County Executive Steve Bellone, in a Monday morning conference call with local reporters, called the federal tax bill a “potential catastrophe” for Long Island.
The U.S. Senate passed its version of a tax cut bill, 51-49, in the early hours of Saturday morning. The 479-page tax overhaul calls for a steep corporate tax cut, along with provisions local officials warn could harm middle class residents. The House bill, passed recently, contains similar provisions. The two bodies of Congress are now reconciling the separate bills to send to President Trump to sign into law.
Mr. Bellone said the process in Congress is happening at such a “breakneck” pace that is it a “real likelihood” it will pass. He added that he doesn’t think the public fully understands the potential impact, most notably on reducing the ability to deduct state and local property taxes.
“There are various reports and studies, but one thing that seems very consistent is that we’re looking at what could amount to a massive tax increase on Long Islanders,” he said.
Such an event would have a significant impact on the economy, home values, consumer spending and small businesses. The county executive pointed to a study by E.J. McMahon, founder and research director for the conservative Empire Center for Public Policy, who has said housing values in the state could decline by up to 20 percent if fewer people are unable to afford more expensive homes and instead put money toward taxes.
“Basically it runs contrary to everything that we’re trying to do as a region to become more independent, to bring young people back to the region, to make the kind of investments necessary for us to recharge our economy…” Mr. McMahon said. “This would be a huge blow to all of those efforts and to middle class families across the region.”
He also warned a bill could adversely impact Medicare and Social Security.
Mr. Bellone said this was not a partisan issue, noting how the Long Island’s Congressional delegation, which include members from both political parties, have opposed the bill.
That includes Congressman Lee Zeldin (R-Shirley), who voted against the House version of the bill, one of only 13 Republicans to vote no. Mr. Zeldin sent out a poll to constituents on Saturday, asking whether they support the House’s bill and if they want it to preserve or eliminate state and local tax deductions.
Mr. Zeldin held a press conference last week with fellow Congressman Peter King (R-Seaford) and Tom Suozzi (D-Glen Cove) along with state officials at the IRS in Hauppauge to discuss concerns for the GOP tax reform plan.
“My goal in this tax reform mission has always been to ensure the hardworking men and women of Long Island keep more of their paycheck, reduce their cost of living and are able to save more for retirement,” Mr. Zeldin said in a statement ahead of the press conference.
Mr. Bellone on Monday said the changes are “dangerous” and “terrible” for Long Island, adding that he considers Nassau and Suffolk Counties a “donor region” to the federal government.
The county executive added that the focus is now on urging President Trump, a New Yorker, to stop the bill from becoming law. The county has been reaching out to community organizations, he said, and started an online petition to prevent a tax increase on Long Island.
“We believe he would understand that being a middle-class family on Long Island is far different than being a middle-class family in Madison, Wisconsin or Louisville, Kentucky,” Mr. Bellone said.