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20 Issues to Watch as State Budget Negotiations Enter Home Stretch

Gov. Hochul addresses the Legislature (photo: office of Governor Kathy Hochul)

The Democratic supermajorities in the State Senate and Assembly recently laid their cards on the table with the passage of their chambers' one-house budget resolutions.

The resolutions serve as opening counter-offers to Governor Kathy Hochul's $227 billion executive budget and sweeping policy agenda, marking battle lines and raising the stakes on a number of key issues. They followed weeks of legislative hearings on the governor's proposals.

Hochul, Senate Majority Leader Andrea Stewart-Cousins, Assembly Speaker Carl Heastie, and members of their teams now lead negotiations as the April 1 start of next fiscal year quickly approaches. A spending plan, with whatever accompanying policy is agreed upon, is supposed to be in place by that deadline, but New York state budgets are often passed late. (Hochul’s first budget as governor was eight days late last year as she insisted on changes to the state’s bail law and a last-minute $600 million subsidy for a new Buffalo Bills stadium.)

There are several notable places where the legislative chambers differ from the governor and each other, setting the stage for heated debate — one that many other stakeholders, including Mayor Eric Adams, are trying to influence. State leaders must come to a conceptual agreement on the total size of the budget, and many details of fiscal policy, including tax rates, business subsidies, reserves levels, and more.

While this is Hochul's second budget season in the Governor's Mansion, it is her first after being elected to a full term by a relatively narrow margin and comes just after a bruising political fight with a State Senate that voted down her nomination for chief judge. Hochul laid out an ambitious agenda earlier this year through her State of the State and executive budget, and has gotten significant push back on several proposals, including to bring more housing to the suburbs, make further changes to the state's bail law, increase the charter school cap, MTA and Medicaid funding schemes, and a host of other contentious topics.

Here are 20 areas to watch as the budget unfolds:

1. Cuts and Cost Shifts to New York City
The governor’s budget proposed several cuts and cost shifts that would fall on New York City as it deals with its own fiscal pressures, particularly the $4.2 billion, two-year projected cost of the migrant asylum-seeker crisis. 

“While the executive budget contains many shared priorities, the cuts and costs shift significantly outweigh the assistance the state is providing to address the asylum-seeker crisis,” Mayor Adams said in testimony last month in Albany before the state Legislature.

The governor has proposed $1 billion in assistance over two years for migrant shelter and services, even as Adams has called for a 50-50 split of the bill between the city and state as the amount of federal assistance remains uncertain. 

Adams has also pushed back against the governor’s proposal to increase the city’s contribution to the MTA by $500 million annually, as well as a proposed increase in the Payroll Mobility Tax and expected fare hikes that would both affect New York City residents and commuters that work in the city.

While Adams supports the expansion of charter schools that Hochul is proposing via lifting the New York City cap on the privately-run public schools, the mayor has said any such move should come with additional state funding to help the city pay for the schools’ rent.

Adams is also pushing back on potential cost-shifts around Medicaid, wage increases for certain court-appointed attorneys, and more. In their budget resolutions, both houses of the Legislature crafted plans more friendly to the city’s bottom line than Hochul’s.

[Read: 6 State Budget Proposals Where Hochul and Adams are At Odds]

[Read: In Albany, Mayor Adams Testifies on Governor Hochul's Budget, State Priorities]

2. MTA Funding
The MTA survived the pandemic with the help of federal aid that is expected to run out by 2025. But the agency has a $600 million deficit that continues to threaten its finances, particularly as ridership has yet to recover to pre-pandemic levels — subway ridership has been stuck at about two-thirds of pre-pandemic numbers on most weekdays. The authority’s $19.2 billion operating budget for 2023 includes a 5.5% hike on fares and tolls this year, following through on a previously planned increase in 2021, as well as cost-cutting measures and potential cuts to service.

Governor Hochul’s executive budget proposal addressed the agency’s structural deficits with several proposals – identifying $400 million in operating efficiencies, $800 in additional revenue by marginally increasing the Payroll Mobility Tax, a $300 million infusion of one-time aid from the state, and the additional annual $500 million contribution from New York City. Under the governor’s proposal, the MTA would also receive a share of the $1.5 billion raised from licensing fees of three new downstate casinos as well as somewhere between $462 and $826 in projected annual casino tax revenue starting in 2026.   

