you that in my school district just this week, earlier this week or late last week, rather than do what was appropriate, we ended up giving a raise. Now we're saying to those same people -- and by the way, they said they were 86 NYS ASSEMBLY JUNE 24, 2011

$80 million in debt. They said they had an $80 million hole in their budget. Now, you tell me how the hell you give out a raise when you've got an $80 million hole. If you've got an $80 hole in your budget at home you have to make some cuts or you've got to go generate some revenues. Well, the Governor cut, we cut, the Senate cut those budgets and, yet, we could give those kind of raises. It's not fair to the kids. I hear this thing about kids. It's never about kids. If you believe it's about kids, simply go to those schools, particularly in those Big Four cities. Now, I can talk specifically about Rochester. I can tell you that we talk about lead and what we ought to be doing. I did, through the Speaker, an IT program in one of our local schools. We paid $30,000 to put the computers in. I had an opportunity to go over there to talk about the reconstruction of some of those buildings, and the principal said, "David, come. I would like for you to see that which we've done with the $30,000 that you gave us." When I walked into the classroom -- now you hear me. This is a school that should be much better than any of us, and I live in the inner city myself, not far from that school. But the fact is that there were gobs of lead hanging off the wall. So, it ain't about kids, yet, everybody else in that school district was getting raises. This is a bill -- except for the fact that Yonkers needs help, and that's the only help we should be giving in this Chamber, if they need it, is to Yonkers. I'm willing to do that. But, as far as I'm concerned, the other districts, unless they ask for it, should not be on this floor by anyone. I do not believe that those districts voted for this bill to be here, okay? I know particularly that my school districts didn't vote for 87 NYS ASSEMBLY JUNE 24, 2011 this to be here. I don't know whether Yonkers voted for it to be here or not, but my colleagues from Yonkers said they needed help. I'm willing to help them, but I don't need them to be giving me help that I don't need, and I don't think I need it. If we needed it I'm sure the mayor would say to me, "David, we've got to have this stuff". If you give this opportunity up to those who sit on those school boards, we all will be here next year or the year after or the year after that talking about how sorry it is. At some stage, we have to start to make sure that we do the right thing on behalf of kids, and that's not necessarily giving up that which the teachers' union wants. Over 90 percent of the people who teach in my schools do not live in my city, live nowhere near my city, pay no taxes in my city but, yet, this bill would give them -- at least the school board the opportunity to tax me and my city. I say it's wrong. I say Yonkers and those from Westchester, if they support it, need the help, let's give them the help, but for God's sake, I'm voting no and I would ask all of my colleagues to vote no. Thank you and God bless. ACTING SPEAKER P. RIVERA: Ms. Calhoun. MS. CALHOUN: Thank you very much, Mr. Speaker. I would just like to speak on the bill. ACTING SPEAKER P. RIVERA: On the bill. MS. CALHOUN: I think one of the major problems I see here is we talk about transparency but, yet, this specific bill takes out of the hands of the people the opportunity to make the decision on 88 NYS ASSEMBLY JUNE 24, 2011 whether they want to do this and extend their taxes out for years. When you're bonding something, you have to bond it with a vote of the electorate in the school district and I just think it's wrong to do that. I think also the fact is that we are really just taking an expense of today and doing what we do so well, which is pushing it off to the future. So, I think that many of the reasons here -- this is a bill that can certainly extend and allow school districts to appear to be staying within a certain limit, but in reality those costs are just there. This is like yearly refinancing your home and extending your mortgage out further and thinking that you really accomplished something and you don't owe the money. So, I will be voting in the negative, and I think the major thing here is that we are not giving the people of that district the opportunity, as we should, to be able to vote upon this decision within their district. Thank you very much. ACTING SPEAKER P. RIVERA: Mr. Peter Lopez. MR. P. LOPEZ: On the bill, Mr. Speaker. ACTING SPEAKER P. RIVERA: On the bill. MR. P. LOPEZ: I have listened to this discussion with keen interest and I have to say that timing is everything. For all of us in this Chamber, we have seen this coming. This is not new news, and all of us here have had every opportunity to come forward with recommendations that can promote quality, affordable education, which is what we want for all of our communities -- quality, affordable education. And moreover, what we're looking for are things that are 89 NYS ASSEMBLY JUNE 24, 2011 consensus based, things that bring people together. Rather than polarization, rather than teachers versus administrators versus business people versus farmers versus parents, we collectively should be engaged in a constructive dialogue that puts forth a series of recommendations that work in the best interests of all involved in education. To date, this Body has not. And it's not from a lack of education in our own right or a lack of ability. It's not from a lack of good will, but it is from a lack of concerted attention to a very serious matter. Now, I have to share with you, a year ago last fall I began a series of tasks forces in my district. I started with public hearings and I said to my community, "Come and tell me, what is it we could or should do that promotes the twin goals of quality, affordable education?" We had a great turnout. From there I established three tasks forces, and each of the tasks forces have met once at this point. My district is expansive, so Southern Tier, Mid-Hudson, Northern Catskills. Cross-sectioned. We have begun an inventory of critical recommendations that can meet those twin goals that have been unanimously embraced by these disparate interests. Why aren't we doing that here? So, back to the issue of timing. Now, is this bill the end of the world? It's not. To be honest, it's a refinancing. It's an attempt to avoid lump-sum costs, but the way it's being presented, whether it's a real impact or a perception, is caught in the midst of an end-of-Session charge without full vetting of the issue, with keen interests and eyes watching, many of whom are rather crispy at this point -- and I can say it's both 90 NYS ASSEMBLY JUNE 24, 2011 inside the Chamber and outside the Chamber -- questioning the logic and timing of this bill. Most recently, we have memos in opposition from Unshackle Upstate. We have a memo in opposition from the Realtors Association. We have a memo in opposition from the National Federation of Independent Business. And, again, it begs the question, if we want to present and provide tools why aren't we doing in full view with full public discussion? I'll just share one example. From our task forces, we had a recommendation that instead of consolidating schools of 1,000 or less, as was recommended in the Suozzi report, a recommendation totally impracticable in rural areas where the prospect of taking kids on a bus and transporting them not just one hour but now two hours to a consolidated school district is impracticable, how about looking at ways of consolidating services? How about consolidating administrative services? And to be honest, that was a recommendation that resonated with everyone. So, I put a bill in. Now, Ms. Russell was gracious enough to help me work with that bill. We have a bill that was sponsored in the Senate by John Bonacic and it passed. So, we have a bill that was live on the floor that would allow school superintendents and business managers and special needs administrators and other administrative officials in large and small rural school districts to consolidate with each other with or without BOCES. Conservatively, by my estimation, small rural districts could save as much as 5 percent, just between two school districts, could save 5 percent on the annual tax roll in one year without 91 NYS ASSEMBLY JUNE 24, 2011 hurting students, without hurting programs, without hurting educational opportunities. To me, that's illustrative of what this Body can do if we put our collective hearts and minds to the challenge. So, I say to you: This bill, is it the end of the world? It's not. But, it's the wrong message at the wrong time and it shows that we have much more work to do as a Body to tackle this issue intelligently, and the issue of quality, affordable education for all our children. I will be in opposition to this bill and I encourage this Body to put our heads together. We are smarter than this. We can do more than this. We are much more capable. Let's put our collective hearts and minds together and come up with a real package that resonates with all interests on this issue. Again, Mr. Speaker, I will be voting in the negative. Thank you. ACTING SPEAKER P. RIVERA: Mr. Katz. MR. KATZ: Thank you, Mr. Speaker. On the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. KATZ: Just to give you one quick example. First of all, I thoroughly agree with Mr. Gantt and I appreciate what he had said about, you know, targeting relief at this point. In my own school district -- and I will make this brief. In my own school district, in Yorktown, I spoke to the school board. There's a $3 million deficit this year. I asked him,"Why is there a $3 million deficit?" The answer was, "Well, last year we got the stimulus money." And I said, "So, you didn't 92 NYS ASSEMBLY JUNE 24, 2011 account for that, that you're not going to get it this year?" I had no answer. So, I would worry about that being carried over on a Statewide level. I don't think that my school district and their level of irresponsibility is unique to the State of New York. And I also do agree that the fact that there's been no talk whatsoever of contribution by the teachers in terms of their pensions on the part of this Body is almost unconscionable. Yesterday we passed a bill for Westchester that is, in effect, going to cost about $96 million and it's strictly for the pensions, to cover the cost of the teacher pensions, and that, in effect, as a businessman, is basically paying for your mortgage with a credit card. I don't think anybody here -- when you start doing that, you know that you're headed down the really wrong road. And that's what I saw yesterday and I'm afraid that's what we're about to see on a Statewide level. At this point I also want to question this two-year spike. I mean, I don't see that as being anything realistic, in the best of all worlds, because the fact remains that for the next 15 years we are going to be saddled with the same pension requirements of the teachers that are going to be retiring, and it's going to be more than just a spike over the next two years. So, on that level, I'll tell you, yes. I grew up in Jericho. We're talking about some great school districts. When I was in Jericho we dealt with an austerity budget, okay, because we didn't want to gold plate it. I grew up where there were 30 to 35 students in my class with one teacher, and you know what? We did pretty damn well. There's a lot 93 NYS ASSEMBLY JUNE 24, 2011 more to it, and I know we don't like to talk about this, than just strict numbers. Thirty to 35 in the class and Jericho is one of the finest school districts in the State, if not the country, just to keep things on a real level. So, I feel at this point that we are looking at a bill that, on a Statewide level, is not responsible. It is kicking the can down the road, and I feel that at this point the best thing we could do is to reconsider. I know that Sandy Galef and I went -- in talking with what Mr. Lopez had said -- we had gone to a meeting talking about consolidation of services in Putnam County and it was staggering what the savings was going to be. Now, I'm not sure whether we need Statewide legislation for that or not, that I can't answer. But, I know that this something that is being actively talked about within Putnam County. I don't see why that can't be done on a Statewide level. Thank you very much. ACTING SPEAKER P. RIVERA: Mr. McLaughlin. MR. MCLAUGHLIN: Mr. Speaker, on the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. MCLAUGHLIN: A long discussion, I'll keep it pretty brief, but I heard a lot back and forth on this one. To me, I agree with Mr. Gantt. And Mr. Katz stole my line about putting your mortgage on a credit card, and that's what this is. It kicks the can down the road, but there's no more road. It kicks it right off the cliff. You're mortgaging a bonus. You're mortgaging a pension requirement. It strikes me as absurd to do that. I wouldn't put my mortgage on a credit card. I don't put gas on a credit card. I just don't do that. It just doesn't make any 94 NYS ASSEMBLY JUNE 24, 2011 sense to do. We've heard about how they're in trouble. Well, of course they're in trouble. They spent like drunken sailors for 30 years and we have allowed it. It happened here and in the Senate and the Governor's mansion. Horrible leadership all around, allowing this to go on. To let them get away with not funding their pensions because times were good, that was stupid. That was really stupid. We all know it in hindsight. We should have known it then. If I had been here then, I have would been screaming about it then. That makes no sense. When times are good, that's when you save more money so that you can get through the bad times. So, of course they're in trouble. We've heard that this is something new. It's not new. It's been tried in Albany all the time. We finance things, we bond things out. We put debt on to the future. It's tried in Washington. It's been tried in Greece, and how's that working out? The place is about to blow up, and Italy's next. Europe is going to be in flames by the end of this summer because of debt, out-of-control spending and never having the guts to say no. At some point you have to take the pain. At some point you have to control your spending, and the time is now. It doesn't make any sense to me to do this. We say that's immoral to say, "How can we take things away from our kids?" Yes, I understand that. Nobody wants to do that. It's also immoral to hand them a bill on the day they graduate and say, "Here, you're just paying for your teachers' pensions, the ones that you got all along here. And by the way, you have to pay for their pensions now and now and now." It keeps building up. This is a Ponzi scheme. It's a shell game. If there's any bill that should go down this year it's this one, and to bring it out now at the 95 NYS ASSEMBLY JUNE 24, 2011 end of Session is ridiculous. It's been here the whole time. If it's such an urgent problem we should have been debating it months ago, but here we are now at the 11th hour. It shouldn't be happening. It shouldn't be happening at all. Don't finance pension costs. At some point you've got to take the pain. We are abdicating our responsibilities to the public by letting them do this. Let me give you an example of what the Troy School District just did. They fired their superintendent this week. Now, why would you fire somebody if his contract doesn't end until 2013? They fired him because he was doing a lousy job. So, what are they going to do? They're going to pay him out to the end of the contract. Fine. I understand that. They're going to pay him for the vacation he's accrued and the vacation he's going to accrue. That's fine, too. Here's where it gets stupid: They're paying for lifetime health benefits for this guy and his family. He's already got a job in Georgia. He's gone. He starts some time in the middle of July, but we pay for it. The people of New York, the City of Troy. We pay for that. That's the school board that did that. So, I don't trust a lot of the decisions they make. It irritates the heck out of me. I will be voting no on this, and the only reason it's a no is because there's not a "hell no" button on this thing. This makes no sense. Thank you. ACTING SPEAKER P. RIVERA: Ms. Peoples-Stokes. MRS. PEOPLES-STOKES: Thank you, Mr. Speaker, very quickly. If I'm correct, when I heard Mr. Abbate when he responded 96 NYS ASSEMBLY JUNE 24, 2011 to Member Gantt's question as to whether or not the school boards as well as the mayors and the city councils will have to approve this decision to further go into debt. I think I'm right about that. MR. ABBATE: Yes. That the school board, if it wanted to partake, you know, in Buffalo, which I'm sure you're talking about, would have to get the city council and the mayor's approval. MRS. PEOPLES-STOKES: Thank you. Well, you what? I was inclined to vote no on this bill because I do think it's a mistake to further get debt, particularly in a State where we're not doing the best at educating our children as it is, even though we spend the most money. But given that the school board, whom I don't have the utmost confidence in, and the city council would have to approve this, I already know that this will not happen in Buffalo. The parents have been so strongly organized in the City of Buffalo because the focus is not on their children, it's always on something else. The city council members have been holding hearings. They have threatened to withhold city contributions to the school district if we cannot get better results out of the district. So, I'm almost confident that even if this bill passes, it would take almost a revolt in the City of Buffalo to engage in any further debt educating children that are not being educated right now. I assure you that the parents will not stand for this. I'm sure the city council would not stand for it, and I'm really confident that the school board would not, as well. So, in that regard, even though I don't like it and I don't think most people will respect it or want to use it even though it will be 97 NYS ASSEMBLY JUNE 24, 2011 their option, I think exactly who it's designed for, Yonkers, they will use it and probably no one else will. In that regard, I will be voting for this bill. ACTING SPEAKER P. RIVERA: Read the last section. THE CLERK: This act shall take immediately. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Can we have some attention here and some order? Ms. Millman to explain her -- I'm sorry. Ms. Nolan to explain her vote. MS. NOLAN: Thank you, Mr. Speaker, my colleagues. As people come into the Chamber to vote on this, I really want to urge my colleagues to vote yes. And I do cast my vote very strongly yes. I want to commend the sponsor for being available for so many hours to answer questions. I'm not nostalgic for a past that never was in education. I am open to options to let people manage debt in a more effective way. I am not going to bash teachers because we could bash members of the Legislature, couldn't we, for things that we do, but we like to think that the bulk of us are responsible professionals. People pay a lot of money to get an education degree and teach today. They deserve a decent salary. I am shocked to hear colleagues act like pensions are a luxury when pensions are an important part of the American Dream for our New Yorkers. So, I proudly cast my vote in the affirmative and urge my 98 NYS ASSEMBLY JUNE 24, 2011 colleagues to do the same on something that, ultimately, is only a technical fix that will allow school districts to have a variety of options. I cast my vote, again, in the affirmative and urge my colleagues to do the same. ACTING SPEAKER P. RIVERA: Mr. Hayes to explain his vote. MR. HAYES: Thank you, Mr. Speaker, to explain my vote. I don't rise to bash any teachers. I don't rise to bash any school board members who serve in their capacity as elected officials in their communities. I don't rise to do anything else but point out to the members of this Body that every nickel that's paid in an interest payment on a long-term bond is a nickel taken away from educating a child, paying a teacher's salary, putting desks and books and computers in schools, and it's the wrong way to fund education in this State. By taking this approach and passing this bill creating a precedent that removes the approval by a vote from the people who are going to take and pay this bill is undermining public education and taxpayer support for public education in this State. It's the first step on a slippery slope of creating a situation where the local taxpayer is taken out of the equation. It is the first time, to my knowledge, that we are now taking a budget that must be approved by local voters every year and saying, "This part of the budget does not have to be approved." It's the first time we have allowed school districts to borrow money where they don't have to get voter approval. And when you worry about the low participation rate of the public in school board votes on school board voting day, this is going to add to that 99 NYS ASSEMBLY JUNE 24, 2011 cynicism, this is going to add to that apathy, and I maintain and I argue we need to do more to encourage people to be involved in our school system and encourage the people who pay the bills to be involved and to support public education in this State. And don't just listen to my criticism, listen to the criticism that was voiced in this Chamber by members of both sides of the aisle, from suburban wealthy districts, as well as urban poor districts, and when you listen to your colleagues I hope you will join me -- ACTING SPEAKER P. RIVERA: Mr. Hayes, how do you vote? MR. HAYES: -- in voting no. Thank you very much. ACTING SPEAKER P. RIVERA: Mr. Goodell to explain his vote. MR. GOODELL: Thank you, Mr. Speaker. I share the sponsor's desire to give options to local governments, and that's one reason why I have supported the authorizations on sales tax to local governments, not because I like it, but I think they're in the best situation to make that decision. The concern I have with this bill is I'm not sure this is the right area to give that local option because we all know that debt is the drug of choice of politicians, because we can incur debt and spend money without taking immediate responsibility. Because of that, our system, our Constitution, our State Constitution is designed to protect our taxpayers from debt. It requires taxpayer approval. This would not. Normally, debt is reserved to capital expenses. This is not a capital expense, it's an operating expense. And when you use debt to pay for 100 NYS ASSEMBLY JUNE 24, 2011 operating expenses, what happens is next year you have to pay the pension costs that you incur the next year plus the debt payment that you incurred to pay last year's. So, all we're doing is raising the cost to our school districts in the outgoing years. Finally, this bill is not a solution. We have talked since the last campaign about the need for pension reform, but that's all it's been is talk. We should keep debt as low as possible. We should not use debt without voter approval. We should not use debt to pay for operating expenses, and we should fix the problem by dealing with pension reform and a cost structure, not kick these costs down so that they burden others. I vote in the negative. Thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: Mr. Benedetto to explain his vote. MR. BENEDETTO: Thank you, Mr. Speaker, to explain my vote. I applaud my colleagues in this Chamber on both sides of the aisle who are voicing what I would consider legitimate opposition to this bill. However, I must take issue with those who have used the excuse of this bill to attack the teachers in this State. A former teacher myself for 35 years, I'm very proud of the work I did in the New York City Public School system and I'm very proud of my colleagues in that system whose dedication I saw day in and day out, doing the job, trying to educate the children. Everybody deserves a fair wage. Everybody deserves a decent pension. To use this bill as an excuse to attack decent, hard-working people is wrong and we shouldn't be doing that. Legitimate concerns, economically, fine. I'll accept that. But don't attack the 101 NYS ASSEMBLY JUNE 24, 2011 teachers of this State because by and large they are good, hard-working people and they should be commended. I will be voting yes. ACTING SPEAKER P. RIVERA: Mr. Weisenberg to explain his vote. MR. WEISENBERG: Thank you, Mr. Speaker, my colleagues. Following Michael, I also was a teacher for over 20 years, and I sit here and am very uneasy when I think people are defaming the potential of our future. Every teacher -- and I'm in schools all the time. My happiness is going into a school and having lunch with first graders or second graders, going into a high school or even speaking at colleges, to see the young, bright people that are teaching our children. Sometimes I say -- and people are not aware up here -- that teachers become surrogate parents because we have dysfunctional families. They send them to school hungry, with all kinds of problems because of broken homes, and the teachers are there. I just want you to understand how important it is to be able to have good people attracted to a profession that is so important for our future. It's upsetting for me to sit here and hear what is said. You know, I ran this last year and I ran against somebody who was from Long Island in the school district where the school board has nobody on that school board having their children in public education. They're all in private schools. And all I heard was teachers are overpaid, they shouldn't have pensions, they don't do a good job, and I'm saying to myself, "This is frightening to me that I'm standing here debating somebody in a library who is defaming a profession that is 102 NYS ASSEMBLY JUNE 24, 2011 so important for our country and who we are in this State." So, I take exception as well. And the answer really is what I always try to educate people and make them aware of is that you, the public, elect your school board. That school board hires the superintendent. They negotiate their salaries. What the teachers are doing is negotiating and trying to do the best they can to have the dignity and the respect and quality of life. But, you can't punish the teachers for what they're entitled to and what they negotiate, but you can certainly make people who are aware of the responsibility when you're paying a school superintendent $400,000 and come to me and say, "We don't have enough money to keep our programs." ACTING SPEAKER P. RIVERA: Mr. Weisenberg, how do you vote? MR. WEISENBERG: I'm voting yes. Thank you. ACTING SPEAKER P. RIVERA: Ms. Jaffee to explain her vote. MS. JAFFEE: Thank you, Mr. Speaker. When did teachers become Public Enemy Number One? I am personally offended by the conversation in the Chamber today. As a former teacher, daughter of a former teacher, mother of two former teachers and a daughter-in-law who is a teacher, all excellent people in our society, in our community, dedicating their lives to the future of this State and this country. It is outrageous that this conversation evolved to a place where it absolutely should not have gone. I don't mind debating on the merits of a particular issue, but to go and create an environment where teachers become the 103 NYS ASSEMBLY JUNE 24, 2011 enemy, where teachers become the ones who are discussed in a very degrading way, I find it extremely offensive. Our school board members, as well, they are public servants who serve the community, who are elected officials. They are elected, without any compensation, to serve the community, all doing public service in a way that I greatly respect. The school board members in my community and the superintendents and the teachers are focused on bettering the lives of our students on a daily basis. You know, let me just give you a fact. According to the State Education Department, New York's teachers have been losing ground against the cost of living, with raises averaging just 1.9 percent a year, less than the inflation rate over the past ten years. They are our middle-class, and they are the ones we need to respect because they are providing us with a future so that our children will have the education that they need. Let's respect those in the classes who have gotten their master's degrees and have gone year after year after year to take credits to be able to improve their abilities as teachers. Not only do I have a master's but I have 60 credits beyond a master's, and most of those I know who are in the education field have done that to be able to improve their ability within the classroom. We should respect the teaching career. We should respect the teaching -- ACTING SPEAKER P. RIVERA: Ms. Jaffee, how do you vote? MS. JAFFEE: -- profession, and I will vote in the affirmative. Thank you, Mr. Speaker. 104 NYS ASSEMBLY JUNE 24, 2011

