NY Money Trail

State Budget Grind, Election Power Play, Precarious Congestion Pricing

Author

Jack O’Donnell
February 03, 2025

Good morning from Albany, New York where the 2025 Joint Legislative Budget Hearings are in full effect, resuming tomorrow with Local Government/General Government at 9:30 a.m.

Legislative hearings continue throughout February and are followed by the Senate and Assembly developing their respective One-House budget proposals. This will lead to negotiations on a final budget, with the goal of completing it by the end of the state fiscal year on March 31st. Watch a live stream of tomorrow’s hearing as well as all future budget hearings here. 

While Albany's focus is on the 2025 legislative session and the upcoming budget, there is still a lone bill remaining from the last legislative session that remains unaddressed. Governor Kathy Hochul has until Friday to act on a bill that would increase the reimbursement rate for after-school busing for private schools in New York City. The issue is particularly acute in Orthodox Jewish neighborhoods where religious private schools generally end later in the day. If Hochul does not act on the bill, which carries a projected $2.5 million price tag, it will be automatically disapproved, also known as a "pocket veto."

Before they get into budget talks, legislators are also looking to play politics. State Democrats are considering a measure that would increase the amount of time Governor Hochul has to call a special election to fill vacancies. If approved, the seat held by Rep. Elise Stefanik (R-NY) would remain vacant longer, likely months longer, after she resigns upon being confirmed as Trump’s Ambassador to the United Nations, depriving Speaker Mike Johnson (R-LA) of an additional GOP vote for the immediate future. No proposal has been put forward publicly, but Assembly Election Law Committee Chair Latrice Walker said, "We’re always looking for cost-effective measures by which to exact democracy. And as a voting rights advocate, I’m always looking for fairness, justice, and equity."

Criminal justice and public safety are once again becoming major issues in budget talks, this time in the form of changes to discovery laws. In her State of the State address, Hochul proposed changes to “finally close the loopholes that were created in our discovery laws that delay trials and lead to cases being thrown out for minor technicalities.” Hochul’s plan would make it more difficult for cases to be dismissed under the State’s speedy trial law for minor discovery issues, which Hochul claims defense lawyers are skillfully manipulating. Under current law, if a prosecutor is found to have violated discovery compliance, the time between the original certification and the challenge is counted against the prosecution under the Speedy Trial Act, sometimes resulting in serious cases being dismissed because of technicalities.

New York City Mayor Eric Adams is backing the proposal to close the loophole, and New York Police Department (NYPD) Commissioner Jessica Tisch did the same last week during her “State of the NYPD” address, saying, “The proposed change to the discovery law will remove onerous restrictions and irreverent technicalities that cause far too many cases to be needlessly dismissed and allow dangerous offenders to avoid accountability under the law.” In further evidence that Albany creates strange bedfellows, the District Attorneys Association of the State of New York (DAANY) and the Legal Aid Society are both supporting Hochul’s plan, with DAANY President Michael McMahon saying the current law “robs the victims of crime of ever receiving justice and is the direct cause of the rampant recidivism we all know and loathe today as dangerous criminals escape accountability and consequence for their criminal action.”

February 20: Amendments to the State Fiscal Year 2025-26 Executive Budget Due
April 1: Beginning of State Fiscal Year 2025-26
June 12: Final (scheduled) Day of Legislative Session

Of course, the legislature must approve any changes to the State's discovery laws, and there may be more interest in helping prosecutors comply rather than weakening the law. State Senator Zellnor Myrie and Assembly Member Micah Lasher proposed a bill that would give prosecutors direct access to police databases to obtain evidence and subsequently, turn it over more quickly. Speaking to reporters, Myrie said, "As Codes Committee chair, I think it's important for me to be listening to all of the parties and all of the stakeholders. As you know, we're going to be having our public protection hearing in about two weeks, where we will have official testimony on the governor's proposal for all parties involved. I look forward to having that conversation." We will see whether the legislature ends up closer to Hochul's plan in their One-House budgets or embraces the Myrie and Lasher proposal.

Our Jack O'Donnell talks Governor Hochul's Executive Budget, the Buffalo mayoral race, and all things political with Joe Beamer on WBEN's Hardline.

New York’s congestion pricing program—decades in the making—could be halted before it gets a chance to get off the ground, before generating much-needed revenue for the Metropolitan Transportation Authority, and before New Yorkers feel the benefits of reduced congestion.

In the flurry of agency memos and executive orders from President Trump’s White House last week, none of them revoked the federal authorization for the program... at least not yet. Trump had vowed to eliminate congestion pricing during the campaign, and New Jersey Governor Phil Murphy, a Democrat, reiterated his opposition to congestion pricing in a letter to Trump last week. Hochul said she spoke with Trump twice last week about the tolling program, but declined to offer details, saying, “I’m not going to disclose the contents of the conversations I’ve had with the president.” MTA CEO Janno Lieber believes the program could withstand a legal challenge from the federal government, stating, “We’ve been sued in every federal court and state court east of the Mississippi, and we’re batting 1.000. We’ve won every time.”

If Trump’s pick to lead the Federal Transit Administration is any indication of his administration’s direction on congestion pricing, Lieber and the lawyers at the MTA are likely to have another opportunity. Trump has selected Marc Molinaro, a former Republican Congressman from the Hudson Valley, to oversee the federal agency responsible for regulating mass transit. As part of the Department of Transportation, Molinaro and his colleagues at the Federal Highway Administration have broad influence over transportation grant awards, including congestion pricing. Molinaro reiterated his support for ending federal approval for the tolling program, posting, “There is a clear path to undoing the State’s cash grab. The MTA is in desperate need of reform, transparency, and accountability. Hardworking New Yorkers and New Jerseyans aren’t an ATM for this bloated bureaucracy. Safety, accountability, accessibility, and efficiency first!" Should the federal government do away with congestion pricing, state lawmakers will have to find a way to fund the already cash-strapped MTA. Even with congestion pricing, the MTA is looking for $33 billion in new revenue to fund its next Five-Year Capital Plan.

