Good Morning from the State Capital 

Governor Cuomo, Assembly Speaker Carl Heastie, and Senate Majority Leader Andrea Stewart-Cousins reached an overdue agreement on the State Fiscal Year 2022 Budget last Tuesday. The $212 billion spending plan caps off an unprecedented State Budget process in which one of Cuomo’s negotiating partners—as well as most of both Majority Conferences—called for his resignation; he endured the start of an impeachment proceeding; and the commencement of parallel State and Federal investigations. Nonetheless, the Legislature and the Governor were able to come together on an overarching spending plan that restores many of 2020’s COVID related cuts and includes major policy changes.

So, what was in the final deal and what other dynamics did we see play out? 

Intra-Conference Dynamics—Ever since Senate Democrats’ rode into the majority on progressive enthusiasm in 2018, and padded that majority in 2020, some onlookers had wondered if we would ever see divides between moderates from Upstate, Long Island, the Hudson Valley, and an increasingly progressive caucus (especially with several members positioning themselves for Citywide office and City Council campaigns). That was no clearer this year than the blow up around the Excluded Worker Fund (a $1.5 billion fund for undocumented immigrants and other workers who have been excluded from federal relief during the pandemic. The fund will allow many of those workers to qualify for $15,000 from the state.) Some members very publicly lauded its inclusion while others called it a “misguided & fiscally irresponsible program” and said “in good conscience they could not support it.” 

Legislature Flexes Its Muscle—Democratic Supermajorities in both Houses secured several major wins and beat back the Governor on several of his priorities, which is tough in New York’s budget process which is heavily weighted towards the Executive. This budget showed that progressives—especially a number of newly elected members—are willing to push back. They did not get everything they wanted, but there were more wins for the Legislature than in recent memory, including a delay of the Fee for Service carve-out (a major victory for the OD&A team as well!), a number of the Governor’s coveted Medicaid Redesign Team proposals, $5 billion in revenue (far higher than the Governor’s $2 billion tax plan, certainly not an acquiescence to Mujica’s statement that NY did not need tax increases because of funds coming from the American Rescue Plan), and the aforementioned Excluded Workers Fund.

What else did we see in the budget? 

Mobile Sports Betting— Under the final plan, web servers will be physically located at the private casinos in New York in an attempt to comply with the constitution, which only legalizes betting in certain situations and makes clear bets must happen at the casinos. Cuomo had been pushing a plan where the state chooses one operator to oversee mobile betting in New York; Lawmakers had been pushing for a more open model that would see more operators. Under the budget, New York will contract with two casinos who can have two “skins” — or partner companies offering mobile betting — each.

Foundation Aid—The Budget includes long-awaited court mandated funds that will pad New York City schools coffers by more than $1 billion in 2023. State education funding currently falls about $4 billion short of the amount the formula calls for — a shortfall that advocates and lawmakers have been fighting to reverse for more than a decade.

Prevailing Wage for Renewable Energy Projects—The OD&A team and labor advocates across the state fought hard for language in the budget ensuring that jobs created by New York State’s focus on Renewable Energy will be good paying jobs for New Yorkers through the expansion of prevailing wage, labor peace, Buy American, and Buy New York procurement preferences.

Restore Mother Nature Bond Act—After it fell off November’s ballot due to fiscal constraints stemming from the COVID-19 pandemic, the budget re-authorized the $3 billion Environmental Bond Act, “Restore Mother Nature” to fund environmental improvements that preserve, enhance, and restore New York’s natural resources and reduce the impact of climate change. The Bond Act will appear on the ballot in the 2022 general election.

Marihuana (that is how it is spelled in State Law) Regulation & Taxation Act—It was a stand-alone bill, not in the budget, but we will include it in budget season policy… Assembly Majority Leader Crystal Peoples-Stokes and Senator Liz Krueger secured a major win on the MRTA which will legalize recreational cannabis in New York State. The final text includes some major wins for the legislature, including mandates that 50% of licenses go to social equity applicants, and statutorily defined tax revenue be placed in a Community Reinvestment Fund earmarked for “communities that were disproportionately impacted by previous prohibitions.”

Attention CPAs!Hodgson Russ Attorneys

What you need to know about the New York State Marijuana Regulation and Taxation Act. Our Jack O’Donnell joins attorneys at Hodgson Russ for this webinar. More information here.

For the Governor’s full summary and announcement (albeit through somewhat rose-colored glasses) click here. Read the final bill texts for all of the appropriations and article VII policy bills for the FY 2022 enacted budget here.

On Thursday, Andrew Cuomo (should he be nominated for reelection) got his first challenger in United States House Representative, staunch Trump backer, and Conservative from headshot of white man in suitLong Island, Lee Zeldin. Zeldin faces an uphill battle in a State where no Republican has won a statewide election since 2002 and Democrats outnumber Republicans by more than two to one. He will be one of several declared or potential Republican candidates interested in running for governor who will appear in Albany, on April 19 to meet with Republican county chairs to lobby for their support.

WBEN 930AM

OD&A in the News

Our Jack O’Donnell offered inside information on the budget battle in Albany in the days leading up to the approved overdue spending plan.

Listen here as Jack talks budget with Susan Rose and Brian Mazurowski during WBEN-AM‘s extended coverage of the last-minute budget wrangling. Listen here as Jack is interviewed earlier by WBEN’s Mike Baggerman.

Jack also provided budget insight in a report from Gilat Melamed of Channel 7 News. Watch here. 

