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This afternoon, Governor Kathy Hochul released her 2023 Executive Budget proposal. Her State of the State address in January provided a rough outline of what to expect in the year ahead; the Executive Budget adds details and gives a clearer picture of the Governor’s priorities.

The Executive Budget is not a final document. The Senate and Assembly will submit their own budget proposals, and all three will negotiate differences over the next eight weeks. A final enacted budget must be passed by April 1.

Highlights of Governor Hochul’s $227 billion proposal:

Energy

• Gradual ban on natural gas connections and appliances.
• “Cap-and-invest” system that will force employers to bid for an increasingly-scarce amount of “emissions allowances.”
• Allowing NYPA to build and operate its own renewable energy generation sources.
• $200 million to help New Yorkers earning below the state median income pay their electric bills.
• $200 million to help low-income families electrify their houses.

Minimum Wage

• Indexing the state minimum wage to inflation, specifically, by using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the Northeast. Annual increases would be capped at 3%. Under her proposal, the minimum wage would not increase in the event of certain economic conditions, such as large increases in unemployment.

Housing

• Statewide goal of building 800,000 new housing units. To do so, the Governor proposes requiring all upstate municipalities to increase their housing stock by 1% every three years. Municipalities that fail to meet their target must develop compliance plans from a list of state “Preferred Actions” designed to grow housing capacity. Otherwise, municipalities would be required to approve proposed affordable housing developments.
• $250 million infrastructure fund to enable the development of new housing options.
• Relief in environmental reviews for housing projects.
• Additional funding for the Emergency Rental Assistance Program.

Education

• $2 billion in new capital funding for SUNY/CUNY.
• 50% state match on donations to endowments at SUNY university centers, including UB.
• Allowing SUNY campuses to raise tuition.

Healthcare

• Historic increase in Medicaid funding.
• 5% increase in Medicaid rates for hospitals, nursing homes, and assisted living facilities.
• 7.2% increase in mental hygiene funding.
• $1-per-pack increase in the tobacco tax.

Business & Economic Development

• $845 million in new economic development programs, largely distributed through REDCs.
• New Office of Semiconductor Expansion, Management & Integration, designed to lure more businesses like Micron.
• Replacing the Start-Up NY Program with a new Extended Prosperity & Innovation Campus (EPIC) Program. Similar to Start-Up, EPIC will provide startups with capital and other business supports, and also offer ten years of tax exemptions. EPIC places a greater focus on startups partnering with universities to reap the benefits of shared facilities and collaboration.
• Increased aid to childcare providers, and a new business income tax credit for businesses that provide childcare for their employees.

Unfortunately, the Executive Budget proposal did not contain any mention of Unemployment Insurance rate relief. As employers face UI rate increases and surcharges to pay down the state-incurred federal debt, the BNP has been calling on the state to act.

Next week, the BNP is hosting its annual Legislative Lunch. At this event, you will hear the BNP’s formal budget reaction, hear the priorities of legislative leaders, and connect with your elected officials. Register today!