ACTING SPEAKER P. RIVERA: Mr. Ceretto to explain his vote. MR. CERETTO: Yes, thank you, Mr. Speaker. I rise because I want to say that I also have a teaching background. I've worked in our schools as well, and I can say to you, just as you're all saying now, there are many, many, many good teachers. But let me tell you this: I will not be voting against this bill for this reason. I will not vote for things that tax and spend or borrow our children's future. I can't do that. Now, in my district in Niagara Falls there are 70 percent of the children that are born into poverty in Niagara Falls, 70 percent. They didn't choose to be in poverty. And our children -- in Niagara County we're losing our kids and they're leaving this area. So, I challenge this Body. That's why I'm here, because I gave up a civil service job to be here. I have three kids in my own family that are in colleges, in a New York State school, and I have got four kids. I'm here because I really believe that we can make a difference, and I challenge us to do that. And to do that we have to face the real problems. And we have done a lot of nice things here; I attest to that. But, we need to go further, take a step further. We need to have real mandate relief. We really need to make sure that in the future that this State is fiscally responsible and we can't borrow that future away. I won't put that burden on my children, so, Mr. Speaker, because of that I vote in the negative. Thank you. ACTING SPEAKER P. RIVERA: Mr. Murray to explain his vote. MR. MURRAY: Thank you, Mr. Speaker. Again, I 105 NYS ASSEMBLY JUNE 24, 2011 don't want to hear us bashing teachers or bashing schools. My best friend in the world, she's an amazing first grade teacher. She does an incredible job. This isn't about teacher bashing. It's a wonderful profession, and they're teaching our future. What it is about, though, is it's about finding solutions. And the problem here -- I don't think there is any person in this Chamber that wants to hurt our educational system or hurt our kids or take away from them and their educational experience, but the problem is we're not finding solutions. What I kept saying before was if this were -- I've heard the term "quick fix." The problem with that term is we're not fixing anything. Again, I'll go back to the Band-Aid on a bullet wound. That's what we continue to do. But, we're not fixing and tackling the actual problems that we're facing. We're not engaging in talk about real pension reform that will fix the problem down the road. My esteemed colleague, ironically, over my left shoulder here, brought up a very good point when he said a couple of years, you know, where do we go then because we're going to have the pension increases and the debt service we're going to have to pay for. So, we're actually compounding the problem. Where do we go in year three now? Year three we'll be back here discussing another supposed quick fix. We have got to fix the problem, concentrate on solutions, real pension reform, not increasing our debt and increasing the problem. So, for that reason, I courage all of my colleagues to vote against this bill. Thank you. ACTING SPEAKER P. RIVERA: Ms. Glick to explain her vote. 106 NYS ASSEMBLY JUNE 24, 2011

MS. GLICK: Thank you, Mr. Speaker. I rise in support of the measure which, as I understand it, provides for a local option to opt in or out, and we always talk about how important it is to provide local choice. So, that's a little mystifying. And, of course, when it comes to the thought of pension expense, you know, pensions have been a part of compensation packages forever, and I suspect that there are people in this House collecting a pension and not just turning it back or not accepting it. And I expect that most of us, when the time comes, will be happy to accept our pensions. So, I am a little bit dismayed at the thought that we somehow think that, well, things have gotten very expensive and now we're just going to have to cut off what people have worked for. This is about trying to help localities make a choice. A choice. They don't have to do it. And I thought that was one of our mantras. We should be doing more to give localities, school districts, options. If they don't like it they don't have to use it. So, I applaud the sponsor's forbearance today and want to thank all of the wonderful teachers in my life who provided me with the skills and the ability to critically think through things and analyze and articulate that point of view. They were, almost to a person, dedicated, hard- working and dealing with, in most instances, 30 to 35 kids that would have driven most of the people in this Chamber completely over the -- ACTING SPEAKER P. RIVERA: Ms. Glick, how do you vote? MS. GLICK: -- edge and, therefore, I will vote in the 107 NYS ASSEMBLY JUNE 24, 2011 affirmative. ACTING SPEAKER P. RIVERA: Mr. Joel Miller to explain his vote. MR. J. MILLER: Thank you, Mr. Speaker. Maybe an apology is due to the individual teachers, but I won't take back one word of what I said when it applies to the teachers' union. And people can yell and scream all they want, it won't make it the truth. What we just heard quoted was an article written by some nutcase from City College without any connection to the facts or truth, because anyone who knows anything about teachers know they're not getting a 1.9 percent pay raise annually. That may be their STEP, but it's not their pay raise. And they are not losing ground to inflation. That, too, is a crock. I won't tell you what I wrote in the letter back to that professor, but I was ashamed he went to my alma mater. This is not about teachers and unions. This is about whether we allow school districts to opt in to a program which will drag them down into debt even faster and make them pay what they're supposed to be paying for, which is education, even worse. This is when you give somebody something that is absolutely not healthy for them, but tell them, "It's all right, you make the choice." It's like giving a 10- year-old a cigarette and saying, "Well, you know, I'm not telling you to smoke, it's your choice." Giving someone who is 21 a bottle of booze, "I'm not telling you to drink, it's your choice." Anyone who chooses this has made the wrong choice. Clearly, what's come out of here is that if Yonkers has a problem, cure Yonkers' problem. But, don't open 108 NYS ASSEMBLY JUNE 24, 2011

Pandora's box for the rest of the State where school boards have not been overly responsible. As a result of that, I will be voting against this bill and certainly would encourage everyone else to. Thank you. ACTING SPEAKER P. RIVERA: Ms. Tenney to explain her vote. MS. TENNEY: Thank you, Mr. Speaker. I just want to say a of couple things. With the exception of Mr. Miller, some of my closest friends -- ACTING SPEAKER P. RIVERA: We're not supposed to mention anybody's name. MS. TENNEY: Okay. I apologize. I apologize, Mr. Speaker. With the exception of certain members in the Chamber, there's one group that's come to visit us, and I know most of us, every single week it seems, are the teachers and they have done a wonderful job. Some of my closest friends, family and mentors in my life are teachers. However, the minute the NYSUT rep leaves the room we get to problem-solving mode. It has nothing to do with the teachers because 90 percent of them are wonderful and I can't really say enough about how wonderful they are; however, I urge the Governor, since it looks like this bill is going to pass, to veto this bill for this reason: Our school districts are begging us not to vote for this tax cap that's coming to us. This tax cap -- this bill does not solve the problem of the tax cap. Again, I hate to use our analogy that's been down here, we heard "Band-aid on a gunshot wound" -- I'm going to say a Band-Aid on a tumour. We need to solve 109 NYS ASSEMBLY JUNE 24, 2011 the problems, the underlying problems that are facing us, with real solutions, not this type of solution. So, for that reason, I will be voting in the negative. Thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: Mr. Lancman to explain his vote. If you don't want to, you don't have to. MR. LANCMAN: I will explain it briefly. Between the chanting and everything else going on it's hard to focus. Listen, let me at the outset say that some of my best friends are the unfunded mandate folks, the folks that we hear from constantly about unfunded mandates and mandate relief, and it was always my understanding that the heart of that argument was the idea that school districts, localities, should have the freedom to run their affairs as they see fit with the minimum amount of restrictions or impositions from those of us here in Albany. Now, that is what this legislation is. As I understand it, it merely provides school districts an additional tool, an additional option, additional freedom to make a choice to run their affairs in a way that they might decide is in the interest of their school district and the children that they serve. And for that reason, I'm very proud to cast my vote in the affirmative. I hope that later today when we debate the issue of a property tax or mandate relief that the same people who are so opposed to giving the school districts the freedom and the opportunity to make this choice will then be consistent in that debate. Thank you very much. ACTING SPEAKER P. RIVERA: Mr. Jose Rivera to 110 NYS ASSEMBLY JUNE 24, 2011 explain his vote. MR. J. RIVERA: Thank you, Mr. Speaker. I really believe that this is not about beating up or scapegoating on teachers. It's hard for people watching us not to believe at times that that might not be the case, given that the Mayor of the City of New York seems to have been on a campaign on the budget situation concentrated around teachers. I don't really believe that anyone here believes that in their heart that what they're doing is not right. I have a lot of fond memories of my teacher. When my mother brought me first into this country, I went to PS 20, located at 167th Street and Simpson Avenue, the area that is known as Fort Apache. And I recall I hardly knew the language, but when she asked me, "What's your name", I said, "Jose..." And she looked around the whole room and she said, "If I call everybody by your full name we will be here all day." Should I hate my teacher? Should I hate my teacher because she taught me that broccoli is good for me? No, I loved my teacher, Mrs. Lesser. Broccoli? I love broccoli. I eat it practically every day. Having said that, in memory of Mrs. Lesser, you know, let's stop sounding like the problems around our State finances or Downstate could be centered around how we deal with teachers. Teachers deserve all the respect that they should be getting because none of you guys, none of us here, would have learned, whether with an accent or not, our ABCs if it were not for the teachers. Thank you very much. ACTING SPEAKER P. RIVERA: Mr. Farrell to explain his vote. 111 NYS ASSEMBLY JUNE 24, 2011

MR. FARRELL: Thank you, Mr. Speaker. I normally don't speak on bills that are not exactly related to the budget, but this one bothers me very much. Ronald Reagan, 29 years ago, started a crash. Remember what he did? He cut taxes, cut taxes, and for eight years they did not pass a bill. They never passed it. They just did it by doing the -- what is it called -- continuing resolutions. But, he knew that sooner or later he was cutting off the water and we were not going to get the water here. Remember, we were getting money from the Federal government, and slowly but surely we are cutting back the amount of money that we give to localities. They did it to us, now we're doing it to them. The end result is, well, we don't care, we just want to make sure we're not making a millionaire pay a tax. The bill that I did not want to pass and did not want to vote on was the tax cap. They asked me to defend it and I said you don't want to do that because with my mouth we'll be in a lot of trouble because I believe that is part of causing a problem in the future. This bill is a small cure in another direction. This might give them a chance. And some of my colleagues on the other side who are so happy to get the word "tax cut" said -- and I don't mean this side, I mean over there -- who want to say the word "tax cut," especially the folks on Long Island, they're going to suddenly wake up to the fact that they're going to be in a lot of trouble and they're going to have to be looking for money. Now, I have heard people -- I was listening to the debate and I heard people talk about the localities as if they were not a place you lived in. I don't fully understand that. You're a political animal. Could you not -- we do it in 112 NYS ASSEMBLY JUNE 24, 2011

New York City. We try to go after people we think are crazy or don't do what we want them to do. Maybe we should be doing that, too. ACTING SPEAKER P. RIVERA: Mr. Farrell, how do you vote? MR. FARRELL: So, because of that and because of what this bill does, I'm going to vote in the affirmative on what I call "the big pretty" -- it's pretty because it's going to let us go home. When we do that, I'll vote for that, also. ACTING SPEAKER P. RIVERA: Mr. Donald Miller to explain his vote. MR. D. MILLER: Thank you, Mr. Speaker, to explain my vote. I knew Ronald Reagan. Ronald Reagan was a friend of mine. There are no Ronald Reagans in this room, although we could use some of that in here. This kind of financial plan, if you want to call it that, is anything but. This is the type of thing that's going to get us deeper into the hole and school districts at this point cannot afford to be deeper in the hole. I will be voting in the negative on this, not because I'm a certified teacher -- this isn't about bad teachers. It's also not about 35 kids who will drive you crazy, because they will but, as a teacher, you end up loving every single one of them. This is about what's good for our school districts and, ultimately, what's good for taxpayers down the road. This bill is not good for either one of those. I will be voting against this. ACTING SPEAKER P. RIVERA: Are there any other votes? The Clerk will announce the results. 113 NYS ASSEMBLY JUNE 24, 2011

(The Clerk announced the results.) The bill is passed. Mr. Canestrari. Could we take one brief second? MR. CANESTRARI: Please go to Mr. Crouch for an announcement. ACTING SPEAKER P. RIVERA: Mr. Crouch. MR. CROUCH: Thank you, Mr. Speaker. There will be a members-only Republican Conference in the Parlor right now. ACTING SPEAKER P. RIVERA: Members-only Conference. MR. CANESTRARI: And now, Mr. Colton. ACTING SPEAKER P. RIVERA: Mr. Colton. MR. COLTON: Mr. Speaker, the Majority also needs a Conference in the Speaker's Conference Room at this time. ACTING SPEAKER P. RIVERA: Majority Conference. The House stands in recess; am I correct, Mr. Canestrari? MR. CANESTRARI: Yes. (Whereupon at 4:50 p.m., the House stood in recess.)

***AFTER THE RECESS*** 6:53 P.M. ACTING SPEAKER N. RIVERA: The House will come to order. MR. CANESTRARI: Ms. Speaker, my colleagues and guests, we will go to the A-Calendar again and we will take up Rules 114 NYS ASSEMBLY JUNE 24, 2011

Report No. 626 from Mr. Kellner. The message of necessity is now in and we can take up this bill now directly. Thank you. ACTING SPEAKER N. RIVERA: The Clerk will read. THE CLERK: Bill No. 8515, Rules Report No. 626, Kellner. An act to amend the Social Services Law, in relation to the provision of speech therapy, physical therapy and occupational therapy to recipients of medical assistance. ACTING SPEAKER N. RIVERA: On a motion by Mr. Kellner, the Senate bill is before the House. The Senate bill is advanced. The Governor's message is at the desk. The Clerk will read. THE CLERK: Pursuant to the provisions of Section 14 of Article III of the Constitution and by virtue of the authority conferred upon me, I do hereby certify to the necessity of an immediate vote on Senate Bill No. 5851 and Assembly Bill No. 8515. The facts necessitating an immediate vote on the bills are as follows: This bill would extend an exemption from Medicaid coverage limits on certain therapies to individuals with traumatic brain injury. Because the bill has not been on your desks in final form for three calendar legislative days, the Leaders of your Honorable bodies have requested this message to permit the immediate consideration of this bill. Andrew M. Cuomo, Governor. ACTING SPEAKER N. RIVERA: Read the last section. 115 NYS ASSEMBLY JUNE 24, 2011

THE CLERK: This act shall take effect immediately. ACTING SPEAKER N. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Mr. Raia to explain his vote. MR. RAIA: Thank you, Madam Speaker. We're dealing with Medicaid, and while I sympathize with individuals that certainly have traumatic brain injuries and other impediments, the fact of the matter is if you have private insurance, they have very strict limits as to how many visits you can get. Many of you might remember that last year at this very same time, I could barely move because of an exploded disc in my neck. They cut me off from physical therapy after six visits, forced me almost to have surgery. Fortunately, I didn't have to have that surgery. I'm going to vote yes on this bill, but it would be nice if our Medicaid payments or benefits that we offer individuals under Medicaid matched what we offer people in the real world that have to pay for their health care out of their own pockets instead of being subsidized by the taxpayers. On that note, I will regrettably be voting yes, but I would hope in the future that anything we offer to individuals on Medicaid we might consider offering to individuals that have private insurance. Thank you. I withdraw my request and vote in the affirmative. ACTING SPEAKER N. RIVERA: Mr. Raia in the 116 NYS ASSEMBLY JUNE 24, 2011 affirmative. ACTING SPEAKER P. RIVERA: Are there any other votes? The Clerk will announce the results. The bill is passed. Mr. Canestrari. MR. CANESTRARI: Mr. Speaker, my colleagues, we will now go to the main Calendar, on Page 7, Rules Report No. 456, Hakeem Jeffries, please. ACTING SPEAKER P. RIVERA: The Clerk will read. THE CLERK: Bill No. 1820, Rules Report No. 456, Jeffries, Brennan, Millman. An act to amend the Public Authorities Law, in relation to creating a subsidiary corporation for the planning and oversight of the Atlantic Yards project. ACTING SPEAKER P. RIVERA: Read the last section. THE CLERK: This act shall take effect immediately. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Mr. Brennan to explain his vote. MR. BRENNAN: Thank you, Mr. Speaker, to explain my vote. I just wanted to express my appreciation to the sponsor, Mr. Jeffries, for his diligence in pursuing the effort to create a governance model for the Atlantic Yards Development Project that would include greater input and oversight from the community, the part of Brooklyn that 117 NYS ASSEMBLY JUNE 24, 2011 we all represent. This bill is sponsored both by myself and Assemblywoman Millman as well, and it is to be hoped that someday this will become law and we can exercise a substantially greater level of oversight and community input into the largest development project in the history of Kings County in Brooklyn, New York. I withdraw my request and vote in the affirmative. ACTING SPEAKER P. RIVERA: Mr. Brennan in the affirmative. Mr. Canestrari. MR. CANESTRARI: No, you may call this vote. ACTING SPEAKER P. RIVERA: Are there any other votes? The Clerk will announce the results. MR. CANESTRARI: Technicalities, okay. Laurie, do your thing. (The Clerk announced the results.) The bill is passed. Mr. Canestrari. MR. CANESTRARI: Well done, Laurie; well done. Mr. Speaker, there will be an immediate meeting of the Rules Committee. Acting Chair Richard Gottfried awaits our arrival. Rules Committee meeting now.

* * * * * * * ACTING SPEAKER P. RIVERA: Mr. Canestrari. 118 NYS ASSEMBLY JUNE 24, 2011

MR. CANESTRARI: Mr. Speaker, would you please call the House back to order? ACTING SPEAKER P. RIVERA: The House will come to order. Mr. Canestrari. MR. CANESTRARI: We will just wait a second or two for some clarification here. The A- and B-Calendars are on the -- I'm sorry, the B- and C-Calendars are on the members' desks. I move at this time to advance the B- and C-Calendars. ACTING SPEAKER P. RIVERA: Without objection, the B- and C-Calendars are advanced. MR. CANESTRARI: That being said, Mr. Speaker, we will go to the B-Calendar, Page 5 and take up directly Rules Report No. 631, Mr. O'Donnell. ACTING SPEAKER P. RIVERA: On Page 5 of the B-Calendar, Rules Report No. 631, the Clerk will read. THE CLERK: Bill No. 8520, Rules Report No. 631, O'Donnell. An act to amend the Domestic Relations Law, in relation to the ability to marry; and to amend a chapter of the Laws of 2011, amending the Domestic Relations Law relating to the ability to marry, as proposed in legislative bill number A.8354, in relation to the statutory construction of such chapter; and repealing certain provisions of the Domestic Relations Law relating to parties to a marriage. ACTING SPEAKER P. RIVERA: There is a Governor's message at the desk. The Clerk will read. 119 NYS ASSEMBLY JUNE 24, 2011

THE CLERK: Pursuant to the provisions of Section 14 of Article III of the Constitution and by virtue of the authority conferred upon me, I do hereby certify to the necessity of an immediate vote on Assembly Bill No. 8520. The facts necessitating an immediate vote on the bill is as follows: This bill provides amendments to the Marriage Equality Act, which was added by a chapter of laws of 2011. Because the bill has not been on your desks in final form for three calendar legislative days, the Assembly has requested this message to permit the immediate consideration of this bill. Andrew M. Cuomo, Governor. ACTING SPEAKER P. RIVERA: Read the last section. THE CLERK: This act shall take effect immediately. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Mr. O'Donnell to explain his vote. MR. O'DONNELL: The freedom to marry, according to the United States Supreme Court, is one of the most vital rights essential to the orderly pursuit of happiness by free people. Thomas Jefferson once wrote, "Our civil rights have no dependence on religious opinion." Today in this building and in this Chamber we are fulfilling Thomas Jefferson's dream of what America is and should be, which is we should all be free people, we should all have equal rights and 120 NYS ASSEMBLY JUNE 24, 2011 we all should have the ability to marry the person that they love. For those of you who have stood with me in this long challenge, I thank you from the bottom of my heart, and even to those who couldn't find a way to be there, to understand what my struggle and what my life has been, I'm eternally grateful by all of your presence in this Chamber and in this building to be here on this hot, muggy night on the day when one of the last barriers to equality will be eliminated in the State of New York. I will be voting in the affirmative. Thank you very much. ACTING SPEAKER P. RIVERA: Mr. Boyle to explain his vote. MR. BOYLE: Mr. Speaker, to explain my vote. I stand here this evening as a supporter of marriage equality. As I've said in years past, I believe it needs to be done as a Constitutional amendment, and as I have said in years past, my fear is that if we do it as a bill, we're going to be tied up -- ACTING SPEAKER P. RIVERA: Mr. Boyle, could you use Mr. Blankenbush's microphone? Thank you. MR. BOYLE: Sure. My fear is that this bill will be tied up in the courts for years to come, and as I see the language in this amendment, I think it is going to be tied up in the courts for years to come and it's going to be defeated, found unconstitutional. I hope I'm wrong, but I think that's what's going to happen and we're going to have to start all over again. I urge my colleagues to consider at that time a Constitutional amendment that will put marriage equality in our State 121 NYS ASSEMBLY JUNE 24, 2011

Constitution, truly protect those rights and, most importantly, allow the people of New York State to decide in a referendum. I will vote in the negative on this. ACTING SPEAKER P. RIVERA: Mr. Boyle in the negative. Are there any other votes. The Clerk will announce the results. (The Clerk announced the results.) The bill is passed. (Applause) Mr. Canestrari. MR. CANESTRARI: Mr. Speaker, my colleagues, we will now go to the B-Calendar, Page 3, Rules Report No. 629, Mr. Lopez, please. ACTING SPEAKER P. RIVERA: Proceeding to the B-Calendar, on Page 3, Rules Report No. 629, the Clerk will read. THE CLERK: Bill No. 8518, Rules Report No. 629, V. Lopez, Silver, Farrell. An act to amend the General Municipal Law and the Education Law, in relation to establishing limits upon school district and local government tax levies; and providing for the repeal of such provisions upon expiration thereof (Part A); to amend Chapter 576 of the Laws of 1974 amending the Emergency Housing Rent Control Law relating to the control of and stabilization of rent in certain cases, the Emergency Housing Rent Control Law, Chapter 329 of the Laws of 1963 amending the Emergency Housing Rent Control Law relating to recontrol 122 NYS ASSEMBLY JUNE 24, 2011 of rents in Albany, Chapter 555 of the Laws of 1982 amending the General Business Law and the Administrative Code of the City of New York relating to conversion of residential property to cooperative or condominium ownership in the City of New York, Chapter 402 of the Laws of 1983 amending the General Business Law relating to conversion of rental residential property to cooperative or condominium ownership in certain municipalities in the counties of Nassau, Westchester and Rockland and the Rent Regulation Reform Act of 1997, in relation to extending the effectiveness thereof; to amend the Administrative Code of the City of New York, the Emergency Tenant Protection Act of 1974 and the Emergency Housing Rent Control Law, in relation to limiting rent increases after vacancy of a housing accommodation and the adjustment of maximum allowable rent based on apartment improvements; to amend the Emergency Tenant Protection Act of 1974, the Emergency Housing Rent Control Law, the Administrative Code of the City of New York and the Tax Law, in relation to deregulation thresholds; to amend the Real Property Tax Law, in relation to tax exemption for new multiple dwellings and exemption of certain new or substantially rehabilitated multiple dwellings from local taxation and to amend the Tax Law, in relation to verification of income (Part B); to amend the State Finance Law, in relation to providing certain centralized services to political subdivisions and extending the authority of the commissioner of General Services to aggregate purchases of energy for State agencies and political subdivisions; to amend the General Municipal Law, in relation to purchasing information technology and telecommunications; to amend 123 NYS ASSEMBLY JUNE 24, 2011 the County Law, in relation to contracts for services; to amend the General Municipal Law, in relation to certain Federal contracts; to amend the Municipal Home Rule Law, in relation to filing and publication of local laws; and providing for the repeal of certain provisions upon the expiration thereof (Subpart A); to amend the General Municipal Law and the Highway Law, in relation to mutual aid (Subpart B); to amend the General Municipal Law, in relation to apportioning the expenses of police department members in attending police training schools; to amend the Criminal Procedure Law, in relation to the prosecution of the offense of identity theft; to amend the Family Court Act, in relation to inter-county probation; to amend the Mental Hygiene Law, in relation to payment of costs for prosecution of inmate-patients; and to repeal Section 207-m of the General Municipal Law relating to salary increases for heads of police departments of municipalities, districts or authorities (Subpart C); to amend the General Municipal Law, in relation to filing requirements for municipalities regarding urban renewal plans and creation of urban renewal agencies and authorities (Subpart D); to amend the Social Services Law, in relation to the use of debit or credit cards for child care assistance payments; and to amend the Social Services Law, in relation to the length of licenses to board children, training of child protective service caseworkers, services plans, funding for children and family services, district-wide child welfare services plans, and non-residential services for victims of domestic violence (Subpart E); to amend the Education Law, in relation to census reporting; to amend the Education Law, in relation to transportation of children receiving special 124 NYS ASSEMBLY JUNE 24, 2011 education services; to amend the Education Law, in relation to funding of certain capital projects and auditing of claims; to amend the Education Law, in relation to establishing a shared superintendent program; and to amend the Education Law, in relation to cost-sharing between districts; and to amend the General Municipal Law, in relation to accounts of officers to be examined; and providing for the repeal of certain provisions upon expiration thereof (Subpart F); to amend the Mental Hygiene Law and the Social Services Law, in relation to the implementation of medical support provisions (Subpart G); and to amend the State Administrative Procedure Act, in relation to alternate methods for implementing regulatory mandates; and to amend the Executive Law, in relation to creation of the Mandate Relief Council and providing for the expiration of such provisions (Subpart H) (Part C). ACTING SPEAKER P. RIVERA: There's a Governor's message at the desk. The Clerk will read. THE CLERK: Pursuant to the provisions of Section 14 of Article III of the Constitution and by virtue of the authority conferred upon me, I do hereby certify to the necessity of an immediate vote on Senate Bill No. 5856 and Assembly Bill No. 8518. The facts necessitating an immediate vote on the bill are as follows: This bill would: (1) amend the General Municipal Law and the Education Law, in relation to establishing limits upon school district and local government tax levies; (2) strengthen and extend the rent regulation laws until June 15, 2015; and (3) enact into law major 125 NYS ASSEMBLY JUNE 24, 2011 components of legislation necessary to effectuate mandate relief from statutory and regulatory mandates on local governments. Because the bill has not been on your desks in final form for three calendar legislative days, the Leaders of your Honorable bodies have requested this message to permit the immediate consideration of this bill. Andrew M. Cuomo, Governor. ACTING SPEAKER P. RIVERA: There's an amendment at the desk. Mr. Palmesano to explain while the Chair examines it. Mr. Palmesano. MR. PALMESANO: Yes, Mr. Speaker, my colleagues. I offer the following amendment, waive its reading, move for its immediate adoption and request the opportunity to briefly explain it. ACTING SPEAKER P. RIVERA: The Chair has examined your amendment and has found it to be germane to the bill before the House. On the amendment, Mr. Palmesano. MR. PALMESANO: Mr. Speaker, my colleagues. This amendment adds language to the bill in chief, which would freeze the municipal share for the local Medicaid costs at the current level, the 2011 trend factor for counties in the City of New York. This amendment deals with Medicaid, and as we consider the property tax cap tonight, mandate relief is a part of that cap. A lot of discussion about mandate relief. By far, the biggest mandate this State has placed on our localities is the Medicaid program. When this program was created in the 1960s, New 126 NYS ASSEMBLY JUNE 24, 2011

