New York City
The bill no one wants to enact during the pandemic
AOC and Sean Hannity have got the details wrong about a proposed $3 surcharge on package deliveries in New York City.
Two years ago, Assembly Member Robert Carroll of Brooklyn came up with an idea to reduce the number of growing numbers of home package deliveries that were leading to blocked New York City streets, overwhelmed doormen and spewed noxious fumes. Carroll's “think before you click” bill proposed a $3 surcharge on online orders in New York City that would encourage residents to buy items online in single shipments rather than spreading them out over multiple orders. Carroll would direct the fee revenue to improve public transit and he hoped that some spending would be shifted from online retailers to local small businesses.
A blocked roadway in his district on Tuesday appeared to give Carroll a great opportunity to highlight the issue and the legislation that he is aiming to reintroduce to the state Legislature early next year, alongside state Sen. Jessica Ramos of Queens. “This holiday season let’s track our packages,” he tweeted. “How many boxes do you get delivered?” People on the political left and right alike were soon accusing Carroll of pushing a new tax at a time when many families are feeling the economic pinch from the coronavirus pandemic.
But online criticism has transformed what was an environmentally minded proposal with some potential revenue benefits into the latest political football over whether state lawmakers should approve new taxes on the wealthy to close a budget gap caused by the pandemic. It is the type of situation that can make a state legislator wish that political allies would also think before they click.
“You know why all this backlash happens when we say “Tax the Rich?” Because the unquestionable norm is to tax the poor & working class,” Rep. Alexandria Ocasio-Cortez of Queens tweeted Tuesday. “Maybe instead of taxing people who need baby formula and essential goods, we tax those who have profited billions from a global pandemic?” Her large social media following ensured that a good chunk of the 1,300 comments on her tweet would be from progressives who were also misunderstanding the issue at hand. “Abolish billionaires and tax the rich!” tweeted Christine Olivo, who ran a distant third as an independent candidate in a Florida congressional race this year. It might be expected that right-wing pundits including Sean Hannity would pounce on such statements to proclaim anew that New York City is suffering from an excess of government regulation, but the backlash to the bill created a rare point of friction between some on the political left and Carroll, whose positions are typically within the progressive mainstream.
Ocasio-Cortez and Ramos represent districts that overlap in Queens. Ramos expressed frustration over an unexpected source of tension with her fellow progressive. “I reached out to her, she hasn't reached out to me,” state Sen. Jessica Ramos of Queens told City & State Wednesday morning, regarding her efforts to discuss the bill with Ocasio-Cortez. “I was really disappointed that she didn't read the bill before tweeting.” A spokesperson for Ocasio-Cortez did not respond to a request for comment by publication time.
The legislative language states that the $3 surcharge would not apply to medicine, food (e.g. baby formula) and purchases made by people receiving SNAP and WIC benefits. It would also not take effect until Jan. 1 of the year following its passage and approval by the governor. That means no one is paying $3 per package until 2022 at the earliest, considering the fact that state lawmakers currently have no plans to reconvene until next year. So it would presumably not go into effect until several months after the coronavirus pandemic effectively ends, given the expected timeline for the vaccine distribution process, though the economic effects of COVID-19 will likely linger for the next few years.
Making consumers pay a $3 charge on deliveries is a regressive tax that disproportionately affects low-income people, in that everyone would pay the same fee no matter their income. That concept rubs many political progressive the wrong way. However, past research shows that more than half of online shoppers live in households with incomes above $75,000 and 40% in households above $100,000 per year – well above the median household income in the city.
Carroll – who declined to speak on the record Wednesday about the bill – has said that the political left has previously supported efforts that aim to boost conservation efforts by charging a flat fee on items with negative social costs, such as cigarettes and pollutants. “I’m a supporter of the plastic bag fee, which is technically regressive,” he said in a Feb. 2019 interview with City & State. Carroll has also recently noted his support for a variety of new taxes on the wealthy, which are not in conflict with the proposed charge on deliveries.
The revenue benefits of the bill are unclear and difficult to project with precision. Carroll recently said in a New York Daily News op-ed that a $3 surcharge could raise more than $1 billion each year for the Metropolitan Transportation Authority, though it remains unclear whether he is relying on the same approach to estimating potential revenues as he did last year when estimating $400 million per year. “The average American household receives 27 packages per year,” City & State wrote last year. “He rounds up to 30 and multiplies that by the number of households in New York City.” Whether or not this rough estimate proves to be true, there is no doubt that a significant amount of money could be raised, considering how many packages New Yorkers have received both before and during the pandemic.
Just how much the proposal would push people to buy more from struggling brick-and-mortar stores or benefit the environment is also unclear. Incentivizing people to cut back on the number of deliveries, while still buying the same number of items overall, could lead to fewer delivery trucks spewing exhaust and less paper and plastic ending up in landfills. That is fine by Liz Moran, environmental policy director at the New York Public Interest Research Group, but she has some qualms with having consumers, rather than online retailers, pay the $3 charge. “As a consumer group, this doesn’t sound like great policy,” Moran, whose organization has no official position on the legislation, said in an interview. Carroll has said he is willing to negotiate changes to the bill, including its potential effects on people with disabilities who may have no choice but to shop online. Such discussions, however, are not likely to happen anytime soon.
Carroll is laying low on the issue for now, following the fact-challenged uproar over the idea. Ramos said Wednesday that the best thing that could happen for the legislation at this point would be if people simply stopped talking about it until a real legislative push potentially begins sometime in 2021. “I want this to die down,” she said of the current controversy that unexpectedly engulfed the legislation. “It actually addresses a real problem, (but) honestly more press about it right now is just going to make it harder for the general public to understand the merits of the bill when the actual right time comes.”
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