There’s a lot to digest in Governor Kathy Hochul’s proposed 2025–26 budget.
Let’s be optimistic and start with the more positive elements.
THE GOOD
Middle class taxes
The governor is touting that she is lowering the middle class tax rates (that is, five of the nine brackets) to the lowest level in decades. The problem is that as, of press time, we have been unable to quantify what that actual deduction means for each household.
The middle class brackets were already at a relatively low rate compared to previous times in New York, so a further reduction, even if just nominal, can be touted as the lowest in some time. Is it a mere trivial amount just to get the headline? If so, then it will be mostly fluff. The numbers still have to be crunched.
More money to combat subway crime
The governor tried to flex her crime-fighting muscles in years past by sending New York State troopers to be visible in the subways. It had little to no effect. Crime was not reduced because a state trooper was walking the halls of Grand Central Station. The crime is occurring in the subway cars and on the platforms. That’s where they’re needed.
The governor has now switched her emphasis to providing more money for overtime to place more New York City police officers in the subway. This could be helpful if they’re indeed placed on the subway platforms and the cars themselves. The question is: What took so long?
Intermodal monies
There’s a desperate need to get trucks off of Long Island’s highways. Expanding intermodal transport is key. That entails constructing rail yards from which to deliver the materials. The problem hasn’t been so much a lack of funding as it has been zoning and community opposition to get these into facilities in place. The extra money can’t hurt, but, hopefully, the state can incentivize localities to work with the state in making these intermodalities a reality.
THE BAD
Extending high-earner tax increase
The so-called temporary surcharge on high-end earners in New York is no longer temporary. It’s been bumped into the future yet again. One may say, “So what? Who cares if we tax those making millions of dollars a year?” But the problem is, in today’s world, they can be mobile and leave anytime they want. In fact, too many of our higher earnings have already changed their addresses to Florida, where there’s no state income tax. The more of these higher earners we lose, the less revenue we actually bring into our coffers.
Bigger spending
The governor would help us far more as a state if she cut spending. Unfortunately, spending in this budget is increased by another 3.6%, bringing the total budget to an astounding $252 million. That’s an enormous increase since 2019, the year before the pandemic. It appears that the massive spending increases during Covid, which were meant to be an anomaly due to the infusion of one time federal grants, has now been incorporated into the base and is the new normal.
More climate spending with few results
Spending is exacerbated by yet another billion dollars funneled into Hochul’s ineffective climate programs. Despite the billions spent by the governor and her predecessor, Andrew Cuomo, on trying to make us an alternative energy state, the carbon input from the state has actually been increasing.
Yet our electricity bills have been going through the roof. Money should be directed to research and development rather than subsidizing inefficient industries and telling us we can’t use a gas stove or drive a gasoline-powered car.
STILL UNKNOWN
One of the highly anticipated potential actions by the governor was her claim she would seek to modify the 2019 evidence laws which severely handicapped local district attorneys in prosecuting crime. The laws required an enormous amount of effort by the local district attorneys to supply an unreasonable amount of information to defense counsel in just a few weeks. Consequently, many DAs had to simply give up on prosecuting many violent crimes. The governor said she was going to include these changes in her budget. We didn’t see whether or not it was included. It would be a major missed opportunity if she declines to address this issue in the upcoming session.