York State was one of two states that mandated participation at the local level. The current cost to the Medicaid program for our local governments, for counties in City of New York, for 2011 was $7.5 billion. It's crippling our local property taxpayers. This amendment, this action, would freeze the county costs and the City cost at the level it is now. The State would assume the growth and the cost of the Medicaid program. We mandate the program. We have the direct authority to reform the program. We can work with the Medicaid Redesign Team to make the changes that are necessary. This amendment, if adopted, will bring immediate fiscal relief to the counties and the City of New York. So, whether you're in Long Island, the Adirondacks, Upstate New York, this is the type of relief our local officials are looking for. This is the type of relief that will bring immediate relief to the local property taxpayers. This goes hand-in-hand with the amendment -- with the bill in chief that we have, the property tax cap with mandate relief, significant mandate relief, which this bill will accomplish. So, I ask you to join me in making sure that we can pass this immediate savings on to our local governments and the counties and the City of New York. ACTING SPEAKER P. RIVERA: Mr. Canestrari. MR. CANESTRARI: Mr. Speaker, my colleagues and guests. We know that the bill in chief, Rules Report No. 629, does contain actual mandate relief for localities and school districts across the State. This amendment, however, is simply a cost shift from localities to the State of New York at a time when the State of New York should not 127 NYS ASSEMBLY JUNE 24, 2011 and cannot bear additional expenses. I urge a no vote. Thank you. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Are there any other votes? The Clerk will announce the results. (The Clerk announced the results.) The amendment is defeated. On the bill. An explanation is requested, Mrs. Galef. MRS. GALEF: Thank you, Mr. Hayes. Because this bill is about affordable housing, there are various components to the bill, so I will try to do my best to explain the property tax cap portion of it. As we all know, in New York State we have a problem. We have had the highest taxes in this nation. We're 78 percent above the national average. Unfortunately, when we compare ourselves to other states, in New York, three of ten counties, of which I live in, had the highest households pay the highest property taxes. And some of you may be in the eight of ten counties with the highest property taxes as a percentage of home value, and four of the ten counties with the highest property taxes as a percentage of personal income, and this is all in New York State. So, tonight we're trying to take a step -- and this is a step -- toward creating an environment for the property taxpayers, whether they're homeowners, whether they're tenants, whether they're businesses, 128 NYS ASSEMBLY JUNE 24, 2011 to try to lower the cost of doing business in New York State, and in a way to be competitive with other states. So, the bill on the property tax cap, just a quick summary. For the local governments -- there are two parts to it; one is local governments, one is education. With local governments we are levying a property tax cap of 2 percent and/or inflation, whichever is less, for our towns, cities, villages, counties, fire districts and all special districts. It does not include New York City. It requires each local government to calculate its tax levy limit and submit information to the Comptroller. It authorizes a local government to exceed the levy limit if it passes a local law by 60 percent. Not a referendum, it's just the boards, the county boards, the local boards, by 60 percent of their membership would vote to go beyond the 2 percent. It applies to local governments starting in their budget year for 2012. It will sunset, as the school one will. It goes into effect immediately, but it will expire on June 15, 2016, but maybe continue thereafter only if rent regulation and control is in effect. Now, there are exemptions. There are exemptions to this property tax cap if there are court orders or judgments that exceed 5 percent of the total levy from the previous year. It also exempts a growth in pension costs attributable to the system average actuary contribution rate increase of more than two percentage points from the previous year. There are also adjustments. There is a carryover. If they do not spend all their money in one year they can carry over no more than 1.5 percent of the levy to use in the following year. There's a tax base growth factor so 129 NYS ASSEMBLY JUNE 24, 2011 that if a community grows in its physical or quantity growth -- new shopping centers or whatever -- that would become a part of the property tax base. Also, an interest of mine is consolidation and dissolution and the Comptroller will calculate for any community. We had just voted earlier, a few days ago, on combining the Village of Ossining Court with the Town of Ossining Court. The Town of Ossining was concerned that they were going to take over a court system and that would raise their cost of doing business but, in this bill, with consolidation it would not. They would be reconfigured by the Comptroller for their levy. Now, the educational part. Again, a 2 percent limit, and the educational cap would not expressly apply to the Big Five school districts because they're a part of their City budget and they will deal with that separately. It also exempts, as it did with the governments, the court orders or judgments over 5 percent, growth in pension payments over 2 percent, but this one in school districts does cover capital. So, it wouldn't include your debt service, your lease expenditures, your transportation capital debt. And there's also the tax base growth factor -- I can't be cut off yet, can I? ACTING SPEAKER P. RIVERA: That's the end of the explanation period. You can go on the bill now, on your time. MRS. GALEF: No, I don't want to do that. I'll sit down. If you want more of an explanation, I'll come back. ACTING SPEAKER P. RIVERA: Mr. Hayes. MR. HAYES: Thank you, Mrs. Galef. That was probably one of the most thorough explanations that I have heard in my 130 NYS ASSEMBLY JUNE 24, 2011 time in the State Assembly. I thank you for that. Obviously, you have done a lot of hard work on this bill. Obviously, you know the provisions inside and out and you explained them in a very straightforward manner. I just want to, maybe, take a minute to ask you a couple of what-if questions. You know, any time that there's a new program I think people, in the back of their mind, look at all of the complicated formulas that come up as part of the legislation and they ask themselves as they apply to their own local situation, "What if." You talked about the fact that the tax cap sets a 2 percent or rate of CPI, whichever is less; however, there is a base of 1 percent. So, hypothetically, in a situation in which a district or a State or the nation experienced severe price declines -- it's possible; we might have even a situation in which there was a negative CPI -- that would not require school districts or municipalities to actually go and adopt budgets that were less. The minimum will always be frozen at 1. It will never be less than 1 percent; is that right? MRS. GALEF: It can go to zero with the CPI and it can go to zero if -- in the education component part of it, if the public does not support up to 2 percent, and they can support more than that if 60 percent of the public votes for it. But, if the public doesn't and there's a less than 2 percent vote twice it would go back to zero percent, also. MR. HAYES: And there's nothing in this that would preclude a governing Body from actually cutting the tax rate? MRS. GALEF: Absolutely not. Of course they can. MR. HAYES: This is the worst case scenario. In terms 131 NYS ASSEMBLY JUNE 24, 2011 of the 60 percent exemption, with a school board or a school district budget, that's something that would be approved by the voters, so it's 60 percent of the number of people who show up on school budget voting day and vote; is that right? MRS. GALEF: That's right. That's the way we count all votes. It's who has gone to vote. MR. HAYES: Okay. But in a village, a municipality, a township, if you had a municipal board of seven people, for example, five would be required to pass the budget under ordinary circumstances, and that number would satisfy the 60 percent requirement to pierce the cap; is that right? MRS. GALEF: Yes. MR. HAYES: Do you have a comment about that disparity? It seems like in those circumstances where there are municipal boards of seven members, five are only necessary to pass a budget, five constitute a 60 percent supermajority. It's really not going to affect any of those municipalities. MRS. GALEF: I think the difference that we had -- remember the bill originally, I believe it was the original bill submitted by the Governor, said that there would have to be -- you know, in school districts we have referendums. We have votes. With our local budgets, we don't go out to the public for a vote unless there is a capital project that people have done permissive referendum or whatever so, you know, the Governor was going to require us to have votes on county budgets, village budgets, town budgets. They all have budgets at different times. 132 NYS ASSEMBLY JUNE 24, 2011

