Governor Cuomo and the State Legislature enacted a $212 billion state budget that includes tax increases on the wealthy as well as substantial relief for renters, undocumented immigrants and business owners who are hard hit by the coronavirus. State operating funds will jump $8 billion more that the Governor originally proposed, and the final budget includes roughly $6 billion in unrestricted federal aid the state plans to collect under President Biden’s American Rescue Plan stimulus bill.
The spending plan – roughly 10 percent higher than last year’s budget – is far from the draconian scenario envisioned earlier this year by Cuomo, when in January he predicted that the state would face a $15 billion hole over two years.
The embattled Governor, who prided himself on meeting the April 1st budget deadline over his three terms in government, was in a weakened position due to series of political scandals. There have been calls from lawmakers for him to resign, an ongoing impeachment inquiry and an investigation by the Attorney General into allegations of sexual misconduct. Those factors made this year’s budget particularly challenging and placed the Legislature in a commanding position.
Key provisions of this year’s budget include:
The Legalization of Marijuana – One week prior to the budget passage, Governor Cuomo signed legislation that legalizes recreational marijuana, paving the way for the potential $4.2 billion industry. Following several failed attempts, lawmakers in Albany struck an agreement to legalize cannabis for adults 21 and older, a move that officials hope will help end years of racially disproportionate policing that saw Black and Hispanic people arrested on low-level marijuana charges far more frequently than white people.
Excluded Workers’ Fund – The $2.1 billion fund, to be administered by the Department of Labor, will provide support for workers who do not have access to Unemployment Insurance, federal stimulus funds and other programs during the Covid-19 Pandemic. This initiative is targeted at undocumented immigrants.
Affordable Internet – Establishes the first-in-the-nation program to provide affordable internet, requiring internet service providers to offer affordable $15 per month high speed internet plans to qualified low-income households.
Business and Arts Relief and Recovery Assistance – A $1 billion relief package for small businesses, arts, and entertainment organizations which have been disproportionately affected by the Covid pandemic.
Mobil Sports Wagering – Authorizes mobile sport wagering providing $500 million in revenue. The state will issue a Request for Applications and must select two platform providers which must work with at least four operators to introduce betting into state.
Increases in Education Aid – Provides a significant increase in local School Aid as well as emergency federal assistance to non-public schools. This year’s budget also includes over $7.7 billion in state support for higher education.
- MWBE Program – Continued support and investment in the State’s Minority and Women Business Enterprise Program. The budget also launches the “Entrepreneurial Navigator” to provide customized services and streamlined access to state start- up programs.
- Comprehensive Technology Services Contract – Authorizes the Office of Information Technology Services to enter into contracts for both the design and building of systems. Such “design build” contracts have been prohibited in the past.
- Made in American Medical Devices and PPE – Requires that any contract for medical devices or PPE be “produced or made in whole of substantial part in the United States.” However, it voids that requirement if the value of the contract would potentially increase it by an “unreasonable amount.”
- Cooperative Purchasing – Extends in law the permission for local governments to enter into cooperative or consortium purchasing. That provision was scheduled to sunset this year.
- MTA Electronic Bids – Allows the MTA to accept electronic bids and contracts, instead of the statutory provision that those bids must be “sealed.”