In the three weeks since the April 1 deadline for a state budget passed, New York lawmakers experienced an eclipse, an earthquake and a cyberattack.
On Saturday, the Capitol saw a more typical event: the passage of a late state budget.
The $237 billion budget includes $2.4 billion to address the ongoing migrant crisis and hundreds of millions of dollars to bolster distressed hospitals, including Brooklyn’s SUNY Downstate, which had been slated for closure.
It also includes numerous policy initiatives, including new protections for tenants, a prenatal leave program for expectant mothers and an extension of Mayor Eric Adams’s control over New York City schools.
Andrea Stewart-Cousins, the Senate majority leader, called it “an extremely eventful budget cycle.”
Here’s a look at how things went.
For Gov. Kathy Hochul, addressing the state’s housing shortage was the top priority, after she failed to pass a comprehensive plan last year. This session, she pushed through a proposal designed to increase housing stock by providing tax incentives for developers, while protecting New York’s existing tenants.
The package offers a substantial new tax break to incentivize the construction of housing, which will include affordable units. In addition, the budget included a requirement for landlords to justify any rent increases above a certain threshold and to offer lease renewals in most cases.
Ms. Hochul also succeeded in shoehorning a number of criminal justice measures into the budget. One will enhance the state’s response to retail theft, adding a State Police unit and levying tougher penalties on people who attack shop workers. A tax credit will be made available to retailers who invest in security measures. The retail theft proposal was a high priority for the governor, but a source of great debate in the Legislature, which eventually relented.
The budget also expands the state’s definition of a hate crime, in response to a number of incidents since the start of the Israel-Hamas war. Roughly 20 additional offenses can now be prosecuted as hate crimes.
Ms. Hochul’s artificial intelligence research center, known as the Empire A.I. project, which establishes a statewide consortium based in Buffalo to conduct research into artificial intelligence, also won funding in the budget.
Did the far left get what it wanted?
Not really.
The housing deal drew criticism from both sides of the debate, including tenants who decried the protections as not strong enough for the current market. The far left had fought for a measure known as “good cause eviction,” which was intended to greatly limit annual rent hikes and aggressively restrict the reasons for which landlords could evict tenants. It passed in the final budget, but in a largely diluted form.
There were a number of exemptions from good cause, including luxury buildings and landlords with 10 units or fewer. Outside New York City, localities may opt in to good cause instead of being required to do so. Housing Justice for All, a tenants’ rights group, estimated that the governor’s version of good cause excluded at least 2.8 million tenants, many of whom live upstate.
Lawmakers were also frustrated that so-called individual apartment improvements were included in the budget — a rent stabilization loophole that allows landlords to increase rent if they add an upgrade or service to an apartment. This budget raises the cap on rent increases that landlords can charge to recoup repair costs.
Progressive lawmakers managed to persuade their colleagues in the Assembly and the Senate to support raising personal income taxes by half a percent for those who earn over $5 million until 2027. They said that such a move would increase revenue by nearly a billion dollars per year. But the governor was clear in her opposition, calling the issue “a nonstarter for me.”
The proposal died, as did another Legislature-supported bill to increase the state’s corporate tax.
What else didn’t make the cut?
Climate activists were disappointed that the budget was not used to address the environmental crisis.
The New York Home Energy Affordable Transition Act would have curbed the expansion of gas infrastructure by not automatically providing gas to all new customers who request it. The measure encouraged utilities and new customers to explore other energy options.
The Climate Change Superfund Act would have required companies that contributed to the buildup of greenhouse gases to contribute to the cost of infrastructure upgrades so that the state could adapt to the various challenges brought on by climate change. Neither it nor the NY HEAT Act were included in the budget.
One of the governor’s key initiatives, outlined in her State of the State address, was also excluded from the budget: the SAFE (Stop Addictive Feeds Exploitation) for Kids Act, designed to limit children’s exposure to addictive social media feeds and protect children’s mental health. Ms. Hochul, who had included the measure in her executive budget, said that the Legislature was broadly supportive and would return to the issue in the final months of the session.
How did New York City do?
The two-year extension of mayoral control over the city’s schools was not the only budget win for New York City.
The state put aside $2.4 billion to help manage the ongoing migrant crisis, money that will go toward the city’s strained shelter system, legal services and health care. The allocation still falls short of Mayor Adams’s initial request for $4.6 billion to cover the city’s costs.
And after failing to advance for a full decade, this year’s budget will allow New York City to lower its speed limit to 20 miles per hour. The measure is named Sammy’s Law, after Samuel Cohen Eckstein, a 12-year-old boy who was struck by a speeding van on his Brooklyn street and died in 2013. In the decade since, his parents have pushed tirelessly to make the streets safer for children.
What’s a budget without cannabis?
Nearly since the moment New York legalized cannabis in 2021, the state has struggled to stifle the growth of the illicit market. Under this year’s budget, key changes were instituted to the way cannabis is taxed and regulated, in an effort to crack down on the city’s illegal weed shops.
The state will add more consequences for shop owners and landlords facilitating the sale of untaxed cannabis and give local governments new tools to shutter such businesses.
“All we have to do is verify that you’re selling products not tested or labeled in accordance with our laws,” Ms. Hochul announced, clutching a padlock beside Mr. Adams at a news conference on Friday. “Once we do that, the padlock goes on immediately.”
The budget also includes a small but meaningful change to the way cannabis is taxed: Going forward, the complicated potency tax on cannabis will be replaced with a flat tax of 9 percent.
Mihir Zaveri and Grace Ashford contributed reporting.