So, you would be having votes all the time. I think it probably would be very, very confusing. So, this bill went back to doing what we do today, and today the Body, the legislative Body makes the decision and we kept it to the same 60 percent as in school district budgets. I grant it, it's much harder, probably, to get a 60 percent for a school budget vote than on a town board, or maybe not, or on a county board. It depends on the makeup and the perceptions of the people that are elected. MR. HAYES: But, specifically, to get five out of seven votes for a simple majority passage on a village board or a town board, are you concerned that because that threshold of the majority is the same as 60 percent, under this legislation, are you concerned at all that taxpayers in those jurisdictions might see this as a meaningless part of the property tax cap effort? MRS. GALEF: Well, I don't think so. Otherwise, it would be four out of seven because that would be majority otherwise and, you know, I think that many of our communities -- the experience that I have been having in our areas is most of the communities are also trying to come within that tax cap, and they all have to go out for elections and, so, there will be that conversation within the community. But, I think the other was so unworkable to have -- I used to be on the county level. I just can't imagine all the different formats. Even within counties there would be county votes at various times because some -- Putnam County has a budget that has to be done, I think, at the end of October. The County of Westchester at the end of December. You have villages in March, April, you know, and you have towns. I mean, it would be so complicated, I 133 NYS ASSEMBLY JUNE 24, 2011 think. So, this gets rid of that complication and I think, still, the communities -- because they're going to be reaching out to the public and public will speak out on the whole property tax issue. MR. HAYES: I want to ask you about the impact of pension costs on this legislation or on school budgets and municipal budgets in general. We had a rather lengthy debate. I don't want to revisit any of that today but, under this legislation, the pension costs, how would they be calculated under the cap? MRS. GALEF: Well, the pension costs, if they go up more than 2 percent, then they would not be covered in the cap. It's the percentage points. It's the rate. So, for example, with employees, ERS employees, in 2011 the rate was 11.9, the contribution rate, and it's going to go up in 2012 to 16.3. So, as it goes up the community is going to have to pay the 2 percent additional rate, but they won't have to pay above that. MR. HAYES: Okay. So, if pension costs are probably one of the fastest rising costs, at least we know over the next several years for school districts and municipalities they're only going to have to absorb up to 2 percent of that under the cap and the rest will just be added to the levy? MRS. GALEF: It's a percentage -- MR. HAYES: The percentage of the increase. MRS. GALEF: -- percentage points. They will have to absorb -- in the cap they have to absorb a 2 percent increase, but they won't have to -- the other will be outside of the cap. So, we are helping 134 NYS ASSEMBLY JUNE 24, 2011 them with the additional costs for pensions. MR. HAYES: Okay. Thank you very much. ACTING SPEAKER P. RIVERA: Ms. Jaffee. MS. JAFFEE: Thank you, Mr. Speaker. On the bill. ACTING SPEAKER P. RIVERA: On the bill. MS. JAFFEE: There's no question that with so many families hard hit in this economy, property tax relief is an urgent priority. Unfortunately, this so-called "tax cap" will not provide -- will not provide our residents with the tax relief they desperately need; rather, I believe this is a recipe for disaster. It's a sound bite, a great sound bite, not sound fiscal policy. The so-called tax cap's fundamental flaw is that it will not lower anyone's property tax bills and has the very real potential to seriously undermine public education, diminish municipal and emergency services and lower homeowners' property values in the process. We cannot cap our way to excellence, progress or sustainability. If a family has difficulty paying taxes now, a tax cap will not help them, nor will it cut their taxes. It will, however, cut the already sinking equity in their homes. And we all know that with the reality of assessments and equalization rates, homeowners' tax bills will continue to rise. For education and local services this legislation limits the amount of revenues school districts and municipalities can raise locally, potentially capping them at a zero growth, as we have heard. Yet, it does not include any requirement that the State uphold its end of 135 NYS ASSEMBLY JUNE 24, 2011 the bargain, either in financing a reasonable portion of the cost of education or basic municipal services or in curbing the mandates that are the main drivers of their cost. And just let me say tonight we are taking a very small step toward some mandates, but nowhere near where we need to go. Perhaps together in the future we can respond to that. I also just want to mention the pension that was discussed. I think there is an error in understanding what it does. For instance, if the pension costs go up one year from 8.2, the next year it's 11.1, which we've had over the last two years, you subtract that and it's 4.9 -- 2.49. The only exemption is .49 because it's above the 2 percent and the only exemption is .49 of that pension exemption. It's very limited in its assistance for our school districts and, certainly, a serious problem. I'm very concerned that this cap proposal is going to be particularly harmful in this weak economy without the State funds, as I've noted, as has been promised. You know, our school districts and school boards have acknowledged the economic realities of our residents and have been responsible, controlling spending and already utilizing much of their reserves. There have been significant teacher and staff layoffs already all over the State, and in my district in particular. Cuts in programs and pay freezes. In addition, and I emphasize the imposition of the cap without meaningful mandate relief, real mandate relief as we move forward, and significant exemptions, this will further threaten public education and municipal services in New York State. There are at least 100 unfunded Federal and State mandates, and the Race to the Top is going to cost one 136 NYS ASSEMBLY JUNE 24, 2011 of my school districts over four years almost $2 million and they get just a very small amount of funds coming back. Recent proposals by the State Education Department to require an additional four graduation credits is going to be a further burden on our school districts. How about energy costs and the further exemptions for pension and health care costs? We need mandate relief as we move forward or we will destroy our public education. This proposal also -- you know, earlier today someone said we're taking the first step towards a slippery slope, taking voters out of the process. Well, I agree. That is exactly what this does. This proposal also undermines the public voice, placing control in the hands of a minority, 40 percent, by requiring a 60 percent majority vote, allowing a small percent of minority voters to determine school funding issues. This silences the local voice and undermines the Democratic principle of majority vote and it is structured to ensure failure. I have had meetings with school superintendents, school board members, PTA parents and I have heard their concerns regarding the impact on their schools and the further program cuts. We discussed the non-mandated programs that are valued by the community, but now are threatened, threatened because inevitably they will be cut. Some of these are BOCES, career tech, class size guidelines, guidance counselors, early childhood programs, kindergarten. Many of my schools are talking about cutting kindergarten. Extracurricular clubs and activities which hold our children to positive activities and keep them from gang activities; elective courses, teaching assistants, school nurses, security 137 NYS ASSEMBLY JUNE 24, 2011 guards, music and art programs. One of my school districts is actually discussing cutting the marching band, which has been an amazing program for over a period of a number of years with an incredible teacher. These are the very young men and women who need to be kept busy and active in our society. They are losing out. You know, recently at a hearing, a Business Council person commented that, "Well, they can restore some of these programs in two or three years." Well, you cannot tell a child that he can't have a kindergarten class, wait a few years. Or a high school student, say to them, "You can't take that course, that AP course. If you want to go to college, wait a few years." Children cannot wait a few years. And this sunset issue. A five-year sunset? Much too long. We need to continue to revisit on a regular basis and reevaluate the impact. Let's look at some history on the tax cap, evidence from other states. Since Proposition 13 in California we have seen California schools go from among the top in the nation to 38th, due to the tax caps. And by the way, New York is 8th in the United States at this time. Let's hope it does not fall like California did. One of my constituents was telling me the other day that his son used to live in California. He had moved to California, he now moved back to New York State. Why? Because the schools are so poor there that do you know the parents had to collect money together so that their school could have an art class, so the kids could have an art class? They had to raise money for that. And Massachusetts, everybody talks about Massachusetts, but when the 2.5 138 NYS ASSEMBLY JUNE 24, 2011 percent tax cap went into place -- and they have a 50 percent, a majority vote -- it was during a great time in the economy. The economy -- they were doing very well and they funded their schools, especially the high- needs schools, with an enormous amount of money and it really worked very well initially, although there are still some middle-class schools that are still having some difficulty. But, as the economy started to go down, there became a great deal of difficulty in Massachusetts. The programs were diminished, closing libraries, closing vast school programs, layoffs, police, firefighters, teachers. Middle-class school districts fared poorly because wealthy school districts overrode the cap. Middle-class school districts struggled and the high-needs school districts got a little help, but they started to really decline. Unfortunately, those poorer school districts have a more difficult time passing the budgets, further widening the achievement gap for children who live in poverty. This increased disparity of educational opportunity exacerbates the achievement gap between children of high-wealth and low-wealth districts. Middle-class students were impacted as well, because their access to school aid was limited. You know, unequal access, unequal opportunities. Yes, New Yorkers deserve relief from the burden of out- of-control, regressive, very regressive, property taxes, which is why I believe that we absolutely must have meaningful real property tax reform. We have to get tax reform right. How do we best do this? Well, to begin with, by not allowing the millionaires' tax to sunset. Provide funding to our public schools and municipalities that would both control the rise of property taxes, protect services, education and our home values. And we 139 NYS ASSEMBLY JUNE 24, 2011 have to move forward with a much more progressive tax structure in New York State and consider the possibility and the concept of a circuit breaker law which caps the amount of property taxes to be paid by families and seniors, based on their income. It actually cuts their taxes -- it's a tax cut -- and protects our schools while continuing to give our taxpayers a voice. You know, we're going to pass this legislation today, but we have to, as I said before, really consider moving forward with real mandate relief and State funding. You know, business and industry are drawn to the areas of high-performing public schools, a solid economic base and reliable, quality municipal services for our residents. The way to sustain communities and the State is to value, not devalue, our public schools, our teachers and our children. Our children are the drivers of our economic future, competitiveness and economic vitality. I know everyone here realizes that we not only represent - at least I feel strongly that I not only represent a voter constituency, but I also represent those too young to have a voice in the electoral process. We must not abdicate our responsibility to provide a sound, basic education for every child. It's their constitutional right. We must not abdicate our responsibility. We have to have real property tax relief. I urge my colleagues to vote in the negative. ACTING SPEAKER P. RIVERA: Mr. Abinanti. MR. ABINANTI: Thank you, Mr. Speaker. Following up on what my colleague from across the River from me from the suburban Rockland County said, I would like to speak on behalf of my 140 NYS ASSEMBLY JUNE 24, 2011 view of what this does to the suburban County of Westchester. It does not provide tax relief and it does not address the causes of high property taxes. It's a bad idea that somehow caught on and just won't go away. If a tax cap were a good idea, we would have a proposal before us for a tax cap Statewide, for all local governments, including the City of New York. And, we would be capping tax burden, not just property taxes, which is the way we finance our government and our schools in the suburbs. I can't speak to how New York City should be run. I can't speak to how Upstate, the rural areas, should be run, but I spent 19 years as a county legislator and six years as a town councilman. I have a little idea of what's going on in Westchester County. This proposal is a disaster. This scheme has significant constitutional implications. It's bad public policy. It interferes with home rule. It's a job killer. It reduces services to our communities yet, paradoxically, produces not one penny of tax relief. The present proposal may be unconstitutional because the Constitution already proposes and imposes a 2 percent cap. So, you cannot tax more than 2 percent of your taxable property values, and the courts have held that this Legislature cannot monkey with that cap. The Constitution prohibits any action which impairs a local government's ability to repay its debt. That's what this does. It grants local governments home rule with the right to levy taxes. This violates that. And it guarantees every child an affordable, sound, basic public education, and we already know the courts have said this State has not provided the monies for that. And the courts have said money is the most important part and we're saying to the local governments, you can't 141 NYS ASSEMBLY JUNE 24, 2011 replace what this Legislature took away. I suggest this may be unconstitutional. Now, it's also bad policy. There's everything wrong with it and nothing right. Number one, it's a job killer. It's designed to lay people off. Look at the numbers nationwide. The private sector has struggled to produce more jobs than it loses. But we're losing on the national level. Why? Because we have 400,000 public-sector jobs that have been lost in the last three years, and it's estimated this will cost us 13,000 jobs over the next year, as a result of this proposal, if this becomes law. And it doesn't provide one penny of tax relief, not one penny. If you struggle paying your taxes today, you will have problems after this bill is passed. You have to understand the way taxes are imposed in the suburbs. You have a budget, you have a tax levy and you have a tax rate. I can tell you about one local school district that has a $56 million budget. It had $2.1 million worth of structural costs, including a 30 percent increase in pension costs this year. It struggled and cut that back to a $700,000 increase by getting rid of teachers and other means of providing education to the kids. So, it had a 1.2 budget increase, and after it used up its surplus and to balance the State and Federal cuts, had a 1.5 percent tax levy increase -- well within this cap. But, guess what? The taxpayers had a 4.8 percent tax increase. Even if they comply with this, there's a 4.8 percent tax increase because some of the wealthy people in the community and businesses insist on challenging taxes and reducing the assessed value of the community. So, the local homeowner is paying 142 NYS ASSEMBLY JUNE 24, 2011 more in taxes even though this school voluntarily complied with what we're going to mandate. For how many years can they it continue to do that. The third point is this decimates home rule. It destroys the concept of home rule and it takes away powers from local officials who are elected to craft local budgets and spend local monies. You know, it's easy for us to mandate that somebody else solve the problem with the local unions and the teachers and deal with all of the problems. We're providing no help to them at all, but we're mandating that they solve the problem. Now, this is also based on several faulty premises, the the first of which is that school and municipal services are a luxury, and we can only afford a certain amount and if you can't afford it then you can't have it. Well, I want to respectfully suggest that emergency services and police services and clearing the roads and schools are not luxuries, but we have to find a way to pay for them. They're not something that you can do without. And I would suggest to you also that all of the services being provided today are necessary, not nice to have. The nice- to-have stuff is gone, at least in Westchester County. We have been closing swimming pools. We have been doing things like that for a while, and we cut taxes last year 2 percent. As a result of this State's budget, there's another 1 percent that's gone. So, the County of Westchester is living on 3 percent less than it was last year. How will it ever get that back? Under this tax cap it could never go back to last year's taxes and it's going to continue to spiral down. It's also based on 143 NYS ASSEMBLY JUNE 24, 2011 the faulty premise that everything else in the world is going to stay the same, that there are not going to be any more Federal and State cuts that are going to affect the budgets, as if the Federal government and this State is going to continue to provide the same level of funding so that the local governments and the schools can deal only with their own discretionary matters if they have any less. It doesn't take into account the fact that we're cutting and the Federal government is continuing to cut. I would like to make one point here. I noticed this is linked with rent control. A tax cap is not rent control or rent stabilization. It is not going to make housing or living in any our suburban communities any more affordable. It is not equivalent or even analogous to rent control. In fact, rent control makes an apartment more affordable by restricting profits of a private investor who knew the terms of the investment when he or she bought the building and knew that it was controlled by a landlord -- was under the control of government. That is very different than trading off services to lower the cost of taxes. And the tax cap will make suburban life more expensive, not less expensive, because it's designed to cut funds available for municipal and school services but it's not going to cut the need for those services. People will still need them, and those who are wealthy will just pay for them privately. So, those will have more will continue to have the same and those who have less will have more of less. And, so, our communities that are poor with people in them that cannot buy their own services, that can't live in gated communities, are going to suffer. They're 144 NYS ASSEMBLY JUNE 24, 2011 not going to have the pre-K, they're not going to have the daycare, they're not going to have all of the things that we take for granted today because government is going to stop paying for those. Those who are wealthier will just pay them privately. The rest will not have them. So, it's going to make our communities more expensive to live in, not less expensive because, in the end, privatization -- which is what this fosters -- actually costs more. And this is going to damage our communities. As I have already said, there are going to be trade-offs; whether you have potholes or police officers, whether you have road repairs, roof replacements or whatever. Our infrastructure is going to fall apart because infrastructure will be the last item that our local governments will put money into. And this is going to encourage poor fiscal practices, as we discussed this morning. We are encouraging municipalities to bond costs. We have already heard some discussion about what this is going to do to our schools. I respectfully suggest that this is going to very badly damage our schools. We already have a present sensible cap on schools. For those of you who are not familiar with the contingency budget, when two budgets fail, two votes fail, you fall back to a contingency budget. A contingency budget is the exact same thing as a tax cap -- this year it's 1.9 percent -- except it has some sensible exceptions in it. The things that we mandate the local schools to do are excepted from the contingency budget. This tax cap is basically the same as a contingency budget, but removes all of the sensible exceptions that this Legislature put into the contingency over the past how many years. So, in one vote we're wiping out all of the good stuff that we did over the 145 NYS ASSEMBLY JUNE 24, 2011 years. And it's also interesting that this is being described, even by its proponents, as "a blunt instrument". Well, you know, we have problems in this State. So what do we do? We set up a study commission. But, we're not going to do that with the schools to see what's wrong. No, we're going to hit them with a blunt instrument and we're just going to say, "2 percent. And you guys on the bottom, you figure out how to get to the 2 percent." It's also interesting, this is undemocratic. The most democratic part of our system is to allow local voters to vote on a budget. This takes that and turns it on its head. It says 40 percent of the people have more power than 60 percent of the people because if you don't get a 60 percent vote, you can't go to a higher spending level. So, we're saying those of you who vote no count more than those of you who vote less or vote yes. So, that's very democratic, I would suggest. And this is not going to cap, as we said before, school taxes. It's just going to cap educational opportunity. We're going to see a real change in our schools, and not for the better. If you take a look you will see the income disparity between our communities is reflected in the type of education that's given in those communities. And it's going to get worse under this. Twenty-four school districts with a non-white population was over 70 percent. Sixty percent of them would not have overridden if this were in place. So, that is, the minority school districts will not override. The last numbers this year show that of the school districts with a non-white population over 70 percent, 60 percent would fail the requirements. And there's really no escape valve; on the other hand, there are sensible 146 NYS ASSEMBLY JUNE 24, 2011 alternatives. We could use a tax circuit breaker to give people tax relief. We could use a sales tax dedicated to the schools. We could use an income tax dedicated to the schools. There are alternatives that give real property tax relief. And, you know, the public support for this is well overstated. There are surveys out there that show that the public really likes the tax cap. Well, some people did just a poll in Westchester County, and they found, interestingly, that when people were informed and were told and said you have a choice, a tax cap or degradation of your school system or degradation of your services, not surprisingly, those who supported the tax cap, the number dropped dramatically. And what many of you may not know, there's an online petition. You know, you can go around to a supermarket and get somebody to sign a petition very easily because they'll sign anything. But, when somebody is being told, "Please sign on online," they have to read what it is they're signing on to, then they have to go through the trouble of finding the petition online and going through that process of adding their name. Well, right at the moment there are more than 10,000 signatures against this proposal and the number is growing by the hour. So, I'm going to suggest to you that when people start to see what it is we did to them, this is not going to be very popular. So, I want to suggest, in short, this tax cap, unfortunately, will begin the process of change in our suburbs and it's not going to be a positive change. So, I urge you to vote no. ACTING SPEAKER P. RIVERA: Mr. Fitzpatrick. MR. FITZPATRICK: Thank you, Mr. Speaker. Since 147 NYS ASSEMBLY JUNE 24, 2011 our esteemed colleague from Manhattan, Mr. Bing, is leaving after today, we did not put this bill through the Housing Committee and he lamented that he would not have an opportunity to see Mr. Lopez and I do our thing one last time. So, I'm going to ask Mr. Lopez if he could just give us a brief explanation of the rent control or the rent stabilization portion of this bill, very briefly. I know we only have 15 minutes. ACTING SPEAKER P. RIVERA: Mr. Lopez? MR. V. LOPEZ: Briefly. We have to define "briefly." Thank you. You know, I would be only glad to explain the bill. Individuals should know that when we deal with rent regulations and rent stabilization, in the three previous pieces of legislation the benefits and provisions were eroded. This is the first time ever in at least the time I have been here, and I'm here 28 years, that the benefits have been enhanced. I think you were part of a debate earlier this year when we came up with a bill that was very comprehensive, had 12 additional benefits. This bill has, I think, four or five, depending on how you look at it. And, also, when you start dealing with compromises, no one likes it, you know. So, the people on the far left don't like it, the landlords don't like it, the real estate people don't like it. The only people that like it are myself and Shelly Silver. No, just joking. It is a work in progress. People came up with a compromise and this was through negotiations. So, let me explain. It's a four-year rent extension, rent stabilization extension. We modified the individual apartment improvements from 160 to 140. The vacancy deregulation threshold, well, in reverse, the act would adjust the vacancy deregulation from 2,000 148 NYS ASSEMBLY JUNE 24, 2011 to 2,500. That is, I think, a 25 percent increase. It also -- prior to this, something was sensitive to me that if you vacated your apartment, every two months there would be consecutive 20-percent increases. This limits the apartment to one 20-percent increase. And, lastly, when we deal with the high-income, high-rent deregulation thresholds, we raised the incomes from $175,000 to $200,000 for units. And rent thresholds would increase from 2,000 to 2,500, like I said. Basically, that's the rent stabilization. This bill would also require the Division of Housing and Community Renewal to promulgate rules and regulations to implement and enforce all provisions of the Rent Regulation Law of 2011. Very significant to the people that are advocates on rent regulations. We pass laws and then seldom are they enforced. This mandates, through language, an enforcement authority by DHCR. So, in summary, I think that's the summary of the bill. As I stated, this bill -- there's a lot of people. Shelly Silver came out real early, whether people liked it or not. When the Governor had the State of the State on his commitment to rent regulations, my office, people like Jessica DeMarco and Jonathan Harkavy and Debbie Feinberg, probably had more meetings, not only with tenant advocates, but with landlord groups and real estate, and we tried to come to bring everyone together. I want to let you know there were about 30 such meetings. The end result of all those meetings was, we failed. We couldn't get a consensus, but we put in a lot of time and energy. I believe -- although I would like to see a better bill, this is not a perfect bill, but this is a compromise. And like I stated earlier, it's the first time in years that we've had some 149 NYS ASSEMBLY JUNE 24, 2011 enhancements to the Rent Regulation Laws. MR. FITZPATRICK: Very good. Thank you, Vito. We call this the Emergency Tenant Protection Act. This emergency, how long have we had this emergency? I guess it goes back to, what, 1940, end of World War II? MR. V. LOPEZ: Well, you know, the answer to that. We've talked about this regularly, that no apartment, no unit, has to be rent regulated. All a landlord has to do is build and not get government subsidies. Then they would be exempt from any regulations. But, what's happened for the last 50, 60 years, when individuals take subsidies then they have certain obligations. That's the same thing with the Roberts decision on -- you know, that's impacting a number of units in Manhattan where they took the J-51 benefit and the courts decided, the courts, that that benefit limited them to vacancy decontrol of the apartments. So, the point is a good one, but if you want to build and you don't want to participate in the rent regulation system, all you do is you do it without government help. Once you get government help, then you have to take certain conditions. MR. FITZPATRICK: Well, absolutely. You know, property owners who avail themselves of those programs fully understand. It's those units where government control was imposed upon them. This was a temporary response to a situation that developed after World War II. We are still living with it. We are the only city, major city in the United States that still has government control of its housing stock or a significant portion of the housing stock. We are not creating, by 150 NYS ASSEMBLY JUNE 24, 2011 virtue of an extension of this law, two classes of people? We have those who are protected, frankly, who don't deserve protection, those who have high income, at the expense of hard-working, middle- and lower-class people who are basically frozen out of a housing market where rates would be very competitive and very affordable for them because there are people who make significant amounts of money who are in rent-stabilized apartments and rent-controlled apartments who have no incentive to moving out, have every incentive to stay and that is very harmful to younger families, younger New Yorkers who have no place to go. MR. V. LOPEZ: Well, I think you would sort of place your thesis or theory in a little bit of conflict when you visit parts of my district -- and I have been trying to get you out there. We wanted you to come last night but you stayed there, I went down. When you look at the one-, two- and three-family unit housing, they have no rent regulations. So, if you came to my district, what you will see is -- and if you worked out of my office, and we pay well, maybe better then you get paid as a salary -- you would get phone calls from ministers saying, "Do you know Mrs. Bacigalupi can't stay. Her rent just went from $1,200 to $1,800 and she only has $1,600 in Social Security and pension. You have to help her out." And there's no market protectors, no protections at all. A young lady across the street, a Lithuanian lady, outlived her family. She said, "My only crime is I lived longer than my children." And she's 88 years old. She cannot -- she's now exhausted her savings, and you might say, "Well, fine. It's market system, to hell with you." We have the fastest 151 NYS ASSEMBLY JUNE 24, 2011 growing number of people in Williamsburg going to shelters. The government pays from a different end. And, you know, interestingly, they'll pay $3,000 a month to place a family in a shelter when they won't pay $1,500. So, this free market system, you have to see how it works with the one-, two- and threes. If we want to replicate that, we're going to be in a lot of trouble and what we will have is ghettos. What will happen is this: People will be -- someone says, well, why do they have to live in Manhattan? Well, that's Manhattan. Why do they have to live in DUMBO or Williamsburg or Bushwick? I represented, up until a few years ago, the poorest community in New York State. It's changing rapidly, and it's scary because a lot of the people that have been living there -- and these are every kind of group -- white, ethnics, minorities -- they can't live anymore there. So, does government -- do we have an obligation to help them? The question before us. I think we do. MR. FITZPATRICK: Very good. That's a fair point and I think the way government helps the people you just referred to and speak of is, quite frankly, to get out of the way and provide opportunities for developers to build that housing, whether it's addressing the zoning laws of New York City or the environmental regulations that hamper development of housing for the population that you're trying to serve, that we all want to serve. Landlords are not in the business of building housing beyond the market's ability to pay. They want to provide a service, provide housing. They want to do it at a fair price, at a fair profit but, in fact, it's government that stands in the way through either a zoning 152 NYS ASSEMBLY JUNE 24, 2011 and/or regulatory process, but also through regulation of the current housing stock, which puts limitations on how much they can earn. And who suffers because of that? The tenants of those buildings who live in substandard or less-than-perfect housing because of an owner's inability to earn enough of a profit to maintain that property. But, I thank you, Vito. MR. V. LOPEZ: Just let me answer that and make a statement. MR. FITZPATRICK: Sure. I'm running out of time, though. MR. V. LOPEZ: Part of the bill, quickly, deals with the real estate industry. It is a 421-a tax exemption where only 20 percent of the units are affordable and 80 percent aren't, they are market rate. And so -- MR. FITZPATRICK: Right. That works well. MR. V. LOPEZ: -- there's an incentive -- works well, depending -- my position would be if it was 40 percent, you know. If it was that, I would be much happier. And, also, something that you should be very excited about because you're colleagues in the Senate wanted it, to communities outside New York City we created a 421-m, which is also similar to 421-a, out of New York City, the localities have to opt in and it could be multiple dwellings. At least half of the units have to be, you know, residential. So, these are incentives. So, in this piece of legislation we're helping developers by giving them tax breaks. We're building a certain percentage of 153 NYS ASSEMBLY JUNE 24, 2011 affordability. We're maintaining rent protections to a certain group of people and the market and the population growth in the City causes us to interfere. As I opened up earlier, anybody that wants to, anybody that wants to, they could build without any regulations, just go out there to build without government help. MR. FITZPATRICK: Very good. Thank you, Vito. Mr. Speaker, on the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. FITZPATRICK: This is a tough vote for all of us. I strongly oppose rent control, but I'm very much in favor of a tax cap. Mrs. Bacigalupi, who Mr. Lopez refers to, is a victim of this current system because there is no affordable market for her and others like her because there are too many people who are undeserving of protection due to their high income, but there's no incentive for them to move out when they're paying a below-market rent. And that's what happens when government gets involved to control prices. It distorts the market. And we're going to have this continue for another four years, unfortunately. But, on the good side, we will get a tax cap and it's going to drive, I think, on the tax cap side of this bill, it's going to drive a very important conversation that is long overdue and that is what is driving our costs up, those structural cost drivers. There's no more blunt instrument, as was referred to by a previous speaker, than the Triborough Amendment. That is a blunt instrument used against the taxpayer by every school district, every county, every township. There's no more blunt instrument than a rigged contingency budget system where contractual arrangements, 154 NYS ASSEMBLY JUNE 24, 2011 contractual agreements, are off limits, and it's those very contractual agreements that are driving up our costs. So, sooner or later, ladies and gentlemen, we will have what I call "our Wisconsin moment," where these very difficult issues will have to be dealt with responsibly because the costs are going to continue to go up. Borrowing will not solve that problem. It just pushes the problem off to another day. A tax cap is necessary because it's going to force us all to have a conversation no one wants to have, but we have to have. Thank you very much. ACTING SPEAKER P. RIVERA: Mr. Donald Miller. MR. D. MILLER: Thank you, Mr. Speaker. Would the sponsor, Mrs. Galef, yield for a few questions? ACTING SPEAKER P. RIVERA: Which sponsor? Mrs. Galef. MRS. GALEF: Yes. MR. D. MILLER: Quick question, I think. Under this cap, how much can taxes go up? MRS. GALEF: It really depends on the community and whether you're talking about the local governments. With the local governments, they have the opportunity to raise their taxes as high as they want if 60 percent of the elected officials decide to do it. For school districts, it is up to the public. It's also up to the school board to decide what kind of proposal they're going to put out to the public, but it is up to the public to decide how much they're willing to entertain with an 155 NYS ASSEMBLY JUNE 24, 2011 increase. MR. D. MILLER: Okay, good. Thank you. Thank you. On the bill, Mr. Speaker. ACTING SPEAKER P. RIVERA: On the bill. MR. D. MILLER: I think the answer to that question is we don't know. Everyone who has risen in this Chamber in opposition to the cap so far has -- the implication in their opposition has been that we need to tax some more. We need to spend some more and we need to protect the taxing and the spending that we do. I am so unbelievably in favor of a tax cap, it just makes me want to jump out of my shoes. The problem is, I'm not in favor of this tax cap. You know, last year I made a promise to the families and the employers of the 121st District. I promised them that I would vigorously pursue job creation through tax cuts and spending reductions. This property tax cap bill raises taxes and allows this Legislature to continue to spend without restraint. This is being marketed as a 2 percent property tax cap, but the cap isn't there. There are carve-outs, there are exceptions that will allow taxes to continue to rise and there's no spending control within this bill because there's no relief from unfunded State mandates. Only the New York State Legislature could pass a tax increase without actually knowing how large it is and continue spending without restraint and call it a tax cap. The taxpayers will be astonished later on this year and next year when their property taxes continue to rise because they believe that we're under a tax control regime. In this bill there is no cap. This bill -- in my opinion, this is going to be a political vote on a political bill 156 NYS ASSEMBLY JUNE 24, 2011 designed for political advertising next year. Now, I consider myself to be a fairly reasonable person -- at least I like to think that I am, and I try to be reasonable. I understand the art of compromise. I understand, you know, the art of taking half a loaf in order to move the marker down the field, in order to advance an idea incrementally. But, my friends, I want us to understand here that that's not what's happening. This 2 percent property tax cap is not incremental tax control. It's institutionalizing tax increases. A 2 percent cap is no cap at all. It's a guaranteed 2 percent tax increase. Why do I say that? In a no-cap environment there will be some years, usually election years, when property taxes won't go up. The reason that local governments can do that is because they know that in ensuing years they can raise taxes 2 percent or 4 percent or 10 percent or whatever they want, but in a tax cap environment, in an environment where property taxes are capped, local governments, whether they need to, from a budgetary standpoint, or not, will go to the cap virtually every year in an attempt to build a reserve fund for years when they would like to go to the cap or exceed the cap, but they can't. Now, some people will say, "Well, let's look at Massachusetts. They've had some success with their cap." Massachusetts is interesting, but it's irrelevant because their success isn't tied to their tax cap. The reason the Massachusetts model has worked is something very simple. It's called comparative advantage. New York and New Jersey have significantly larger populations than Massachusetts. Those populations are wealthy and mobile and they live under a significantly larger tax burden than Massachusetts has. That gives 157 NYS ASSEMBLY JUNE 24, 2011

Massachusetts a comparative advantage over New York and New Jersey when families and employers are looking for a home. The Massachusetts model doesn't apply for New York because New York is the highest- taxing, highest-spending State in the nation. We have no opportunity to create a comparative advantage with any other state, certainly not when we institutionalize annual 2 percent property tax increases. Any tax cap that's above zero is a tax increase, plain and simple. And it's a tax increase that we cannot afford in this State because it's a job killer. New York State, we are the worst in the nation on taxing. We collect more State income tax per capita than any other State. We collect more State and local income tax per capita than any other State. We collect more State and local corporate tax than every other State except for Alaska, because of their oil industry, and we'll take back the number one spot once we start hydrofracking. Only a handful of states collect more State and local sales tax than we do. Only California has a higher gas tax than New York, and that's just by four-tenths of a penny. Only two states have higher cell phone taxes than New York. New York State even has the highest cigarette excise tax in the country, which I don't have a problem with, which may shock some of you. I don't have a problem that our cigarette excise tax is the highest in the country, but I'm afraid that it's not highest because we're most adamant about discouraging smoking. I'm afraid that our cigarette excise tax is the highest in the country because that's just what we do. We want to be first in the highest taxes in the country. Now, let's talk about property taxes. New York State, 158 NYS ASSEMBLY JUNE 24, 2011 we collect more property tax per capita than any other State. For owner-occupied housing as a percentage of home value, nine of the ten highest-taxed counties in the country are in New York State. My own county, Onondaga, has the seventh-highest property taxes in the country; not in the State, in the country. Set all of that taxing against the fact that we are no higher than sixth in the nation in income per capita and you can see where the problem lies. We do not have a revenue problem in this State. We are not under taxed. I am unconvinced by the argument that if we just tax a little more, give just a little bit more to the State, then all of our problems will be solved. We will have paid for whatever we need to pay for and we can all breathe a sigh of relief. It is absurd to argue that in the highest-taxed State in the nation we don't collect enough taxes. We do not need and we cannot afford annual 2 percent property taxes increases. You know, we need real tax relief in this State. Everyone who has risen to this point has defended the current system. I proposed new ideas. Someone said somewhere that we need a proposal that actually caps taxes. I proposed legislation that's a 0 percent property tax cap. Zero percent is an honest, genuine cap that stops property taxes from rising so that we don't need gimmicks like a circuit breaker. A circuit breaker is supposed to help, you know, our elderly, our indigent, our infirmed so that they don't have to worry about being taxed out of their homes. Under a 0 percent cap they don't have to worry about being taxed out of their homes because their property taxes won't rise. Now, 0 percent, you know, the street says 0 percent is pretty harsh. Everyone 159 NYS ASSEMBLY JUNE 24, 2011 with an interest in growing government makes the same argument. They say caps are draconian. They say caps are a blunt instrument. They claim that State and local governments can't survive under something as reactionary as a tax cap. Nonsense. Every other major tax that we impose in this State is capped. Sales tax is capped, 3 percent with a 1 percent extender. Income tax is capped at a number of levels. In fact, the debate about raising the millionaires' tax is fundamentally a debate about exceeding the income tax cap. The corporate tax, capital gains tax, estate taxes, are all capped in the same manner. They cannot exceed a particular level. Property tax is the only tax that's not capped, and it needs to be capped because, look, let's be honest. The reason the seniors, our seniors and our working families can't afford homes is because the property tax is not a tax on property, it's a tax on income. It just happens to be -- it's an income tax. It just happens to be figured on the value of a person's home instead of the value of their paycheck. But, it's still paid for out of current income. A person's primary residence doesn't generate revenue and that's why our seniors cannot afford to keep their homes and that's why our working families can't afford to buy home. A 0 percent property tax cap is the first step in the right direction toward helping our seniors and our indigent. Our problem is not on the taxing side. Our problem is on the spending side. So, how do we handle the spending side? Well, not with the bill before us today. This bill does virtually nothing, virtually nothing, to control State mandates, funds or unfunded. My proposal for a 0 percent property tax cap contains in it complete mandate 160 NYS ASSEMBLY JUNE 24, 2011 relief for local governments, towns, villages, counties, schools. You know, we tell the locals what to do. We tell them how to do it, we tell them when to do it and we do it with precision. Sometimes we even do it with a little bit of flair, but we don't do it with any money. In fact, we hide the true size of our spending problem here in Albany by forcing State programs onto the locals for them to pay for. Schools are a great example of this. Every year people go to the polls and they vote on their school budgets. They believe that they're voting to approve or reject their local spending plan, but you and I know that they're not. Somewhere between 90 and 95 percent of those school budgets are driven by us. We're telling them what they're going to spend their money on. Occasionally a budget goes down and a district will go to contingency and taxpayers are shocked that the contingency budget is higher than the budget they just rejected. Why? State mandates. That's us. You will often hear the argument that schools can't survive under a cap, and that's true if there's no mandate relief. In my bill there's complete mandate relief which returns budget control and decision-making to school districts and local governments, and that saves our schools. And for that reason alone, with no mandate relief in the current bill, for that reason alone it's worth voting against this bill. But, I'll tell you what. Even under this current bill, as bad as it is, the argument that schools can't survive a tax cap is bogus. Property taxes are not a dedicated revenue stream for schools and a property tax cap does not define the limit of education spending. A property tax cap defines the limit of property taxing. We could cut taxes in New York State, taxes 161 NYS ASSEMBLY JUNE 24, 2011 and spending, across the board 10 percent if we wanted to, and still increase education funding. It's simply a matter of priorities for us. So, what about the argument that we can do a 2 percent cap today and drive it down later, or we can do a cap now and get real mandate relief later on. I worked in Washington long enough to recognize that one. Don't you believe it. Don't believe it. Mr. Speaker, my constituents and all New Yorkers need honest tax relief and we only get that with a 0 percent property tax cap, not with the bill that's before us today. We need genuine spending controls. We only get that with real mandate relief, not with the bill that's before us today which is virtually silent on mandate relief. Today might not be the day for a 0 percent property tax cap, but neither should it be the day for a 2 percent cap that could be who knows how much. I made promises to my constituents back home. I promised them that I would not vote for a cap that's above zero. I promised them I would only vote for mandate relief that actually relieves and saves school districts and local governments, and I promised them I wouldn't vote for any of those proposals if they were included in the same bill. Unfortunately, as much as I like the idea of a tax cap, and as much as I'm going to continue to fight for a good one, this bill tonight, for me, based on the promises that I made to my constituents, fails on all three counts. Thank you, sir. ACTING SPEAKER P. RIVERA: Ms. Paulin. MS. PAULIN: Thank you, Mr. Speaker. We have reached a point where property taxes are just too high. No one is 162 NYS ASSEMBLY JUNE 24, 2011 questioning that fact. The question we are debating before us is whether or not to adopt this tax cap, this proposal. If we do, will we contain costs but still allow our cities, towns, villages and schools to provide the services and programs that make them among the best in the nation? Can this tax cap, with not one bit of real reform, token reform, minutia reform, actually achieve the goal of reducing taxes without doing irreversible, long-term damage? I don't believe it can. First, there's a time warp between when the cap is effective and when schools and municipalities can negotiate new contracts with adjusted salaries and benefits. It could be as much as three years. Thus, for those three years, if local communities and school districts cannot reduce salary increases, increase benefit contributions or reduce staff, they will be forced to cut or eliminate programs to stay within the cap. As we all know, once a program is eliminated it's very hard to bring it back. We will see discretionary programs -- kindergarten, art, foreign language, sports in the schools, recycling pick-ups, street and sidewalk repairs in our municipalities reduced, response time to police and fire emergencies reduced, putting residents at risk. I'm particularly vexed by the proposal to allow an override of the tax cap with a supermajority vote. Not only is it undemocratic, as many of my colleagues have pointed out, the wealthier school districts will likely get a 60 percent majority to override the cap, but the poorer districts will not. Year after year after year, poorer districts will need to cut more programs and more staff to stay within the cap. This 60 percent supermajority override will surely create a greater learning gap among poor and wealthy students, exactly what we 163 NYS ASSEMBLY JUNE 24, 2011 have been trying to avoid for the last decade or more. It is clear, too, that we cannot institute a tax cap without significant mandate relief. As most of you know, pension contributions are a fixed mandated cost for municipalities and school districts with little control on their part. In my community, the most recent village budget pension costs were 4.5 percent increase on the tax levy. Obviously, if the tax cap were in place this last year, major cuts in services and staff would have been required. In my school district, the increase from pension costs was 1.72 percent, leaving little or no room for other increases, programmatically or contractually. The bill we are voting on would require an 18 percent increase in pension costs before costs could be exempted. Moreover, capital costs are only exempted for school districts, not municipalities. What happens when the community has a boiler breakdown, needs a new fire truck or has to replace aging sewer lines and basic infrastructure? Do we force communities to fire a firefighter to buy equipment; fire two police officers to pay for their equipment? I've thought long and hard about this decision. Voting yes is clearly the easier vote. It's the political vote. Is the politically-expedient vote, but I believe it's also the wrong one. In the end, I could not be part of a movement that denied reality, abandoned our students, neglected our citizens and threatened our future. I don't believe this cap is sustainable over time. A yes vote today will create irreversible damage to our educational programs and municipal services. I plan on voting no and I encourage and urge all of my colleagues to do the same. 164 NYS ASSEMBLY JUNE 24, 2011

