June 12, 2023

The state Division of Budget late last week released its revised financial assessment of New York’s future budget years, finding a combination of slower revenue from taxes and increased spending in part with the newly approved $229 billion budget last month. 

To view updated plan:
https://www.budget.ny.gov/pubs/archive/fy24/en/fy24en-fp.pdf#page=20

Here’s what the Update says:

• Gaps between spending and tax revenue will reach $9.1 billion in the budget year set to kick off in January with Gov. Kathy Hochul’s proposal. The gap grows to $13.9 billion the following year and $13.4 billion in the year after that. 
• That’s $36 billion over three years, an increase from the $21 billion initially projected when Hochul presented her budget at the start of the year. 
• Tax receipts have been on a downward trajectory, with budget officials lowering estimates by nearly $37 billion compared to a year ago. 
• State spending has increased while federal aid has melted away: 9.7% hike for school aid and a 7% raise for Medicaid. All told, spending is expected to rise by 3.9%.  

This isn’t written in stone given the projections are based on the current expectation of revenue and spending targets. But budgets by law must be balanced in New York. Analysis of updated Plan by State of Politics:

New York’s budget gaps grow to $36B over 3 yearsnystateofpolitics.com