WASHINGTON — Halfway through his first year back in office, President Donald Trump has the green light from the Republican-majority Congress to move ahead on major parts of his domestic agenda.
The sprawling budget bill Congress passed this week will touch Long Island in a variety of ways — from the economy to the environment, from health care access to immigration enforcement, and will be at the center of next year’s midterm elections, said Lawrence Levy, executive dean of Hofstra University’s National Center for Suburban Studies.
“On Long Island, the messaging battle will take place over SALT,” said Levy, referring to the $10,000 cap on state and local tax deductions that was approved by the Republican congressional majority in 2017 and raised to $40,000 under the current bill.
“Who wins will not only depend on media skill and money raising, but on how the economy is doing and how much people feel the pinch of the caps compared to everything else going on in their economic lives,” said Levy.
WHAT NEWSDAY FOUND
- The sprawling budget bill Congress passed last week will touch Long Island in a variety of ways — from the economy to the environment, from health care access to immigration enforcement.
- Long Island will benefit in particular from an increase in the deduction for state and local taxes, or SALT, which goes to $40,000 for households earning $500,000 or less for the next five years.
- Meanwhile, health care advocates say hundreds of thousands of New Yorkers could lose access to health care coverage due to changes to Medicaid eligibility requirements and Affordable Care Act enrollment requirements.
Long Island’s House delegation voted along party lines, with Reps. Andrew Garbarino (R-Bayport) and Nick LaLota (R- Amityville) voting in favor of passage, and Reps. Tom Suozzi (D-Glen Cove) and Laura Gillen (D- Rockville Centre) voting against it. Democratic Sens. Chuck Schumer and Kirsten Gillibrand also voted against.
Here’s a glance at some of the expected impacts of the bill on New York and Long Island:
Economics
The cornerstone of the megabill was extending the 2017 tax cuts congressional Republicans passed during Trump’s first term that were set to expire at the end of this year.
The current bill makes the majority of those cuts permanent, but also adds some new temporary provisions, including increasing the cap on state and local tax deductions to $40,000 for households earning $500,000 or less for the next five years, after which it will default back to the $10,000 cap first initiated in the 2017 Trump-backed bill.
Matt Cohen, president and CEO of the Long Island Association, a nonpartisan business group, lauded Garbarino and LaLota for their work negotiating an increase amid opposition from red-state Republicans, but said the group is still examining the long-term impacts the overall bill will have on Long Island.
“The reinstatement of SALT has been the holy grail for Long Islanders and kudos to Congressmen Garbarino and LaLota for delivering significant changes to it which will impact many more taxpayers, jolt our economy, and make our region more affordable,” Cohen said in an email to Newsday. “While other provisions of the bill like making permanent a small business tax deduction will benefit us here, we are examining how the legislation will impact health care, renewable energy, food security and the national deficit.”
The White House has argued that the tax cuts will boost domestic spending and spur business growth, but various economic studies have countered that costs of the package will add $3.4 trillion to the national debt through 2034, which will likely slow long-term economic growth.
“There are few provisions that would drive economic growth in the long run as opposed to simply running up debt and generating upward pressure on interest rates,” states a recent analysis by the Yale Budget Lab.
Health care
Hundreds of thousands of New Yorkers could lose access to health care coverage due to changes to Medicaid eligibility requirements and changes to Affordable Care Act enrollment requirements, according to health care advocates.
New York stands to lose $120 billion in federal Medicaid funding over the next decade as states that expanded Medicaid access under the Affordable Care Act will be expected to shoulder an increased share of Medicaid costs with the federal government, according to an analysis by KFF, a nonprofit focused on health care policy.
In Suffolk, 367,087 individuals are enrolled in Medicaid, and Nassau has 308,354 enrollees, according to the most recent state health data.
Kenneth E. Raske, president of the Greater New York Hospital Association, a group that advocates on behalf of the state’s hospitals and medical facilities, said the group has projected major cuts to services and jobs, including 1.5 million New Yorkers potentially losing health care coverage.
The nonpartisan Congressional Budget Office has estimated more than 11.8 million Americans will lose access to health care by 2034, under the health care provisions of the bill.
“Cutting health insurance eligibility doesn’t stop people from getting sick and ultimately going to the hospital, but it does skyrocket hospitals’ uncompensated care costs,” Raske said in a statement released by the group after the Senate passed the bill on Tuesday.
Environment
Biden-era clean energy tax credits aimed at boosting the use of solar panels, wind energy and electric vehicles will be phased out under the bill, which local environmental advocates said will likely tamp down some of the growth Long Island has experienced in the clean energy sector.
A $7,500 tax credit for the purchase or lease of a new electric vehicle will end on Sept. 30, and a 30% tax credit for rooftop residential solar panels will be eliminated at the end of the year. Larger scale wind and solar energy utility projects that previously qualified for tax credits will have one year from when the bill is signed into law to claim the credits. Projects that start later would need to be operational by 2027 to qualify for the credits.
Adrienne Esposito, executive director of the Farmingdale based Citizens Campaign for the Environment, said the eventual loss of the credits will hurt middle to low-income homeowners on Long Island who have used the credits to help reduce some of their energy costs.
“On Long Island, we have very high electric costs, so the people who have been using all these tax breaks are low- to moderate income people,” Esposito said. “That’s who’s using the tax breaks to get solar panels, to buy energy efficient appliances, to change out their windows. I’d like to tell you they’re doing it to save the environment, but they’re actually doing it to save money.”
Immigration
Immigration enforcement ranked as a top issue for New York voters during last year’s presidential election, with Trump using campaign rallies at the Nassau Coliseum and Madison Square Garden to promise a widespread deportation campaign.
Those plans, largely already underway, will now receive a $100 billion surge through 2029. The money to expand the footprint of the U.S. Immigration and Customs Enforcement agency, making it the largest law enforcement agency in the country, includes $45 billion to build detention facilities, $46 billion for border security efforts along the U.S. southern border and $14 billion for deportations.
Levy said the increased enforcement could help Republicans score points with Trump’s base in next year’s midterm elections, but could also turn away moderate swing voters as a number of recent polls show a majority of respondents disapprove of how masked U.S. Immigration and Customs Enforcement agents are implementing Trump’s plans.
“The way that U.S. Immigration and Customs Enforcement has carried out its orders has turned off a lot of people, particularly political independents and moderates, who are the swing vote in this country,” Levy said. “By the same token there are a lot of people who are pleased and would like to see even more aggressive action. So it really depends how the parties handle this in terms of messaging.”
Laura Figueroa Hernandez is the White House correspondent and previously covered New York City politics and government. She joined Newsday in 2012 after covering state and local politics for The Miami Herald.