Mayor Eric Adams has pushed back against the MTA funding proposal. He has pointed out that the city already sends the MTA about $2.4 billion annually in operating funds and that the governor’s proposal would cost the city closer to $526 million in the next fiscal year and more than $540 million every year after that. 

Assembly Democrats rejected the proposal to increase the Payroll Mobility Tax to generate an estimated $537 million and the city’s contributions to the MTA, which they estimated would cost about $369 million in the 2024 fiscal year. Instead, they called on the state to cover that funding while also pushing for $196.9 million for the MTA to avoid the fare increase to $3. They also proposed a $50 million zero-fare bus route pilot program for two routes in each borough. 

Senate Democrats also intentionally omitted the proposal to increase the city’s MTA contributions, rejected increased fare hikes in 2023 and 2025, proposed increased surcharges on for-hire vehicles, and supported the proposed free bus route pilot. They also proposed directing casino revenue to education instead of the MTA and authorizing the city to create a residential parking permit program with revenue dedicated to the MTA.

The Senate also proposed eliminating the $43 million annual property tax exemption for Madison Square Garden and sending future property tax revenues to the MTA.

3. Asylum-Seeker Funding
As New York City continues to deal with the arrival of tens of thousands of migrant asylum-seekers, the cost of providing shelter and services has ballooned, straining the city’s budget. Officials from the Mayor’s Office of Management and Budget (OMB) estimate that it will cost the city more than $4.2 billion in the current and next fiscal years combined. 

The city has called on the federal and state governments for more aid to deal with the crisis. The federal government has, so far, only awarded the city about $8 million in FEMA funding, but separately appropriated $800 million to help cities with their migrant influx nationally. It’s unclear how much the city will receive from that pot, though OMB officials told the City Council that they don’t expect any additional federal aid in the current fiscal year, which ends June 30. 

Governor Hochul, in her budget, provided $1 billion in assistance over two years, which would include reimbursing 29% of the city’s shelter costs as the state usually does, and proposed a framework to split the costs of services evenly among the city, state, and federal governments. 

The Senate budget supports reimbursing the city for 29% of its costs even if they exceed the governor’s $1 billion proposal for the Migrant Service and Assistance program. The Assembly one-house budget merely provides $40 million for immigration legal services for migrants and asylum-seekers.

After meeting with the governor and legislators in Albany on Monday, Mayor Adams cited funding for asylum-seeker services as his top state budget priority, along with resolving the question over MTA funding without the city being required to meet the governor’s proposal.

4. Charter School Cap
Hochul wants to increase the number of charter schools in New York City, a contentious issue opposed by teachers unions and many Democratic legislators. Her proposal would eliminate the regional cap on the number of charters permitted in the city, which has been hit, and authorize unused charters to be reissued. In sum, it would allow more than 100 new charter schools in the city.

Both chambers excluded the proposal in their one-house budgets signaling an uphill battle as budget negotiations unfold. Enrollment in privately-run public charter schools has grown significantly over the last decade while traditional public school enrollment has declined. Many charter schools, which predominantly teach Black and Latino students, continue to grow as they add grade levels in expansion based on their original charter approvals.

Hochul has argued the relative demand is a reason for expansion while Heastie and Stewart-Cousins have indicated they believe those resources should be put toward traditional public schools, which account for roughly 86% of the city's public school student body.

While Mayor Adams is supportive of charter school growth in general, he said in state budget testimony that the governor’s proposed expansion of charters could cost the city $1 billion more annually in rent payments.

5. Local Medicaid Costs
Hochul's proposal includes ending a Medicaid cost-sharing arrangement between the state and counties that has been in place since 2015. The state's Medicaid program, which provides health care coverage for low-income New Yorkers, is funded by a mix of federal and state money, with the majority share falling on the federal government.

Under the governor's plan, the state would keep the full enhanced Federal Medical Assistance Percentage (eFMAP) funding to localities, which is provided under the Affordable Care Act. The proposal has been fiercely opposed by local leaders who said counties would have to cover the funding gap by raising taxes or cutting services.

Mayor Adams estimated the plan would cost New York City $343 million next fiscal year. The New York State Association of Counties estimated the change could cost counties outside New York City $280 million in the next fiscal year.

