FY25 Executive Budget

MEMORANDUM

Highlights:

• Hochul proposed a balanced $233B FY25 Executive Budget, focused on school aid, Medicaid, and migrant spending.
• The FY25 Executive Budget closes a $4.3B deficit faced by the state.
• Hochul’s budget authorizes a new residential construction tax incentive in New York City but did not provide any details on this tax incentive.

The Governor proposed the following in her FY25 Executive Budget:

        Migrants:

• $2.4B to assist NYC serve newly-arriving migrants for shelter, social services, and resettlement
  • $1B specifically to reimburse the city for costs up to this point
  • $500M to NYC from a one-time withdrawal from the state reserves for emergencies
  • NYS will take over funding for roughly 3,000 beds, in addition to the state’s previous pledge to fund a 2,000-bed shelter in Brooklyn.

      Medicaid:

• $3B increase in state Medicaid spending, for a total of $30.9B
  • Over $1B in savings proposals
• Control over rising Medicaid costs, driven largely by increased enrollment and managed long-term care programs.
• Identified Medicaid reimbursement rates and service reductions as potential savings areas.

      Education:

• Increase by $825M, bringing total education funding to roughly $35B
  • $10M earmarked for new literacy method training for teachers
  • $507M increase in Foundation Aid funding
• Change in school aid funding to even out aid disbursement between districts of different means
• Four-year extension of mayoral control of schools in NYC

      Mental Health:

• $15M to develop supportive housing for people with intellectual disabilities
• $12.5M for teams to support New Yorkers with serious mental illness who are homeless or justice-involved

        Miscellaneous:

• $40.2M to combat retail theft
• $36M for district attorneys to tackle domestic violence
• $35M for hate crime mitigation
• $2.5M for operating costs in the Empire AI consortium for artificial intelligence research

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