Politics on the Hudson

Smokers would have to a pay $1 more in taxes on a pack of cigarettes, soda drinkers would have to pay about 16 percent more on a can of soda, and gamblers would be able to spend more time playing Quick Draw and video-lottery terminals under Gov. David Paterson’s budget plan today.

With the state facing a $7.5 billion deficit in the 2010-11 fiscal year, Gov. David Paterson is proposing $1 billion in new taxes and fees. The proposal is much lower than in the current fiscal year when Paterson and lawmakers agreed to about $8 billion in new taxes and fees to close a $18 billion budget gap, but if approved the new taxes would still be a hit to many New Yorkers.

The cigarette tax would increase the current $2.75 per-pack tax by $1, giving New York the highest tax on cigarettes in the country. The state estimates it would bring in $218 million a year in new revenue.

The excise tax on ‘beverage syrups and soft drinks” would be imposed at a rate of $7.68 per gallon for syrups and $1.28 per gallon for soft drinks and powders. It would essentially mean about a one penny per ounce tax on sodas and other sugary drinks. So the $1 cost of a 16-oz. bottle of soda would increase by about 16 cents.

The proposal, which fizzled last year after Paterson proposed it, would bring in about $465 million for the state, Paterson estimated. Pepsi and other major bottlers in New York have fought the measure.

Paterson also proposed a severance tax on some natural-gas producers. A 3 percent tax would be imposed on natural-gas producers in the Marcellus and Utica Shale formation in the Southern Tier and central New York using a horizontal well. The state doesn’t expect any revenue in the 2010-11 fiscal year, but estimates $1 million in the following fiscal year.

Paterson would impose $240 million in assessments and surcharges on the health-care system, including on hospitals, physicians and nursing homes.

The Democratic governor also wants to eliminate restrictions on the Quick Draw lottery game, such as limiting the games to restaurants and bars and limiting operations to 13 hours a day. Racetracks with video lottery terminals would be able to expand hours; they are currently limited to no more than 16 hours a day.

Paterson again wants to let grocery stores sell wine, a plan that has been beaten back by liquor stores.

“This misguided plan would put money in the pockets of Big Box stores without creating even one new job, while imperiling Main Street businesses across the state and the thousands of jobs they provide,” said Jeff Saunders, founder of the Last Store on Main Street coalition and president of the Retailers Alliance.

The budget proposal also includes a fee ranging from $45 to $540 per child for early intervention services provided by the state, based on income starting at 251 percent above the federal poverty level.

Filing fees at courts would increase from $165 to $215 in state Supreme Court and from $45 to $60 for city and district courts.

Paterson would legalize mixed martial arts competitions in New York and expand the use of speed-enforcement cameras around the state.

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