Governor Kathy Hochul’s 2025 State of the State Address
Today, Governor Kathy Hochul delivered her fourth State of the State address from the Hart Theater at the Egg in Albany. During the State of the State, the Governor mainly focused on making New York a more affordable place to live. The speech contained numerous policy proposals, and the Governor also released a briefing book containing over 200 distinct proposals organized in fifteen main topics areas, including: supporting families, helping children thrive, public safety, economic development, housing, health, and sustainability. We are reviewing this briefing book and will send along proposals of interest.
During the weeks preceding the State of the State, the Governor made a series of announcements previewing some of the proposals that would be included in the address. In late December, the Governor announced that her budget will include an “Inflation Refund,” which would provide direct payments to New York taxpayers by using excess sales tax revenue. The payment would be $500 for families making less than $300,000 and $300 for individual taxpayers making less than $150,000. Last week, the Governor announced a proposal to expand the Child Tax Credit from the current $330 per child. The expansion would provide families with a tax credit of up to $1,000 per child under age four and up to $500 per child aged between four and sixteen.
Some of the highlights from the Governor’s State of the State include:
- Middle Class Tax Cut: The Governor proposed a tax cut to taxpayers earning up to $323,000 for joint filers. This would be estimated to impact 8.3 million New Yorkers, an estimated three out of every four taxpayers.
- Housing: The Governor proposed numerous initiatives to both increase available housing in New York and decrease the cost of housing. One of the proposals would ban the sale or use of price-fixing through algorithmic real estate management software services. According to the Governor, these algorithms cost tenants nationwide an estimated $3.8 billion more in rents last year. Another proposal would allow communities to redevelop vacant properties into housing through strengthening existing municipal authority to acquire vacant and abandoned buildings. Additionally, this proposal would authorize localities to adopt a tax exemption to incentivize redevelopment of these properties into affordable homes. An additional proposal would ban private equity companies from bidding on single- and two-family homes for the first 75 days that it is listed on the market.
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Mental Health, Safety, and Crime: The Governor proposed updating New York’s involuntary commitment laws following a series of high-profile violent incidents on the subway. The proposal would allow intervention when individuals are at substantial risk of harm due to their inability to meet basic needs like food, shelter, or medical care. It would clarify that evidence of imminent risk or recent overt acts is not required, allowing earlier intervention. Additionally, the Governor unveiled a plan to have a police officer on every overnight train in New York City for the next six months.
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Climate Change: The Governor proposed investing $1 billion to help spur the transition to clean energy. These funds would be used to help retrofit homes and incentivizing the installation of heat pumps, as well as building out thermal energy networks at SUNY campuses. Additionally, the Governor announced that she will direct state agencies to achieve 100% renewable energy by 2030.
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Universal School Meals: The Governor is proposing universal breakfast and lunch for students. Under the proposal, all schools that participate in the national school lunch and breakfast program would provide free breakfast and lunch to their entire student body. According to the Governor, this would mean that an estimated 400 million meals would be made available annually.
Next week, the Governor will be presenting her 2025 – 2026 proposed budget. This will officially kick off the start of the budget process. Once her budget proposal has been delivered, the Senate Finance Committee and the Assembly Ways and Means Committee will announce their joint budget hearing schedules, which will last until the end of February. In early to mid- March, both houses will release their proposed one-house budget bills and negotiations between the Governor, Senate and Assembly will commence with the hope of having a final budget deal in place by the State Constitutionally mandated deadline of April 1.
As always, we will be sending updates as the session advances. Please let us know if you have any questions.