Governor Kathy Hochul unveiled a record-setting executive budget proposal of $227 billion on Wednesday. The budget seeks to double the growth of the state’s housing over the next decade, invest $1 billion in mental health services, and address crime through community-based services and changes to the bail laws.
Governor Hochul says she is committed to a fiscally responsible approach and has taken steps to rebuild the state’s financial future. This is evident in her decision not to raise income taxes this year despite a growing number of economists predicting a recession.
The budget proposal marks the start of a two-month negotiation period for some of the most debated state policy proposals. It will also be a test for Governor Hochul’s position on policy initiatives after her narrow election victory in November. The budget plan comes as Governor Hochul seeks to keep a balanced budget in the face of a projected recession and declining tax revenues. Despite out-year gaps in the budget, the governor remains confident that the state will be able to afford its investments without dipping into reserves.
Governor Hochul’s budget prioritizes reducing debt overspending and controlling new borrowing. The state comptroller’s office recently warned of a 42 percent hike in state debt by 2026 and an over-reliance on borrowing to fund capital projects. However, administration officials refute this characterization and state that debt will remain affordable. relies on a disciplined approach to control new borrowing as the state prepares to spend $95 billion in capital projects over the next five years. This includes $6 billion in cash resources to fund capital projects using the “pay as you go” model.
Governor Hochul is also proposing changes to the state’s bail laws, with the goal of restoring judicial discretion and removing the “least restrictive” standard for judges. The governor is laser-focused on addressing the gun violence epidemic and is dedicated to ensuring that the criminal justice system is fair and just for all. The budget proposal has come at a fraught moment in state politics, with the first-ever appointment of a judge to lead the state’s highest court being met with opposition from progressives. Overall, Governor Hochul’s budget proposal seeks to balance fiscal responsibility with progressive values and political priorities.
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