Tuesday, August 08, 2017

NYC mayor’s plan to tax wealthy to pay for subway fix

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NYC mayor’s plan to tax wealthy to pay for subway fix Office of Mayor Bill de Blasio

New York City Mayor Bill de Blasio outlined a proposed tax plan he says could raise as much as $800 million for the city's transit system by raising taxes on the wealthiest residents.

The mayor says the tax adjustment would be levied on fewer than one percent of the city's wealthiest tax filers and would allow the city to reduce transit fares by 50 percent for the low-income residents.

The proposal would increase the income tax rate from 3.876 percent to 4.41 percent on taxable incomes above $500,000 for individuals and above $1 million for couples. The mayor estimates the tax rate would affect 32,000 tax filers. The proposal would raise $700 million in 2018 and potentially rise to $820 million per year by 2022. The extra funds would add $1.6 billion in city operational support for subways and buses.

"Instead of searching for a quick-fix that doesn't exist or simply forking over more and more of our tax dollars every year, we have come up with a fair way to finance immediate and long-term transit improvement and to better hold the state accountable for the system's performance. Our subways and buses are the veins that make life in the greatest city in the world possible. This fair funding source will provide immediate help to straphangers – and it will help New Yorkers get around our city reliably for the next generation and beyond," said Mayor de Blasio.

The mayor also believes the extra revenue dedicated to the modernization of the transit system would also support borrowing $8 billion for capital upgrades.

"The mayor believes this funding should be immediately directed toward core infrastructure improvements like signal improvements, new cars and track maintenance key to reducing delays and disruptions that have paralyzed the system in recent months," de Blasio's office said in a statement.

New York Gov. Andrew Cuomo issued a statement that didn't reject de Blasio's proposal, but did suggest the tax proposal would take too long to produce the funding that is needed immediately to pay for emergency repairs.

"We need two things: immediate action and a long-term modernization plan. One without the other fails the people of the city. The state is currently evaluating a range of dedicated revenue proposals for the future to be discussed and advanced in January when the legislature returns. There is no doubt that we need a long-term dedicated funding stream. But there is also no doubt that we cannot wait to address the current crisis. Riders suffer every day and delaying repairs for at least a year is neither responsible nor responsive to the immediate problem, or riders' pain," Gov. Cuomo said. "The city should partner with us and match the state funding now so we can begin [Metropolitan Transportation Authority] Chairman [Joseph] Lhota's overhaul plan immediately and move forward. We cannot ask New Yorkers to wait one year to start repairs."