Assembly's $266 Billion Proposed Budget Puts Money Back in the Pockets of Hardworking New Yorkers

Speaker Carl Heastie and Ways and Means Committee Chair J. Gary Pretlow today announced that the Assembly will pass a $266 billion State Fiscal Year (SFY) Budget proposal or $272 billion including funding for the Essential Plan, that will invest in New York’s communities and make the state a more affordable place for families.

“The Assembly Majority is committed to investing in our communities, our families and in our future,” Speaker Heastie said. “Our budget includes critical relief for hardworking families, makes college more affordable for more students and puts money back into communities across the state. We will continue working to make New York State a more affordable place to live, work and raise a family.” 

“From relief for New Yorkers struggling with high utility rates to expanding TAP eligibility to investments in childcare and affordable housing, this budget will help make our state a more affordable place for families,” Assemblymember Pretlow said. “I look forward to continuing our work to uplift families across New York and to invest in the programs and services that they need.”

Putting Money Back Into New Yorkers Pockets

The Assembly budget would provide a one-time $2.6 billion rebate credit, Protecting Out Wallets Energy Rebate (POWER) Checks, to assist New Yorkers with the rising cost of utility bills. Eligible residential ratepayers with incomes below $150,000 would receive a credit amount of $500, and eligible residential rate payers with incomes between $150,000 and $300,000 would receive a credit amount of $300. The credit would be provided as advanced payment in the fall of 2026.

The proposed budget would build upon the 0.1 percentage point low- and middle class tax cut that was included in the SFY 2025-26 Enacted Budget to provide an immediate one percent tax cut for certain taxpayers with incomes below $323,200. This would offer $2.1 billion in tax relief in SFY 2026-27 and $3.5 billion the following year.

Finally, the proposed budget would reduce the Personal Income Tax (PIT) for certain low- and middle income New Yorkers with at least one dependent. It would eliminate the New York State PIT liability completely for certain taxpayers with income below the eligibility threshold. It would benefit approximately 363,000 tax filers and provide $211 million in tax relief.

Helping Small Businesses

The proposed spending plan would further ease the burden on small businesses by increasing their tax deduction from 15 percent to 25 percent of net income, gain, loss and deduction. This would save New York’s small businesses $67 million.

Also included is a proposal to allow small businesses to create hardship savings accounts. Businesses with fewer than 25 employees would be able to make contributions up to 10 percent of their net income to a tax deferred savings account. They would be able to withdraw funds from the account during specified times of economic hardship to retain or create jobs.

Revenue

The Assembly’s budget proposal would include an increase of the PIT rate for high income earners. Those making $5 million to $10 million would go from 10.3 percent to 10.5 percent. Those making $10 million to $25 million would go from 10.3 percent to 10.75 percent. Those making $25 million to $100 million would go from 10.9 percent to 11.75 percent. Those making above $100 million would go from 10.9 percent to 12 percent.

The budget would also establish the Crypto Mining Facility Excise Tax, a tiered tax ranging from $0.02 to $0.05 per kilowatt hour (kWh) on energy used to power crypto mining facilities that use at least 2.25 million kWh per year of electricity and that use proof of work authentication methods.

The Assembly proposal includes various revenue-raising proposals for New York City, primarily related to City Business Taxes and Real Estate Transfer Taxes (i.e. Mansion Taxes).

Energy

New York is facing some of the highest utility rates in the nation. This proposed budget includes critical provisions to rein in rising rates and put money back into New Yorkers’ pockets. In addition to the POWER Checks, the proposed budget includes $163.3 million in relief to ratepayers across New York State by shifting an existing assessment from ratepayers’ monthly utility bills to the General Fund, including $134.6 million for Department of Public Service operating costs and $28.7 million for NYSERDA operating costs.

It also includes a two-year moratorium on approving new rate cases or implementing already approved rate increases that would result in an increase in electric or gas rates. It would also establish the Blue-Ribbon Commission on Residential Affordability Through Energy Savings (RATES Commission) to study the causes and origins of rising rates and recommend actions to reduce rates.

