State leaders have agreed on the outlines of a $254 billion budget for the coming year, Gov. Kathy Hochul said — with the caveat that the spending plan will need to be reopened if Republican-led federal spending cuts blow a hole in New York’s finances.
The deal, which came with few details, adds $2 billion to Hochul’s initial proposal and signals that an end is near to budget talks in Albany after negotiations dragged on nearly a month past the April 1 deadline. Hochul, addressing reporters from the State Capitol Monday evening, said she had reached agreements with state Senate and Assembly leaders to enact versions of most of her key priorities — including a tax cut for middle-income households, rollbacks to evidence-sharing laws between prosecutors and defense lawyers, and changing laws to enable more involuntary hospitalizations of people who are mentally ill.
To pay for the Metropolitan Transportation Authority’s $68 billion five-year capital plan, leaders agreed to a payroll tax increase on businesses with payrolls exceeding $10 million in areas served by the MTA, although the exact increase is still being debated. Small businesses will get a 50% payroll tax cut, Hochul said. The state will also redirect $1 billion it would have spent on a Penn Station renovation, freed up by the federal government’s takeover of that project, and has directed the MTA to find its own $3 billion in savings to help pay for the plan, Hochul said.
But the governor said it was too early to slash state spending in anticipation of federal cuts to Medicaid and other aid programs. Instead, she reiterated that she could call lawmakers back for a special session later this year, depending on the spending plan that emerges from Congress.
“The scale of these potential cuts is simply too massive for any one state to absorb,” Hochul said, calling on New York’s Republican lawmakers to vote against major cuts. “There is a possibility that we’ll have to come back later this year and adjust our budget based on federal actions.”
Some of Hochul’s priorities have been scaled back — her so-called “inflation rebate” checks to New York households, derided by watchdogs as an election-year stunt, have been reduced from $250 to $200 for eligible individuals and $500 to $400 for families, cutting the program’s overall cost from $3 billion to $2 billion.
Changes to “discovery” laws that govern criminal cases will entail giving judges more discretion to decide whether prosecutors had used due diligence to turn over evidence, and limiting the amount of evidence that prosecutors are required to share in the first place, said Hochul’s counsel Brian Manhanna. Legislative leaders said they secured their own language on discovery after rebuffing Hochul’s more widespread initial proposal, which would have rolled back much of the state’s 2019 reforms. (Hochul and local prosecutors have said the 2019 reforms caused cases to be dismissed based on timing technicalities; criminal justice advocates said Hochul’s rollbacks would return New York to an era in which defendants languished in jail while prosecutors dragged their feet over turning over evidence.)
Hochul said the deal with legislative leaders also included:
Banning private equity firms from bidding on single- and two-family homes during their first 90 days on the market,Banning public school students from using smartphones for the entire school day,Unspecified expansions of Kendra’s Law, a 1999 policy that allows local governments to seek a court ruling mandating outpatient mental health treatment,Tripling the state’s child tax credit to up to $1,000 per child under the age of 4,Increasing penalties for people who wear a mask while committing a crime or fleeing a crime scene — a controversial last-minute request by Hochul that lawmakers had resisted.
