Gov. Kathy Hochul on Tuesday unveiled a populist 2025 agenda built around tax cuts, subway safety and more investment in mental health care. The proposals come as she faces voter unrest about crime and the cost of living and looks ahead to a tough re-election fight next year.
In her fourth State of the State address, the governor proposed cutting $1 billion in annual income taxes for about 8 million residents, allowing doctors to more easily commit and treat people with serious mental illness, and spending money on new platform barriers, fare gates and police deployments in the New York City subway system.
She also outlined some new housing policies, like streamlining reviews for small projects and cutting taxes for affordable developments in the city — but stopped short of advancing any wide-ranging reforms as she had in recent years. And the governor pledged to support a $68 billion capital plan for the Metropolitan Transportation Authority, ahead of what may be a tough fight with the state Legislature.
“Worries about crime and struggles to make ends meet are too common,” Hochul wrote in an introduction to the policy agenda, shared with reporters before her Tuesday afternoon speech in Albany. “Our state has to be livable, and people have to be able to afford to live in it.”
The governor will put price tags on more of her proposals later this month, when she releases her budget proposal for the next fiscal year that starts April 1.
Tax cuts and $500 checks
Continuing a “money in your pockets” theme that Hochul has emphasized for months, the governor said she will seek to slash personal income taxes for people who earn up to $323,200 per year as joint filers. The precise changes were not specified, but Hochul’s office said they would begin taking effect this year, cutting rates across five of the state’s nine tax brackets and affecting about 77% of filers.
Hochul also reiterated a proposal she unveiled in December to send residents $3 billion in “inflation rebates” this year — consisting of $500 payments to joint filers who make less than $300,000, or $300 payments to individuals who earn below $150,000. Hochul also proposed significantly expanding the state’s child tax credit to $1,000 per child under the age of four, up from the current $330 for low-income families.
By advancing the people-pleasing policies, Hochul is taking advantage of New York’s solid finances, which the state comptroller deemed “relatively stable” in a July analysis — although budget gaps total about $14 billion over the next three years.
More involuntary commitments, changes to discovery law
As Hochul promised in the wake of a spate of frightening subway violence around the end of 2024, her State of the State agenda includes law changes intended to expand providers’ ability to involuntarily hospitalize people with mental illness.
She proposed updating the state’s Mental Hygiene Law to clarify that clinicians and other professionals can commit a person who is “at substantial risk of physical harm to themselves or others” due to their inability to meet basic needs like food and shelter — changes that would bring New York in line with other states, according to her policy book. The proposal roughly aligns with the Supportive Interventions Act, a piece of legislation that Mayor Eric Adams plans to push for this year.
Hochul said she will also propose expanding involuntary commitment authority to psychiatric nurse practitioners, and amend the 1999 measure Kendra’s Law to “reduce barriers” to assisted outpatient treatment — although few details were provided.
“We cannot allow our subway to be a rolling homeless shelter,” Hochul said during her speech.
To house vulnerable people, Hochul will propose increasing funding for two programs: the New York State Supportive Housing Program and the Empire State Supportive Housing Initiative, the latter of which was found to suffer from lax oversight in a September audit by State Comptroller Thomas DiNapoli.
Hochul’s public safety agenda also revisits, once again, the state’s 2019 criminal justice reform laws. While not seeking to roll back bail reforms as she did in 2022 and 2023, Hochul instead wants to change the 2019 reforms to the discovery process — which were designed to share more evidence with defendants, but which have forced some district attorneys to drop cases based on technicalities.
Hochul wants to narrow the current law, which penalizes prosecutors when they are found to have waited too long to share information with defendants. Hochul’s changes would ensure that challenges are limited to the “error itself,” rather than resulting in an entire case being dismissed, according to her office. It’s unclear whether that change will go over well with state lawmakers, who have proposed their own legislation that would streamline discovery by giving prosecutors direct access to police records.
Housing: Speedier environmental reviews, but no new mandate fight
Hochul is not reviving her unsuccessful 2023 push to impose mandates for housing construction on cities and towns. Nor is she revisiting last year’s deal that paired eviction protections with tax breaks for new development that left the real estate industry less than thrilled.
Instead, Hochul’s new housing agenda includes speeding up environmental reviews for some “modestly sized” residential projects by allowing multifamily buildings below 10,000 square feet to qualify as “Type II” under the State Environmental Quality Review Act — a designation that assumes they will not significantly impact the environment.
Hochul’s agenda also includes banning real estate management companies from using algorithms to fix rent prices — an apparent response to the federal government’s similar allegations against RealPage. New York’s ban would be the first in the country, Hochul said.
To shore up the state’s Mitchell-Lama affordable housing program, Hochul wants to expand an existing abatement on the buildings’ shelter rent taxes. Hochul said her proposal, which would slash the taxes by at least half on Mitchell-Lama buildings within the city, would ensure that complexes have the money to cover insurance and utility costs.
