With an eye on the $4 billion environmental bond referendum that’s up for a vote this November, New York Gov. Kathy Hochul proposed a $500 million investment in offshore wind energy.
It was only one of a variety of proposals she put forth Wednesday in her first state of the state address as governor since taking over from Andrew Cuomo last year.
Hochul said the investment would create thousands of highly paid green jobs that could boost economic growth while helping the environment.
“We've already started with increasing the Environmental Bond Act to $4 billion to go on the ballot this fall so we will have the resources we need,” she said.
Additionally, Hochul wants a faster transition out of fossil fuel usage.
“As we build out our wind-energy capacity, and continue our transition to clean energy, our reliance on fossil fuels must be phased out,” she said. "In September, I announced two clean energy mega-projects to put us on a path to achieve the ambitious goal of cutting 80% of New York City's power plant emissions by 2030. New construction in the state will be zero-emission by 2027, and we will build climate-friendly, electric homes and promote electric cars, trucks, and buses.”
Making the state's infrastructure more resilient against climate change and spending on digital infrastructure also figure in the governor's plans.
“We are making the largest-ever investment in New York's digital infrastructure, putting $1 billion into connecting more New Yorkers with high-speed internet,” she said. “This investment will boost innovation and economic growth — especially in our most remote communities.”
New York ranked third in the nation in bond issuance last year. State, city, county and related agencies sold over $48.21 billion of debt in 2021. This was down from the $57.09 billion the various state and municipal issuers offered in 2020.
The state's general obligation bonds are rated Aa2 by Moody’s Investors Service and AA-plus by S&P Global Ratings, Fitch Ratings and Kroll Bond Rating Agency.
Turning to transit issues, Hochul announced plans to move forward with the Interborough Express and directed the state-run Metropolitan Transportation Authority to begin the environmental review process for this infrastructure investment, which would connect neighborhoods in Brooklyn and Queens to as many as 17 subway lines and the Long Island Rail Road.
“This project would smartly repurpose existing infrastructure to add mass transit and create access to jobs, education, and opportunity for so many residents of Queens and Brooklyn," said MTA Acting Chair and CEO Janno Lieber.
The project also aims to improve travel to and from Manhattan and open opportunities for reverse commuting into Nassau and Suffolk counties.
In addition to passenger service, the governor noted the Bay Ridge Branch corridor might be able to be used for cross harbor freight rail, which could reduce truck congestion and expand the movement of goods. Hochul directed the Port Authority of New York and New Jersey to complete an environmental review for the project.
Hochul also wants to make a $10 billion multi-year investment to increase the state’s healthcare workforce by 20% over the next five years.
Key components of this plan include:
- $2 billion to support healthcare wages;
- $2 billion to support healthcare and mental hygiene worker retention bonuses, with up to $3,000 bonuses going to full-time workers who remain in their positions for one year and pro-rated bonuses for those working fewer hours;
- $500 million for cost-of-living adjustments to help raise wages for human services workers;
- $2 billion for healthcare capital infrastructure and improved lab capacity; and
- Investment in workforce and healthcare access and delivery.
Hochul proposed a spate of other programs for consideration.
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Republicans lambasted the governor’s plans.
“You know in your bones that New York is broken,” Nick Langworthy, chairman of the New York Republican Party, said in a video response to Hochul’s address.
Census Bureau data shows New Yorkers are leaving at an historic rate, faster and in greater numbers than ever before, he said, and “they are moving to ‘red’ states like Florida and Texas or in other words free states, prosperous states and growing states.”
But Hochul's address was short on details, said Citizens Budget Commission President Andrew Rein. “As is customary, the state of the state alone does not provide sufficient details to evaluate most of its proposals. We await those details, especially the fiscal implications,” he said.
“While the state’s budget appears sound in the short- and medium-term, there is a looming $3.5 billion
New York City is the engine that drives the state’s economy and a good state-city relationship is vital to the economic health of both. Cuomo and former New York City Mayor Bill de Blasio had a contentious relationship.
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“I’m here to declare there is a new day dawning and a whole new era of cooperation,” Hochul said then. “We'll fight for you and not fight each other anymore."
However, the city faces a cold winter as it slowly recovers from the pandemic even as the state-city relationship warms up.
New York State Comptroller Thomas DiNapoli noted Wednesday local sales tax receipts are continuing to rise while the unemployment rate continues to fall. Federal funding has helped move the state to a relatively strong fiscal footing, he said, but significant challenges lie ahead.
The city’s restaurant, retail and recreation sectors were continuing to struggle even before the latest surge in COVID-19 cases, a report DiNapoli released Tuesday showed.
There were 169,700 fewer jobs in these sectors in November compared to the same period two years prior. These losses accounted for 41% of the total private sector jobs the city lost during the pandemic.
Currently, the city’s overall economic recovery continues to lag the rest of the country. The city lost a higher share of jobs between the second quarter of 2019 and the second quarter of 2021 than any of the other five most populous counties in the nation, the comptroller’s report showed.
About 10% of the jobs lost in the nation over the period and 62% of the jobs lost in the state were based in New York City.
The federal government has given about $45 billion of COVID-19 relief to businesses in the city as part of the $1.3 trillion U.S. Small Business Administration aid programs. These include the paycheck protection program, the economic injury disaster loan program, the shuttered venue operators grant program and the restaurant revitalization fund program.
The city's GOs are rated Aa2 by Moody’s, AA by S&P, AA-minus by Fitch and AA-plus by KBRA.