The Senate and Assembly both rejected that proposal by including $624 million to be passed back to counties and New York City to offset the state's eFMAP grab. The one-house budgets also each rejected a Hochul proposal to delay adding coverage for undocumented immigrants over 64 who were previously ineligible for Medicaid. Both houses also included coverage for income-eligible undocumented immigrants under the Essential Plan, a state-operated, federally-funded health care option for low-income residents who are ineligible for Medicaid.

6. SUNY and CUNY Tuition
Hochul's executive budget proposal of tuition increases for SUNY and CUNY received strong backlash from student advocates and some state legislators and was mostly rejected in both one-house budgets.

The executive budget includes an annual tuition increase for SUNY and CUNY students indexed to the Higher Education Price Index – a measure of inflation in higher education costs – and capped at 3% annually. It also would allow tuition to increase up to 6 percentage points annually at SUNY's four university centers with a cap at 30% over five years. According to the state Division of the Budget, the increases would raise $97 million for SUNY and $31 million for CUNY in academic year 2024 operating funds.

The Senate's response rejected Hochul's tuition hikes for SUNY and CUNY while leaving open the possibility for SUNY tuition increases for out-of-state students. The Assembly one-house budget rejected the increase for CUNY students only.

Overall, Hochul’s budget proposed a decrease in CUNY funding from the state while the legislative budgets include significant increases.

7. Tax Rates
In 2021, lawmakers raised the corporate tax rate on corporations earning over $5 million in profit from 6.5% to 7.2%. Hochul's executive budget included a three-year extension on the higher rate, which will otherwise sunset at the end of this year.

The Senate and Assembly one-house budgets both include the three-year extension but rejected an additional payroll tax to fund the MTA. Instead, each house proposed covering that additional revenue through an increase in the corporate tax rate downstate. In the Senate's case that came by increasing the MTA surcharge – a boost in the corporate tax rate for businesses in downstate counties served by commuter rail.

Both one-house budgets also included personal income tax increases for the highest earners, raising the rates half a percentage point for filers making between $5 million and $25 million annually and for people making over $25 million. Hochul's proposal would keep income taxes flat, and the governor has vowed not to raise income taxes this year. Meanwhile, many lawmakers and advocates want to go well beyond the tax increases in the legislative proposals to raise billions more to fund social services.

8. Minimum Wage
Senate and Assembly Democrats are upping the ante on Hochul's proposal to tie New York's minimum wage to inflation, arguing the base wage must first be raised in order to help low-wage workers keep up with rising prices. The minimum wage is now $15 an hour in New York City, Long Island, and Westchester and nearing it elsewhere in the state ($14.20) as the gradual phase-in to $15 passed in 2016 nears completion.

Hochul's executive budget included a cap on annual minimum wage increases at the lower of 3% or the increase in the Northeast Consumer Price Index rate, which measures inflation. It also includes exceptions in the case of certain economic downturns.

The one-house budgets did not specify an exact amount for base wages to increase before being indexed to inflation. Legislation introduced in the Senate and Assembly would raise the minimum wage in New York City and parts of Long Island to $21.25 an hour by 2026 and to $20 an hour in the rest of the state, with increases pegged to inflation thereafter.

9. Funding for Prosecutors and Public Defenders
In her budget, Hochul proposed $52 million in “aid to prosecution” funding, a nearly $40 million increase, to help the state’s 62 counties hire more prosecutors and bolster their offices as they deal with the mandates of recent state criminal justice changes including discovery and speedy trial reforms.

The governor’s budget would also continue a $40 million annual allocation for prosecutors in counties outside New York City to comply with the discovery reform law that went into effect in 2020. Additionally, the state would provide $7 million to DAs that establish specialized units dealing with the opioid overdose crisis. 

Public defenders, however, have argued that they also need a commensurate boost in resources as they too contend with the new criminal discovery laws. Public defender organizations are already struggling with staffing crises as their caseloads have increased, leading to further case delays and increasing the backlog in criminal courts. 

[Read: As Prosecutors Get Budget Boost, Public Defenders Seek More Funding Too]

Hochul’s budget for the state Office of Indigent Legal Services, which aids counties and indigent legal service providers, remains flat at $359 million for the next fiscal year. She also allocated $7.6 million for “aid to defense” programs for indigent service providers like the Legal Aid Society, an amount that is also unchanged from the current fiscal year. The budget did propose increased pay rates for “18-b attorneys” under the state’s Assigned Counsel Program. 

