ALBANY — With the state facing a $3.1 billion fiscal gap, Gov. Andrew Cuomo has put the finishing touches on a state spending plan that is expected to top $170 billion and find new revenues from sports betting and taxes on what is expected to be legalized sale of marijuana.

Heading into the State of the State speech he will make before lawmakers today, he downplayed the significance of the revenue that could be generated from pot sales, suggesting the state would reap about $300 million.

The sales tax rate for pot is expected to be included in the raft of budget documents his administration will release today

 
The entire spending plan, which will have to address the state's deficit, is required to be in place by April 1, the beginning of New York's 2019-2020 fiscal year.

Cuomo is expected to seek a continuation of the state's cap on local property taxes while keeping overall state spending growth at below 2 percent over the current year's level of some $168 billion.

MILLIONAIRE'S TAX

The governor is also faced with a fragile New York economic environment, complicated last year with the passage of the Republican tax plan in Washington, a policy that caps deductions on federal returns for state and local taxes, known as SALT.

Cuomo has maintained that the federal move could cause some wealthy New Yorkers paying high property taxes here to move to other states.

"The cap on the SALT deductions really does have an impact on the state's ability to be competitive," said David Friedfel, director of state studies for the Citizens Budge Commission.

Some budget analysts and fiscally conservative lawmakers now say that the temptation for taxpayers to move elsewhere could be increased if Cuomo seeks to generate more revenue by extending the so-called millionaire's tax or imposes a surcharge on that higher income tax rate.

New York now generates about 40 percent of its income tax receipts from taxpayers with incomes of $1 million or more — about 0.6 percent of all filers, said Friedfel.

The top rate for those high earners would drop from 8.82 percent to 6.85 percent if the millionaire's tax expires, as scheduled, Jan. 1. But Cuomo has signaled that he favors extending it, though some influential Assembly Democrats may push for a surcharge on the highest rate.

Sen. Rob Ortt (R-North Tonawanda) said Cuomo's fiscal plan will be closely scrutinized.

"Will he double down on the very thing that is chasing people out of this state?" said Ortt.

He noted that the "inescapable reality" of why the federal tax plan had such a strong impact on New York is the fact that the state is ranked as having among the nation's highest property taxes.

SPENDING CAP

Meanwhile, Cuomo, at a time when he is trying to adhere to a self-imposed cap of 2 percent on spending growth, will face pressure from lawmakers to send more state money to public school districts, said E.J. McMahon, research director for the Empire Center for Public Policy.

"Keep your eye on his spending cap," McMahon suggested. "Does he blink on his spending cap?"

Cuomo's budget presentation will be embedded in his annual State of the State speech, a pronouncement that could be the governor's closest thing to a victory lap since November, when he was handily re-elected and Democrats took control of the state Senate, giving his party full control over both legislative chambers.

New initiatives, in addition to legalized marijuana, will include: a ban on single-use shopping bags; an extension of the period by which victims of child sexual abuse can seek to hold their molesters accountable with civil and criminal claims; and authorization of sports betting at existing gambling parlors.

 
The nation's highest court has authorized gambling on professional and collegiate sports.

Peter Iwanowicz, director of the advocacy group Environmental Advocates, contended Cuomo's proposal banning plastic bags is flawed because it would clamp no fee on paper bags, which also end up getting tossed into the waste stream.

"We want people to use reusable bags, not just shift from plastic to paper, and we want the revenue to go to support municipal parks or climate mitigation."

But Iwanowicz said his group supports Cuomo's call to expand existing bottle bill legislation by putting a five-cent redemption charge on many kinds of beverage containers, such as juice drinks and iced tea, an initiative aimed at combating roadside litter and curbing the amount of plastic that ends up in landfills.

Cuomo provided new details Monday of his marijuana legalization proposal, contending the minimum purchase age should be set at 21. He is also calling for the age to purchase cigarettes to be increased from 18 to 21.

A Siena College poll issued Monday found that 56 percent of New York voters support legalizing marijuana. Voters in the upstate region backed legalization, 57 to 41 percent, Siena reported.

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