By Josephine Stratman
New York Daily News
(TNS)<\/p>\n
NEW YORK\u00a0\u2014 Gov.\u00a0Kathy Hochul\u00a0announced a handshake deal Thursday on a $268 billion state budget that includes a controversial pied-\u00e0-terre tax on second homes in\u00a0New York City\u00a0aimed at bringing more money to city coffers amid a multibillion-dollar city budget deficit.<\/p>\n
The purported state budget deal, which comes after a five-week delay, includes funding for childcare in the five boroughs and a slate of immigration measures intended to push back against the Trump administration, the governor said.<\/p>\n
Hochul said that the final details will be worked out \u201cwithin a week,\u201d but Assembly Speaker\u00a0Carl Heastie disputed the governor\u2019s claim of an agreement.<\/p>\n
\u201cThere\u2019s no budget deal,\u201d Heastie told reporters in\u00a0Albany.<\/p>\n
\u201cThere\u2019s so many open issues on money \u2026 We signed off on nothing major,\u201d Heastie added. \u201cThis is what I\u2019m telling y\u2019all is wrong with this process. I\u2019m saying this to y\u2019all very clearly: I am never doing this again. Budgets are supposed to be about money, not policy.\u201d<\/p>\n
A key factor in the state budget talks was how much aid would go to\u00a0New York City. Mayor Zohran Mamdani has lobbied the state for months for helping closing the city\u2019s estimated $5.4 billion budget gap. In efforts to put pressure on\u00a0Albany, he sounded the alarm about a fiscal crisis and threatened to raise local property taxes.<\/p>\n
The budget does not include the corporate or income tax hikes Mamdani has pushed for in spite of resistance from Hochul. A Pass-Through Entity Tax credit reduction both Mamdani and Council Speaker Julie Menin threw their weight behind was also a non-starter.<\/p>\n
\u201cI held through to what I said,\u201d the governor said.<\/p>\n
It\u2019s still unclear, with a final state spending plan still in the works, how much more money the state will be sending the city\u2019s way.<\/p>\n
The governor was also expected to deliver additional financial help or delay the class size mandate for schools, a rule that budget experts have said costs the city at least hundreds of millions of dollars, though she did not mention either at the Thursday announcement.<\/p>\n
Mamdani, at an unrelated appearance in\u00a0Brooklyn\u00a0on Thursday, said he was hopeful that the state budget would deliver the help the city needs but that he was waiting on details.<\/p>\n
\u201cWe are seeing that there are still a few more things to be discussed and agreed to in that state budget negotiation, but we are hopeful as to the direction of that conversation and the progress that we\u2019ve been seeing over the last few days and weeks.\u201d<\/p>\n
With the state budget stalling, city lawmakers pushed back a budget deadline. The mayor\u2019s next budget proposal is due Tuesday.<\/p>\n
Mamdani, a democratic socialist, campaigned on raising taxes on the city\u2019s millionaires and billionaires as well as some corporations\u2014but Hochul viewed those ideas as a nonstarter and has emphasized the city should find savings in its own $127 billion budget.<\/p>\n
\u201cI\u2019m not going to mince the words: The negotiations were not easy,\u201d Hochul said. \u201cThey were very substantive disagreements, tough choices and powerful special interests trying to influence the outcome, and the dysfunction out of Washington certainly doesn\u2019t help.\u201d<\/p>\n
The budget is slated to include $15 billion in reserves, which Hochul lauded as a \u201cpretty impressive\u201d accomplishment given the Trump administration\u2019s attacks on federal funding.<\/p>\n
The pied-\u00e0-terre tax, which would place a surcharge on the most expensive second homes in\u00a0New York City, was one of the final areas of uncertainty in budget negotiations, which stretched weeks beyond the\u00a0April 1\u00a0deadline. Hochul has insisted it would rake in $500 million annually for the city, although she said Thursday the details have still not been worked out.<\/p>\n
One hang-up in the talks about that tax was how to determine the values of the homes it will impact. It\u2019s unclear how exactly that number will be calculated, as the city uses a \u201crather bizarre\u201d assessment process that significantly undervalues luxury homes, Hochul said.<\/p>\n
Hochul called this year\u2019s budget negotiations \u201cunusual,\u201d given the particular focus on the city: \u201cThis is the first time that we\u2019ve been so immersed in helping them solve their budget problem.\u201d<\/p>\n
The \u201cgeneral agreement\u201d reached by the state doesn\u2019t offer specifics on any new funding the city\u2019s K-12 schools, with her budget director,\u00a0Blake Washington, telling reporters during a Q&A that the state legislature was considering different variables.<\/p>\n
\u201cWe\u2019re very invested in helping particularly the high-needs communities,\u201d Hochul said.<\/p>\n
Hochul spoke about the child care money she pledged to the city in January, new youth online safety laws that block direct messages from unknown adults to minors and disable AI chatbots and restrict location-sharing for youngsters under 18 were also included.<\/p>\n
The budget also includes an expansion of the governor\u2019s free community college initiative.<\/p>\n
\u2014 With\u00a0Cayla Bamberger<\/p>\n
Photo caption: New York Gov. Kathy Hochul discussed key state budget proposals during a press conference on April 28, 2026. (Kathy Hochul\/YouTube)<\/p>\n
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