The Senate’s one-house budget includes $47 million to support criminal defender services and another $40 million for “Discovery Reform Criminal Defenders,” and adds $35 million in funding for the Office of Indigent Legal Services, among other measures raising pay rates for assigned counsel attorneys. 

The Assembly’s proposed budget sets the Office of Indigent Legal Services budget at $564 million, an increase of $198 million over the governor’s proposal. It also adds $100 million to help public defenders comply with the criminal discovery law, and an additional $60 million for prosecutors on top of the $40 million that the governor proposed, for $100 million total.

10. Bail Reform
After the State Legislature approved sweeping reforms to the state’s bail system and then revised and tightened them twice, including last year, Hochul is pushing for another amendment this year. It is again among the most controversial elements of budget negotiations, with her calls for more pretrial incarceration met with opposition by many legislators and criminal justice reformers. 

Hochul seeks to eliminate the “least restrictive means” standard that judges are required to use when setting bail. She has insisted that it is necessary to clear up contradictions in the law – in part a result of changes she saw through last year – and would apply to violent felonies, high-level misdemeanors, and repeat offenders. Hochul demonstrated last year that she is willing to delay the budget if the state Legislature doesn’t approve her demands on bail law changes, potentially setting up another face off this year.  

Hochul has the support of some moderate and conservative Democrats, including most prominently Mayor Adams, as well as Republicans who are pushing for even greater amendments to the bail law. In particular, Adams and others have called for instituting a “dangerousness” standard that judges can use while deciding to set bail or remand a defendant to custody. 

As expected, Democrats in both houses of the Legislature rejected Hochul’s idea and it was not included in their one-house budgets.

11. Alternatives to Incarceration and Re-entry Services
Hochul included $31.4 million for funding alternatives to incarceration in her executive budget, double the funding in the enacted budget for this fiscal year.

The executive budget also includes $7.7 million in new funding for reentry services, which would bring total funding to $11.5 million.

The Senate's one-house budget added to Hochul's proposal an additional $10 million for "criminal and civil legal services, alternatives to incarceration, community supervision and re-entry initiatives." The Senate budget also adds $1 million from the federal Justice Assistance  Grant appropriation to violence, crime, and drug prevention and alternatives to incarceration. The Assembly's one-house budget adds $5.2 million for alternatives to incarceration, which can include community supervision and employment-based programs.

Some state legislators are pushing for the inclusion in the state budget of the Treatment Not Jails Act, which would expand mental health treatment courts statewide. It was not included in the one-house budget resolutions, but elements of it could make their way into a budget deal.

[Read: State Legislators Push 'Treatment Not Jails Act' to Avoid Incarceration for Many with Mental Illness]

12. Hochul's Housing Plan
“Housing Compact” to build 800,000 homes over a decade to meet the state’s desperate need for housing. Her plan involves a broad mix of policies including mandatory local and regional targets for housing production, amendments to state zoning rules, tax credits, infrastructure and planning funding, and more.  

One of the measures she proposed would create processes to override localities when they either fail or refuse to meet targets for housing creation. It has prompted heated opposition, particularly from suburban lawmakers who believe the state is attempting to supersede local control of land use decisions.

There are several other proposals in her housing plan including required rezoning for higher density around all MTA subway and rail stations, eliminating the Floor-Area-Ratio (FAR) cap in New York City that limits apartment building density, expanding commercial conversions to housing and incentivizing it with a new tax credit, expanding a property tax exemption for Accessory Dwelling Units (ADUs), allowing New York City to legalize basement apartments, a new local property tax exemption for multifamily affordable housing, and more. 

Hochul did not, however, propose a new affordable housing tax abatement to replace the expired 421-a program, after floating and then later abandoning an alternative program called 485-w last year. But she does want to see a new version of such a program agreed to in the new budget, or at the least, for now, support for her proposed extension of the construction deadline for buildings to receive 421-a credits, from completion in 2026 to 2030, which would apply to tens of thousands of potential apartments.

Both the Senate and Assembly, in their budgets, rejected the governor’s proposed mandatory housing growth targets and zoning override proposal, though they did both include the growth targets and leaders have said they are open to negotiations on many details around housing.

The Senate proposed $500 million in annual state infrastructure funding incentives to encourage housing creation. The Assembly proposed the same amount for municipalities outside New York City and $125 million separately for New York City.

