Gov. Kathy Hochul and New York legislative leaders have come to a preliminary agreement on the state budget that includes a comprehensive housing plan, record funding in education and increased emphasis on public safety measures, the governor said.
Lawmakers on Monday appeared to have found consensus on a spending plan worth $237 billion, which is up from $233 billion that the governor proposed at the start of the legislative session in January.
“Each of us came to the table with really strongly held beliefs, but then in the interest of our state, we came together,” Hochul said Monday evening in Albany while announcing the specifics of funding.
However, lawmakers say they’re not done yet. With voting not expected until later in the week at best.
“Sometimes when I’m going on a run and I have that last mile left and I tell myself I’m done and that’s how I get across the finish line, maybe the governor was doing something like that,” quipped state Assemblyman Alex Bores, a Manhattan Democrat.
“I think saying there’s a deal is a bit premature. I think the governor said [there are] the parameters of a conceptual agreement, so whatever that means, we’re close. We’re optimistic we’re gonna wrap this up soon. I would say we’re probably about 95% of the way there. But that last 5% can be tricky,” said state Sen. Michael Gianaris, a Queens Democrat.
Housing
One of the bigger sticking points this legislative session, Hochul said the budget will include “the most comprehensive housing policy seen in the state in three generations.”
Statewide initiatives include new tax incentives for housing construction, safeguarding against deed theft and $500 million for up to 15,000 new housing units on state-owned properties.
Hochul said protections against price gouging also will be expanded to tenants where they weren’t available before.
The governor said New York City will be getting the local control to unlock housing growth and the 421a tax abatement program will be extended for six years, accessing previously approved projects that were allowed to expire.
Both the real estate industry and tenants’ rights groups were not thrilled with the announcement.
“We are confident that this package falls far short of addressing the city’s housing needs and must be reassessed in the coming years to put the rental housing market on a solid footing,” said James Whelan, president of the Real Estate Board of New York.
Cea Weaver, director of the tenant advocacy group Housing Justice for All, called the housing deal “a sham.”
“This sham of a housing deal will do absolutely nothing to make housing more affordable and keep New Yorkers in their homes. It is nothing more than a massive giveaway to the real estate industry,” she said in a statement.
Money will also go toward turning former office space into housing and a pilot program allowing for basement apartments.
Public safety
To combat the problem of organized retail theft, the budget deal has increased penalties for assaulting retail workers, makes it illegal to foster the sale of stolen goods online and allocates $40 million for retail theft teams in the State Police and local law enforcement.
The state and localities also will have the power to combat illicit cannabis vendors; the deal provides $36 million for law enforcement and district attorneys to prosecute domestic abusers; and it adds 20 offenses that can be prosecuted as hate crimes.
Education
After proposed changes in Hochul’s executive budget to public school funding exposed fault lines between her agenda and the state Legislature, Hochul said the budget agreement commits $36 billion to education, which is the highest in state history.
However, she said changes to the formula for education funding will come in next year’s budget, Hochul said, and the state Education Department will conduct a comprehensive study over the next year on Foundation Aid after Hochul proposed eliminating the “Save Harmless” provision, which ensures schools don’t receive less funding regardless of population loss.
“Many schools have more resources than ever before,” Hochul said while noting there’s been a 10% decline in enrollment in recent years.
“In the long-term, it just doesn’t make sense to keep paying for empty seats in classrooms,” Hochul added.
Higher education will also see changes, with the minimum award for tuition assistance raising from $500 to $1,000. Qualifications for the state’s TAP grant will increase from families earning $80,000 or less to $125,000 or less.
Other items
Scrutiny of Medicaid spending remains, but Hochul said Monday the Consumer Directed Personal Assistance program will change to one state Fiscal Intermediary, which she said will save the state $500 million a year.
The state will also be the first in the nation to offer paid pre-natal leave to expecting mothers.
The budget will also have $275 million for the Empire AI Consortium, and $125 million in private and university funding to build the state’s footprint in artificial intelligence development.
Hochul’s agreement also leaves several major policy items unfinished, such as a proposal to make pensions more attractive to current and future government workers and an extension of mayoral control of city schools, a key priority for Mayor Eric Adams.
The state Assembly and Senate will conference Monday night to further discuss details.
The budget was due on April 1 and lawmakers have passed numerous extenders since then to keep the government running and paychecks flowing to state employees. The most recent extender runs through Thursday.
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