Governor Cuomo delivered his combined State of the State Message and 2019-20 State Budget Presentation yesterday to the State Legislature at Albany’s Empire State Plaza. Lt. Gov. Hochul, State Comptroller DiNapoli, State Attorney General James, Assembly Speaker Heastie, Senate Majority Leader Stewart-Cousins, Budget Director Mujica and top Cuomo administration officials were also present . The speech formally began the 2019 legislative session, as well as two-and-half months of state budget negotiations. The deadline for approving the budget is April 1.
The Governor’s first budget of his third term was delivered to an all-Democratic State Legislature for the first time in his tenure. Lawmakers have already begun approving some top policy issues including reforms to the state’s voting laws and protections for transgender New Yorkers. Other proposed initiatives popular with Democrats include legalizing marijuana, making college aid programs available to children of people in the country illegally, a stronger abortion law and changing the state’s bail system. Additional measures Cuomo would like advanced are on gun control, election reforms, a ban on campaign contributions from corporations, the creation of a public financing system passage of the DREAM Act, and congestion pricing for the MTA.
Early details on the State Budget:
- The Governor proposed a $175.2 billion state budget ($178.3 billion including closing the current $3 billion gap, which the Governor largely attributed to federal policies) Revenues from personal income taxes are down $500 million from last year’s projections.
- He proposed keeping higher income-tax rates on millionaires set to expire at year’s end, and extending the 8.82 rate through 2024, noting it provides about $4.4 billion to the state’s coffers.
- He wants to make the state’s 2% property-tax cap permanent;
- He would lower the state tax rate from 6.85% to 5.5% for those earning between $40,000 and $150,000, and from 6.85% to 6% for those earning between $150,000 and $300,000.
Homeowners earning between $250,000 to $500,000 a year would get a check back for their STAR rebates to help pay for school taxes, rather than receiving the savings directly in their tax bill. (H omeowners who earn less than $250,000 a year and have owned their houses prior to Aug. 1, 2015 would continue to get STAR as an upfront savings on their school-tax bills.)
- He would boost school aid just 3.6 percent, and use monetary settlements to keep budget growth at two percent.
- The Governor said the $10,000 annual limit on the federal deduction for state and local taxes (SALT) provisions have hit New York taxpayers harder than in many other states, representing a 30% tax increase for many New Yorkers, which threatens state fiscal stability and could contribute to a housing crisis.
In terms of banking industry , the Governor’s State of the State indicated he plans to introduce legislation to prevent abuse of confession of judgment/stop predatory merchant cash-advance loans.
In the proposed state budget , Article VII Regulation of student loan servicers appear to be unchanged from last year’s budget. It would require student loan servicers to be licensed by DFS, and would establish a regulatory framework for the industry in New York. The bill is necessary to implement the Fiscal Year 2020 budget.