13. Good Cause Eviction and Housing Access Vouchers
Two top priorities for housing and tenant advocates this year are the so-called “good cause eviction” bill and the Housing Access Voucher Program (HAVP). 

Good cause eviction would protect tenants against exorbitant rent increases as well as prohibit evictions in most cases unless tenants violate a lease agreement. Hochul has not taken a firm position on the legislation, but has noted that it is not part of her agenda.

The Senate’s one-house budget expresses support for “advancing tenant protections that align with the core principles of Good Cause Eviction.” The Assembly, on the other hand, does not mention it but does add $15 million for an expansion of statewide eviction prevention legal services, for a total of $50 million.

The HAVP would create a $250 million statewide program for those experiencing homelessness or at risk of eviction to pay rent via vouchers. The measure passed the Assembly housing committee in February, and both chambers funded it in their one-house budgets. 

Last year, Hochul opposed a new housing voucher program, though her resistance to it was reportedly based on an inflated projection of its cost – roughly $6 billion annually – that did not match lawmakers’ demands.

Though the New York City Housing Authority has a $40 billion five-year capital need, its focus this year has shifted to its struggles with its operating budget because of plummeting rent revenue. 

The governor’s budget proposal included no new capital or operating funds for NYCHA, even as lawmakers and housing advocates are pushing for increased assistance to cover rental arrears for tenants.

[Read: NYCHA Rent Arrears Crisis Shifts Budget Focus from Capital Needs to Operating Assistance]

[Read: NYCHA Officials Sound The Alarm at City Council Budget Hearing]

In total, NYCHA has tenant rent arrears of about $466 million from 73,000 households, up from $125 million in 2019. The authority has applied for $120 million in rental assistance for more than 31,300 households under the Emergency Rental Assistance Program (ERAP), a state program created during the pandemic using federal aid. But none of those payments have been approved since NYCHA tenants were placed at the bottom of the priority list for the program, and arrears for those tenants have grown to $240 million. ERAP funding has since been depleted. 

NYCHA has asked for about $330 million from the state to help cover its rent arrears and to avoid fiscal crisis as it continues to dip into reserves to cover expected annual operating deficits.

The Senate’s one-house budget proposes adding the $389 million for ERAP, as well as another $350 million in capital funds for NYCHA in the coming fiscal year. The Assembly’s budget also proposes $385 million for statewide rental arrears assistance. It’s unclear how much of that amount would be earmarked for NYCHA tenants.

15. Cap-and-Invest
As part of her State of the State agenda, Hochul proposed a cap-and-invest program that would place a tax on carbon emissions from large polluters and fuel sellers. The executive budget estimates the corresponding Climate Action Fund will generate $1 billion annually from the tax, which would be used by the state to pay for energy rebates to consumers and businesses, and decarbonization efforts.

The Senate included the program in its one-house budget with more guidelines and guardrails for how the proceeds can be spent. The Assembly one-house budget did not include cap and invest language.

16. Gas Bans and Renewable Energy
Hochul added $5.5 billion for climate action in the executive budget bringing total spending to over $30 billion. That includes spending on energy affordability, emissions reductions, and clean air and water.

The capital plan includes financing $805 million over five years under the Environmental Bond Act, which voters approved last fall to authorize state borrowing up to $4.2 billion for environmental projects. That includes $100 million in fiscal year 2024.

[Read: How New York Will Implement the $4.2 Billion Environmental Bond Act Passed by Voters in 2022]

Hochul also proposed a ban on fossil fuel hook-ups in newly-constructed buildings starting in 2025 for some buildings and a plan to phase out the sale of heating equipment that burns fossil fuels. Both the Senate and Assembly one-house budgets included the ban on gas in new construction (with differences in the phase-in dates and other secondary changes), giving environmental advocates hope that the three parties will reach a deal in the final budget.

Both houses also included a measure to decarbonize state-owned buildings, including SUNY campuses, by 2040 – a proposal left out of the executive budget.

One point of division between the governor and State Legislature is the Build Public Renewables Act, which would require the New York Power Authority to build renewable energy power and phase out fossil fuel burning plants, along with certain labor standards for renewable projects. Hochul proposed a pared down version of the bill in her executive budget: it allows but does not require the NYPA to build renewable energy plants and leaves out some of the labor provisions included in the legislation.