N.Y. Budget Director Responds to Questions on Hochul’s Executive Budget Plans

Blake Washington joins Capital Tonight’s Susan Arbetter.

In Washington, D.C., President Trump is following through on his promise to be a disruptor; a memo from the Office of Management and Budget (OMB) placed a temporary freeze on all federal spending and grants, leaving organizations from research hospitals to Meals on Wheels in a state of uncertainty. The memo ordered, “to the extent permissible under applicable law, Federal agencies must temporarily pause all activities related to obligation or disbursement of all Federal financial assistance, and other relevant agency activities that may be implicated by the executive orders, including, but not limited to, financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the Green New Deal.” The vague wording and lack of agency guidance caused confusion among many non-profits, state and local governments, and other groups reliant on federal assistance and was immediately met with pushback from Democrats who pointed out that Congress, not the Executive Branch, has the power of the purse. 

New York Attorney General Letitia James led a coalition of Attorneys General in suing the Trump Administration over the freeze, ultimately blocking it minutes before it was set to take effect. In a statement, James said, “Millions of Americans rely on federally funded programs every day to get the health care they need, support their families, and stay safe in their communities. Already, this policy has unleashed chaos and uncertainty, with law enforcement halting drug enforcement efforts, Medicaid portals shutting down, and other critical services being thrown into disarray.” The White House rescinded the order in the wake of the court’s decision, but vowed to “end the egregious waste of federal funding.” Expect more targeted freezes, halts, and disruptions in the weeks ahead.

Budget Reconciliation, Simplified

House Republicans are moving forward with a plan to advance all of Trump’s policy priorities through one massive bill, rather than separate pieces of legislation. The plan extends Trump’s 2017 tax policy and adds $325 billion in spending over the next ten years, mostly for immigration enforcement and national security, but claims $315 billion in spending cuts. To achieve those savings, the GOP is expected to propose work requirements for Medicaid enrollees and recipients of the Supplemental Nutrition Assistance Program (SNAP). A majority of House Republicans appear to support the plan, but their soon-to-be one-vote margin means Johnson cannot afford any defections. Rep. Tom Emmer (R-MN), the third-ranking House Republican, made a not-so-veiled threat to some of his colleagues, saying, “You don’t want [Trump] coming into your district and telling all your voters that you are the one preventing the Trump agenda from moving forward.” If the “one big beautiful bill” strategy stalls in the House, Senate Majority Leader John Thune (R-S.D.) has a plan to divide the package into two separate bills.

Former Republican congressman and New York gubernatorial candidate Lee Zeldin was officially confirmed by the Senate last week to lead the Environmental Protection Agency. Three Democrats—Sens. Ruben Gallego, Mark Kelly of Arizona, and John Fetterman of Pennsylvania—joined all 49 Republicans in the 52-48 vote. New York will be well represented in the Trump administration with Zeldin and Rep. Elise Stefanik, Trump’s pick for United Nations ambassador, as well as “border czar” Tom Homan, and Treasury Secretary Scott Bessent, both of whom call New York home. Robert F. Kennedy Jr., tapped for Health and Human Services secretary, may or may not be from New York. TBD.

If you are looking to rub elbows with the new cadre of Trump appointees, this new Capitol Hill restaurant might be your best bet. 

Finally…

If you are planning to have kids, make sure you stay up-to-date on the latest nursery trends.

—>Affordability, public safety, & mental health proposals

—>Transportation funding challenges

—>Trump’s NY impact & new administration

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New to the NYS Legislature

Daniel Norber, Republican State Assembly Member for District 16, represents Nassau County communities, including Great Neck, Port Washington, Manhasset, and Williston Park. A first-generation American, Daniel's life story is rooted in resilience and determination. His grandparents survived the Holocaust, and his mother escaped Soviet communism, instilling in him values of hard work, sacrifice, and a deep appreciation for freedom.

Born in the United States and raised in Israel, Daniel served in the Israel Defense Forces as a staff sergeant in the military police, an experience that shaped his character and commitment to service. After earning a bachelor’s degree in Political Science and Government from Reichman University, Daniel moved to New York City and built a career as a successful entrepreneur. As the founder of a leading moving company and an investor in industrial real estate, he has created thousands of jobs and contributed to the region’s economic growth.

Daniel's platform focuses on addressing key issues impacting his district and New York State. He is committed to strengthening public safety by reforming cashless bail laws, combating drug trafficking, and supporting law enforcement. As the son of immigrants, Daniel also advocates for immigration reform that secures borders while upholding the integrity of legal processes.

Dedicated to improving affordability for middle-class families, Daniel champions tax relief, small business support, and workforce development, particularly in skilled trades and technology sectors. His priorities also include expanding access to affordable healthcare, protecting seniors’ benefits, and promoting educational opportunities, including trade school investments and school choice programs.

In addition to his professional accomplishments, Daniel actively supports community initiatives through organizations like Samaritan Village and Women in Need. A proud family man, he lives in Nassau County with his wife, Inbal, and their four children, Michelle, Idan, Karin, and Jonathan.

Daniel is committed to bringing his entrepreneurial spirit, life experience, and commitment to common-sense solutions to Albany, where he aims to improve the quality of life for his constituents and ensure opportunities for all New Yorkers.

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