When a Tax Isn’t Really a Tax

ALBANY – “I say no new taxes, period,” Gov. Andrew M. Cuomo declared on the day of his inauguration last month, echoing a top promise from his campaign. And after leafing through his first executive budget on Tuesday, lawmakers and others at the Capitol seemed to agree that Mr. Cuomo had indeed kept his pledge.

At horse-racing tracks around the state, however, some people begged to differ.

In his budget, Mr. Cuomo proposes to close the state’s $10 billion budget gap almost entirely through cutting costs. But he did propose one new fee: a 2.75 percent surcharge on purses at horse races around the state, which would raise $7.6 million for the state next year.

“Talk about blindsided,” said Rick Violette, a trainer who is the president of the New York Thoroughbred Horsemen’s Association. “It really did come from out of left field.”

To Mr. Violette, horse racing should be looked at as an industry just like any other. The New York Racing Association, which operates the Aqueduct, Saratoga and Belmont race tracks (and has teetered on insolvency), says it contributes more than $2 billion annually in the state’s economy. Horse racing is estimated to account for some 35,000 jobs across the state.

“It just seemed like the mantra going in was that raising taxes and creating new taxes was not good for businesses in New York State,” Mr. Violette, who is a board member for the racing association, said of Mr. Cuomo’s budget. “Yet here a troubled industry right away is really going to pay.”

He was not the only one. “If it looks like a duck, walks like a duck and quacks like a duck, in New York State, it’s a tax,” said Assemblyman James N. Tedisco, a Republican whose district includes Saratoga Springs.

Mr. Tedisco said he hoped Mr. Cuomo would reconsider the surcharge.

“Most of the breeders are not millionaires; they’re small-business people,” he said. “This governor said, ‘If we’re going to keep more people in New York State, we’re going to have to create jobs.’ And this won’t help that.”

The Cuomo administration has a different view. The money generated by the surcharge will go toward the New York State Racing and Wagering Board, which, among other things, provides oversight for horse racing in the state.

The Racing and Wagering Board’s racing division currently operates at a deficit, requiring loans from the state’s general fund. Cuomo officials present the fee on purses as a matter of fairness. The briefing book that lays out the governor’s proposed budget explains that the surcharge will “ensure that the cost for the board’s regulatory activities are fully borne by the racing industry rather than by taxpayers.”

The budget also holds some good news for race tracks that are supported in large part by the casinos they also house. Mr. Cuomo proposed allowing free game credits at video lottery terminals in an effort to induce frequent players to gamble more. That may be little consolation to the people who go to race tracks for the actual horse racing, but the money on the line is significant: the increased video betting is projected to generate $38 million for the state.

Meanwhile, for those keeping score at home, the budget office believes that Mr. Cuomo did, in fact, keep his promise of not creating any new taxes. They consider the horse-racing surcharge to be a fee, not a tax, because it affects such a narrow constituency.

THOMAS KAPLAN

Wal-Mart Gets a Lift From the Weather
Wal-Mart has friends in high places, from Michelle Obama to Mayor Michael R. Bloomberg. But it seems it may have developed a new partnership, and this time it has outdone itself.

Meet the retail giant’s new godfather: Mother Nature?

The New York City Council has scheduled several hearings to explore what Wal-Mart’s impact might be on the city’s economy, including on surrounding small businesses, but those hearings keep getting canceled, mostly due to snow.

“We knew Wal-Mart was powerful, but we didn’t realize they controlled the weather!” said Bertha Lewis, a longtime activist who is helping to organize opposition to the retailer. “They’re purchasing cheap snow from China!” she added wryly. “How many coincidences could there be?”

The Wal-Mart hearing, which was originally scheduled for December, has been moved three times, and is currently on the calendar for Thursday. The first change, according to Christine C. Quinn, the City Council speaker, was necessary because so many people were clamoring to join the hearing that they needed a bigger room.

But while those people were banging down the door, Wal-Mart tipped its hat and walked in the other direction, declining invitations to attend.

Earlier, Wal-Mart sent a letter to the Council — complete with several pages of facts about the company, its diversity initiatives and philanthropy — suggesting that city officials investigate the economic impact of existing chain stores in New York, like BJ’s and Sears, before they look into what a possible Wal-Mart store might mean.

Many of the retailer’s supporters also declined to testify.

“It was unclear what we would be testifying about,” said Kathryn Wylde, the president of the Partnership for New York City, a business group. “There was no specific store proposal, and we think that location matters.” The hearing, she added, “is hypothetical.”

Instead of speaking to the Council, Wal-Mart has taken its case to the street in a sizable public relations campaign, complete with radio advertisements, a Web site and a Facebook page, which started this week. They have also been working behind the scenes, brokering a deal with a politically powerful union, the Building and Construction Trades Council, to gain its support in exchange for building and renovating stores with unionized workers in the five boroughs.

With or without Wal-Mart, the Council plans to try for that hearing. The forecast calls for another cold day, but no snow — though perhaps it would be best if council members kept their fingers crossed.

ELIZABETH A. HARRIS

When City Council Isn’t Always a Steppingstone
Memo to aspiring mayors of New York: serving on the City Council may not be the boon to your résumé that it might seem, at least if history is any guide.

New York is the only major American city where the three most recent mayors have not previously served as city lawmakers, a study released on Wednesday by Pew Charitable Trusts showed.

Michael R. Bloomberg was a successful businessman before coming to City Hall. His predecessor, Rudolph W. Giuliani, was a hard-nosed lawyer. And David N. Dinkins, who served from 1990 to 1993, occupied a variety of political offices outside of City Hall.

The last mayor to have spent time as a city lawmaker was Edward I. Koch, who served on the Council from 1966 to 1968 and was elected mayor in 1978. Asked what he had learned at the Council that helped prepare him to be mayor, Mr. Koch said, “Absolutely nothing.”

But the Council has gained considerable influence in recent years. Indeed, three of the often-mentioned candidates for mayor in 2012 have roots in the Council: John C. Liu, the city comptroller; Bill de Blasio, the public advocate; and Christine C. Quinn, the Council speaker.

Andrew White, director of the Center for New York City Affairs at the New School, said those three candidates had established themselves as “formidable leaders,” a break with tradition.

“They play into that abstract notion of being perceived as an executive,” Mr. White said.

The study compared councils in 15 cities. It found that New York spends the smallest portion of its overall budget on its council, and that women and Latinos were significantly underrepresented among city lawmakers.

JAVIER C. HERNANDEZ


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