Monday's apparent Republican takeover of the New York Senate could leave issuers in the lurch, since the future of much end-of-session legislation was cloudy Tuesday.
Confusion reigned as Republicans claimed they had control of the Senate, while the chamber itself remained locked and Democrats said the coup was illegitimate on parliamentary grounds.
With court challenges expected, it's anyone's guess whether anything will get done before the regular legislative session ends June 22.
New York City was counting on Albany to impose sales taxes and close business tax loopholes to raise about $900 million. Without action, the city faces the possibility of its control board stepping in, said City Councilman David Weprin, D-Queens.
"If Albany's not available to act because the Senate is not meeting - which looks like it might be the case for the next couple of weeks - we'll have a problem adopting our budget," said Weprin, who chairs the City Council's finance committee and is a candidate for city comptroller. "We have to, by law, have a budget in place by July 1st, or else the control board could technically take control of the city finances."
The city could temporarily raise revenues or cut services, Weprin said.
A request by New York City for state lawmakers to increase the debt cap on the Transitional Finance Authority would go nowhere this year if the Senate did not reconvene.
The New York State Housing Finance Agency and the State of New York Mortgage Agency would be unable to issue bonds after June 30 and July 15, respectively, without a routine extender bill.
Also uncertain is the future of a proposal that would let the State of New York Municipal Bond Bank Agency issue taxable Build America Bonds in pooled financings on behalf of local governments. Gov. David Paterson was expected to introduce that legislation before the end of the session.
The future of pension reform is in doubt, too. A plan to create a less generous tier of benefits for new government employees, which would save an estimated $30 billion over 30 years, requires legislative action.
The coup also cast confusion over the future of economic development issues such as tax-increment financing legislation and changes to the state's Empire Zones and Industrial Development Agencies.
It "is anyone's guess at this point," New York State Economic Development Council Executive Director Brian McMahon said Monday in an e-mail to members of his organization.
