New York lawmakers gave their final approval to a $268 billion budget that will include a tax on second homes in New York City, pension sweeteners, and utility rebate checks.
The majority-Democratic state legislature signed off on the remaining final budget legislation late Wednesday night, approving Gov. Kathy Hochul’s slate of policies she contends will improve affordability for New York residents. Hochul, a moderate Democrat, has been criticized by several progressive lawmakers who had split with the governor over her weakening of the state’s 2019 climate law and refusal to raise income and corporate tax rates.
The budget will also include $4 billion in aid to New York City, with Mayor Zohran Mamdani leaning on Hochul for state assistance in closing a budget deficit he has said his administration inherited.
Democratic leaders said the state budget is a response to actions by the Trump administration, including those contained in President Donald Trump’s “one big, beautiful bill” or H.R.1.
“The budget process has unfolded against a backdrop of national economic uncertainty, far-reaching consequences of a reckless war,” said Senate Majority Leader Andrea Stewart-Cousins on Wednesday.
“We are lowering costs, we are investing in people, we are continuing to move our state forward,” she added.
The state budget is nearly two months delayed by protracted negotiations between Stewart-Cousins, Assembly Speaker Carl E. Heastie, and Hochul over her signature policies to amend the state’s climate law to delay a key emissions target from 2030 to 2040 and to change the insurance payout system in cases of auto accidents, both bids to tamp down inflationary costs related to energy prices and auto insurance premiums.
Progressive advocates had held out for higher tax increases on wealthy residents and corporations but were ultimately disappointed.
The advocacy group Invest In Our New York said in a statement Hochul sided “with her billionaire donors instead of working-class people,” cheering the pied-à-terre tax on second homes but arguing it did not go far enough. The group vowed to continue pressuring Hochul on tax hikes next year.
The budget does not account for federal cuts to Medicaid, which will affect at least 460,000 residents who will lose certain health insurance benefits by July. It does include a prohibition against local law enforcement from cooperating with federal immigration agents.
Republicans overwhelmingly criticized the final enacted budget. Senate Minority Leader Rob Ortt said the budget, rather than improving affordability, contained measures “handicapping law enforcement, making things more expensive, increasing taxes, bailing out a socialist mayor in New York City.”