Kathy Hochul Unveils Record $216 Billion Budget Plan for NY


Mr. Cuomo warned just a year ago that, without significant federal aid, the state was staring at a daunting $15 billion deficit because of the pandemic, and would have to enact a “doomsday” budget with tax hikes and spending cuts. Before him, former Gov. David A. Paterson faced a ballooning state deficit and state debt during the Great Recession, which roiled the economy and decimated the state coffers.

Ms. Hochul inherited a state looking down the road at years of balanced budgets, thanks in part to revenue from income tax increases on the wealthy that the Democratic-controlled Legislature passed last year. That gives the governor more flexibility to steer money to fund her most immediate priorities, even though she will face the typical frenzy of lawmakers and special interest groups with ideas of their own of how to spend the state’s extra money.

But New York’s rosy fiscal outlook masks some uncertainty: The current projections rely on a significant influx of pandemic-era federal aid, about $22 billion over four years, an unsustainable revenue source that will evaporate over time. State officials used a large part of the federal aid in this year’s budget, which included $2.3 billion to help tenants late on rent and a $2.1 billion fund to provide one-time payments for undocumented workers.

And with so much of the state budget reliant on tax revenue from high-income earners, lingering questions about population loss, the future of remote work and how quickly Manhattan will rebound could have seismic effects.

New York lost more than 300,000 people in the past year, according to census records — the greatest loss of any state. New York City’s 9.4 percent unemployment rate is more than double the national average. Reversing that trend, in part by telegraphing that New York is open for business, will be crucial for the governor.

Ms. Hochul committed to placing 15 percent of the state’s operating expenses into reserves — a historic number, but less than the 17 percent figure recommended by independent budget analysts.

Nonetheless, fiscal experts said that with so much money to work with, the governor could help put New York on a path to financial stability, or increase spending on new programs to help people struggling during the pandemic and shore up floundering ones, focusing on child care, health care, housing, education, transportation and green infrastructure.

“We actually have enough money to do both — that’s the amazing thing,” said Andrew Rein, president of the nonpartisan Citizens Budget Commission. “The risk is the feeding frenzy, the fiscal cavorting, the fiscal hangover.”



Read More: Kathy Hochul Unveils Record $216 Billion Budget Plan for NY

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

Live News

Get more stuff like this
in your inbox

Subscribe to our mailing list and get interesting stuff and updates to your email inbox.

Thank you for subscribing.

Something went wrong.