Errol Louis: Hello Governor.
Governor Cuomo: Hello. Good to hear your voice, Errol.
Errol Louis: Let me start by asking you, we are getting close to a government shutdown. If that happens at midnight, what does that mean for the state? I know you have a lot of places including some fairly important ones where state and federal government have to interact.
Governor Cuomo: Well you know we went through a government shutdown a couple of times. I was there during the Clinton Administration when there was a government shutdown. The federal facilities are affected, Errol. The federal state interchange is affected. But I don't believe it's going to have a dramatic effect in this state. More on the federal parks, monuments, etcetera. And obviously it's a hardship on the federal employees. And even more than that it's just a violation of the public trust with the voters of this country. Not just New York. The citizens of this country. I mean, it's a failure of government.
Errol Louis: Well, you have got a number of different complains with the federal government and you talked about that at length in your budget address, about how the changes in tax law that are going to affect the deductibility of income taxes among other things and property taxes here in New York is going to really be a problem. Now your proposed solution, shifting from state income tax to payroll tax, strikes me as something that although we haven't heard yet from them, isn't the business community going to have a huge accounting and administrative burden to try to make that happen?
Governor Cuomo: Yeah, here's the situation. Life is options, Errol. When the President signed that federal tax bill, he may as well have pushed a button and launched an economic missile headed directly to New York State. That federal tax bill gave a tax cut for the richest Americans, financed by 12 states, all Democratic, at the top of the list, the State of New York. Second, California. They eliminate the deductibility of state and local taxes, called SALT. It costs us $14 billion. Your income taxes will go up 25 percent. It will be economically devastating to this state. I fought it. I am continuing to fight it. We're working on a lawsuit. I'm working on repealing the bill and putting together a coalition federally to repeal the bill. But when they launch a missile, the best advice is to get out of the way. If they want to attack our tax code, our income tax, my point is fine. We'll restructure our tax code. Your point is right, it's complicated, it's detailed, but what is the alternative?
If we do nothing, income taxes go 25 percent, property taxes go 25 percent, you hurt the economic competitiveness of this state structurally long term. So I'm saying take our income tax structure and restructure it to a wage tax. Meaning we now tax you on the income you receive. Rather than tax you on the income you receive, tax the employer on the wages they pay you. It's net neutral, you don't pay an income tax, state income tax, your salary is reduced by the amount you would have paid in income tax, and the employer pays the wage tax at the same limit. Now, what we're using is in their new tax bill, they eliminated the deductibility for individuals, but not for businesses. So the business can fully deduct the tax they pay. It costs them nothing. On the other hand, if you receive the income, you pay state income tax and then they tax the state income tax. So yes, it is a complicated detailed transaction.
Errol Louis: Are, are the, Governor, are the legislative leaders on board with this in particular, because it strikes me that in might affect me, it might affect others who do file the long form, but of course in New York as in most places, most people don't file the long form. This is a relatively small or select number of people who would be affected by this in any event, and even fewer if you start taking away people who are relying on investment income at the top end of the scale, people who are artists or freelancers at the lower end of the scale, it really gets to be a relatively narrow group of people who are going to have to go through this, right?
Governor Cuomo: Well, everybody who received, everybody who pays state income tax, Errol, just got a 25 percent increase. I don't care how you receive the income, you just got a 25 percent income tax bump under this federal plan. Our challenge is to design a new structure that addresses all the different sources of income that you just went through. You're right, the wage tax only would include people who get paid wages, wage income. We have another proposal that's called the UBT, unincorporated business tax, which would take care of people who get paid through an LLC or passive income. But the daunting challenge is anyone who receives income in the state of New York just got a 25 percent increase, how can we go back and restructure the code so those sources of income are taxed and get to deduct it rather than raising the income tax?
Errol Louis: OK. We're all going to become experts on this, I suspect, in the next few weeks. Let me ask you about the proposal that came out today by the commission that you put together to try and examine different proposals to fund the MTA and also deal with some of the congestion that is choking Midtown, where you work and where I suspect you see this all the time. What is your sense of how far apart you might be from Mayor de Blasio? Since you seem to both be talking in some cases of the same language, about needing to restrict or reduce or at least properly reprice truck traffic, for-hire vehicles, and other things that contribute to the problems in Midtown?
