State budget fallout: A weakened Cuomo, emboldened lawmakers

ALBANY — Gov. Andrew M. Cuomo’s weakened political position, a growing Democratic majority in the State Legislature and public bickering by progressives made for extraordinary closing moments in New York’s annual state budget ritual.

Cuomo, who held an iron grip on the state’s budget during his first 10 years in office, failed to stop income tax hikes on the wealthy and corporations.

Emboldened legislators won significant victories on school aid, recreational marijuana, immigrants who are in the country illegally and the use of solitary confinement in state prisons.

Democrats took shots at one another online and in legislative chambers. Some even publicly blasted the party’s state chairman and the leader of the Assembly, in an unusual step, used his closing remarks on the budget to urge his colleagues not to break ranks.

All of it was laid bare in the days leading up to lawmakers’ adoption of a $212 billion state budget late Wednesday.

The budget parameters alone showed the shifting political sands.

The budget raised spending $18 billion, or nearly 10%, boosted school spending a record amount, expanded prekindergarten programs, froze public college tuition, permitted mobile sports betting and hiked taxes on the wealthy — things Cuomo opposed at one time.

"The New York budget represents a massive shift from 10 years ago … This isn’t Andrew Cuomo’s budget anymore," Zephyr Teachout, who challenged Cuomo in the Democratic gubernatorial primary in 2014 and ran for attorney general in 2018, said on Twitter.

Cuomo, facing multiple investigations and the threat of impeachment, agreed to $4 billion in tax hikes — the largest single increase anyone can remember, legislators said. The Democratic governor had opposed tax hikes on the wealthy and businesses, saying it would drive them to leave New York. He had subdued past calls to raise taxes, but not this time.

With it, he lost one of his favorite campaign lines: Every New Yorker pays a lower income-tax rate than when he took office in 2011.

For his part, Cuomo said he achieved all his budget priorities: He said it helps the state continue to manage the pandemic, provide relief for many of the hardest hit and "reposition New York, re-imagine New York, reconstruct New York, renew New York for the next 20, 30, 40 years."

Said the governor: "It's a timely budget and under extraordinary circumstances, and it's the most important budget, the most important plan that we've done."

But he didn't exert as much control as in the past, analysts said. The tax hikes were the clearest example of the changed dynamics in Albany, said George Arzt, a longtime Democratic consultant.

"The governor still has an outsized role in the budget and still gets most of what he wants," he said. "However, it would seem his grip on major legislation is loosening. Clearly the drama surrounding him has altered the way he leads and the intimidation he always showed the left."

Cuomo is facing multiple investigations. Attorney General Letitia James is overseeing a probe of sexual harassment allegations leveled at the governor, including accusations by four former or current members of his administration.

The federal Department of Justice is investigating his administration’s handling of COVID-19 and nursing homes. And the State Assembly has launched an impeachment inquiry looking at those issues and others, including the governor’s recent book deal and reports that family and friends of the governor got priority virus testing last year when tests were scarce.

Cuomo has resisted calls for his resignation — including from the state’s two U.S. senators, Charles Schumer and Kirsten Gillibrand. He has denied wrongdoing and urged New Yorkers to await the outcome of the investigations.

On the budget, Cuomo had proposed to keep spending relatively flat, pending more federal aid. The Biden administration pushed through a stimulus package that sent $12.6 billion to state government — about $6 billion more than Cuomo counted on in January and enough to wipe out the state’s budget shortfall. But it also was $3 billion less than he requested.

Even with the aid, the Democratic-dominated Senate and Assembly went further, making the total spending hike $18 billion.

Cuomo used to like to say he was the only progressive left in New York, Syracuse University political scientist Grant Reeher said. But legislators clearly are pushing him further left.

"New York had a significant budget problem prior to COVID and Cuomo was already warning about it," Reeher said. "Then COVID hit. Then the federal government comes in with enough money to cover it and the left reacts by spending even more money and raising taxes to do it."

Democrats were emboldened by rapid gains in the Senate. They had long controlled the Assembly but Republicans held the Senate before massive losses in 2018. That year Democrats also ousted most members of a renegade Senate wing calling itself the Independent Democratic Conference that had helped Republicans stay in power.

Democrats gained even more seats in 2020 and now hold supermajorities — enough to override any gubernatorial veto — in both houses. And with it, momentum to push the agenda.

"Make no mistake: Taking the Senate majority … has changed our state forever," wrote state Sen. Michael Gianaris (D-Astoria) on Twitter after the tax hikes were approved. "The wealthiest who did so well last year will now help fund: More school aid. Rental assistance. Excluded workers. Small biz relief and more."

If anything, Democrats this budget season had tougher fights among themselves than against Republicans in the Legislature.

A significant number opposed creating a $2.1 billion fund for "excluded workers" — people in the country illegally who lost their jobs during the pandemic but were not eligible to receive unemployment or stimulus benefits. As originally proposed, the excluded worker fund also would cover ex-prison inmates who had lost their jobs.

In the end, the latter provision was dropped and the state benefit was made taxable. But not before some progressives implied opponents were racists, one moderate accused a progressive of giving him the finger during a Democratic Zoom conference, a progressive complained about being strong armed, and party Chairman Jay Jacobs of Nassau County issued a statement that said questioning the policy initiative doesn’t make someone racist.

That didn’t go over well. Sen. Alessandra Biaggi (D-Pelham) said Jacobs was "unfit to lead the future" of the party.

So when Assembly Speaker Carl Heastie (D-Bronx) went on the rostrum shortly after 11 p.m. Wednesday to make his customary closing remarks upon the passage of the budget, he addressed the intraparty tension.

He said getting consensus on the budget always was difficult but told Democrats that governing was a team sport and they needed to act like it.

"If we get on the field and run a different play than what we called in the huddle," bad things will happen like sacks and fumbles, Heastie said.

The institutional dynamics in Albany have changed and there’s a "change in the points of view of Democrats being elected," said Gerald Benjamin, a SUNY New Paltz dean and longtime state politics observer, noting that the state has moved steadily left politically.

"There’s tension now between progressive and more mainstream Democrats," Benjamin said. "It’s reflective of the demographic and electoral changes in New York."