NY TOUCHAnd, the New York State Joint Commission on Public Ethics discussed and authorized “steps” concerning unspecified “investigative matters” during a specially-called meeting last Friday. That announcement, from JCOPE’s general counsel Monica Stamm, came after a lengthy closed-door executive session held by the 14 commissioners overseeing New York’s ethics oversight agency. Speculation has been circulating that the matters could be relating to any one of the Governor’s current scandals, but most also noted that “J-JOKE” (as it is called amongst many good government groups) will be unlikely to bring a full investigation. 

Photo: Corning Tower in Albany was lit up Friday night to say “NY TOUCH” instead of “NY TOUGH”. The mistake was corrected about twenty minutes later.


In the Nation’s Capital… President Biden

In Washington D.C., on Friday President Joe Biden unveiled a massive $1.5 trillion federal spending plan that he will try to get through Congress later this year. The Biden Administration is seeking to invest heavily in a number of government agencies to boost education, expand affordable housing, bolster public health and confront climate change. The request marks Biden’s first discretionary spending proposala precursor to the full annual budget he aims to release later in the spring that will address programs including Social Security, Medicare and Medicaid. The early blueprint calls for a nearly 16% increase in funding across nondefense domestic agencies, reflecting the White House’s guiding belief that a bigger, better-resourced government in Washington can help address the country’s most pressing political and economic challenges.

WSWRead more from our colleagues in Washington at Winning Strategies Washington on the Biden Administration’s proposed American Jobs Plan here.

PentagonHowever on defense, Biden’s $715 million plan has already been met by staunch opposition from both the GOP and Progressives. In short, the increase is too much for Progressives (who had been pushing for a 10% cut) and too little for Republicans (who had sought a 3-5% increase above inflation). “At a time when his own Treasury Secretary, Janet Yellen, recently criticized a federal budget that is basically ‘military and pensions’ without building our productivity capability here at home, it’s disappointing that President Biden would propose a budget of $715 billion for the Pentagon, an increase of 1.6% over Trump’s $704 billion budget, instead of working toward returning to the Obama-Biden era spending levels,” Rep. Ro Khanna (D-Calif.), deputy whip of the Congressional Progressive Caucus, said in a statement. Senate Budget Committee Chairman Bernie Sanders (I-Vt.) expressed “serious concerns” with the defense request. In a joint statement, Senate Majority Leader Mitch McConnell (R-Ky.) and the top Republicans on the Senate Armed Services, Intelligence, Budget and Appropriations committees said the proposed budget sends “a terrible signal not only to our adversaries in Beijing and Moscow, but also to our allies and partners. President Biden recently said, ‘If we don’t get moving, [China] is going to eat our lunch.’

And finally, the scandals surrounding Republican Reps. Matt Gaetz of Florida and Tom Reed in New York continued to unfold. The House Ethics Committee announced it was openingMatt Gaetz and Tom Reed probes into sexual misconduct allegations against both representatives. While Gaetz has continued to deny any wrong doing, Reed has apologized for his actions and said he will not seek reelection in 2022. Reed was also stripped of the Chairmanship of the Bipartisan Problem Solvers Caucus that he co-founded (which he has led with New Jersey Democrat Josh Gottheimer since its inception). He will be replaced by Pennsylvania Republican Rep. Brian Fitzpatrick.

Jack O’Donnell

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nys legislature: new member spotlight

Assembly Member Demond Meeks (D, 137th District) 
In the June 2020 Democratic Primary, Assembly Member Demond Meeks defeated Monroe County Legislator Ernest Flagler-Mitchell to represent Rochester’s 137th Assembly District, which had been held by David Gantt since 1983. Gantt—prior to his passing—and the Monroe County Democratic Party both had endorsed Flagler-Mitchell. Meeks ran uncontested in the November 2020 General Election.
 
Prior to his election, Assembly Member Meeks was an administrative organizer with 1199 SEIU, where he represented nearly 800 health care sector employees and took on an array of tasks including bargaining contracts. Assembly Member Meeks mobilized workers around workplace issues, such as improved wages and benefits. Shortly after achieving employment with 1199 SEIU in November 2010, he became an active member of the Rochester Chapter of the Coalition of Black Trade Unionists.
 
Since its induction in 2013, Assembly Member Meeks has been an active member of Rochester’s Parent Leadership Training Institute Civic Design Team. Assembly Member Meeks is also an active member of the Omega Psi Phi Fraternity Incorporated. He was initiated into the brotherhood in the spring of 2010. Assembly Member Meeks currently assists his fellow fraternal brothers with “Project Stride,” a youth mentorship program at School #4 as well as mentorship at the Boys & Girls Club of Rochester.
 
With the assistance of his family, Assembly Member Meeks commits to braving the elements on Rochester “Cold Blue” weather days and feeding those in need of a hot meal. As a member of the New York Statewide Coordinating Committee of the Poor People’s Campaign, Assembly Member Meeks works with groups such as Metro Justice and the Social Welfare Action Alliance (SWAA) to build coalitions as part of “A National Call for Moral Revival.”
 
Assembly Member Meeks has won a number of awards for his work in the Rochester community. In 2017, he was awarded the Black Men Achieve Awards Civil & Human Rights and Brother of the Year. In 2018, he was awarded the Frederick Douglass Award from the Coalition of Black Trade Unionists. In 2019, Assembly Member Meeks was awarded the Civil & Human Rights Activist of the Year. Assembly Member Meeks was also awarded the Dr. Walter Cooper Community Service Award by the Rochester Black Bar Association as well as the Superior Community Service Award from the Omega Psi Phi Fraternity Incorporated.
 
This session he will serve as Chair of the Subcommittee on Insurer Investments and Market Practices in Underserved Areas; as well as a member of the Committees on Children and Families; Cities; Governmental Operations; Housing; and Insurance.