Albany, NY — In response to Governor Hochul’s State of the State address and policy book, Empire Center experts issued the following reactions:

 

Budget and Tax — Peter Warren, Director of Research 

“The state, under the current year’s $220 billion budget, is on an unsustainable fiscal path. Instead of seizing the moment to revisit and right-size out of control spending, the Governor proposed today to expand spending and create new commitments.

“As part of a massive hike in state aid to public school districts whose collective enrollment declined five percent during the pandemic, Governor Hochul proposes to earmark $250 million for tutoring to recover learning loss that occurred during the pandemic. But New York schools already received $9 billion in federal emergency aid for just such a purpose that’s available to them through the 2023-24 school year.

“Disturbingly, the governor seeks to pledge up to a half-billion dollars in public matching funds for deposit directly into SUNY university center endowments, where university administrators could spend it as they see fit, including on non-instructional, empire-building boondoggles.

“These spending expansions would increase the state’s fiscal exposure and make its residents — already among the highest-taxed in the nation by any measure — more vulnerable to further rate hikes. While the Governor acknowledged in her speech that New York residents are fleeing the state at an alarming rate, there is little in her address that will encourage put-upon residents from pulling up stakes in search of greener pastures where they can hold onto more of their own earnings.”

Energy and the Environment — James Hanley, Fellow 

“Supporters of the Climate Act should be enthused by the Governor’s address — which gave explicit support for most of the Climate Action Council’s major proposals. Most notable is the directive for DEC and NYSERDA to craft a cap-and-invest program for greenhouse gas emissions. While economists support such programs as the least-costly way of reducing emissions, it is questionable whether it can work at the state level without driving businesses out of state. Further, such a major economy-shaping policy should be developed by the elected legislature, not backroom bureaucrats.

“Gov. Hochul also declared that no low-income New Yorker should pay more than six percent of their income on electricity. Though noble, unfortunately there is currently no estimate of what this will cost. As residents are forced into electrification and electric cars by her policies, the price tag will surely climb. New Yorkers who will have to pay for these expensive policies deserve upfront cost estimates before the bill comes due.”

Labor – Ken Girardin, Fellow 

“This is an inappropriate time to be considering further increases to the minimum wage, which has swollen from $7.25 per hour in 2013 to more than $14 upstate and $15 downstate. New York ended 2022 with a quarter-million fewer private-sector jobs than it had three years prior. The state has been slow to add jobs since the 2020 lockdown, and that recovery has been continually hindered by bad policies from Albany. There are more effective ways to achieve wage growth than making it a crime to pay high-schoolers $14 per hour to bag groceries.”

Reducing Regulation – Cam Macdonald, Adjunct Fellow 

“Governor Hochul has renewed her promise to propose legislation entering New York into the Interstate Medical Licensure Compact and the Nurse Licensure Compact.  Reducing licensing barriers could provide increased access to qualified health care professionals in underserved communities and make it easier for New York-based physicians to practice across state lines, including via telemedicine. It would be good for the Empire State if the Governor and the Legislature could make the interstate licensing compacts a reality this year.

“Governor Hochul also has re-upped her proposal to maximize scope of practice for other medical practitioners. Last year, the Governor and Legislature passed a law to give nurse practitioners greater flexibility to provide their services. In the long-term, maximizing scope of practice for other medical professionals can benefit New York’s rural and underserved communities by providing greater access to care.

“Empire Center’s DeregulateNY grand prize winners Chris Kendall and Jacob Rieper can take a half-bow. Governor Hochul proposes to amend New York’s archaic law requiring affidavits of publication to form LLCs, LLPs, and LPs. New businesses will still need to buy ads announcing a “notice of organization” for six weeks in two local newspapers, one weekly and one daily. Business formations will still cost unnecessary hundreds or thousands of dollars to run ads — but the governor promises fewer rejections by the Department of State, by changing from affidavits to simpler affirmations.

“Governor Hochul is dipping her toe into the waters of overly burdensome licensing requirements in New York, by proposing a trainee licenses and training option for cosmetology professionals. New York’s regulations require 1,000 hours of instruction that can cost more than $16,000, on average. Hair shampooers and hair braiders need almost double the instruction time as EMTs to be licensed in the Empire State. The focus should be on what the state requires for licenses — and minimizing barriers to entry in the field.”

Education — Emily D’Vertola, Education Policy Analyst 

“Governor Hochul’s education message focused more on increasing investment and enrollment to selected institutions and less on sustainability and accountability. And for all the talk of education investment and innovation, there was a deafening silence on her 2022 campaign commitment to open more charter school seats for New York kids (even though charters can be hubs for exactly the type of educational innovation she claims to be striving for).

“New York already spends more than any other state on education. The governor plans to increase public education spending by $2.7 billion or 13 percent, with little accountability to the public regarding the return on that investment. A proposed $250 million will go towards an investment in high-impact tutoring — a proven intervention that many schools across the country implemented at the start of the pandemic. New York has already received over $9 billion in ESSR/ARPA funds, and has largely spent it on instructional salaries. Many schools are still without sustainability plans for when these funds expire.

“Another $125 million is being allocated to expand high-quality kindergarten programs, $20 million for early college high-school and P-Tech programs and $10 million over two years for select districts, BOCES and community colleges who are working in collaboration with local industries.

“The omission of issues like the charter cap, graduation standards, and school attendance leaves one to wonder just how committed this administration is to improving education in our state.”

Health Care — Bill Hammond, Senior Fellow for Health Policy 

“The surprising thing about Governor Hochul’s health care agenda is that she doesn’t seem to have one.

“Her speech said nothing about the thousands of nurses that are on strike, nothing about the shocking conditions in nursing homes exposed by the attorney general’s recent lawsuits, and nothing about the looming turmoil for Medicaid — including the loss of billions in federal aid and a deadline to prune a million or more recipients from the rolls.

“Indeed, her speech did not include the word ‘Medicaid,’ even though it’s one of two biggest items in the state budget and covers the medical bills of one in three New Yorkers.

“Also going completely unmentioned was what should be the state’s highest public health priority — repairing and improving the state’s public health defenses, which showed themselves to be woefully unprepared for the coronavirus pandemic.

“Her written proposals included some good ideas, including loosening the state’s excessively restrictive professional licensing and ‘certificate of need’ laws. Those laws hurt consumers by constraining the supply of health care services, which reduces choice and increases costs.

“At the same time, Hochul is proposing to spend even more state funds on capital projects at hospitals and other health-care providers — a dubious of use taxpayers’ money that would also be redundant. The state has already committed $5.4 billion for health-care capital over the past eight years, including $1.6 billion in 2022 – and all but $1.7 billion remained unspent as of last spring.”

The Empire Center, based in Albany, is an independent, not-for-profit, non-partisan think tank dedicated to promoting policies that can make New York a better place to live, work and raise a family.

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