New York Gov. Kathy Hochul on Tuesday announced her executive budget proposal totaling $260 billion that comes with offsetting cuts in federal funding but no increase in income taxes.

“The last four years we’ve proven something important, that you can make historic investments without raising income taxes, without mortgaging the next generation, without losing sight of what people can afford,” Hochul said during her proposal presentation in Albany.

The fiscal year 2027-2028 state budget proposal is a slight increase – 0.7% – from last year, primarily, Hochul said, to make up for those federal cuts. Hochul said this year, the state will see a $10.3 billion decrease in federal funding – an 11.4% decrease in just the last year – and state operating funds will increase to $157.6 billion. The state has $14.6 billion in maintained reserves.

“The newest, most unpredictable challenge is something very different. Direct attacks on states by the Trump administration,” Hochul said.

In addition to no tax increases, the governor’s proposal would eliminate taxes on tipped wages up to $25,000 per year and provide $30 million in targeted relief for farmers impacted by tariffs.

Here’s a closer look at the governor’s proposals on specific areas.

Health care

Medicaid funding is up to $38.2 billion 
Improvements to CDPAP, which found nearly $1.2 billion in recurring savings
Use those savings to stabilize Medicaid 

Child care

Invest $4.5 billion to expand access and reduce costs in child care
$500 million to fully fund Universal 2-Care in New York City
$1.3 billion statewide to make universal Pre-K available for every 4-year-old by 2028
Pilot community-wide child care for newborns up to 3-year-olds
Build on the Child Care Assistance Program and voucher system

Education

$39.3 billion for school aid, an increase from last year
$395 million to expand universal school meal access to feed children during summer months
Continues a tuition freeze for SUNY and CUNY and provides additional $90 million in operating support
$59.5 million to expand access to high-demand fields in community college

Housing

$250 million for affordable housing to keep projects moving
$100 million for MOVE-IN NY program to build starter homes
$50 million for resilience and protection against extreme weather
$153 million for Homeless Housing and Assistance Program

Public Safety

Continue $352 million for gun violence prevention
Continue $77 million to for subway safety
$35 million for grants to help secure houses of worship and vulnerable organizations