Higher Education

The Assembly budget restores $8 million in funds for SUNY. It also includes $10 billion for a 5-year SUNY capital plan. The Assembly proposal provides $7.8 billion in CUNY funding for a 5-year capital plan.

The Assembly’s budget includes $285 million to increase TAP eligibility to 8,000 New York students by increasing the income threshold for the maximum TAP award from $7,000 to $30,000 for dependent students, $7,000 to $30,000 for independent married students, $3,000 to $30,000 for independent single students. Additionally, the budget would expand TAP and Excelsior Scholarship eligibility by increasing the income threshold from $125,000 to $150,000.The Assembly proposal also includes $160 million to reinstate graduate TAP, allowing graduate students to receive TAP awards.

The Assembly budget includes the New York Reinvests in Student Educational Supports (NY RISES) Program, a student loan program that provides further support to students, given the dramatic changes to the federal student loan programs. The Assembly budget provides $500 million in bonding authority to the State of New York Mortgage Agency (SONYMA) to facilitate this program.

Education and Childcare

The Assembly proposed budget makes vital investments in education and child care for families across New York State. It provides $39.4 billion in school aid, a $2.1 billion increase from school year (SY) 2025-26, and $27.8 billion in Foundation Aid, a $1.4 billion increase over SY 2025-26.

The proposed budget includes a $20.9 million increase in three-year-old Pre-K to a minimum of $10,000 per pupil for districts outside of New York City. Additionally, it would expand Universal Pre-K (UPK) to support full day instruction for four-year-olds by fall 2028, consolidate UPK and statewide Universal Full Day Pre-K into a single program, and increase funding for the instruction of three-year-olds in New York City.

It would also provide $100 million for after-school programs that service youth up to age 18, providing funding for an additional 40,000 slots. The budget also includes the executive proposal to provide $3.6 billion for child care and would provide $18.7 million to eliminate minimum wage eligibility requirements to access childcare assistance.

The Assembly budget proposal also includes $100 million for electric buses and related infrastructure for schools. 

Aid for Municipalities

The Assembly’s budget includes vital relief for cities and municipalities across the state. It would make $1.5 billion in additional Temporary Municipal Assistance available over three years to municipalities that have budget deficits, are raising property taxes or are in fiscal distress. Of this funding, $1 billion would be available to New York City, $452.74 million would be available to other cities, and $47.3 million would be available for towns and villages.

Transportation

The Assembly proposal provides $6.4 billion for the final year of the five-year Department of Transportation (DOT) Capital Plan, an increase of $324 million over the executive proposal. Of this, there is $1.53 billion in Local Capital Aid funding, an increase of $150 million over the executive proposal, including an additional $50 million for CHIPs, for a total of $698 million, and $50 million for Local Pave NY, which is distributed through the CHIPs formula, for a total of $200 million. It also includes $50 million for the State Touring Route program, for a total of $190 million, and would expand the program to include vehicles and equipment to make the eligibility of this funding identical to the CHIPs eligibility criteria.

The proposed budget also includes $15 million for a fare-free bus program in New York City, with one fare-free bus route in each borough.

Housing

The proposed budget includes critical capital funding investments in public housing and affordable housing across the state, including $750 million for the New York City Housing Authority (NYCHA), $750 million Mitchell-Lama Preservation and $225 million for public housing authorities outside of New York City. It also provides $100 million for Mitchell-Lama developments and NYCHA to offset maintenance costs.

To help provide more families with home ownership opportunities, the budget includes $50 million in downpayment assistance to families with between 50 and 120 percent of area median income. Of that, $20 million is set aside for homeownership opportunities for diverse populations.

The proposed spending plan includes an additional $200 million for the Housing Access Voucher Program (HAVP), for a total of $250 million.

Additional Proposals

The Assembly’s budget also includes a 4 percent cost of living adjustment (COLA) for social services agencies.