N.Y. Gov. Hochul proposes $233B budget with $2.4B for migrants

ALBANY — Gov. Hochul on Tuesday proposed a $233 billion budget that would include about $2.4 billion for the city’s migrant crisis, vowing not to raise taxes but declaring that the state “must support the City of New York in this moment.”

The governor continued her calls for more federal support to assist with the asylum seeker surge — saying that she would visit Washington, D.C., on Friday — but said she expected the city would continue to be “swimming against the tide” for the time being.

As part of her budget plan, Hochul said she would make a one-time dip into the state’s financial reserves to support the city with what she called a “humanitarian crisis.”

“We’re doing this not just because it’s the right thing to do,” the governor said in a speech from Albany. “We also know that companies won’t do business in New York if there are thousands of people sleeping on the streets.”

Almost 70,000 asylum seekers are in city care, according to government estimates. Throngs of migrants, many fleeing political upheaval and poverty in Central and South America, have streamed into the state since spring 2022, some apparently attracted by New York City’s unique rules requiring the government to shelter arrivals.

Hochul’s budget proposal sets off months of negotiations with lawmakers ahead of an April 1 deadline to pass the budget.

Last year, talks ran a month late. This year, negotiations may be somewhat less prickly: Hochul struggled last year to reach agreements with lawmakers as she sought and secured changes to bail reform, and pushed an ambitious housing program that fell through.

Overall, Hochul’s election-year budget proposal outlined Tuesday would come out to about a 2% increase from the $229 billion budget that the governor and lawmakers approved last year.

The left-leaning state Legislature is expected to seek to push the overall budget price tag up. But it was not immediately clear how lawmakers would receive the governor’s proposal on migrant costs.

“Since the beginning of time, governors come in low, and I think legislators like to come in high — and we’ll just see where we end up,” Assembly Speaker Carl Heastie, a Bronx Democrat, told reporters Tuesday afternoon.

The speaker appeared receptive to Hochul’s plan to use reserves to support migrant funding. Hochul decided to propose drawing on $500 million in reserves only in the final 24 hours or so before her speech, according to her budget office.

“Reserves, rainy day funds — it’s supposed to be for difficult times,” Heastie said. “I think this is a difficult time.”

The proposed migrant investment, a significant sum that figures to draw sharp criticism from Republicans and more than doubles what Hochul had previously floated, would exceed the state’s $1.9 billion commitment in the current budget cycle.

Hochul and the Democratic-controlled Legislature agreed to about $1 billion in funding for the asylum seeker challenge in the current cycle, but the governor — under pressure from her ally Mayor Adams to help the city — increased state migrant funding to $1.9 billion in the 2024 fiscal year budget.

Hochul’s 2025 fiscal year budget proposal would put at least $1.1 billion toward migrant shelter costs, according to the state Division of Budget.

The blueprint would reserve more than $650 million for costs at sprawling migrant shelters at Floyd Bennett airfield in southeast Brooklyn; at the Creedmoor Psychiatric Center in eastern Queens; and at Randalls Island.

Hochul’s plan also includes almost $8 billion in spending for the Metropolitan Transportation Authority, and investments numbering in the tens of millions for new crime-fighting efforts, youth mental health services and efforts to grow trees in New York.

Hochul proposed $45 million in state funding to build the Interborough Express, a light-rail project that would connect Brooklyn and Queens residents to more than a dozen subway stations by running trains along a scarcely used freight rail line.

She also said she plans to put aside $16 million for feasibility studies and early engineering for a westward extension of the Second Ave. subway along 125th Street in Manhattan.

Addressing the state’s severe housing shortage, Hochul reiterated many of the points she made in her State of the State address last week, including her support for a replacement and four-year extension of the expired 421a tax exemption, a tax break for housing developers that is controversial in the Legislature.

She also outlined $650 million in discretionary funding intended to encourage housing creation in development-averse areas such as Long Island.

In Hochul’s plan, state Medicaid spending would be hiked to almost $3 billion, a roughly 11% year-over-year increase, according to the state budget office.

Hochul’s office said that revenues came in higher than previously projected, helping the state to close a projected $4.3 billion budget gap for the upcoming year.

In her remarks, Hochul addressed potential criticism from left-wing members of the Legislature who want the state to lift taxes on the rich and to spend more aggressively, describing her plan as fiscally responsible given “sizable deficits” projected in future years.

“We can’t spend like there’s no tomorrow, because tomorrow always comes,” she said.

She also reiterated her opposition to increasing taxes, telling reporters that her answer to lawmakers pushing for hikes is firm.

“I will say no,” Hochul said.

The directors of the progressive New York Working Families Party issued a statement Tuesday afternoon saying that the state must “raise taxes on the ultra wealthy and invest deeply in housing, child care, education, and climate resiliency.”

The governor’s budget proposal also promised criticism from her right.

“Democrats have failed at the border and here in NY, and the price of their incompetence is going up,” William Barclay, the Assembly’s Republican minority leader and an Oswego Republican, said by text ahead of Hochul’s remarks.

At the same time, State Sen. Brad Hoylman-Sigal of Manhattan, smiled on the proposed outlay.

“It’s a welcome lifeline from Albany,” Hoylman-Sigal, a Greenwich Village Democrat and a member of the Senate leadership, said by text as he rode the train to Albany on Tuesday morning.

“I hope this funding goes a long way towards helping the City avoid cuts to vital infrastructure like schools and libraries,” he added.

Adams, a centrist Democrat, had not publicly set a number for how much money he wants the city to receive from the state for migrants in the next budget cycle.

But after visiting Albany to watch Hochul’s State of the State speech last week, Adams described the governor as a “partner.” He told reporters at the state Capitol that funding for the city’s migrant crisis is the “most important thing” for the city in the state budget.

See also: Takeaways from New York Gov. Hochul’s state budget plan

Mayor Adams’ $109B budget spares NYPD, homeless services, schools, libraries, sanitation: source

The mayor’s office, which outlined the city’s budget proposal on Tuesday afternoon, projected that the city’s migrant-related costs will reach $10 billion by summer 2025.