Thank you. ACTING SPEAKER P. RIVERA: Mr. Zebrowski. MR. ZEBROWSKI: Thank you, Mr. Speaker. I rise today -- it's no secret that property taxes are one of the largest burdens that are affecting our residents here in New York State. How many years, how many Sessions, how many platforms, how many campaigns have there been where property taxes are one of the number-one priorities? Yet, it doesn't seem that we ever really get a handle on it. It's a burden for seniors that are living on fixed incomes. It's threatening families that are trying to thrive in our suburban Upstate and urban districts. And it's a burden on young people who are trying to get a foothold in the communities they grew up in. And, perhaps, most importantly, it's also a burden on our businesses. You know, in Rockland County over the past eight years property taxes have grown at double the rate of wages. Wages have grown by about 2.29 percent and property taxes by about 5.21 percent. However, that doesn't really tell the whole story because in the past couple of years, school districts and municipalities have lived within the property tax cap. They have kept it around 2 percent. However, it's those prior-year budgets where the overhead is really created that taxpayers are still living under. If you take between 2003 and 2008 in Rockland County, the average property tax increase was 6.35 percent. For a lot of districts there was at least one time in there where the tax increase reached about double digits. To put this in context for my constituents, if one of my constituents currently pays about $8,000 in property taxes and 165 NYS ASSEMBLY JUNE 24, 2011 the average increase is around 6 percent, in five years they'll be paying $10,800 in property taxes. $12,000 starting now, it will be $16,300 in about five years. This is simply unsustainable. We talk a lot about growing businesses, creating jobs. And we talk about it not just because it grows the economy and gets people back to work but, also, because if you can grow rateables, you can help reduce property taxes. However, you only need to ask one business in any of our regions what the single biggest obstacle is in either coming to New York or staying in New York, and they'll tell you it's property taxes. It's simply time for a time-out. I think that's what this tax cap will finally do. It will call a time-out on this rising burden, and it will put a downward force on the rising expenses that we have all seen our municipalities and school districts do. But why a tax cap? Why did we come to a tax cap here when we have talked about a host of proposals and everybody, everybody in this Chamber, in the campaign has talked about property taxes as the number-one priority. You know, I was sitting at a forum a couple of years ago with a couple other State Legislators that a group put together -- I don't even remember what it was -- and it was on property taxes. About midway through the forum I looked out into the audience and in the audience were school superintendents, town supervisors, county officials, and it occurred to me that I was up on the panel talking about property taxes and I was from the only level of government that didn't levy property taxes. Everybody that levied them were out in the audience. You know, our municipalities and school districts in this 166 NYS ASSEMBLY JUNE 24, 2011

State operate under the authority given to them by the State. The legal term of art is called they're "creatures of the State;" therefore, it is incumbent upon the State, if we see a problem in the way that municipalities and school districts are operating, to change the way that they operate. By enacting a tax cap we're saying that the current status quo is not working. The current status quo is not allowing families to thrive, it's not allowing seniors on fixed incomes to stay in their house and it's not allowing young people to get a foothold in their communities. There has been a lot of misconceptions about that tax cap and there have been a lot of half-truths. The first thing that I have heard a lot is that this does not provide tax relief. That is simply not true. This slows the rise of property taxes. As I said before, if you're paying $8,000 now and you pay the average property tax increase in Rockland County, you will be paying close to $11,000 in five years. Under this bill, you will be paying less. That is property tax relief. I have heard a lot about the minority of voters being able to determine a budget. If we enact a tax cap where a simple majority can override, it will be the status quo. We won't have done anything in this Chamber. In fact, if you stay at 2 percent or under 2 percent, a simple majority will follow; however, we do allow certain municipalities, under the guise of home rule, to make the case to taxpayers and to get a supermajority of 60 percent in the case of school districts, in order to override. We've also heard a lot of fear tactics. I have gotten letters. I have heard about kindergarten being eliminated, I have heard about roads not being plowed, that there is no police coverage. Let's get this straight. 167 NYS ASSEMBLY JUNE 24, 2011

After this bill passes there will not be a decrease in spending. There will not be a decrease in taxes. There will simply be a limit in the increase. To all those teachers that have written me -- and, you know, we talked a lot about teachers earlier today and I respect the job that they're doing -- to all those teachers, if we enact this today it will simply limit the increase. If you have kindergarten in your budget today, if you have snow plowing in your budget today, next year you will only be allowed to increase it 2 percent. If you have to increase it more than 2 percent, go to the voters. Convince the voters. Get a supermajority on why it's necessary to go above the 2 percent because the State is determining that property tax increases are a problem of paramount concern and we need to get a handle on that. You know, we heard a lot about the circuit breaker and I supported the circuit breaker in the past; however, the problem with the circuit breaker is, number one, you need to come up with over $1 billion to pay for it and, number two, it really doesn't do anything to control the cost of spending in our State or in our municipalities. Anyone who has had school budgets or had school referendums on capital projects will tell you that one of the things that goes on during the debate is that everybody says, "Listen. This might cost 'X' amount; however, we're going to get 'Y' amount in reimbursement from the State because that's what they reimburse us for capital costs, so it's really only going to cost the taxpayers a lower amount because of the State reimbursement." The problem with that is that everything just keeps going up. It keeps snowballing. It's still coming out of your pocket. It's just coming out of 168 NYS ASSEMBLY JUNE 24, 2011 the other pocket. The way the circuit breaker works, people will be putting forth tax breaks, tax increases of 6, 8, 10 percent, but they'll be saying to people, "You know what? With the circuit breaker, the State will be picking up 'X' amount." Our budgets are going to skyrocket. State taxes are going to skyrocket. We're going to be continuing to cut because we're not cutting expenses. This will force people to cut expenses. You know, just to conclude, I understand the challenges of our school districts and municipalities. I have had countless meetings with them and I have done a lot of things throughout my time here to try to ease that burden. There are mandate components to this bill, which I think are good. I think we need to go further. This tax cap takes effect next year, and I think it's imperative that we continue to seek out real money savings, real dollars for our municipalities and school districts. I have a lot of needy school districts in the district I represent. I pledge to continue to work with them to set up meetings, to continue to work with different ways that we can get additional State funding, identify ways that they're shortchanged within the State funding formula so that they can better handle the tax cap. However, I also know that I need to balance the very real burden of property taxes in Rockland County. As many calls and letters as I get from people that are against this tax cap or as many meetings I have with seniors or people that simply cannot afford it, maybe they're paying a couple thousand dollars in a mortgage and they're paying $1,000 to $1,500 in their property taxes. It's simply unsustainable. The current status quo is 169 NYS ASSEMBLY JUNE 24, 2011 unsustainable. The State is doing something today by enacting this property tax cap which will have a positive effect on property taxes. It will drive down costs and it will help people stay in that home. For that reason, Mr. Speaker, I encourage all my colleagues to vote yes on this bill today and I pledge to everybody that has written to me with concerns that I'll continue to work with you for the betterment of our children, the betterment of our communities, the betterment of our school districts and the betterment of our municipalities. Thank you. ACTING SPEAKER P. RIVERA: Mr. Jeffries. MR. JEFFRIES: Thank you, Mr. Speaker. Will the distinguished Chair of the Housing Committee yield for a few questions? ACTING SPEAKER P. RIVERA: Mr. Lopez? MR. V. LOPEZ: Yes. MR. JEFFRIES: First, Mr. Chairman, thank you for your leadership in this area. Thank you for the leadership of Speaker Silver. The bill that we have before us certainly is a meaningful step forward in an area where, as you have pointed out, for the past 20 years we have been sliding backward. I just wanted to ask a few questions of clarification as it relates to some specific provisions of the bill. First, it is my understanding that the bill changes the deregulation rent threshold from $2,000 to $2,500; is that correct? MR. V. LOPEZ: Yes. MR. JEFFRIES: And that is the first increase in the rent threshold since vacancy decontrol was put on the books in 1993; is that 170 NYS ASSEMBLY JUNE 24, 2011 correct? MR. V. LOPEZ: I believe so. MR. JEFFRIES: The bill also changes the provisions related to the statutory vacancy allowance which, under current law, allows for landlords to increase the price of a rent-regulated apartment by 20 percent upon vacancy? MR. V. LOPEZ: Yes. MR. JEFFRIES: And under the current law -- MR. V. LOPEZ: It limits it to one per year. MR. JEFFRIES: Right. So, under the current law there's no limitation on the amount of times that a landlord can get the benefit of that 20 percent statutory vacancy bonus, but under the provisions of this bill that vacancy bonus will be limited by one year, correct? MR. V. LOPEZ: Yes. MR. JEFFRIES: The bill also changes the law as it relates to the individual apartment improvements; is that correct? MR. V. LOPEZ: Yes. MR. JEFFRIES: And under the current law, any apartment, no matter the size of the building, upon vacancy and alleged improvements made by the landlord, that landlord would then be entitled to increase the price of the rent for the next regulated tenant by 1/40 of the alleged cost of the renovations; is that correct, under the current provisions of the law? MR. V. LOPEZ: Yes. 171 NYS ASSEMBLY JUNE 24, 2011

MR. JEFFRIES: And under the bill that's presented before us, the 1/40 increase would be reduced to 1/60 for -- MR. V. LOPEZ: All buildings with more than 35 units. MR. JEFFRIES: Okay. And the law would remain the same for buildings that are 35 units or under; is that right? MR. V. LOPEZ: Yes. MR. JEFFRIES: Now, with respect to all of the provisions that I just mentioned, as well as some of the other provisions that you previously discussed in your summary, what, if any, enforcement mechanism exists in the bill that's before us right now? MR. V. LOPEZ: Well, I think we've mandated that DHCR promulgate rules and regulations to implement and enforce all of the provisions that we just went through that are in this act, and we look forward to working with them and making sure that that particular piece, which is an important one, is enacted. And just for a second, thank you for all the meetings you have attended with advocates, as well as people who have different points of view. This is very significant. Our job is to sit down with DHCR and with some of the advocates to make sure that a solid plan is in place. MR. JEFFRIES: Thank you, Mr. Chair. And is the provision that you just referred to Section 44 of the act? MR. V. LOPEZ: Yes. MR. JEFFRIES: And under the current law it's the Division of Housing and Community Renewal which has historically been charged with implementing, administering and enforcing the rent 172 NYS ASSEMBLY JUNE 24, 2011 regulation provisions in the State; is that right? MR. V. LOPEZ: Yes. MR. JEFFRIES: And DHCR, as it's known, is an Executive agency in New York State under the current jurisdiction of Governor Andrew Cuomo; is that right? MR. V. LOPEZ: Yes. MR. JEFFRIES: Thank you, Mr. Chair. On the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. JEFFRIES: Again, I just want to thank Chairman Lopez and Speaker Silver and all of the advocates and my colleagues in government who have worked hard in a very difficult political environment to do the best that we can as it relates to both renewing and strengthening these very important rent regulation laws. There are 2.5 million New Yorkers who are living in rent-regulated apartments, and despite all of the rhetoric, the hysteria, the hype, the spin, the paranoia as it relates to the income levels of these individuals, the suggestion that an overwhelming majority of these folks are concentrated in wealthy Manhattan communities, the fact remains that these are working families, middle-class New Yorkers, low-income folks, senior citizens. The average income in a rent-stabilized household is $38,000. We have done the best that we can. There are folks who wanted more. If we could have done more, we would have done more. We were unable to, but this does represent the first significant strengthening in 20 years. In 1993 we slid backward. In 1997 we slid 173 NYS ASSEMBLY JUNE 24, 2011 backward. In 2003 we slid backward. But, for the first time in more than 20 years, in 2011 we're taking a meaningful step forward. And now the responsibility shifts to Governor Andrew Cuomo to bring life, as the Chairman indicated, to DHCR to enforce the law, to look out, as is your responsibility under the laws of this great State, for the 2.5 million New Yorkers living in rent-stabilized apartments. That is our challenge to you. We look forward to working with you, Governor Cuomo, in that endeavor and we live to fight another day. I urge all of my colleagues to vote in the affirmative. ACTING SPEAKER P. RIVERA: Mr. Weisenberg. MR. WEISENBERG: Thank you, Mr. Speaker, my colleagues. This is a very emotional situation that I have found myself in. I know this is going to pass, but it's a question of my values. Is politics take over government? No, not with me. I know that this is a very bad political situation that I'm facing because I'm going against what the polls show, 75 percent approval, but all I can do is vote from what I've seen and what I have experienced. I'm concerned because I can't see capping education because that's my life and that's where I have been and I see the successes that we have while people are knocking our schools, our teachers and everybody else saying we're not doing as good as we should. The answer really is we're really very much superior to everything else in our region or even within this country, and you can judge that by the science fairs that we have when we have a third of the national honorees coming from New York. But, the thing that bothers me so much is that I find that 174 NYS ASSEMBLY JUNE 24, 2011 there is a change in our society for the very people that we admired and respected and that we give an awesome responsibility in education to teach, are the ones that are being targeted and attacked. What I said before, earlier, on another issue, was I just don't understand why boards of education, who are elected people, to be able to get a representation of the people -- they elect their board. The board negotiates their salaries, the board hires the superintendent, and they pay them extremely high. That's up to the board who is elected representing the people. Not us. But, I mean, there is no reason why anybody should be getting $3- or $4- or $500,000 a year, but that's their decision, not ours. But, you know, the thing that bothers me are the consequences that I see. I was involved in elections where I had people bragging and campaigning, saying, "We're going to cut back on our school expenses, we're going to do with music and art. The success of our schools is being measured by test scores." And I'm saying people are teaching for tests, not to develop each and every child's potential. They're teaching to get test scores and we're missing out on developing the whole child. That's what the philosophy of education is all about. So, I feel that I have an obligation to stand here from my life experience and speaking with teachers, especially in special education, because if there are going to be cutbacks, believe me, the most vulnerable and the biggest target is going to be the cost of special education. And what the Regents have done, or tried to do -- I passed legislation trying to eliminate -- when I first got elected I had booklets, "What Every Parent Should Know About Special Education." I had it in 175 NYS ASSEMBLY JUNE 24, 2011

English and Spanish. I brought a card in from State Ed and I gave it out to the whole committee that was sitting in our conference. Nobody even knew about special education or their rights. So, I'm trying to inform parents that if your child is diagnosed as having a disability, it's difficult enough that you take the blame for your deficits of your child, but what do I do now? So, we give them that information. So, I see the Regents said, "You know what? We don't have to give those booklet out anymore. We're going to save money." Are you kidding me? IEP, Individual Education Plans. They're taking away the rights, or want to take the rights of parents to be able to stand up and have some kind of voice and support in advocating for their child. When I see these things happening it's frightening to me. And this is what they're going to save money on? I mean, we have a lot of issues. But, I'm not here to ask you to vote the way I feel. I'm just telling you that it is my values that I'm here for, and I'm going to take a vote that I know is with 75 percent of the polls. And I want to share this with you, and I'll do it as fast as I can. Phone calls. Everybody that calls me I try to call back. "Vote for the tax cap." I said, "Do you know what it's all about?" "Well, no. I don't know, but we have to vote for it." So, I said, "Well, you know, it's obvious to me that we had almost millions of dollars campaigning for this tax cap, but many of the people that called have no knowledge or understanding of what it is." I even had somebody call -- I said, "Spell that word". "Tax cat, C-A-T." I said, "Excuse me?" But, this is what is happening because people are being told this is what you should do and 176 NYS ASSEMBLY JUNE 24, 2011 do you it. But what is frightening me is that I don't see this being successful. I really don't. And with that, you know, I took on -- you know, Suozzi started this and David Paterson started this. And I have always said I can't, in my good conscience, vote for capping education. I don't think we should ever cap a potential. And I really feel the obligation and responsibility to every district. And, what bothers me the most is the poorer districts and those children are going to be the ones that are going to be hurt, I feel, the most. Well, we'll see how it works out. You know, good luck to the Governor. Good luck. I hope he's successful, but the reality is we're going to see that this is not going to do -- this is strictly a political thing and it's not really on its value or on its merits. It's not going to do what it is supposed to do. And when we talk about restoring or cutting mandates, it just isn't present. I mean, everything that was brought to view just doesn't do the job. You know, there was one bill I had that you can't have a special ed child have two Regents in one day. I mean, it takes hours and they need extended time and you have to have a teacher to be there. Look at the money you will save because a child shouldn't be in there for eight hours. But that's not even the issue. The fact is that it just makes sense to do, but we couldn't get that done. So, there are ways that we can make this better. But, I'm here to vote in my conscience and I said when I give up my values, I don't belong here anymore. So, I am here and I'm saying I'm going to vote against the tax cap because I really feel very badly that it's going to be not successful and that we're going to have people that are going to end up 177 NYS ASSEMBLY JUNE 24, 2011 being -- in some way, their opportunities will be diminished. Vito, I congratulate you on all the work that you did in regard to the housing, and I thank you, Mr. Speaker and my colleagues. I just felt I had to share with you the fact that I just can't vote for something against my conscience. ACTING SPEAKER P. RIVERA: Ms. Calhoun. MS. CALHOUN: The hour is late. I will not take a full 15 minutes. I have worked in taxes and understand them pretty well. For over 35 years I collected school taxes. I worked in assessments, and I have been here for 21 years. We are in a historic mode tonight, and I truly mean that. Nobody is going to go away from here totally happy because what we have done is we have taken two very divergent bills and we've put them together, and many of us are voting based upon one of those two sections of those bills and they're taking the other along because it goes with it. If you really need rent control, you know you have to vote for the tax cap because they're together. And if you're an Upstater and you really need the tax cap, you're going to vote for rent control because that goes with it. It's a very unique thing. But, I want to speak in a way that says we're taking an action tonight and we're looking forward. I think what we're looking forward is we are going to have to make changes on these bills as time goes on, but if we do nothing, we continue what we have and what we have now is driving our middle class away, and it's preventing businesses from coming in. When you look -- the MTA tax. We talk about it. We lost to West Virginia a $1.8 billion company, Macy's main distribution 178 NYS ASSEMBLY JUNE 24, 2011 center, and it was because of taxes. Are we going to be perfect in doing this? No. But, what we're going to do is we're going to give our schools the opportunity that when those contracts expire, and before the arbitrator would come in and say, "Well, you can give" -- in my case we had 5 and 6 percent increases. "You can give them because you can just raise your tax." Well, now we're empowering to make that more a reasonable number. We haven't taken away Triborough; maybe we should, maybe we shouldn't. But, we haven't done that. But, we're going to give our school districts the opportunity to temper the increases. Four years ago I spoke to people who are very high up in NYSUT. Four years ago. I said, "Why don't you consider" -- "You have to negotiate what you pay in your health insurance. Why not consider that when each of your contracts expire, for that contract you adopt the State, 10 percent of individual and 25 percent additional if you take family?" You would have -- within three or four years you would have the whole thing solved. People would be paying the same as our PEF, our CSEA and us, and you wouldn't have one school that pays nothing for their health insurance and another that may pay 10 percent, 15 percent. We have an opportunity tonight and we will probably overwhelmingly pass this bill. But before we do that I have to say something. I find it extremely interesting when I hear my colleagues speak that the average person in rent control is $38,000 income because I don't consider that to be exorbitant in New York City. But that's not what we hear about. We hear about increasing the annual income for people living there making, now, $200,000. And I have to tell you, yesterday, 179 NYS ASSEMBLY JUNE 24, 2011 today, $200,000 is regarded as a millionaires' tax and to people who are telling us we need to raise it higher, $200,000 is considered being poor. You can't have it both ways. For those people making $38-, $40,000, we need to have stabilization. So, I congratulate those who are now going to have people who can sleep better at night, but we need to have the same privilege in the suburbs. We need to find a way to try to cap our taxes and make a difference. If we don't get it right today we can come back tomorrow and we can fix things, because when we talked about mandate relief and you look at what it says, there is $25 million of mandate relief for about 700 schools. That evolves, if you take it generally, into $35,000 a school of mandate relief, and I have schools that have $100 million budgets. What is $35,000? It's less than the cost of one teacher's starting salary. We have a lot of work to do on mandate relief. We have a lot of work to do on pension reform. We have plans that say, "Take all of us. Take everybody except those in a union and freeze their pension at the defined benefit and let us all go into a 401(k)." We have to find ways to do things differently and to do them right. So, I want to stay tonight that we're going forward. Not all of us are happy with everything, but we still do go forward. I just want to tell you one little story and I'll sit down. Many years ago when I was a supervisor, we were awaiting the opening of Route 287 into New Jersey, and we had numerous meetings with the supervisors in New Jersey and in New York because everybody in the one area was certain that we were going to have roads clogged because when they opened the 180 NYS ASSEMBLY JUNE 24, 2011 section of 287 into the Thruway, every single local town was going to be completely blocked by cars and vehicles. And I'm telling you, a lot of effort went into this. The day that that road opened up, guess what? Nothing happened. So, sometimes we look ahead and we see things that we fear and sometimes they don't happen. But, if we don't take the steps that we're taking tonight, we will continue and we will continue to keep businesses from coming in and we will continue to see middle-class families going out. So, I want to compliment the Governor because I think it was his leadership that brought this to the point where we are tonight, having this vote. I will proudly vote yes. I will wish the people of rent control to have the greatest success, and I will work hard to make sure that the people in our schools are able to find the solutions to make a tax cap work and work properly for all of the students and all of the employees and all of the people and taxpayers of New York State. Thank you very much. I obviously will be voting in the affirmative. ACTING SPEAKER P. RIVERA: Ms. Rosenthal. MS. ROSENTHAL: On the bill. ACTING SPEAKER P. RIVERA: On the bill. MS. ROSENTHAL: Mr. Speaker, I plan to vote for this measure, which extends rent regulation and strengthens it in several measures, even though it is not the piece of legislation I would have written and it falls somewhat short of several goals that I believe are important for New York's 2.5 million rent-regulated tenants. 181 NYS ASSEMBLY JUNE 24, 2011

