November 21, 2002

Workers to Fight Resident Tax

By William Murphy
STAFF WRITER

Several city unions are mounting a drive to allow members who live outside the city to be treated just as other commuters would be under any tax proposals — permitting them to pay less in taxes than they do now.

Many city employees who live outside the city currently sign a waiver that subjects any income they make — inside or outside the city — to the same personal income tax rate that city residents pay.

If a couple files jointly, the spouses' income also is subjected to the rate. Additionally, city employees can't deduct that income tax from their federal tax returns.

"It's like double taxation, although they call it a waiver instead of a tax," said Robert Zink, the political director of the Patrolmen's Benevolent Association.

Commuters who don't work for the city pay no city income tax at all.

But because the Bloomberg administration has proposed to tax all income earned in the city regardless of where the employee lives, unions see the proposal as a chance to lobby Albany to change the waiver system.

"This could come sooner than expected," said Capt. Peter Gorman, president of the Uniformed Fire Officers Association.

For a superior officer in the Fire or Police Department, a change could mean an estimated $3,000 more in take-home pay annually, some union officials estimate, depending on the level of any new tax.

A spokesman for the city Finance Department did not return a call seeking comment.

This is not the first time the waiver system has been questioned. The fire officers union also has filed a federal lawsuit challenging the legality of the provision of the City Charter that allows the city to force its employees to pay the resident income tax regardless of their residency.

"If you want to tax all commuters, OK," Gorman said, "but let's be fair and tax everyone equally."

He said the tax, or waiver, is applied only to agencies under direct control of the mayor; employees of the Housing Authority, for example, are not covered.

When the transit and housing police forces were merged into the NYPD, those members who lived in the suburbs — previously exempt — were suddenly hit with the resident income tax, Gorman said.

"We have a coalition of about 24 unions involved in this and we think we have a shot at making it happen," Gorman said.