Governor Cuomo: Yeah, I think we're trying to get to the same place and I think the panel of experts is trying to get to the same place. Look, this has been a problem for many, many years, right? And the problem is two-fold. The congestion in the central business district of Manhattan, not Manhattan writ large, the central business district - the congestion is unbearable. It's worse than ever before. It's a nightmare. Business communities say it costs $20 billion in lost revenue. That's problem one. Problem two is we need long term funding stream for the subway system because it has deteriorated and we didn't pay the maintenance for decades and now it's catching up to us. Rather than fighting about it every year, and we short the investment in bad years, let's find a long term funding stream so the subways are what they should be. Those are the two goals. They're difficult to reach, being fair to all. I think this panel did good work. Basically what they are saying is, first, define a central business district because it's not a problem in all of Manhattan, it's the central business district. We now have technology, Errol, that you see when you go through the cashless tolls on the Triborough and the Midtown Tunnel, we have technology that can toll a car anywhere, so define a central business district - what roads are in, what roads are out - and come up with a rational, fair tolling system.
The tolling system now is bizarre. You have some bridges where the tolls are $11 dollars. You have some bridges are $17. You have some bridges where the tolls are zero. Come up with a fair system. Now, I am a Queens boy. Rocco Vertuccio claims he is a Queens boy - he is not a real Queens boy. I am a born and bred Queens boy. And when you are an outer borough person, you have a different perspective on life than those who were gifted enough to live in Manhattan. And my perspective is from the outer boroughs, Queens, Brooklyn, Staten Island, Bronx - make it fair and affordable for those people who have to go into Manhattan. Now, the vast majority of people from the outer boroughs do not drive. I can't remember driving into Manhattan, you know, you needed a passport at the time to go from Queens to Manhattan. You took mass transit. And Mass transit is how most people get into Manhattan and get to work. A small number, frankly, less than 5 percent of the people from the outer boroughs are actually driving in, but it has to be affordable for them and I also believe the plan should find a way to reduce the prices on the outer borough bridges. Why am I paying as much on the Throgs Neck or the Whitestone to go between Queens and the Bronx as I am paying to go into Manhattan?
Errol Louis: No, we've got the plan and that part of it in particular - I end up taking those bridges to see my dad up in Westchester and I'm very attentive to that. We're going to let you go Governor, before I do that though, I have to say it is reelection year for you, it is political season. We caught the actress Cynthia Nixon last night and asked, "Hey, what's with these rumors, are you running for Governor?" Her answer was maybe. And I want to get your response to that as well.
Governor Cuomo: I think a lot of people are running for Governor maybe. I think you might be running for Governor; I've been watching you and I want you to know I'm ready for you Errol. I'm ready. Bring it. Bring it.
Errol Louis: I'm about $30 million short but after I play the lotto this weekend, I might let you know.
Governor Cuomo: Yeah, but you're better looking than I am.
Errol Louis: You don't sound worried, so I guess that's our answer for now.
Governor Cuomo: Look, it's a Democracy. Let whoever wants to run, run. I feel two things - I feel that I have produced in my job for the people of New York. I have a lot of projects that are underway. We're building a new LaGuardia, JFK, new Kosciuszko Bridge, we're in the middle of Penn Farley - we have a lot going on Errol. We have tackled a lot of tough problems that everybody has avoided for a long time. You're seeing a rebirth of this state that you haven't seen in years, and I want to see that through. To get stuff down nowadays you have to push the boulder up the hill every day. And that's what I do. That's what guys from Queens and Brooklyn and the Bronx do. You get up and you push the boulder every day. I haven't finished the job. I want to finish the job. And that's why I'm going to run with all my heart and soul. And anybody who wants to run, I'm ready. And Errol, I'm looking for you. I'm looking for you.
Errol Louis: I have no news for you on that score today at least Governor, but we'll talk another time. Thank you for spending some time with us.
Governor Cuomo: Thank you. Thanks for having me Errol.