Nonetheless, it will extend rent protections for families throughout our City, many of whom live in my district on the Upper West Side and in Hell's Kitchen. If we fail to extend existing rent regulation, thousands of middle-class families will be forced out of their homes. Whole neighborhoods will no longer be affordable for the middle-class and working-class families who are the backbone of our community. This is not speculation. This is an economic fact, and it's a fact that we have, sadly, grown too familiar with over the past 15 years. This bill does make some progress. It increases the dollar threshold for vacancy decontrol from $2,000 to $2,500. It changes the 1/40 and the 1/60 formulas. When landlords make individual apartment improvements, sometimes reporting that they do, sometimes reporting honestly, sometimes reporting that they do, actually having not done it, but getting permission by just sliding through the system. I continue to believe that vacancy decontrol is wrong and should be repealed. That is the bill that I have sponsored for a number of years. Vacancy decontrol provides a tremendous financial incentive for unscrupulous landlords to force people from their homes. In my district office we see the results of that policy week in and week out, with people at least once a week coming in crying that they have gotten eviction notices from their landlords. Landlords have other tricks they use: Major capital improvements that go into the base rent and are calculated as part of the rent forever; unverified individual apartment improvements, as I said before; ownership occupancy of apartments when they have no intention of providing that apartment for members of their families, it's 182 NYS ASSEMBLY JUNE 24, 2011 just a way to get rid of tenants; rampant harassment of tenants through various ways; a vacancy bonus of 20 percent every time someone moves. Thankfully, we're changing that in this bill. That will only be allowed once per year. But, I think one of the most important parts of this renewal of rent regulation is the following line, "The Division of the Housing and Community Renewal shall, pursuant to this act, promulgate rules and regulations to implement and enforce all provisions of this act and any law renewed or continued by this act." Now, some may think that the Department of the Housing and Community Renewal already had that power and should have exercised it much more often than it has in the past. However, the Governor's promise, the insertion of this language in the rent renewal bill, gives me some hope. It gives me hope that the dynamism, creativity and continuous sense of reinvention that newcomers to this City provide will be allowed to flourish and continue. It gives me hope that this City will not turn into enclaves for the very wealthy and the very poor, and no longer within the grasp of those of modest means. It gives me hope that the system of rent regulation will not be entirely driven by tenant complaints when they are well-informed enough to know that their rent is explosively high and it should be much lower or when landlords are depriving them of their legal rights, but that the Department of the Housing and Community Renewal will grow and finally be the agency that tenants can turn to as a solution to the woes of the more powerful landlord, landlord attorneys. A whole system of landlord domination of legitimate tenancies where people pay their rent on time, all they want to do is live in quiet and peace, not be harassed, get 183 NYS ASSEMBLY JUNE 24, 2011 their services. You know, a coexistence with the owner and the tenant. So, I call on this government and the DHCR to immediately, once this is passed and signed into law, to go about the business of fixing this Department, hiring more people, upgrading the computer system, creating a system of transparency where tenants can feel that they are being heard and that they are being given justice. So, while I'm disappointed that we did not accomplish this year everything that we set out to do, while I'm disappointed that it's not the bill that the R3 Campaign, Legal Aid Society, all of the advocates who spent hours and hours on buses and on telephones and on street corners, tenants and neighbors, all the people in my district who were persistent, dedicated, tireless, relentless in campaigning for stronger rent laws, I would like to thank all of them and tell them that this is a renewal, it's a strengthening, but it really is only the beginning. I didn't come here to settle for just what we could get, I came here to fight for the rights of tenants and I will continue fighting for them starting next week. Thank you, and I vote in the affirmative. ACTING SPEAKER P. RIVERA: Ms. Gibson. MS. GIBSON: Thank you, Mr. Speaker. I certainly want to start just by thanking the sponsor of this bill and Speaker Silver and everyone who really stood up and spoke up about one of the very important issues that we will continue to deal with, and that is the affordable housing stock in this great State. While this has certainly been a long journey for all of us this entire legislative Session, there has not been a more longer journey than it has been for the 2.5 million New 184 NYS ASSEMBLY JUNE 24, 2011

Yorkers who believed that their homes were in jeopardy. For all of the residents that came to Albany, for all of the advocates that stood with all of us at City Hall, here in the Capitol, that spoke out, that made sure that this Body knew how important it was to save their homes, I want to say to you that today is about progress. Today is a giant step forward in the right direction. Today is about making sure that everyone in this State and our communities know how important it is to continue to protect the investment in our communities. In addition to education and social services and health care, there is nothing more important than knowing that you, as a mother, as a father, has a roof over your head to take care of yourself and your children. That is what this journey has always been about. So, I stand here tonight proud. Certainly, there are many concerns that I have with regard to this legislation because I really hoped that it would another step forward, but on behalf of all of the residents that I represent that live in rent-regulated houses in Bronx County -- and that is 27,000 residents -- I want to say to you, thank you. Thank you for coming to me. Thank you for standing with me and thank you for sharing your concerns, understanding that this is the most important thing that we will discuss when we return to our districts this weekend. We have to make sure that these conversations continue, because while we made great victory today in making sure that individual apartment improvements have been changed, making sure that the vacancy bonus is limited to one year, that is a great stride. But, I am certainly concerned for those of us that live in buildings that are currently under major capital 185 NYS ASSEMBLY JUNE 24, 2011 improvement. I'm also concerned about those tenants that are preferential tenants, and I want to make sure that as we move forward those continuing conversations will play out so that we can make sure that we're truly making a difference in our State. So, again, I know that this is a major, major, major victory for the advocates and I want to say to every one of them, thank you. The fight will never end. We will always stand up for those seniors and those retirees and those children and those families that look to us for leadership. This is about making sure that we protect the fabric of our communities and encourage the continued growth of affordable housing in our communities, making sure that our communities have stability, our families are able to grow and progress. That is what it has always been about in this journey. And so, while I am pleased today, I want to let everyone know that the fight will never end for affordable housing in our great State. Also, I really want to clarify. As I have sat here and listened to so much dialogue about rent-regulated apartments in the City of New York, I really want to emphasize that when you talk about the one million units of affordable housing, let's be clear that of those million units, we are not talking about the wealthiest New Yorkers. In my building alone the average income is just under $40,000. We are not talking about the high-income earners in this category, but we are talking about hard- working families and hard-working New Yorkers that deserve to be protected. That is what it has been about, protecting those who have taken care of us, and we owe that to these seniors and we owe 186 NYS ASSEMBLY JUNE 24, 2011 that to these families. So, I think that today is about making sure that our residents and constituents know that they have been at the forefront of these discussions over the last few months. Certainly, again, I want to thank the sponsor and everyone who stood with us at every long meeting and made sure that rent regulation and rent control was always a priority. So, with that said, I continue to work with the Executive and my colleagues in making sure that we go a step further in the continuing years ahead, and I will be voting in the affirmative and encourage my colleagues to do the same. Thank you. ACTING SPEAKER P. RIVERA: Mr. Latimer. MR. LATIMER: Thank you, Mr. Speaker. I don't speak very much and I know my colleagues are as tired as I am, but as I listened to many of them speak multiple times during the week, I try to speak only when I have something to say. I know history is being made down the hallway, so what I'm about to say can't possibly compete with that. But, I do want to say that we all know that we have higher property taxes in New York State. The real question is, why? And the answer to that question is what is embedded in this bill that troubles me so much, because what's assumed when you apply a tax cap as a blunt instrument is that it is the spendthrift policies of mayors and supervisors, of county executives and county legislators and school board trustees that have given us higher property taxes in New York, higher than any other state in the nation, save, perhaps, New Jersey. Who made the decisions that 187 NYS ASSEMBLY JUNE 24, 2011 drove us to this point? Who made the decisions? Was it the County of Essex or Schuyler County that made the decision to require Medicaid costs to be picked up by the county governments? It was the State of New York that made those decisions back in 1966. Who made the decision to structure the pension system that we have today? Was it the Village of Lake Placid? Was it the Town of Taconic? It was the State of New York that made that decision. People in this room and the other room and on the second floor. Who made the decisions for personnel policies or for laws like the Wicks Law and the Triborough Amendment? Was it the Town of Lackawanna that made that decision? Was it the City of Peekskill? Or was it the State of New York that made that decision? Who made the decision to bus kids out of the district for private and parochial schools? Was it made by the Shenendehowa School District or by the Rye Neck School District? No. That was made by the State of New York. Policy after policy after policy made by the State of New York. And who made the decision to impose the MTA payroll tax, which doesn't affect the whole State, but affects a significant portion of the State? Who made that decision? In every one of these situations we're looking at policies that drive the cost of local governments at every level that we are now capping. We are now saying that property taxes are killing us, which they are, and we need to take bold action. And the bold action is to cap that property tax that can be levied by cities, by villages, by towns, by library districts, by fire districts. But, every one of the decisions that led us to this point was made by the State of New York. And that is the 188 NYS ASSEMBLY JUNE 24, 2011 truth. They weren't all made by the people who currently hold the positions, but an aggregate. The State of Utah didn't make these decisions. The State of Georgia didn't make these decisions. The State of New York made these decisions. So, I must tell you, when the State tells the cities in the State and the villages and the school districts and library districts, "Tighten your belt. Times are tough, tighten your belt," it's hypocritical. I'm overweight. How dare I tell anybody else to go on a diet. How dare I? Start with myself. We have a provision in this bill, it's been talked about already, in which we say, we, the State says, you must have 60 percent of the support of the people before you can raise taxes. When did we ever apply that to ourselves? When did we ever say that? When did we ever say before we raise a sales or property tax -- I've voted for many of them for many communities -- when did we ever say that we ought to have 60 percent of the support for that? When did any Assemblyman or Senator say, you know, "If I don't get 60 percent of the vote in this election I won't serve another term." It's hypocritical to make these statements and try to put the blame on people who I served alongside with for 17 years before I came into this room and say, "You're the problem, Village of Lake Placid. You're the problem, school district in Rye Neck, you're the problem, Mamaroneck Library District" when the problem are decisions made in this room. Now, I'm going to sit down. I'm nowhere near my 15 minutes. I learned in first grade in Mrs. Simonson's class in 1958 at Grimes Elementary in Mount Vernon, how to count. I can count to 76, 189 NYS ASSEMBLY JUNE 24, 2011 and in a few minutes those lights will go up there and I know what I'm going to see. It was 57 to 5 in the other Chamber. So, I also know from my life experience, our life experience, that you move on to what comes next. What comes next, Mr. Speaker, is mandate relief and real mandate relief. I supported the proposal made by my friend, Mr. Palmesano, because I recognize that the State cannot have real mandate relief unless the State is willing to take back costs that we have asked other governments to pay for. We're the only State out of 50 that makes those counties pay that Medicaid. And Addie Russell served in the County Legislature, Steven Englebright served in the County Legislature, Teresa Sayward headed a board of supervisors, Cliff Crouch headed a board of supervisors. They're sprinkled through this room, many people who have done county budgets dealing with that mandate. So, if we're going to be honest, if we want to lower property taxes, then we have to go where the changes have to be made. With that, Mr. Speaker, I thank you for the opportunity to speak to my colleagues. ACTING SPEAKER P. RIVERA: Ms. Barron. MS. BARRON: Thank you, Mr. Speaker. I will be very brief. The two parts of this bill that I'm going to speak on are the property tax cap and the rent regulations. I have to lend my voice to those who say that when we put a cap on the property tax knowing that that's the money that funds the education of our students, we're putting limitations on how high our children are going to rise. There are certain elements that must be contained in an educational system that don't put 190 NYS ASSEMBLY JUNE 24, 2011 limitations and handcuffs, and limiting them with this property tax cap is going to do exactly that, not only those who have special needs, but those with general needs as well. To move on to the rent regulations, the rent advocates who have spoken to me have said that they are very disappointed with the advances of this rent regulation bill, the extension of this bill. They have cited the fact that they wanted to have consideration for Mitchell-Lama and Section 8 to be able to move into the rent regulation capacity. They wanted to have an end to vacancy decontrol. They wanted to have the ability to go beyond four years as a lookback to see the history of the apartments that landlords may have raised the base rent inappropriately. They wanted to have an end to increasing the base rent beyond what the cost was that landlords have incurred for capital improvements. They wanted a landlord to, of course, be able to recoup his investment, but then have it end, not have it continue into perpetuity. So, they have expressed those concerns and those are concerns that I take to heart. Those advances that we do have in the rent regulation bill do not impact on the lower-income persons who have rent regulations, they impact the middle- income and upper-income people disparately. I think that for those reasons, the limited progress that we have made, which has been acknowledged, and for the reasons that we're putting limitations on our children's educational opportunities, I will be voting in the negative. ACTING SPEAKER P. RIVERA: Mrs. Rabbit. MRS. RABBITT: On the bill, Mr. Speaker. ACTING SPEAKER P. RIVERA: On the bill. 191 NYS ASSEMBLY JUNE 24, 2011

MRS. RABBITT: Mr. Speaker, I know it's quite late and we all want to get home. I would just like to say that I agree with George Latimer. There is nothing that we don't do here that impacts our local communities, and for all the decades of the mandates that we have put on our communities we're now asking our communities to go into a tax cap for the damage that we have done here for so many years. For that reason alone, I will be voting in the negative. ACTING SPEAKER P. RIVERA: On a motion by Mr. Lopez, the Senate bill is before the House. The Senate bill is advanced. Read the last section. THE CLERK: This act shall take effect immediately. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Mr. Cahill to explain his vote. MR. CAHILL: Mr. Speaker, it's really quite simple. Unaffordable real property taxes with a 2 percent cap are still unaffordable real property taxes. I withdraw my request and vote in the negative. ACTING SPEAKER P. RIVERA: Mr. Castelli to explain his vote. MR. CASTELLI: Thank you, Mr. Speaker. You know, first of all, I want to applaud the Governor and all my colleagues on both sides of the aisle for doing the hard work that they did in this Session. It is an honor to work with all of you. 192 NYS ASSEMBLY JUNE 24, 2011

This bill is certainly no panacea. There are no perfect problems, ladies and gentlemen, and, therefore, there are no perfect solutions. But, a tax cap is something that we need to do to save the State from sinking. The Governor chose to lead by the front and, in doing so, I chose to follow him in this. I believe it's an important thing. It's a necessary measure. I believe the rent regulation is important and necessary for the 4,476 apartments and 39 other buildings I have in the City of White Plains and in the Town of Mount Kisco. And beyond that, while I wish we saw a greater effort at mandate relief, I believe it is a step in the right direction. I would hope that we will see greater mandate relief in the short term -- Wicks Law reform, the Triborough Amendment reform, reform for Medicaid, as well as pension reform. But, I will cast my vote in the affirmative for all the reasons that I mentioned to you, and I would urge my colleagues to please cast their vote in the affirmative as well. I withdraw my request and cast my vote in the affirmative. Thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: Mr. Braunstein to explain his vote. MR. BRAUNSTEIN: Thank you, Mr. Speaker. I proudly vote in favor of this bill tonight because I believe that it will help millions of people stay within their homes, whether it be in the suburbs of New York or in New York City for renters. I do regret, however, that we still, to this day, haven't found any protections for co-op owners in New York City. In New York City, if you're a middle-income person and you 193 NYS ASSEMBLY JUNE 24, 2011 rent an apartment, there are protections for you. If you're a one-, two- or three-family homeowner, there's a 6 percent cap on the appraisal increase of your unit per year. For co-ops there is no such protection. In my district the property tax assessments came out this year, and some co-op units saw 80 percent increases, 100 percent increases. One co-op in my district was valued at 147 percent of what it was valued at last year. Now, the City of New York, in my speculation, does this for revenue purposes. They argue that they just changed to a different valuation model. After three months of complaining, they said, "Oh, you know what? We had a computer glitch with our new system. We're only going to raise the valuations 10 percent." From 147 percent to 10 percent. Now, if we don't make changes to this system -- and the City of New York has even said that they believe that there should be changes made -- future administrations can continue to use assessments as a revenue generator. So, while I am voting today because I feel that we're helping many people stay in their homes, the people of my district still need protections in their co-ops, and I'm hopeful that next year we could take this up and finally protect co-op owners in New York City. Thank you. ACTING SPEAKER P. RIVERA: Mr. Brennan to explain his vote. MR. BRENNAN: Thank you, Mr. Speaker. I wanted to congratulate Mr. Lopez, the Speaker and all the staff people who have been involved for so many months, in fact, so many years, in trying to 194 NYS ASSEMBLY JUNE 24, 2011 win some improvements in our tenant protection laws. I will be voting yes, clearly, because my constituents need these rent protections. I just wanted also, for the record, to note that were the real property tax cap and the renewal of the rent laws separated, I would have voted against the real property tax cap. Thank you. ACTING SPEAKER P. RIVERA: Mr. Wright to explain his vote. MR. WRIGHT: Thank you, Mr. Speaker. It is with some apprehension and some trepidation that I rise to explain my vote. It is my hope that during this next legislative Session that we will be able to secure some improvements to this bill. For example, hopefully we can get rid of vacancy decontrol in this next legislative Session. Hopefully, we can secure some protections regarding MCIs for tenants in this next legislative Session. I'm not happy with this bill, but we could have and we should have done much better, much better. However, I am a firm believer in rent protections for tenants, and I take this issue personally, absolutely personally, because I am a tenant. I am a rent-stabilized tenant and I will never, ever be a part of ever not supporting tenants. It might be popular to vote no on this bill but, quite frankly, it's not the responsible thing to do. So, I will be voting to support tenants in the City of New York and beyond. So, I withdraw my request and vote in the affirmative. Thank you. ACTING SPEAKER P. RIVERA: Mr. Bing to explain 195 NYS ASSEMBLY JUNE 24, 2011 his vote. MR. BING: Thank you, Mr. Speaker. For several years I have carried legislation to raise the thresholds for high-income decontrol, and I want to thank the Speaker and also my good friend and, in many ways a mentor to me, Mr. Lopez, for pushing to see these income limits raised in this legislation. We need this legislation because the vacancy -- in order to have an emergency under the Emergency Tenant Protection Act, we need a 5 percent vacancy rate. In the City of New York right now we have a 2.9 percent vacancy rate, so we are in an emergency and that's why we need this legislation. This is not just about Manhattan. Fifteen years ago, 98 percent of the apartments that were decontrolled were on the Island of Manhattan. In 15 years that's decreased to 64 percent, almost 40 percent of the margin of decontrol. This is a Citywide problem, and this is why we need a Statewide solution. For the constituents in my district who are just on the cusp of leaving their apartments, this is important because if you do not raise the income levels, the people who are going to be forced out of their apartments, once the apartment rents are raised, are going to be out on the market pushing everyone else down the market and making it more difficult for those at the lower end of the income stream to find affordable housing and that becomes not just a New York City issue, but a Statewide issue because these folks are going to move to suburbs around the City of New York, outside of Manhattan, outside of the five boroughs, and make it an affordable housing crisis not just in the City of New York, but in the entire tri-state area. So, for my constituents in 196 NYS ASSEMBLY JUNE 24, 2011

Manhattan House and other parts of my district that are very close to being forced out of their apartments, this is going to allow them to stay in their neighborhoods, continue to make a difference, continue to spend money, continue to pay taxes in the City of New York and continue to be able to keep the neighborhoods they have called home for so many years their same neighborhood. So, I want to thank the Speaker and thank Mr. Lopez. I withdraw my request and cast my vote in the affirmative. ACTING SPEAKER P. RIVERA: Ms. Schimel to explain her vote. MS. SCHIMEL: Thank you, Mr. Speaker. I have always felt that if it feels wrong, it is wrong and, sadly, this bill feels wrong. If the tax cap had a two- or three-year sunset, as well as significant mandate relief, I swear I would have given it a chance. But five years is a lifetime for local governments and schools when there may not be enough revenue to sustain their respective missions. Ironically, one of the significant mandate relief items in this bill is to allow school districts to use school buses based on actual ridership. Running empty yellow buses is a waste of taxpayer dollars. I wrote this bill in consultation with the Department of State Education. I am told that our districts will save a half a million dollars each year and be able to plow it back into classrooms. Even though my own legislation was folded into this omnibus bill, I cannot ignore the inherent flaw of co-mingling so many different policy areas. Together, these disparate policies can bring an unpredictable impact to the services and protections to the people I 197 NYS ASSEMBLY JUNE 24, 2011 represent and that they depend on. I vote in the negative. ACTING SPEAKER P. RIVERA: Mr. Kellner to explain his vote. MR. KELLNER: Thank you, Mr. Speaker, to explain my vote. What rent regulation is about is about protecting the middle class of the City of New York. We have seen with so many urban areas across this country when you have the vastly, vastly wealthy and the extremely, extremely poor, you have urban decay. What rent regulation does is keep that middle class in their home and they are the lifeblood of the City of New York. They are the people who own businesses. They're the ones who go to work in our hospitals and our schools every day. We need rent regulations to keep the City of New York great. So, I proudly vote for my vote in the affirmative. This bill definitely expands the laws. Is it everything? Is it the panacea? Is it perfect? Absolutely not. But, goes a long, long way in expanding rent regulations for the first time in two decades. So, I withdraw my request and vote in the affirmative. ACTING SPEAKER P. RIVERA: Mr. Moya to explain his vote. MR. MOYA: Thank you, Mr. Speaker. I rise today to explain my vote. We're not faced with easy choices here today. My district has over 11,000 units which are protected by rent stabilization in over 400 different buildings. Every day I walk through the streets of my neighborhood and the telltale signs of affordable housing being lost are 198 NYS ASSEMBLY JUNE 24, 2011 seen on street corner after street corner; the luxury conversion in Jackson Heights or a displaced family in Corona. The signs are the same, but the pain and personal stories in each building and in each apartment are unique. We have turned the tide today. Changes in the decontrol threshold and calendar year limits for vacancy bonuses were unthinkable advancements just a decade ago. I accept the political realities of the current situation where landlords and the leadership of the other Chamber have stood against people they don't understand and tenants they don't see and know but, at the same time, I do not embrace these constraints. I will not stop until our loud advocacy changes the tide completely, until we really get strong rent reform that stops affordable housing from slipping away from hundreds of thousands of tenants. I reluctantly vote in the affirmative, knowing this is the first battle that we have won in what I know will be a successful drive for making New York affordable for working families. ACTING SPEAKER P. RIVERA: Ms. Malliotakis to explain her vote. MS. MALLIOTAKIS: Thank you, Mr. Speaker. First and foremost, I would like to congratulate the sponsor, Mr. Vito Lopez, of Brooklyn as well, for the hard work. I know he has put in a lot of effort into this legislation. I do commend him. You know, the one thing that I want to say is that I am voting for this bill, but I'm extremely disappointed that New York City is not included in the property tax cap. I'm even more disappointed that many of my colleagues here from New York City did not advocate to 199 NYS ASSEMBLY JUNE 24, 2011 have New York City included in this tax cap. But, I'm not going to penalize the renters of my district because I know that this will help them. They do need rent stabilization. I'm not going to penalize the other property owners from around New York State, either. So, I will be voting in the affirmative and urge my colleagues to do the same. Thank you. ACTING SPEAKER P. RIVERA: Mr. Hayes to explain his vote. MR. HAYES: Thank you, Mr. Speaker, to explain my vote. Mr. Speaker, just for some historical perspective, I believe that the tax cap idea came back in 2007 from the Republican Conference in the State Assembly. We have heard different people of different political persuasions pick up the mantle, to pick up the fight for a cap on property taxes, but in this Conference, the Assembly Republican Conference, we were the first to bring it to the front for the debate in this State. I'm proud that we are going to get a property tax cap tonight, but I'm not happy that it is limited in a number of ways. I would ask that my colleagues continue to work with us, work together, both sides of the aisle, to strengthen the assistance that we provide to property taxpayers throughout this State. One way we can do that, a very important way we can do that, is through the continued expansion of mandate relief on our localities, school districts and municipalities. Of the nine unfunded mandates that the New York Association of Counties says cost 90 percent of the dollars that localities spend each year, not one of these categories were touched by the mandate relief contained in this bill. And so, I'm 200 NYS ASSEMBLY JUNE 24, 2011 proud that we have a property tax cap. It's only the beginning. It's not the end. We must continue to work hard to make sure that this means real tax relief for our property taxpayers, but it's a start. And for that reason, I'm casting my vote in favor. Thank you. ACTING SPEAKER P. RIVERA: Mr. Lopez to explain his vote. MR. V. LOPEZ: I think, as I stated earlier and, I think, as Assemblyman Jeffries made reference to, I think if we look at the last 20 years and the three prior bills, there were erosions -- ACTING SPEAKER P. RIVERA: You're not supposed to comment on other members, as you know, Mr. Lopez. MR. V. LOPEZ: As long as they're from Brooklyn. Where's my good friend to defend me? Don't take this off my three minutes. Two minutes, one minute left. (Laughter) I'm glad it's the last night. You know, the world isn't perfect, and if it was we would all probably, I guess, be happy. We might not even be here if it was perfect. It's negotiations, process and commitment. The last three other bills that we had, there were erosions of benefits. For all the tenant advocates that are apologetically voting for this bill, there was a good chance that we could have lost the battle and had further erosions. And we didn't even get a straight extender. We got enhancements. Are they perfect enhancements? No. But, there is something about this place. Too often, when people go home after a lot of hours they're almost a little bit masochistic in their style. They'll say, 201 NYS ASSEMBLY JUNE 24, 2011

