Monday Morning Memo – March 27

Good morning from Albany, NY where the budget frenzy continues. Sources report small but measurable progress in negotiations regarding health and environment/energy issues.  That said, three-way negotiations blew up this weekend over criminal justice (re: bail) though were back on as of yesterday afternoon.

The Legislature and Executive Chamber have until the end of the day Friday to reach an agreement on a new state budget. However, the real deadline very well may be 4 p.m. on Monday, April 4th— at which point the State Comptroller would not be able to issue paychecks to state workers without an enacted budget.

Lawmakers did get one step closer this past week with the first meeting of the General Budget Conference Committee, also known as “The Mothership.” The public meetings, comprised of the Senate Majority Leader, Assembly Speaker, and Finance and Assembly Ways & Means Committee Chairs, are intended to serve as a window of transparency into the budget process. In reality, little of substance is decided in those meetings. Similarly, joint budget subcommittee meetings—on more specific issues from Higher Education to Healthcare to Environmental Conservation—happened last week, but the two sides have yet to release their table targets which are used as the basis for budget negotiations among the committees.  

• Murder: -11%
• Rape: -5% 
• Aggravated Assault: +9%
• Robbery: +21%
• Burglary: +16% 
• Larceny: +26%
• Motor Vehicle Theft: +21% 

Leadership in the Legislature feels that the Governor’s focus on bail reform and its connecting to spikes in crime across the State is misguided. Assembly Speaker Carl Heastie said, “Crime statistics are going down, study after study is showing that bail reform is not the driver of crime.” In addition to pushing back on bail reform, criminal justice activists are advocating for the Clean Slate Act to finally get across the finish line this year. The proposal, which would automatically seal an individual’s criminal records under a series of conditions, was included in the Senate One-House Budget proposal, but was omitted in the Assembly. 

The proposal to phase out natural gas hookups on new buildings was advanced in both One-House Budget proposals, but with notable exceptions for single family homes, commercial food service, and other venues like hospitals, laboratories, and emergency backup power sources. A similarly high-profile proposal, Hochul’s housing plan, was initially met with skepticism from some lawmakers who had concerns with the state overriding local zoning authority. It has been reported that the Senate originally considered backing Hochul’s plan before choosing to incentivize rather than require housing development, but the proposal is still very much in play as negotiations continue. The Legislature also threw cold water on Hochul’s plan to ban menthol and other flavored tobacco products amid pushback from sheriffs, the tobacco industry, convenience store owners, and some members of the clergy who feel it unfairly targets Black and Brown people. The plan also drastically raises the per pack cigarette tax from $1 to $5.35. 

The 1199SEIU healthcare workers union held a mega-rally last week to advocate for increased funding to safety net hospitals, a higher Medicaid reimbursement rate, and protections for home healthcare workers. Their asks, totaling more than $2.5 billion, are generally included in One-House Budget proposals and leadership in both Houses reiterated their support for healthcare workers at the rally. Senate Majority Leader Andrea Stewart-Cousins said to the 17,000+ crowd at MVP arena, “Thank you, and our One-House Budget says ‘Thank you.’ We put in a billion dollars more for the hospitals” and Speaker Heastie added, “We ain’t gonna do a budget unless it shows you the respect that you do.” 

Progressive lawmakers in Albany have decried Governor Hochul’s plan on the minimum wage which would tie the minimum wage to inflation while capping yearly increases at 3%. Senator Jessica Ramos, who chairs the Senate Labor Committee, said “In a year like last year, 3 percent would have been nonsense.” Ramos has a proposal of her own that would mandate a $21.25 minimum wage in NYC and $20 everywhere else in the state. Both houses are open to indexing the minimum wage to inflation, but they want it to be raised first. 

Another area of disagreement, how to fund the MTA, has resulted in a number of proposals aimed at generating revenue, including residential parking permits in NYC and removing Madison Square Garden’s property tax exemption and redirecting those funds to the MTA. The Senate proposal also includes a $.50 surcharge on Uber rides and other ride-sharing apps throughout the State, with funds going to both the MTA and non-MTA transportation authorities. Both houses rejected the MTA’s planned fare increases in 2023 and 2025 while also establishing a pilot program offering free ridership. Another proposal in the Assembly to increase funding for mass transit systems includes a 4% local sales tax and 4% state sales tax on digital streaming services like Netflix and Hulu. 

