NY Lawmakers Challenge Limit on Outside Income

ALBANY, N.Y. (CN) – Despite being among the highest paid state legislators in the country, 11 Republican New York lawmakers sued Friday to overturn a new rule restricting how much money they can earn in outside income.

Members of the New York State Senate debate budget bills at the state capitol on Sunday. (AP Photo/Hans Pennink)

The plaintiffs, including Senator Thomas O’Mara and Assembly Minority Leader Brian Kolb, claim the new law goes way past what the Legislature intended and violates the state constitution.  

In a report issued last December, the New York State Compensation Committee voted to limit outside income among state legislators, saying they could not earn more than 15 percent of their salary in income from other sources.

The committee had also unanimously approved a pay raise for state legislators, from $79,500 annually to $130,000 by 2021. The pay raise, the first in two decades, would be implemented over the next three years, with an immediate jump to $110,000. 

The lawsuit, filed Friday in Albany County Supreme Court, claims the committee’s report not only infringes on lawmakers’ right to free speech and assembly, it also oversteps its bounds.

“The Legislature did not, and count not, confer upon the committee the authorization to alter, limit, or otherwise restrict outside employment or income earned by legislators,” the complaint states.  

The Republican lawmakers – represented by lead attorney Dennis Vacco with Lippes Mathias – allege the committee is essentially redefining the job description for state legislator, which has always been considered a part-time position, as a full-time job. 

Their lawsuit also claims the committee’s restriction that legislators could earn no outside income for non-physician jobs involving a fiduciary relationship is particularly troubling.

“This outright ban targets accountants, stock brokers, financial advisors, real estate brokers, pharmacists, attorneys, insurance agents, trustees, directors, and all others who have a fiduciary obligation to clients, customers, institutions or employers,” the complaint states.

A similar lawsuit brought shortly after the December 2018 report, filed by attorneys with the conservative Government Justice Center, also claimed the committee exceeded its constitutional authority and violated open meetings laws. 

The pay restrictions take effect Monday, which is when New York’s 2019-2020 fiscal year begins. 

If no other states increase their state legislator salaries, New York lawmakers are on pace to be the highest paid in the nation by 2021. Currently, only legislators in Pennsylvania and California—who make $87,180 and $107,241, respectively – earn more. 

The move to curtail outside income was done in part due to scandals involving state legislators, including the conviction of Sheldon Silver after he made $800,000 through two real estate schemes and failed to disclose certain payments.

A 2015 report by the New York Public Interest Research Group found that more than two-thirds of state legislators at the time reported little or no outside income. However, the report also noted that New York disclosure rules were somewhat lax compared to many other states. 

State legislators making more than $5,000 in outside income need permission from a legislative ethics commission to confirm no conflicts of interest are present. 

After the committee’s report in December, Senator Brad Hoylman, a Democrat from Manhattan who sponsored the bill to restrict outside income, was quoted as praising the new rule.  

“Most of our colleagues treat this job as full time and recognize that moonlighting presents inherent risks,” he told the New York Times. “The public is watching.”

The compensation committee did not immediately return an email seeking comment. 

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