"Terrible bill, I had to vote for it." This bill is a better bill and enhances rent regulations. And the Speaker should be commended. The Governor stepped in. The Speaker made it a priority, and a lot of staff, Program and Counsel Staff got involved in this. I think Jessica DeMarco probably spent 200 hours coming down from Albany to New York City and Jonathan and others really put their heart and soul in it, and I proudly vote in the affirmative. ACTING SPEAKER P. RIVERA: Mr. Murray to explain his vote. MR. MURRAY: Thank you, Mr. Speaker. As the person that just spoke before me -- and I won't mention his name -- as he said, it's not a perfect bill, but it's a start. I have been advocating for a tax cap for years and I know our Conference has as well. On Long Island we get crushed by property taxes. So, this is a start. It's certainly not the end all and be all, though. I'm very disappointed. When we were first going to take the vote I thought this is a slam dunk. Of course I'll vote for a tax cap. But then when I saw the lack of mandate relief, I mean, we're talking weak here. We really have some work in front of us and I'm hoping that, as I said, this is a start, not an end because we desperately need real mandate relief. How about pension reform? How about Medicaid reform? How about getting rid of the MTA payroll tax? Just to mention a few that would really bring some savings. So, it's not perfect but, yes, I'll vote for it. But I do have to mention one quick bit of irony that I think is amazing. A member earlier had mentioned that she thought that the continuation of the 202 NYS ASSEMBLY JUNE 24, 2011 millionaires' tax would be the answer. Well, it's ironic that when the millionaires' tax that's currently in place right now that ends at the end year, it's described as starting at $200,000, yet, the threshold for receiving relief from your rent and protection from your rent is well, gee, $200,000. Really? We need protection from it but, yet, we're too rich? I guess it just depends on the issue, not necessarily the number. But, with that said, I'm voting in favor of this bill. Thank you. ACTING SPEAKER P. RIVERA: Ms. Nolan to explain her vote. MS. NOLAN: Mr. Speaker, my colleagues. It's very rare -- I have had the privilege of serving in the Chamber for a very long time, I suppose some might say too long, but most of my colleagues know that it's very rare that I'm really undecided and indecisive. I, of course, want to see rent regulation extended, and I may yet, as I finish these remarks, cast my vote in the affirmative, but it's very hard to be the Chair of the Education Committee and meet so many, many school district people who feel that this is going to be the worst thing to happen to the schools in our State because it will really limit their ability to do the right thing by children. In particular, I want to add -- and the thing that really, really bothers me about this tax issue, tax cap, if we want to call it that name; I sometimes wonder what it really is -- it's the 60 percent that the people would have to vote to overturn it. I just think we are setting such a terrible precedent there. You know, it's very, very difficult for me to cast a vote in the affirmative. I guess there's a few 203 NYS ASSEMBLY JUNE 24, 2011 more votes. For the moment, I'm going to keep my negative up on the board, but I will ask my colleagues to indulge me in this indecisiveness because I think we are taking such a serious step for a 60 percent vote on school budgets and the consequences can be so very, very negative that I continue to cast my vote in the negative. Having said that, of course, no one from the City of New York wants to see rent regulation end. I want to commend the Housing team and Mr. Lopez for all the work, and the Speaker, that they have done on it. It's just a very, very difficult matching, probably the worst I've ever seen in my 27 years here. You know, it got the job done but, boy, is it a tough vote. So, I regrettably cast my vote in the negative. Thank you. ACTING SPEAKER P. RIVERA: Mr. Linares to explain his vote. MR. LINARES: Thank you, Mr. Speaker. I rise to express, in some regard, how difficult this vote is, as some of my colleagues have indicated because it is, in many ways, a mixed bag of goodies and not-so-good items in it. I represent a district that is, by and large, representative of people who live in affordable housing or live in rent-regulated apartments. For them, the anxiety has been so, so hard and has taken such a toll to see them expire, being unprotected, feel that they don't know today what will happen. And so, this is the one piece that I looked more closely. Now, this bill, while it shows some aspect of the bill that we approved looking to extend rent regulations and strengthening it, it's a far cry from what we approved earlier, but I want to 204 NYS ASSEMBLY JUNE 24, 2011 acknowledge that, nevertheless, it's important and critical for New York City, for my constituents, to see that they'll continue to have rent protections and also that there is some enhancement taking place. I think it's a step in the right direction. I want to acknowledge the Speaker. I want to acknowledge the Chair of the Committee, Vito Lopez, and those who have worked hard to make sure that we continue having this protection in New York City. ACTING SPEAKER P. RIVERA: Mr. Linares, how do you vote? MR. LINARES: I will vote, with hesitation, in the affirmative. ACTING SPEAKER P. RIVERA: Mr. Kavanagh to explain his vote. MR. KAVANAGH: Thank you, Mr. Speaker. I expect to vote -- I planned to vote in the affirmative on this bill and I don't think at this hour of the night that we're going to convince folks who after many, many years in this Chamber have discussed the perspective that many of us have that we need rent regulation in the City of New York. I don't expect to convince folks on the other side of that, but I just want to say that this is the opportunity -- the option we had this year was to extend rent regulation or to let it expire. People in this House fought very hard for the strongest possible bill, as we have year after year after year. This year we have a Governor who was willing to fight on the side of tenants for stronger protections, and the dynamic is playing out much as it has in the past. We have a State Senate that was unwilling to make the 205 NYS ASSEMBLY JUNE 24, 2011 changes that many of us wanted in this House. Notwithstanding that, this is a bill that strengthens rent regulation in significant ways. It's not -- what other people have said, it's not all that we wanted in this House, but it is an important improvement and, at the end of the day, because we live in such a tight housing market, because we need to have stable communities where people can move in and people can build stable families and rely on a lease being renewed the next year, because that's so important for all of our communities, and because we have a landlord community that is trying to profit not by running a reasonable business and providing a reasonable service, but by speculating on their ability to evict thousands and thousands of people from their homes because this law that we are renewing tonight is the only bull work against that kind of activity that would literally wipe out middle-class communities like the ones I represent and also lower-income communities and working-class communities throughout the City, we need to extend this law. We need to continue to work on enforcement. One of my colleagues mentioned that we are relying on the provisions of the law that say that DHCR will -- ACTING SPEAKER P. RIVERA: Mr. Kavanagh, how do you vote? MR. KAVANAGH: For all of those reasons, at this late hour, I vote in the affirmative. ACTING SPEAKER P. RIVERA: Mr. Burling to explain his vote. MR. BURLING: Mr. Speaker, my colleagues, to explain 206 NYS ASSEMBLY JUNE 24, 2011 my vote. I made a promise to my school districts and to my municipalities that I would not vote for a tax cap that did not have meaningful mandate relief. I know how popular a tax cap is and I know what the polls say, but when you tell people what it will do when you don't cap the mandates that we place on our schools and our municipalities, then their views changed. This is a cruel hoax on people. Two years from now or a year from now when the budgets are done, people are going to expect that their taxes are going to go down. I'll tell you what's going to happen. I was also a county legislator, vice chairman. I'll tell you what happened. We never raised our taxes, our tax rate, but we sent our assessors out and we raised the assessments. That's what going to happen. These counties are not going to be able to absorb the increased costs that we place on them, and a tax cap is only going to hinder it more. They're going to have to override them or they're going to raise your assessments. So, I don't think this is meaningful. I don't think it's going to do what it is supposed to do. I hope it does, but I think a year from now these folks are going to come back to us and say, "You tricked us." Thank you. ACTING SPEAKER P. RIVERA: Mr. Losquadro to explain his vote. MR. LOSQUADRO: Thank you, Mr. Speaker. When we discussed earlier a potential amendment to this bill, there was a statement that was made that this would just simply shift the burden to the State, away from the counties, and I say that would have been exactly 207 NYS ASSEMBLY JUNE 24, 2011 the mechanism that would have forced the State to undertake the real task of relieving municipalities from these mandates. In the absence of that amendment, in the absence of codifying that in this legislation, the cap itself, I agree with the Governor, becomes that mechanism and we will have to undertake the course of real mandate relief in very short order. It needs to be done. We know it needs to be done. We know this bill is not perfect, but it's a step in the right direction to getting the mandate relief that we need for this State, for our municipalities and for the taxpayers. I proudly vote in the affirmative. ACTING SPEAKER P. RIVERA: Mr. Ceretto to explain his vote. MR. CERETTO: Thank you, Mr. Speaker. You know, at the beginning of this Session, when I first came on I was on the Housing Committee and, to tell you the truth, I didn't even know about rent stabilization or rent control. I had never even heard about it. Sometimes I feel like, you know, with the people in New York City and where I live, way on the other end of the State, it's almost like we live in two different worlds. In my area, Niagara County, we're the second highest per house value on taxes. We're the second highest in the nation. I see the devastation and what it does to my area. When I meet the seniors and I talk to my seniors, a lot of them are being forced out of their homes for the same reasons that I hear that they're being forced out of New York City. So, we have something in common. The good thing, I think, tonight, is what I'm hearing and what I saw is we have something different but, yet, we're trying to fix something that's the same problem -- 208 NYS ASSEMBLY JUNE 24, 2011 help our children, help our elderly. And, again, as somebody on the taxpayer side I can tell you this: Were not fully happy either, it's just as the rent control people aren't fully happy or satisfied in what we have done all together. But, you know what? I truly feel we have made a lot of progress in my freshman year here. It gives us something to come back for because the job isn't done but, yet, we're on the right track. That's why I'm voting yes, because we will get there and I truly believe that. So, thank you. ACTING SPEAKER P. RIVERA: Mr. Rodriguez to explain his vote. MR. RODRIGUEZ: Thank you, Mr. Speaker. I rise to explain my vote. This is certainly a challenging situation with respect to rent regulations in the City, and I rise to represent the 16,000 rent-regulated apartments that I look to defend as a result of moving ahead with this legislation. However, the challenging part is that the median income for my community is approximately $25,000. So, some of the protections that we have included in the bill are not necessarily targeted on my community. So, what we are looking for and hope to move forward with in our next Session is how do we continue to focus on strengthening the tenant protections around rent regulation. I think when we talk about the improvements, in particular, we have many, many apartments that are -- buildings that are less than 35 or 50 units, which is another area that I hope we continue to explore when we look at revising and potentially strengthening this legislation in the future. But, we have to take a step because no step would continue to put 2.5 million people at 209 NYS ASSEMBLY JUNE 24, 2011 risk with respect to losing rent regulation in general. So, while this does not accomplish everything we would like it to do and that there are many things that are left out of this legislation -- and I would like to remind us that we probably have to look no further than the bill we passed earlier in terms of the variety of different tenant protections that we could implement, but are not able to do to this situation with respect to the politics as they exist here. But, I cast my vote in the affirmative to make sure that we continue to protect 2.5 million New Yorkers who benefit from rent regulation. Thank you. ACTING SPEAKER P. RIVERA: Mr. Palmesano to explain his vote. MR. PALMESANO: Thank you, Mr. Speaker, to explain my vote. This isn't a perfect bill, and I admit this has been a tough vote. But, it's a first step. I, for one, wish there was a lot more mandate relief in this bill. That would be the proper way to do this. I do believe this cap is going to force this issue of mandate relief. It has to, and it has to start with Medicaid. We had an opportunity earlier in this Chamber to address that issue, but I think we're going to continue to revisit it. We must go after that growth in the Medicaid program that's burdening our county. We put it there. The State of New York put it there and we should take it away. And pension reform is critical to address these mandates. I do believe it keeps local control. I never said the property tax cap would lower taxes. The only way we're going to lower property taxes is when we effectively go after these mandates that are the true cost drivers of our property taxes. But, what this bill will do 210 NYS ASSEMBLY JUNE 24, 2011 is it will make it more challenging, a little bit more effort to raise taxes, and that's a good thing in my opinion. As my colleagues said, we don't adopt that here in this Chamber, but maybe we should. If we're willing to pass that on to our counties, on to our local governments, I think we should do that here. Make it more difficult to raise taxes. Make it a supermajority in this Chamber to raise taxes. Let's live by what we're putting on to our local governments. I'm for that. I'll support that. So, as the Governor has used his bully pulpit to pass the tax cap, it is my hope that he continues to move forward to address meaningful mandate relief. He needs to do it because this bill needs to put more into it and push for a supermajority of vote to raise taxes at the State level. If it's good for our local governments, it should be good for us. I will be voting in the affirmative. ACTING SPEAKER P. RIVERA: Are there any other votes? The Clerk will announce the results. (The Clerk announced the results.) The bill is passed. Mr. Canestrari. MR. CANESTRARI: Yes, Mr. Speaker. On this historic night, we will now go to the C-Calender, previously advanced. Go to Page 3, Rules Report No. 632, Mr. Heastie, please. ACTING SPEAKER P. RIVERA: C-Calender on Page 3, Rules Report No. 632, the Clerk will read. 211 NYS ASSEMBLY JUNE 24, 2011

THE CLERK: Bill No. 7357-A, Rules Report No. 632, Heastie, Ramos. An act to amend the General Municipal Law, in relation to obtaining best value for purchase contracts. ACTING SPEAKER P. RIVERA: On a motion by Mr. Heastie, the Senate bill is before the House. The Senate bill is advanced. An explanation is requested, Mr. Heastie. MR. HEASTIE: Thank you, Mr. Speaker. This bill would allow municipalities and other localities the option of using the best value criteria when procuring contracts for services and goods, but not including public works. This would bring in line local procurement practices with those of the State of New York. ACTING SPEAKER P. RIVERA: Mr. Molinaro. MR. MOLINARO: Thank you, Mr. Speaker. Just on the bill very, very briefly. We understand the intent of the legislation and recognize that, certainly, it is supported by a number of groups, including the Mayor's office. The concern that I think many of us have and some of the objections that have been raised by the general contractors and others focus around the concept that currently competitive bidding, lowest, most responsible bidder, is a process that was meant to ensure transparency and protect against corruption. While the intent of the legislation is commendable, the objections raised by others speak to this very question of what is best value, and while the bill attempts to define what that may be, there is a fear that bidding will become less and less transparent and the potential for corruption could be made greater. And for these reasons, I would urge my colleagues to think very, very carefully about 212 NYS ASSEMBLY JUNE 24, 2011 the legislation and expanding competitive bidding in is way. I thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: Read the last section. THE CLERK: This act shall take effect immediately. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Are there any other votes? The Clerk will announce the results. (The Clerk announced the results.) The bill is passed. Mr. Canestrari. MR. CANESTRARI: Mr. Speaker, we will now go to the B-Calendar for the last bill of the evening, I might add, Rules Report No. 630, Ms. Glick, please. ACTING SPEAKER P. RIVERA: Proceeding to Page 4, Rules Report No. 630, the Clerk will read. THE CLERK: Bill No. 8519, Rules Report No. 630, Glick, Peoples-Stokes, Hoyt, Schroeder. An act to amend the Education Law and the New York State Urban Development Corporation Act, in relation to establishing components of the NY-SUNY 2020 Challenge Grant Program; making an appropriation therefor; and providing for the repeal of such provisions upon expiration thereof. ACTING SPEAKER P. RIVERA: On a motion by Ms. Glick, the Senate bill is before the House. The Senate bill is advanced. 213 NYS ASSEMBLY JUNE 24, 2011

There's a Governor's message at the desk. The Clerk will read. THE CLERK: Pursuant to the provisions of Section 14 of Article III of the Constitution and by virtue of the authority conferred upon me, I do hereby certify to the necessity of an immediate vote on Assembly Bill No. 8519 and Senate Bill No. 5855. The facts necessitating an immediate vote on the bill are as follows: This bill would implement components of the NY-SUNY 2020 Challenge Grant Program. Because the bill has not been on your desks in final form for three calendar legislative days, the Leaders of your Honorable bodies have requested this message to permit the immediate consideration of this bill. Andrew M. Cuomo, Governor. ACTING SPEAKER P. RIVERA: Mr. Jordan. MR. JORDAN: Thank you, Mr. Speaker. On the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. JORDAN: This has been a long battle that, I think, primarily has been instituted to try to provide some added revenue for our colleges to improve the educational opportunity for our college students. Two things about this bill strike me as fundamentally contrary to that purpose. One is something that I know SUNY Albany has lobbied for extensively and fought for, for a very good reason. Before I came to the Assembly, sweeping was something I used to do in the kitchen or on the 214 NYS ASSEMBLY JUNE 24, 2011 front porch. I have discovered in Albany that that's a clever way to get money from one fund into the General Fund to feed our spending problems. Well, they were concerned about that, and they wanted a lock box. They didn't get it. So, properly, they are concerned that without a lock box controlled by the Comptroller, funds that are put into this through higher tuition can be swept away to fund other unrelated programs. Secondly, and more, I guess, surprising to me, was to find language in the bill that mandates project labor agreements on construction projects, and I really couldn't come up with an understanding of why that would be. But, my concern is this: In New York last year, 76 percent of our contractors were open shop. Project labor agreements essentially preclude open shops from bidding on the project. That is fundamentally contrary to what we should be about. I am all for project labor agreements if they are optional. If a bidder thinks it's the best way to do the job, let them bid it that way. Do not mandate things that preclude 76 percent of our industry from bidding on the project. For those two reasons I will be casting my vote in the negative and I appreciate your indulgence, Mr. Speaker. ACTING SPEAKER P. RIVERA: Mrs. People-Stokes MRS. PEOPLES-STOKES: Thank you, Mr. Speaker. There are, as you know, quite a few historic events going on in our State Capitol tonight and, okay, we have been joined by who, I think, is the person who should certainly be leading this conversation, the Chair of our Higher Education Committee, Deborah Glick. The work that was done 215 NYS ASSEMBLY JUNE 24, 2011 on this bill by Ms. Glick, her Committee and the staff and, certainly, the Speaker and the Governor is, quite frankly, historic as well. As has been noted, this legislation is a long time coming. Back a few governors ago, there was something set up called the Higher Education Commission, and several of us, including Member Glick, spent our entire summers while other folks were off, traveling around the State to different SUNY institutions and CUNY institutions, listening to both the advocates, the administrators, the faculty, the staff and the students about some solutions that they thought could get them to growing their opportunities to provide better services, and a lot of what came out of that is a lot of what's in this legislation today. Not long after that, the University of Buffalo came up with a strategic plan that really looked at how we can build on our research institutions to help grow not just the economies of the districts where they're located, but the economy of the State as well, as well as the economy of knowledge-based, scientific- based businesses. As a result of all of those things, the transformation has been SUNY 2020, and it actually not only just focuses on the four research institutions that New York so proudly has, but -- I can hear his whole conversation -- but it also focuses on SUNY in its entirety and CUNY in its entirety. I think that because we have broadened it to that aspect that it actually will be beneficial to every community and every institution that delivers public higher education in the State of New York, and I think it's a wonderful opportunity and a very historic occasion. Because it is only for five years, Mr. Speaker, I think for those of us who are concerned, you know, that this really may not be the right thing to do, 216 NYS ASSEMBLY JUNE 24, 2011 allowing boards of trustees, the SUNY Trustee Board as well as the administration of these respective institutions, to make decisions about whether or not their tuition will increase up to $300 -- it doesn't mean that it will or that they will even ask for it -- but I think after five years we will be able to see through this, what I call a "demonstration project," that it has not only been beneficial to increasing the capacity of these institutions, but it will be beneficial to increasing the academic excellence of these institutions and, thereby, I think, also increasing the number of students who will be attending there. There has been a lot of conversation as well, Mr. Speaker, about concern for students of low and moderate income who may not be able to meet the higher costs. Ms. Glick, through her vigorous work, I think, has offered the proper solutions to make sure that that does not happen. Also, the SUNY Trustee Board has been directed by the Chancellor for each institution to individually look within itself to make sure that there are always going to be opportunities for students who are in need of additional resources. So, the fact we have all of these creative ideas working to make sure that the resources are available, the student population will grow, I think that every community where SUNY and CUNY universities, colleges, are located are going to prosper as a result of this bill. I'm sure everybody knows that folks from Western New York are very much supportive of this but, at the end of the day, what's good for Western New York, I think, is also good for the rest of the State. So, I'm really proud to take a vote today that will begin a process of allowing our 217 NYS ASSEMBLY JUNE 24, 2011 higher education institutions to take their rightful place in our communities. I recently traveled to the City of Philadelphia, one of my favorite cities in all of America, and everywhere in Philadelphia much of what we have in New York they have there. There's a college or university almost in every neighborhood, and there's also a hospital almost in every neighborhood. So, there's a connectedness for New York in particular, and definitely Buffalo, with the universities, both public and private, and hospitals, creating opportunities to grow economies, that can grow communities and create jobs. So, I again look forward to working with Member Glick and the rest of the committee, as well as the Speaker and all the members, to make sure that this actually will be beneficial to those institutions. Now, my colleague on the other side of the aisle did mention that there is not that lock box concept. That was a little bit of a disappointment because when you know that there's a key on it, you it's not going to change. But, I think when we have a governor like Governor Cuomo who has made such a commitment on so many issues and has really put all of his efforts into making sure that they were successful, I believe when he says that we're going to make sure that there's a maintenance of effort, that there will be no back-dooring out of the resources. Families will know for sure, if their students need four years, exactly how much it's going to cost them for tuition. There won't be anymore 35 percent increases that get swept into the State's budget. The resources that are collected by these respective institutions will stay at those institutions so 218 NYS ASSEMBLY JUNE 24, 2011 that they have the opportunity to grow their facility and staff and increase the number of programs that are offered in each respective department. So, again, Mr. Speaker, I thank you for the opportunity to speak on this bill. I really hope that all my colleagues who still have some hesitancy about this will, you know, give this a try. I mentioned earlier that there are a lot of historic things going on in this State today. This is yet another one of them. There was the tax cap. Now there's same-sex marriage. And, hopefully, there will be some autonomy and a bit of room for SUNY and CUNY to grow and flourish this State, like it should, as the Empire State. Thank you, Mr. Speaker, and I certainly will be voting in support of it. ACTING SPEAKER P. RIVERA: Mr. McLaughlin. MR. MCLAUGHLIN: Thank you, Mr. Speaker. On the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. MCLAUGHLIN: The SUNY system is a jewel of public education throughout the country. I'm a big fan of SUNY. Sixty-four institutions, including the top veterinary school in the country. They do a fantastic job and I'm a big fan. I've been a strong advocate for including SUNY Albany in UB 2020. I think that's vital that we do that. This bill is not bad, but there are some things here that give me significant pause and it will cause me to vote no on this legislation. The fact that there is no lock box concerns me greatly. I understand the maintenance of effort piece, but I believe we should have had a lock box with this. The fact that the bill does not address public- 219 NYS ASSEMBLY JUNE 24, 2011 private partnerships, which I view is very important to the universities, is not addressed at all as far as I can see in this bill. Also, for me, the project labor agreements, I view them as anti-competitive and I think that too many times they shut out the open shops and they cause kind of a -- sometimes a 20 percent increase, a lot of estimates say, in these construction costs. So, although I'm a huge fan of SUNY and I like the fact that we're kind of evening out the tuition over the years because too many kids get hit with these big spikes, which isn't fair to them, so I like the fact that we're evening that out, there are a couple of glaring weaknesses here that will cause me to vote in the negative. Thank you. ACTING SPEAKER P. RIVERA: Mr. Heastie. MR. HEASTIE: Thank you, Mr. Speaker and to my colleagues. I know I have told many of you my personal story, and for those of you who have heard it before, I apologize for saying it again and again, but I remember the day that I was going over my college applications and offers with my mother, who was a nurse. We were looking at the offers from MIT and UPenn and RPI and Stony Brook, and as I saw the look in my mother's eyes when she was so proud that MIT would dare to offer her son the ability to go to the School of Engineering at MIT, I could see that she knew that there was no way, while she was also paying for my older sister to go to college, that she could afford for me to go to MIT. I remember, I said to her, "Mom, don't worry about it. I'll go to Stony Brook. It's a top-rate engineering school and I will be fine." And here I am, you know, years later as a member of the Legislature. But I, do think we all agree on a diagnosis of the patient. 220 NYS ASSEMBLY JUNE 24, 2011