As we highlighted a couple of weeks ago, the steady stream of recent mailers and TV ads touting Governor Hochul’s budget proposal have been revealed to be the work of American Opportunity, a group funded by former billionaire mayor Michael Bloomberg with the goal of enacting moderate public policy at the state level. The ads read “You want to live in a New York that is safe, where you can raise a family and not get proved out. Kathy Hochul understands that. And her budget reflects that” before prompting viewers to scan a QR code to easily contact their state representatives. When asked about Bloomberg’s help in building support for her policies, the Governor said “I am happy to receive the support from all over the state of New York. I have support for the budget from the NAACP, from clergy from Buffalo to Long Island.” 

In Washington, D.C., the Senate advanced a bill to repeal the 2002 Authorization for the Use of Military Force (AUMF) which gave sweeping executive authority to then President George W. Bush and has been used by Presidents since to carry out military action without the approval of Congress, and would restore a major check in the balance of power between the White House and Congress. Senate Majority Leader Chuck Schumer said in floor remarks, “Senate passage of AUMF repeal is now a matter of when not if, and today we’re going to continue working to make sure that it happens as soon as we can. Americans want to see an end to endless Middle East wars. Passing this AUMF repeal is a necessary step to putting these bitter conflicts squarely behind us.” After further debate on Republican amendment proposals, the measure will go before the full Senate for a vote. 

Former President Donald Trump’s prediction that he would be indicted by Manhattan District Attorney Alvin Bragg last Tuesday failed to materialize. However, it has been reported the Grand Jury is nearing the end of their proceedings, meaning a potential indictment could come any time after that. His legal troubles stem from a 2016 hush money payment to adult film actress Stormy Daniels who alleges she had an affair with Trump in 2006 and was later paid by Trump’s former attorney Michael Cohen to keep quiet. Given that the timing of the payment coincided with the 2016 election, Manhattan D.A. Alvin Bragg contests the payment amounts to a federal campaign finance violation and Cohen, who himself was convicted and served prison time for the payments, is cooperating with the District Attorney’s office. 

Florida Governor Ron DeSantis, who is expected to announce a 2024 presidential bid of his own, has used the opportunity to further contrast himself with Trump. When asked about the looming indictment at a press conference, DeSantis said “I don’t know what goes into paying hush money to a porn star to secure silence over some type of alleged affair. I just, I can’t speak to that.” DeSantis followed up on his veiled insult of President Trump with an interview on Fox with Piers Morgan where he was more explicit in his criticism. Speaking on how his approach to governing from Trump differs, he said “You bring your own agenda in, you’re gone. We’re just not going to have that. So, the way we run the government, I think, is no daily drama, focus on the big picture and put points on the board, and I think that’s something that’s very important.” Recent polling suggests that DeSantis cannot afford to sit back and let the former President’s attacks go unanswered. Since formally declaring his 2024 candidacy, Trump has called DeSantis “Ron Desanctimonious”, “Meatball Ron”, and even suggested the Florida Governor groomed children and was secretly gay during his short stint as a teacher. In December 2022, around the time when Trump’s attacks first started, DeSantis actually led Trump in a GOP primary poll 39%-26%. Now, the former president leads DeSantis 41% to 27%. 

Finally on Friday, all eyes in Washington D.C. were on TikTok CEO Shou Zi Chew’s testimony before Congress on the potential forced sale or full on ban of the app in the United States. The four-and-a-half hour hearing saw bipartisan onslaught that underscored broader tensions in Sino-American relations. The Chinese government added fuel to the fire just hours before the hearing with Chinese Commerce Ministry spokesperson Shu Jueting saying China’s government would have to approve any sale or spinoff to a U.S. entity. Amongst the consistent offensive against Chew, TikTok found a progressive defender from New York’s Congressional Delegation, Bronx/Westchester Rep. Jamaal Bowman. Earlier in the week, Rep. Bowman held a press conference outside the Capitol touting the platform’s virtues. Bowman said he wants to see Congress take a more holistic approach to social media giants. “We didn’t talk about a ban on Facebook” after Russia used it to influence the 2016 election,” he said.

As a tech-friendly firm, we are always pushing ourselves to be on the leading edge of computing-driven paradigm shifts… but forming a cult worshipping artificial intelligence? We are on the fence. We leave you this week with a story to ponder on the new-age group pushing the concept of worshipping an AI-driven “seed of cosmic mind.”

-Jack O’Donnell

 OD&A was at the University at Buffalo as Congressman Brian Higgins announced $933,800 in federal funding for the University at Buffalo School of Public Health and Health Professions. Secured by Congressman Higgins as part of the fiscal year 2023 budget, this community project funding will support a mobile health unit in medically underserved communities in Erie, Niagara, and surrounding counties in the Western New York region. [Read more.]

 

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