The Senate's one-house budget includes the full Build Public Renewables Act, which the chamber passed last year and again this year. The Assembly has not passed the bill and did not include language around the New York Power Authority in its one-house budget.

The Senate's one-house budget includes a $500 million increase to the Environmental Protection Fund, while the Assembly added $435 million. Both houses added $100 million on top of the governor's $500 million proposed funding for the Clean Water Infrastructure Act, along with water quality measures in Suffolk County.

The Senate also included the Waste Reduction & Recycling Act, a measure proposed in Hochul's executive budget that would hold companies responsible for the environmental impact of the packaging they use. The Assembly did not include the bill but accepted the governor's proposed Department of Environmental Conservation budget, which includes staffing to support the program.

17. State Public Campaign Finance System
The Public Campaign Finance Board requested $14.5 million for administration and infrastructure to run the new state campaign finance system that includes public matching for small-dollar campaign donations; and $100 million for the matching funds pot.

Hochul's executive budget included $14.5 million to launch the new office and $25 million for matching funds, building on $10 million Hochul and the Legislature included in last year's budget. The PCFB and Hochul have said public matching payments are not expected to be made until the following fiscal year, which begins April 1, 2024, when that year's primaries for state legislative seats will be well underway.

State lawmakers approved the program in 2020, setting lower contribution limits and creating a public small-dollar match option for candidates running after the 2022 election cycle for statewide and state legislative seats. The new system is modeled on New York City's campaign finance system, which supporters say helps reduce the influence of large donors on elections.

In February, Spectrum News reported legislators were discussing delaying the start of the public matching program for two years over concerns about being able to fully fund the program. The Senate and Assembly one-house budgets included the governor's full proposal without new start dates.

[Read: Hochul’s Budget Offers Far Less Funding Than Requested by New State Public Campaign Finance Board]

18. Film and Television Tax Credits
Hochul's proposal to increase New York State's Film Tax Credit appears to have the support of the Senate and Assembly, which included the provision in their one-house budgets.

The credit is one of New York's largest industry subsidies. It currently offers a 25% credit of eligible production costs for movies and TV shows made in New York, running roughly $420 million a year. Hochul and legislative leaders want to up that subsidy to 30%, which would total roughly $700 million annually. Hochul is also seeking to expand the types of production costs that would be eligible for the tax credit, a proposal included in the Assembly's one-house budget but rejected in the Senate's.

The proposal is one of several major industry subsidies that Hochul is pushing – now with the backing of the two legislative majorities. That also includes expanding a tax credit for Broadway theaters from $200 million a year to $300 million. The Musical and Theatrical Production Tax Credit was created during the height of the pandemic to help struggling theaters cope with massive revenue losses that came from closing their doors. The Assembly and Senate each included the increase in their budget proposals, with the Senate extending the credit to off-Broadway theaters as well.

19. Belmont Racetrack Loan
Hochul and the Legislature appear to be aligned on a proposal to lend $455 million to the New York Racing Association to demolish and rebuild facilities at Belmont Park, an aging horse racing facility on Long Island. Both the Senate and Assembly one-house budgets included the funding, which Hochul proposed in her executive budget earlier this year.

The deal requires the New York Racing Association, the nonprofit operator of Belmont, to give up its lease for the state land on which nearby Aqueduct Racetrack sits in Queens, once the reconstruction is completed. In the process, horse racing at Aqueduct, which is also operated by the racing association, would be moved to Belmont and Aqueduct torn down, freeing up 100 acres of state-owned land adjacent to JFK International Airport, which some want to use for housing.

While some critics and watchdogs question investment in the declining horse racing industry and risk for New York taxpayers and using tax dollars to subsidize animal cruelty, proponents including the governor insist the plan would attract more economic activity, including tourism, to the area and open up opportunities to redevelop the valuable land under Aqueduct.

20. Cigarette Tax and Flavor Bans
In her State of the State agenda and executive budget, Hochul proposed increasing the state tax on cigarettes by a dollar a pack to $5.35 per pack, and banning flavored tobacco products, including menthol cigarettes.

The Senate and Assembly one-house budgets accepted the tax hike but omitted Hochul's flavor ban, which has become the subject of fierce lobbying by anti-tobacco groups, the tobacco industry, and some Black leaders on both sides of the debate.

The Senate also included a proposal of Hochul's to impose additional penalties on cigarette retailers that refuse Department of Tax and Finance inspections.

