- Democrats control the entire state legislature and the governor’s mansion in New York for the first time in nine years.
- Given the newfound power, Democrats agreed to a budget that will have sweeping effects for New Yorkers.
- The new budget includes changes to the tax code and criminal-justice system, and even a ban on plastic bags.
After years of a divided government, Democrats are bringing sweeping changes to New York with a new budget deal, and the changes will be big for New Yorkers.
It was the first time since 2010 that the party controlled both chambers of the state’s legislature and the governor’s mansion, allowing Democrats to introduce sweeping changes to the criminal-justice system, tax code, infrastructure, and more.
While the budget fight was not without contention, Gov. Andrew Cuomo and Democrats in the state legislature signed off on the deal on Sunday. Cuomo said the deal contained “landmark policies that will bring sweeping transformation and social justice reform to the state.”
Here’s a rundown of a few of the biggest changes:
- Imposition of congestion pricing in parts of New York City: Congestion pricing has been a long-debated topic in New York, and the new budget finally approved a surcharge for driving in some of the busiest parts of Manhattan. While the exact pricing has not been set, a plan backed by Cuomo and other Democrats would charge drivers to enter Manhattan’s main business district, starting from 60th St. and extending south to Battery Park at the tip of the island. Advocates say the plan could raise about $US1 billion a year. Proponents say the plan will reduce traffic in some of the busiest areas of the city, reduce carbon emissions, and give the Metropolitan Transit Authority (MTA) more funds to help improve the city’s struggling public-transportation system. Advocates point to similar plans in cities such as London that have helped reduce traffic. Opponents say the charge is an unfair tax on commuters who live in the outer parts of the city and commute by car.
- Increased taxes on high-priced real estate:While progressives pushed for a tax on second homes – called a pied-à-terre tax – the budget deal ultimately included a less-aggressive tax on high-priced real estate. A pied-à-terre tax would have been an annual tax on second homes valued at $US5 million or more, which New York real-estate brokers said would have been devastating for the high-end market. The final deal instead included an increase to the one-time “mansion tax.”
- Instead of a flat 1% tax on the value of a real-estate purchase above $US1 million, the new budget will create a graduated scale that tops out at a one-time 4.15% tax on purchases over $US25 million. The plan is expected to raise $US365 million annually.
- Increased spending on education: The budget for education will rise by a little more than $US1 billion next year to $US27.9 billion for 2019-20.
- A cash infusion for the MTA: Funding for the new congestion pricing and real-estate taxes would also allow the state to issue $US35 billion in new bonds that would then go toward transportation infrastructure. While some money would go to the Metro-North Railroad and the Long Island Rail Road, a large chunk would be put toward the MTA’s massive efforts to overhaul New York City’s transportation system. But the new money does not come without strings, the agency has until June 1 to come up with a reorganization plan to better streamline its bureaucracy.
- A permanent cap on the property taxes:Cuomo’s top priority was to make permanent a cap on the amount that a locality can increase property taxes in a single year. The governor also wanted to make sure the 2% annual increase limit did not contain loopholes. Cuomo got the cap.
- An overhaul to the bail system: The state will do away with the cash-bail system for a majority of crimes, which requires defendants to give a monetary deposit to the government in order to be released from jail while awaiting trial. Advocates say that cash bail disproportionately harmed low-income people and minorities. In New York, 33,000 defendants were unable to post bail in 2017.
- Adjustments to trials: The budget also imposes new rules that would force prosecutors to hand over evidence that could be beneficial for a defendant earlier in the trial process. The budget also calls for reforms to make trials speedier.
- A ban on plastic bags: The budget would also ban most types of single-use plastic bags, such as those used at grocery stores. The ban does have some exceptions, including garment bags, bags used for food delivery, and newspaper bags.
- Moves forward with a political campaign donation matching system: While details need to be worked out, the budget also creates a commission that would design a new election-donation-matching system. New York City has a program in which campaigns can opt-in to the matching program, and for every $US1 a city resident donates to the campaign, the city gives the campaign $US6. Candidates that opt-in to New York City’s program are placed under strict limits on the types of fundraising they can do. It’s unclear how expansive the commission will make the state program.
One element sought by progressives that was not included in the budget deal was a proposal to legalise recreational marijuana use in the state. The legislature could still take up another bill to do so, but not including the change in a budget deal makes its passage less likely.
Business Insider Emails & Alerts
Site highlights each day to your inbox.