Albany, NY — After nearly a week’s delay, Governor Kathy Hochul has finally announced a budget deal. Though the legislature has yet to formally agree to most of it, the governor disclosed numerous specifics of the purported $220 billion deal. The comments below are based on budget information released so far, which is incomplete. Our experts will review further details as they become available.

On taxes:

“The deal’s $220 billion price tag includes a double-digit hike in state-operating spending — the dollars the state must raise on its own — for recurring expenditures subject to unpredictable growth. That means taxpayers are being set up for a hard fall. Unsustainable spending can only result in abrupt service cuts or counter-productive tax hikes,” said Peter Warren, director of research at the Empire Center.

“The budget punts a billion dollars of public money toward a football stadium boondoggle that will primarily benefit team owners and the Building and Construction Trades Council. Sidelined from participation are most Buffalo-area construction workers — those who don’t belong to a union.

“Despite accounting for federal COVID relief funds, the budget fails to invest in the state’s recovery by paying down the $9 billion in unemployment insurance trust fund debt New York racked up because two million residents were thrown out of work due to the pandemic and related lockdowns. That leaves employers — including small businesses — footing the bill, which weighs down the state’s tepid jobs recovery.

“Rather than reducing business taxes broadly, the budget doubles-down on the state’s tried and failed strategy in which government picks winners and losers. By maintaining business as usual, the budget ensures New York will continue to rank among the least tax friendly business climates among the states.”

On health care:

“New York’s Medicaid home care program is a national outlier — with higher per capita spending and employment than any other state — and it’s growing fast. Any labor shortages that persist in that context are a sign of deeper dysfunction that demands thoughtful reforms, not knee-jerk solutions,” said Bill Hammond, senior fellow for health policy at the Empire Center.

“In the absence of other actions, the proposed mandatory wage hike for care aides is likely to aggravate labor shortages for hospitals and nursing homes — and further drive up health-care costs for taxpayers, employers and average New Yorkers.”

On the environment:

“The state’s unprecedented CLCPA has a staggering price tag, likely costing more than half a trillion dollars to implement. How it will be financed is already unclear and the state budget does very little to address that,” said James Hanley, senior policy analyst at the Empire Center.

“While a goal of electrifying the state’s school bus fleet by 2035 may be noble, if not lofty, the state has only created another unfunded mandate on local school districts. With a total estimated cost of $7.5 billion, the $500 million in the budget isn’t even ten percent of the total price, leaving school districts on the hook for another half a billion dollars per year.

“Fortunately, a measure to ban gas hookups in new construction appears to have been withdrawn from budget negotiations. This is clearly a policy issue without significant budget implications, so it is properly considered in the post-budget legislative session. This will allow for a more thorough airing of the costs and benefits of such a policy, including the effects on housing prices for moderate- to low- income New Yorkers.”

On public ethics:

“New Yorkers, both in and out of government, overwhelmingly agree that the Joint Commission on Public Ethics has been a complete and total failure since its inception. Undoubtedly it should be abolished, but doing that work in secret, shoved inside a budget bill, as is purportedly being done, is an abomination and an insult to every New Yorker, said Cam Macdonald, adjunct fellow at the Empire Center.

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The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.

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