“The biggest problem lies in the relationship between government and the truth”
-The Great Influenza” by John M. Barry (2004)

The day after Labor Day some of the the legislature’s committees will convene in Albany and report bills for consideration by the legislature on Wednesday, May 27. Members will “attend session” remotely. The capitol will remained closed to the public and lobbying efforts conducted via the web. Much of the agenda will deal with the abating the consequences of COVID -19.

The impact of some of these bills could be consequential, though neither house is moving legislation that would make exposure to COVID-19 an occupational disease for “essential” occupations under the state’s Workers’ Compensation Law, or legislation (S.8396 / A.10472) that would preclude prior approval for any COVID-19 related treatment under the Workers’ Compensation Law.

Make sure you can document your compliance with work place guidelines.

Though a budget plan exists to address the shortfall in revenue the legislature will need some idea of the extent of a federal bail out for the state and political subdivisions, to determine the mix of tax increases and spending cuts to close an deficit of approx. $13-14 billion. Some are proposing the usual – “tax the rich”, allow on-line sports betting and legalize recreational marijuana, the latter two proposals left undone when session ended April 3rd, but unlikely in an election year.

As part of the budget adopted in April – referred to as “The Phantom” – the legislature gave considerable discretion to the governor and budget director to limit spending to available revenue diminished by the lockdown of much of the economy. The budget is a moving target; it is annual though deals with multi-year spending plans with obligations moved into future fiscal years to avoid the appearance of too large a gap.

In addition, the governor’s declarations of emergency give him broad powers for the duration of those orders, that are periodically renewed, essential empowering him to govern by decree, suspending regulations and laws as needed to protect the health, safety and welfare of citizens.

How long he holds onto these powers or some of them has raised questions among legislators and legal scholars though his executive orders are correctly viewed as constraints on economic activity to limit the spread of COVID-19. Of course some of the actions implemented on an emergency basis might be enshrined in legislative action, typical of govt. expansion following emergencies, wars, etc.

When the legislature assigned the control over spending to the executive branch it shifted responsibility for any proposed cuts to schools, local governments and Medicaid, the latter the biggest budget buster of all. But reductions in Medicaid spending are unlikely. To avoid cuts to education the legislature may re-allocate funds from wealthier to poorer districts. Some capital projects that rely on pay-as-you go will be shifted to bonded obligations of state authorities and others will be postponed or abandoned.

Organized labor has raised the usual suggestions to tax-the-rich, second homes, and postpone (likely, and part of the budget proposal) planned income tax reductions already scheduled to kick in. Others have proposed restoration (likely) of the sales tax on clothing under $110 aimed mostly at back to school purchases, and allowing small retailers to re-open with safe guards, their closure now viewed as giving an unfair advantage to big box retailers and other essential industries such as supermarkets who potentially expose multiple parties to the same risk.

If the states receive a bail outs from Washington they may be conditional on restructuring the fiscally irresponsible habits of states like New York, Illinois and California. More likely it will cover only short falls attributable to Covid 19. It is not clear at this time if a federal bailout will be conditional on the re-configured budget proposed by the governor or if a mechanism exists to keep the state tax/expenditure within limits of the plan. [An echo of the Emergency Financial Control Board established to monitor N Y C fi n a n c e s ) . T h a t N Y S h a s b e e n disproportionately affected by the pandemic suggests a formula based on per capita data.

The governor cannot be faulted for many of the consequences of the pandemic or for any missteps that should be viewed in the context of the initial confusion and uncertainties in dealing with such a rare occurrence. Since he is being widely blamed for insisting that nursing homes take sick, elderly patients from hospitals, some provisions might be enacted to limit the liability of those homes and other providers from the predations of the tort bar.

We may start to see employees or customers who contract COVID sue for damages, so it is important to keep records on compliance with government issued guidance and directives as a defense.