Legislature closes in on overdue $212B budget

The New York State Capitol in Albany. Matthew Cavanaugh/Getty Images

ALBANY — Senators and assemblymembers persisted with hours of debate about taxing the rich, requiring nursing homes to spend 70% of revenue on patient care and other budget policies Tuesday with the intent of passing the 2021-22 state spending plan six days late.

The state’s historic $212 billion spending plan includes a provision to legalize mobile sports betting, a new program to study the state’s availability and cost of high-speed internet services, $29.5 billion in school aid and $29 billion to grow the state’s green infrastructure and economy.

The state budget — one of the largest in history — uses about $112 billion from state operating funds and reflects a $23 billion increase in spending, with $5 billion earmarked for future budgets. The budget deadlined at midnight April 1, making Tuesday’s expected passage six days overdue.

“Budgets are a statement of values, and in my two decades of service to the people of New York, I can’t think of a more far-reaching and impactful budget than this,” said Assembly Speaker Carl Heastie, D-Bronx. “It meets long-standing goals of our Assembly Majority and addresses the historic inequities that have existed for too long. My colleagues and I have worked tirelessly to deliver a budget that will help New York rise from this health crisis and recover from its devastating economic impacts while upholding our commitment to putting New York families first.”

The new taxes on millionaires and billionaires will amount for $3.5 billion of the $8.5 billion state spending increase.

The state will net $2.75 billion from increases on personal income tax this year, and $3.25 billion next year.

Republicans largely spoke out against the tax increases, which start for people with an income of $1 million for a single person and $2 million for a couple. The tax rates continue to increase at the $5 million and $10 million marks, and are expected to affect about 50,000 of 19.4 million New Yorkers.

The tax increases sunset after 2027, said Senate Finance Committee Chair Liz Krueger, D-Manhattan.

“I was always taught that in this town, Democrats, when they needed to spend, tax to raise revenue and Republicans borrowed to spend,” Krueger said. “I think of the two choices, I would pick the tax to spend than go into a deficit to spend, but that’s just me.

“To clarify ... this is not a tax increase on the vast, vast majority of New Yorkers,” Krueger continued. “It’s a relatively small, about 50,000 taxpayers on the wealthiest end of the scale even during the pandemic and economic meltdown. It’s an interesting question of what’s biggest when, but it’s also who are you taxing?”

Under the budget, private and public nursing homes will be required to reinvest at least 70% of revenue, excluding capital costs, on direct resident care, including 40% on resident-facing staff.

Several lawmakers in both chambers questioned the provision and the process where facilities will need to request a waiver from the state Health Department to spend outside the new regulatory threshold.

The Health Department is not required to respond within a specific time frame, but the facility cannot be penalized for spending decisions until the department responds.

The change is part of ongoing nursing home reform in the wake of the state’s controversial number of COVID-19 deaths in nursing homes and issues wrought by congregate facility owners who maximize profits at the expense of quality care, according to a statement from 1199SEIU United Healthcare Workers East on Tuesday.

“Our members took their grief and anger over what happened over the past year and turned it into action to demand reform, and today, Albany listened,” said Milly Silva, executive vice president of the union’s nursing home division. “The past year has brought so much pain to residents, their families and the workers who tirelessly provide the best care they can. This victory belongs to all of them.”

The Senate passed its health and mental hygiene spending, or bill S02507-C/A03007, with a vote of 42-21. Assemblymembers were debating the health bill after 5 p.m.

Legislators were set to discuss, vote on the state transportation, public protection and the general revenue measures and pass the 10-bill fiscal plan by the end of the night.

Gov. Andrew Cuomo, Assembly Speaker Heastie and Senate Majority Leader Andrea Stewart-Cousins, D-Yonkers; announced their final three-way agreement on the budget late Tuesday as lawmakers continued to debate on the floor.

Stewart-Cousins commended legislative leaders for reaching an agreement with the ongoing challenges posed by the COVID-19 pandemic.

“However, driven by a commitment to long-term equity and prosperity for all, we have accomplished a great deal,” she said Tuesday. “I am proud of the strides we have made in funding our schools, helping businesses rebuild, and protecting New York’s most vulnerable. Working and middle-class taxpayers will receive the relief they desperately need, while the wealthiest New Yorkers will help their neighbors. This budget makes New York better for all. In the remaining months of session, the Senate Majority will continue to deliver results that are reflective of our progressive values and priorities.”

The governor highlighted the budget continues to fund the state’s $311 billion infrastructure plan.

“New York was ambushed early and hit hardest by COVID, devastating our economy and requiring urgent and unprecedented emergency spending to manage the pandemic,” Gov. Cuomo said. “Thanks to the state’s strong fiscal management and relentless pursuit to secure the federal support that the pandemic demanded, we not only balanced our budget, we are also making historic investments to reimagine, rebuild and renew New York in the aftermath of the worst health and economic crisis in a century. I thank the legislative leaders — Senate Majority Leader Stewart-Cousins and Assembly Speaker Heastie — for their partnership in helping make this critical budget a reality and delivering results for the people of this state.”

Check back for more details on this developing story.

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