SUNY has been starved. Money has been taken away from them, even when we've done prior tuition increases. But, I think what we're doing here today is not the best cure for the patient, and the best cure for the patient, because as we have talked about and debated other bills today that talked about the affordability and how costs are rising, a tuition increase is a tax on college families, and what we will be doing today is actually raising taxes on college families. Now, were there better ways to do this? I do believe that we could have continued the millionaires' tax on the so-called millionaires because we have to remember, it's millionaires that are leaving the State; many times it is our young people who, when they graduate from college and have mortgage-sized debts when they graduate from college are the ones who are looking to move to the south and out west. And we have to remember -- I have a Chief of Staff and she's 25 years old. She went to UPenn -- and she's probably going to be upset with me for putting her business out in the street -- but, she has over $100,000 of college debt at 25 years old. So, as I'm going to painfully -- because I know that SUNY does need the money -- I'm going to painfully vote for this because I do think SUNY does need the money and I feel for my western colleagues, particularly Crystal Peoples, who believe that this will help Western Buffalo, but I think at some point this State and this nation has to start to worry about how much debt we're putting our college graduates in. So, I will, again, painfully vote for this bill. Thank you, Mr. Speaker. 221 NYS ASSEMBLY JUNE 24, 2011

ACTING SPEAKER P. RIVERA: Mr. Ra. MR. RA: Mr. Speaker, on the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. RA: I just want to commend the sponsor, Ms. Glick, and Speaker Silver, the Governor and Majority Leader Skelos for their work on this. I think this is an important piece of legislation because it does include this rational tuition plan that will, along with our State's maintenance of effort, enable the SUNY and CUNY institutions to continue to provide a quality education to New York's students. It also includes this New York SUNY 2020 grant program, which is going to allow the institutions to compete for funding, it's going to allow them to do important construction projects which are going to create jobs and implement cutting-edge new programs. It's certainly, you know, something we always pause with when we're looking at the cost of education, and the 21st District, which I'm privileged to represent, has a lot of students that attend Nassau Community College and then move on to our SUNY schools throughout the State, and they go on to the healthcare profession and as teachers and they're really doing great things in our community. One of the things I really want to applaud in this legislation is that the sponsor made sure that we took care of some of the lower-income people in terms of protecting them from some of the increases that will occur and, especially, allowing the TAP awards to continue to cover that. So, with that said, I think this will help prevent the continued occurrence of students having to go for an extra semester of 222 NYS ASSEMBLY JUNE 24, 2011 school, the cost of which is much higher than what they're going to be paying over the four years under this legislation. As a result, I'll be casting my vote in the affirmative. Thank you. ACTING SPEAKER P. RIVERA: Ms. Barron. MS. BARRON: Thank you, Mr. Speaker. On the bill. ACTING SPEAKER P. RIVERA: On the bill. MS. BARRON: This move, this bill, as I understand it, is to help generate revenue for SUNY and CUNY. I think if we had, as one of my colleagues has indicated, continued the millionaires' tax, there would have been the funds that could have been added to SUNY and CUNY to allow them to fund the programs that they need to have to maintain the excellent universities that they have. We've heard that there is a TAP tuition credit to lend assistance to those who are in the lower income. I went online to the Higher Education Services Corporation site, and they have a calculator which asks you to plug in figures of your income and they will generate for you a projection as to what your award will be. It was very interesting. If you're a financially-dependent student in the $40,000 taxable income bracket, single with two people in the family, applying for TAP and the tuition is $5,000, you would qualify for $500 a year. If you are a financially-dependent student in the $25,000 taxable income group at $5,000 tuition, you would qualify also for $500 a year. If you are financially independent in the $25,000 income bracket, single, one person, applying for TAP for $5,000 tuition, you would get 223 NYS ASSEMBLY JUNE 24, 2011 zero TAP dollars. If you are financially independent, $12,000 taxable group, single person, you would qualify for $2,500 a year. So, going back to the financially-independent person, $25,000 a year, $5,000 tuition, you would not have any tax, according to the calculator on the HESC website. So, people are trying to tell us that while the low-income students will be provided a tax credit, which will cover any increases that come, but let's look also to the middle-income student. When CUNY was founded, they said that they were a school fashioned as a free academy for the purpose of extending the benefit of education gratuitously to persons who have been pupils in the common schools of the City and County of New York and they would be offering a high-quality, tuition-free education to the poor, working class and immigrants. Then in 1969, after the struggle by African-American, Latinos and others who were underrepresented at CUNY, they installed an open admissions policy. That policy continued, and in 1975 CUNY imposed tuition for the first time, and in 1999, CUNY ended its open admissions policy. Now, as we talk about TAP being awarded and we talk about students in CUNY and SUNY, of the 147,000 students who attend CUNY undergrad, only 66,000 of them qualify for some level of TAP, and of the 77,000 part-time students who qualify, of the part-time students enrolled at CUNY, only 174 qualify for TAP. I believe that last year there was legislation enacted which removed TAP awards for graduate students. So, all of those graduate students are no longer 224 NYS ASSEMBLY JUNE 24, 2011 eligible for TAP. At SUNY, out of 192,000 students -- I don't have the total number -- oh, 134,000 are receiving TAP at SUNY. We're talking about tuition, but we also need to realize that there are other out-of-pocket costs. Tuition is just the beginning. You've got your book costs, you have travel expenses and other incidentals that come up with being a student at SUNY or at CUNY. We have to also recognize that each year or each time that TAP comes up for review, there are more and more students who are dropping out because the award limits change and are modified from year to year. So, the fact that there are "X" number of students receiving TAP now does not guarantee that those same number of students will be eligible for TAP. We understand that TAP is for four years, but there are so many students now who are taking more than four years -- even though they may be taking the minimum 12 credits to qualify for TAP -- so many more students were taking more than four years, and a part of the reason that they're taking more than four years, New York City -- in New York City, the New York Times reported that even though there are high schools that receive a rating of A, 40 percent of those students that go on to college need remedial courses, which I think is a testimony to the failure of mayoral control, but be that as it may, those students who are graduating from so-called "A schools" are not prepared for college or career. So, it's going to take them more than four years because they have to include the remedial courses that they need to bring them up to par. I'm concerned, also, that there will be additional fees that 225 NYS ASSEMBLY JUNE 24, 2011 will be awarded to the research schools, and I see that as the beginning after two-tier system. I'm also concerned about the reduction in the number of African-American and Latino and other so-called minority students who will not be able to pay what, for some people, seems to be a mere amount of up to $300 and then the following year, an additional $300, which means $600 more than this year, and the following year $900 more than this year and so on. So, I think that this tuition request is another way of limiting the access of African-American and Latino students, poor people and, also, middle class, especially having gone to use the calculator at the website and seeing how little the TAP awards are. I'm very concerned, Mr. Speaker and my colleagues, that we are undermining our responsibility. Someone made mention of the fact that they thought sweeping was just what you did with your broom in your house. I was shocked when I came and found out that sweeping meant that the money that was allocated for a particular agency, and this time we're talking about education, was taken away with no intention of being replaced, no intention of being replaced. It's not that, oh, we're going to take it and replace it at some later date. We have no intentions of giving it back. I'm also concerned that there is no lock box. Yes, the wording may say a maintenance of effort. That's no guarantee. That's no guarantee. "Notwithstanding" is another word had that this Body uses from time to time. So, notwithstanding the fact that there's a maintenance of effort clause, that does not mean that money will not be taken through 226 NYS ASSEMBLY JUNE 24, 2011 a sweep or some other measure from what its intended purposes are. There are no guarantees. A lock box would have been somewhat more of a guarantee because I've been told the Executive can pretty much take it even if there is a lock box. But, in any event -- Mr. Speaker, can we have a little less noise? It's difficult for me to concentrate. ACTING SPEAKER P. RIVERA: Can we have some silence, please? MS. BARRON: Thank you, Mr. Speaker. So, a lock box would have been more of a guarantee, but that's not in this bill. We have an obligation as a legislative Body to put our money where we say issues are important, and if we say education is important, if we talk about from pre-K through 20, then we need to put money in what we say is important and we, as a Body, have not done that or we have allowed those instances to come and take that money from the dedicated purposes. I think that this bill is not good intentioned in terms of maintaining a broad, open door and especially in this climate where people are being laid off, people do not have jobs, people are looking for jobs, people have two and three jobs to try to maintain their homes and pay their mortgages and homes are in foreclosure, I think this is bad timing, especially given our economic circumstances and I will be voting in the negative. ACTING SPEAKER P. RIVERA: Mr. Hayes. MR. HAYES: Thank you, Mr. Speaker. On the bill. ACTING SPEAKER P. RIVERA: On the bill. 227 NYS ASSEMBLY JUNE 24, 2011

MR. HAYES: Mr. Speaker, I want to commend my colleagues, first and foremost from western New York on both sides of the aisle. I have always considered it one of the greatest privileges of my role as a State Assemblyman to be able to represent the campus at the University of Buffalo, the north campus, the main campus, and this bill tonight is a culmination of the spark of a lot of hard work and effort that started with the Western New York delegation and the people at UB who had a vision and who had a dream about the future, about a bright future for Western New York and for the State of New York. And although this bill that's before us tonight is not exactly like what was envisioned at the very beginning of that journey, it still remains intact a very powerful catalyst for what is so desperately needed in Western New York, and that is a place where the university, its intellectual capital, the way it can integrate in the business community and the possibility to create jobs for our most precious investment, those young people that we spend so much time and so much money investing in and educating in this State and the heartbreak that we feel, so many of us, when we watch them have to leave New York State for other places simply to find a job to be able to raise a family and to enjoy a quality of life. These are big issues. These are tough issues and they are issues that my colleagues on both sides of aisle from Western New York took to all of you in this House and in the State Senate to tell the story. And as we attracted supporters and friends along the way, there were others in other parts of the State who had a similar vision for their communities and we welcome the ability for UB 2020 vision to now become SUNY 2020 and its vision. But it's going 228 NYS ASSEMBLY JUNE 24, 2011 to take the continued effort and leadership of our Governor, Governor Cuomo, to make good things happen at these university campus centers and to continue to keep higher education affordable for our young people and their families. And, again, although this does not have every component of the original vision, and it is not the perfect panacea, it is a wonderful catalyst for Western New York and for New York State, and for that reason, I'll be casting my vote in the affirmative. Thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: Mr. Schroeder. MR. SCHROEDER: Mr. Speaker, on the bill. ACTING SPEAKER P. RIVERA: On the bill. MR. SCHROEDER: You may have noticed, I have not uttered a word this year, six months, on the floor or in conference regarding UB 2020 or SUNY 2020, for obvious reasons, mostly because I didn't want to jinx it. I'm optimistic, positive by nature, Mr. Speaker, but if you were to tell me three years ago, three months ago, three weeks ago, three days ago that my name would appear as a co-sponsor with the Chair of the Higher Education Committee here in the Assembly on a UB-SUNY bill, I would have been doubtful. So, I would like to thank publicly the Chairperson, Deborah Glick, and also, a special thank you to Speaker Silver. I realize now that some things take time to hatch or to develop. The Italians have an old saying, "Roma non è stata costruita in un giorno." Sorry, Carol and Marina. Just put down, "Rome wasn't built in a day." I would also like to suggest that many of you watch hockey, 229 NYS ASSEMBLY JUNE 24, 2011

NHL Hockey, and they have the number one star after each game. In my opinion, the number one star in the New York State Assembly on this issue has been Assemblywoman Crystal Peoples-Stokes, her tireless efforts. She has credibility and added value to all discussions having to do with UB and SUNY 2020. Also I would like to thank the Western New York delegation for pursuing this vigorously. Finally, last January on a cold winter's day in Amherst at a press conference at UB, I said that Governor Andrew Cuomo would find a creative way to get this done and that he understood that this would be good for all SUNY students across our State and communities across our State. And so, I would like to thank you, colleagues, for your patience on this three-year discussion and your yes vote tonight would be appreciated. Thank you. ACTING SPEAKER P. RIVERA: Read the last section. THE CLERK: This act shall take effect on the first day of July next succeeding the date on which it shall have become a law. ACTING SPEAKER P. RIVERA: The Clerk will record the vote. (The Clerk recorded the vote.) Mr. Katz to explain his vote. Colleagues, we still have business to do in this House. I'm sorry, Mr. Katz. MR. KATZ: Thank you, Mr. Speaker. I would just like 230 NYS ASSEMBLY JUNE 24, 2011 to say that I do agree with my colleagues that SUNY is truly one of the jewels that we have here in our State, but I also would like to say that as a Penn grad, New York does have the second-best veterinary medical school in the State. Thank you very much. ACTING P. RIVERA: Mr. Katz in the affirmative. Mr. Crespo to explain his vote. MR. CRESPO: Thank you, Mr. Speaker, to explain my vote. A lot has been said this week about voting our conscience on issues -- if you will excuse me. A lot has been said about voting our conscience on issues and, as a student, a graduate of John Jay College who was able to take advantage of the SEEK Program in order to afford my college education, I understand what it is to struggle financially. And so, in the same year that we said to millionaires that they would be off the hook in terms of helping us deal with a tough economic crisis and in the same year that we said that we could not afford to continue to invest in higher education, to now come here and say that we need the students to be the ones to cover those expenses for SUNY and CUNY, the expenses that we cannot find the funding for, I think, is an unconscionable decision. I commend the sponsor of this bill for trying her best to make sure that low-income students would not be affected directly. Nonetheless, now is not the time for us to ask students to do what we could not do, so I'll be voting in the negative. MR. CANESTRARI: Mr. Speaker, excuse me. Could we have some quiet the Chamber, please? If you're leaving after this last 231 NYS ASSEMBLY JUNE 24, 2011 vote, please leave quietly. Our colleagues are explaining their votes. They deserve our courtesies, please. Please be quiet and say your goodbyes out in the hallway. Thank you. ACTING SPEAKER P. RIVERA: Mr. Gottfried to explain his vote. MR. GOTTFRIED: Mr. Speaker, when I was about 14 years old, about the first demonstration I ever went to was a protest against then-Governor Rockefeller's effort in those days to impose tuition charges at what became the City University of New York. I understood then, a lot of people understood then, and I believe it even more today that a college education today is the economic and cultural equivalent of what a high school education was years before, and no one in their right mind would suggest that we should be funding our schools by charging tuition to families that want to send their youngster to high school. It is every bit as wrong and irrational to be charging tuition for public higher education. We should not be raising tuition, we should be lowering tuition. We should be eliminating tuition for public higher education. It is wrong to fund public higher education by taxing students and their families for that basic public service. Now, Speaker Silver and Deborah Glick and many in this Chamber have done an amazing job of containing and limiting the tuition increases in this bill, but I believe it is important to stand up and say raising tuition is the wrong thing to do. We should not be doing it. We should be funding public higher education through broad-based, progressive taxation where the rich pay more and the poor 232 NYS ASSEMBLY JUNE 24, 2011 don't. That's how we pay for important public services in this society, and I vote no. ACTING SPEAKER P. RIVERA: Mr. Englebright to explain his vote. MR. ENGLEBRIGHT: Thank you, Mr. Speaker. When we finished the budget, we finished it on time, but we left incomplete that part of the budget that related to the real institution, the ultimate institution of optimism for our State, which is our public higher education system of CUNY and SUNY. And tonight, even though we have worked and worried our way through a whole myriad of proposals and possibilities, I think what we have before us is something that completes the need that was left so obvious at the time that the budget was completed to actually provide funding sufficient for SUNY to continue its mission; most particularly, the research centers have such potential. I believe that the challenge grant program that is a part of this bill is vitally important for the creation of new patents and, through that, new jobs and from that, the future of our State. For the best and our brightest minds, this bill may be the most important thing that we have done this year. It maintains the open door. Even though there are costs associated with it, not to have done this would have closed that door and that would have been truly devastating, not only to those individuals but, ultimately, to the entire trajectory of our State. This is a journey. Tonight we make a number of steps forward. I congratulate the Chair, Deborah Glick, who has studiously tried to bring people together and find a way -- 233 NYS ASSEMBLY JUNE 24, 2011

ACTING SPEAKER P. RIVERA: Mr. Englebright, how do you vote? MR. ENGLEBRIGHT: -- and I'm also going to explain that I'm going to vote yes -- ACTING SPEAKER P. RIVERA: Thank you. MR. ENGLEBRIGHT: -- and congratulate the Governor and the Speaker at the same time. Thank you very much. ACTING SPEAKER P. RIVERA: Mrs. Peoples-Stokes to explain her vote. MRS. PEOPLES-STOKES: Thank you, Mr. Speaker. I just wanted to rise and thank my colleagues for their support on this very important issue. I really do think that if we don't do this that, in spite of how it looks, we actually are limiting access to a lot of students and we're actually causing more families to expend more than they need to by not doing this. I think it also, you know, helps create an opportunity where people will clamor not just in New York State to get into a CUNY or SUNY school, but all over the world to get into one of these schools of excellence. So, again, thank you very much for your support. I certainly want to say thank you to the Speaker and Member Glick and all of the staff that worked on this because I know it took a lot of people's efforts to make this a reality and I am grateful. I trust that everyone will have a great summer and a great evening. Thank you, Mr. Speaker. ACTING SPEAKER P. RIVERA: Are there any other votes? 234 NYS ASSEMBLY JUNE 24, 2011

The Clerk will announce the results. (The Clerk announced the results.) The bill is passed. Mr. Canestrari. MR. CANESTRARI: Mr. Speaker, I understand you have resolutions for us to consider. ACTING SPEAKER P. RIVERA: Yes, we have resolutions. Privileged resolution by Mrs. Rabbitt, the Clerk will read. THE CLERK: Resolution No. 782. Legislative Resolution commending Sharon "Jellybean" Warantz as she celebrates her 20th year as the founder and President of Jellybean Promotions. WHEREAS, It is the sense of this legislative Body to recognize and commend individuals and businesses which contribute substantially to the economic health and vitality of the communities of the great State of New York, and to their quality of life; and WHEREAS, Attendant to such concern and in full accord with its long-standing traditions, this legislative Body is justly proud to commend Sharon "Jellybean" Warantz as she celebrates her 20th year as the founder and President of Jellybean Promotions, Goshen, New York; and WHEREAS, For 20 years, Jellybean Promotions has provided quality imprinted promotional marketing products for use at 235 NYS ASSEMBLY JUNE 24, 2011 trade shows, golf outings, grand openings, or other special events, or to recognize or motivate employees, thank customers, attract new customers, or participate in a community event; and WHEREAS, Under Sharon Warantz's able leadership Jellybean Promotions offers more than 500,000 items and personal, friendly service with on-time delivery and at competitive prices; and WHEREAS, Pens, mugs, water bottles, and travel mugs, tote bags, mouse pads, magnets, bumper stickers, caps and hats, plastic bags and stress relievers are Sharon Warantz's most popular items and many people have received her own purple pens in greeting; and WHEREAS, Sharon Warantz is a member of the Orange County Chamber of Commerce and serves on its Board of Directors and, she and her business are certified as a Women's Business Enterprise by the Women's Business Enterprise National Council; and WHEREAS, She has given business workshops and spoken to groups throughout the area and when called upon to contribute her time, talents and expertise to countless civic endeavors, she has always given of herself unstintingly; and WHEREAS, In recognition and appreciation, Sharon Warantz has fittingly been honored with the Girl Scouts Heart of the Hudson and YWCA of Orange County's 2008 Business Award and the Orange County Chamber of Commerce's 2010 Board Volunteer of the Year Award; and WHEREAS, Businesses, such as Jellybean Promotions and its owners and employees, exert a strong, positive influence on the 236 NYS ASSEMBLY JUNE 24, 2011 communities they serve and are an essential component of the economies of Orange County and the State of New York, and of their quality of life; and WHEREAS, It is with great pleasure that this legislative Body acknowledges this exceptional business and its contributions, and those of Sharon "Jellybean" Warantz, fully confident they will continue to enjoy the success Sharon has worked so hard to achieve; now, therefore, be it RESOLVED, That this legislative Body pause in its deliberations to commend Sharon "Jellybean" Warantz as she celebrates her 20th year as the founder and President of Jellybean Promotions and to applaud her for her successful and dynamic leadership and her exemplary service to her community; and be it further RESOLVED, That a copy of this Resolution, suitably engrossed, be transmitted to Sharon Warantz. ACTING SPEAKER P. RIVERA: On the resolution, all those in favor signify by saying aye; opposed, no. The resolution is adopted. Privileged resolution by Mr. Crouch, the Clerk will read. THE CLERK: Resolution No. 783. Legislative Resolution commemorating the 200th anniversary of the Town of Masonville. WHEREAS, Each and every city, town, village and hamlet within its borders proudly resonates with the rich and noble history of the State of New York; and 237 NYS ASSEMBLY JUNE 24, 2011

WHEREAS, It is the sense of this legislative Body to recognize and commemorate the anniversary of the founding of municipalities throughout the State, noting in turn their contributions to the fabric and development of this great Empire State; and WHEREAS, This legislative Body is justly proud to commemorate the Bicentennial of the Town of Masonville, New York, recognizing the significance of this special anniversary and applauding its distinguished history; and WHEREAS, Formed in 1811, the Town of Masonville, located in Delaware County, is a vital community rich in historical tradition and the spirit of pride of its citizens; and WHEREAS, The Town of Masonville will proudly mark its 200th anniversary on Saturday, July 16, 2011 with a Parade from Town Hall to the Federated Church of Masonville, where there will be a ceremony recognizing the auspicious milestone of the Town's 200th anniversary; and WHEREAS, There will also be a historical display in the church's Fellowship Hall featuring items chronicling the history of Masonville along with a slide show and photo albums and photographs donated or loaned by Masonville residents for the occasion, and, later, in the afternoon, there will be an old-fashioned community picnic and entertainment on the Masonville Elementary School's back lawn; and WHEREAS, Remaining fruitful over the ebb and flow of decades of growth and change, the Town of Masonville retains its commitment to enhancing the quality of life of its citizens; and 238 NYS ASSEMBLY JUNE 24, 2011

WHEREAS, As the Town of Masonville celebrates its 200th anniversary, it honors its illustrious past, its proud heritage and its promising future; and WHEREAS, In recognition of the Town of Masonville's rich history and enduring contribution to the State of New York, this legislative Body is proud to pay tribute to this spirited Town upon the occasion of its Bicentennial; now, therefore, be it RESOLVED, That this legislative Body pause in its deliberations to commemorate the Bicentennial of the Town of Masonville and to enthusiastically salute its residents as they celebrate this auspicious occasion; and be it further RESOLVED, That a copy of this Resolution, suitably engrossed, be transmitted to the Town of Masonville. ACTING SPEAKER P. RIVERA: On the resolution, all those in favor signify by saying aye; opposed, no. The resolution is adopted. Mr. Canestrari. MR. CANESTRARI: With that, Mr. Speaker, I move the Assembly stand adjourned until Monday, June 27th, Monday being a Legislative day, and that we reconvene at the call of Speaker Sheldon Silver. ACTING SPEAKER P. RIVERA: The House stands adjourned. (Whereupon at 11:31 p.m. the House stood adjourned, to reconvene at the call of Speaker Sheldon Silver.) 239