NY Legislature to return with affordability, deficit on its mind

ALBANY — Lawmakers return to the State Capitol on Wednesday looking to kick off a legislative session focusing broadly on “affordability” issues, but might be limited by a looming budget deficit.

The State Senate and Assembly officially open the 2024 legislative session this week with a largely ceremonial first day. The action begins the following week, highlighted by Gov. Kathy Hochul’s outlining of goals in her State of the State address on Jan. 9.

It is a session lining up to perhaps be dominated by holdover issues from 2023, ranging from housing stock to tenants’ rights, college finances to spending on migrants, and marijuana dispensaries to renewable energy, according to legislators.

The major political issue will be a repeat, too: drawing new boundaries for the state’s 26 congressional districts.

But while the issues might be familiar, the state’s financial picture has changed.

Gone are the generous federal government outlays that came during the COVID-19 pandemic. The influx helped states cover revenue shortfalls and boost spending on a range of programs.

The Hochul administration has said the state’s projected deficit for the next fiscal year is estimated at $4.3 billion. While that’s better than the original estimate of $9 billion, the governor has asked state agencies to “hold the line” on spending in their requests for the new budget.

“We’re not in fiscal crisis, but we’re also not rolling in dough from all the federal COVID aid. We’re somewhere in the middle,” Assemb. Fred Thiele (D-Sag Harbor) said.

It sets up classic tension between a legislature whose members are up for election in November and a governor who doesn’t have to run again until 2026, said Blair Horner, executive director of the New York Public Interest Research Group.

“The pressures will be different on the executive and legislative branches,” Horner said. “For the legislators, it’s not popular to cut programs in an election year.”

Whereas the governor “will be dealing with this with an eye toward ’26,” which means holding firm now because, Horner said, “Typically, you make your tough fiscal decisions earlier in your term.”

The budget is supposed to be adopted April 1. It is supposed to deal just with financial issues, but lawmakers typically load it up with policy issues because it’s a way to negotiate thorny issues and make trade-offs.

Expect more of the same this year. Even though the session runs into June, most of the major issues either will be settled within a budget deal or put on hold until 2025, Horner said.

“Once they get done with the budget, I think lawmakers will be eyeing the exits,” he said. “With primaries coming at the end of June, they aren’t going to want to hang around in Albany.”

Among the top issues will be housing, lawmakers and officials said.

Last year, Hochul sought to address affordable housing by prodding communities to build more units. The idea was doomed politically when she included a provision that would allow the state to override local zoning decisions.

Legislators countered with proposals to create a pot of money to provide incentives for local governments. But no agreement was reached. Legislators say they expect it will be at the top of the agenda this year.

Lawmakers also may work on higher education funding and student grants, especially in the wake of several private colleges closing and the sprawling State University of New York system reducing programs on some campuses.

They also could look to address the state’s slower-than-expected opening of legalized marijuana dispensaries. Another topic will be how to reach New York’s renewable energy goals.

Funding to aid migrants arriving in New York also will continue to be on the agenda, lawmakers said, even while saying it’s an issue primarily for the federal government.

Redistricting might be the highest profile issue. New York’s top court agreed with Democrats in a lawsuit and last month ordered congressional boundaries to be redrawn.

A bipartisan redistricting panel is supposed to present proposals to the legislature no later than Feb. 28. With Democrats controlling both houses, the party has a chance to alter boundaries to help its candidates but also risks going too far and being sued for gerrymandering — which is what happened in 2022.

With Republicans holding a narrow majority in the U.S. House of Representatives, New York’s map could impact the balance of power — which is why it will draw national scrutiny.

Beyond lawmakers' “must-do” list, national themes and campaigns probably will have a bigger impact on what happens in Albany, said Lawrence Levy, executive dean of suburban studies at Hofstra University. It will impact what issues legislators tackle — or put off. The presidential election and congressional elections also will have an impact on how the parties position themselves, he said.

“This year, more than any I can remember, it’s not going to be about the little things. It’s going to be about the branding of the parties — what do they stand for as we go into the presidential and congressional and legislative elections,” Levy said. “The Albany agenda is going to be nationalized more than I can remember.”

By Yancey Roy

yancey.roy@newsday.com@yanceyroy