As she already previewed this month, Hochul will separately propose making it harder and less attractive for institutional investors like hedge funds to buy single-family and two-family homes — forcing them to wait 75 days before making an offer on such properties and banning them from using tax provisions like depreciation deductions on the properties.
In hopes of expanding homeownership opportunities, Hochul wants to set aside $50 million to incentivize the construction of starter homes and another $50 million in aid for down payments.
Subway platform barriers and a $68 billion capital plan
On the heels of congestion pricing’s launch, Hochul is now gearing up for a fight with state lawmakers to find cash for the Metropolitan Transportation Authority’s $68 billion proposed capital plan, which the agency sends to Albany every five years for approval and which would go toward modernizing the region’s mass transit. Hochul stressed that she “fully supports” the MTA’s proposed capital plan; it would be the largest in state history.
To fund the effort Hochul said she intends to propose a mix of federal, state, city and MTA contributions, alongside new revenues to be hashed out during budget negotiations this spring.
In the shorter term, the governor vowed to double down on safety-minded investments to grapple with the stubborn challenge of high-profile crimes in the subway. Hochul intends to throw more law enforcement at the problem with a promise to bolster the NYPD’s already robust presence in the system, with more cops on platforms and in trains, and by adding police patrols to every overnight train for at least the next six months.
Physical infrastructure investments are also part of Hochul’s subway safety strategy. The governor said Thursday that she intends to kick in state dollars for MTA crews to install platform barriers at an additional 100 stations — up from the current 15 — by the end of 2025. The fixed, waist-high steel barriers are designed to give riders protection from being pushed or accidentally falling into subway tracks.
The investments come after a spate of brutal crimes, including a woman who was set on fire in a Brooklyn station and a man who pushed into the path of a train in Manhattan. The events earlier this month rocked the subway and put many riders on edge. The timing couldn’t be trickier for Hochul and the MTA, as the authority works to lure travelers out of cars and onto mass transit with the start of congestion pricing.
Although Hochul has not exactly celebrated the Manhattan tolling program that she famously “paused” last year, her policy book notes that the new revenue will fund the Second Avenue Subway’s extension to East Harlem and new signal systems on the A/C and B/D/F/M lines, along with other transit investments.
Sparse detail on clean energy goals
Hochul’s climate agenda noticeably lacked any mention of how she intends to achieve the state’s flagging clean energy goals in the face of president-elect Donald Trump’s open hostility to renewable energy. Trump vowed this month that “no new windmills” will be built along the country’s coasts once he’s back in the White House.
Her State of the State agenda describes addressing climate change as “a moral imperative and an enormous economic opportunity.” Hochul announced Tuesday that she plans to direct $1 billion in state spending toward a more sustainable future and growing New York’s green economy.
Among those efforts is broadening the role of nuclear energy in powering the state’s electric grid. New York will develop a so-called Master Plan for Responsible Advanced Nuclear Development that will guide any future nuclear projects in the state, according to Hochul’s office. The state also intends to support a request for federal grant dollars by the Baltimore-based Constellation Energy, the owner of New York’s operating nuclear plants, to explore bringing “a small modular reactor” online — such infrastructure is a significantly scaled-down version of a conventional nuclear power reactor.
To help fund these and other climate investments, Hochul has directed her agencies to advance the state’s ambitious cap-and-trade program to raise billions of dollars toward reducing greenhouse gas emissions. The system, which Hochul signed into law at the eleventh hour in December, would create a market in which polluting companies can purchase or obtain allowances for their emissions. Proceeds from the envisioned auctions would then go toward developing renewable energy and other climate-adjacent projects.
Hochul’s office said she aims to propose regulations for the program by the end of year.
Under her climate agenda, businesses would also have an easier time recovering after disasters, such a flood or fire, with easier access to the Jobs Retention Tax Credit Program. A newly proposed grant would similarly support businesses in modernizing their dated refrigeration equipment with new, low-emissions alternative alternatives.
AI layoff notices and faster procurement
The State of the State agenda includes a grab-bag of dozens of other policies that Hochul’s office says are designed to improve safety and affordability.
After seeking to harness artificial intelligence through the Empire AI consortium that launched last year, Hochul now wants new regulations on the technology. Under a new proposal, employers who are required to submit layoff notices through the state’s WARN system would need to disclose whether a layoff is related to the business’s use of AI.
On the development front, Hochul wants to expand the use of “alternative delivery” procurement methods that can speed up planning for infrastructure projects. While not offering many details, the governor’s office said it wanted to allow government agencies to use methods like progressive design-build and construction-manager build, which pair builders with architects earlier in the planning process — systems that the Adams administration has successfully pushed more within the city.
And with an eye toward boosting the state’s workforce, Hochul pledged to make community college free for students aged 25 to 55 who are pursuing associates degrees in high-demand fields like nursing, teaching, engineering and technology.