Still Other Issues to Watch:
There are a number of other areas where there seems to be space between the governor's proposals and the Senate and Assembly's one-house budgets, or negotiations in motion to make changes.

Changes to Marijuana Law: Just last week, Hochul proposed increasing civil and tax penalties for illegal marijuana sales as well as stronger enforcement powers for the Office of Cannabis Management and the Department of Taxation and Finance to shut down stores that sell marijuana without a license. State Senator Liz Krueger, who sponsored marijuana legalization in her chamber, recently told Gotham Gazette that three-way negotiations among the governor’s office, Senate, and Assembly were underway to add several enforcement mechanisms to the law.

Assembly Majority Leader Crystal Peoples-Stokes, the Assembly sponsor of marijuana legalization, and State Senator Jeremy Cooney have separately proposed changes to simplify how marijuana sales are taxed in the state.

Clean Slate Act: Criminal justice reformers are pushing for the passage of the Clean Slate Act, which would automatically seal conviction records, except for sexual offenses, for New Yorkers once they become eligible after time served and parole periods. The bill passed the Senate last year but failed in the Assembly, and this year the Senate included it in its one-house budget but the Assembly did not. Hochul has not supported it.

Universal Free School Meals: Legislators and advocates are pushing for about $280 million in state budget funding for universal free school meals across New York, where all students would be able to eat breakfast and lunch at their schools every day.

Freelancer Protections: After Governor Hochul issued an end-of-year veto of the Legislature’s attempt to expand protections for freelance workers, lawmakers reintroduced the “Freelance Isn’t Free Act” bill this year and hope to include it in the budget. The bill, modeled after successful legislation in New York City, would give freelance workers wage protections, including a right to contracts for their work, timely payments and a grievance redressal process.

When Hochul vetoed it, she said it would place an undue financial burden on the state Department of Labor to enforce, lending impetus for it to become part of budget negotiations.

[READ: After Hochul’s 2022 Veto, Lawmakers Reintroduce Bill to Protect Freelance Workers Statewide]

Farmer Tax Credits: Last year, the state expanded an investment tax credit for purchasing or upgrading farm equipment, and, in her budget this year, Hochul proposed making the credit refundable for five years. Both the Senate and Assembly have come out in support of that proposal. 

Cost of Living Adjustment: Hochul proposed a 2.5% cost of living increase for human services workers, lower than the 8.5% increase sought by behavioral health advocates and included in the Senate and Assembly one-house budgets.

Unemployment Bridge Program: Immigrant advocates and some Democratic lawmakers and labor unions are pushing for the inclusion of a $500 million "unemployment bridge program" that would provide unemployment benefits to undocumented New Yorkers. The proposal was not included in the executive or one-house budgets but the Senate's resolution includes a review of options to expand traditional unemployment benefits.

Access to Representation Act: Immigrant advocates and lawmakers are also calling for the passage of the Access to Representation Act, which would provide the right to counsel in immigration court proceedings. 

Increased penalties for attacks on retail workers: Amid the ongoing spike in retail theft, legislators have sponsored a bill that would make it a Class D felony and bail-eligible offense to attack a retail worker – the same level as an assault on a police officer or firefighter, for instance.

They have also sponsored measures to crack down on the online sale of stolen goods and to increase penalties for repeat shoplifting. 

Adams’ proposed tax credit expansion: Mayor Eric Adams last week rallied with labor unions to push for a further expansion of the Earned Income Tax Credit and Child Tax Credit, after successfully urging the state to expand both last year. Under a proposed state bill, those with Individual Taxpayer Identification Numbers (ITIN) would be eligible for the credits, instead of the current eligibility for just people with Social Security numbers.

Working Families Tax Credit: Some lawmakers are also seeking a Working Families Tax Credit, which would provide families $500 per child and up to $1,500 for low-income households. Hochul's budget did not include the credit while Senate and Assembly one-house budgets included some elements of the proposed legislation.

Comptroller Oversight: Hochul's executive budget would exempt $12.8 billion from competitive bidding and comptroller oversight. State Comptroller Thomas DiNapoli said the provisions would harm the integrity of state procurement.

by Samar Khurshid, senior reporter, Gotham Gazette

Read more by this writer.

by Ethan Geringer-Sameth, reporter, Gotham Gazette

Read more by this writer.

Note - this article has been updated. 

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