Hochul isn't supporting tax hikes to fill federal cuts

And cannabis shops are being offered another solution to the school distance debacle.

Good afternoon — it’s Tuesday and Poll Worker Recruitment Day.

In today’s CapCon:

• Hochul said Tuesday she’s no more likely to raise taxes on high-income earners than she was before the federal government approved sweeping cuts.

• State Senate Majority Leader Andrea Stewart-Cousins said Democrats should take a different approach to elections in the context of the redistricting debate.

• Another bill has emerged that would both protect cannabis shops currently too close to schools and give future applicants more options.

• This lawmaker wants to codify into state law a prohibition on churches and other tax-exempt entities from participating in politics.

Names in today’s CapCon: Kathy Hochul, Andrea Stewart-Cousins, Felicia A.B. Reid, Luis Sepulveda, Al Stirpe, Tony Simone, Shelley Mayer

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(New York Governor’s Office)

💰 Hochul doubles down on opposition to tax hikes to fill federal funding gaps

When the financial crisis of 2008 sent the country’s economy into freefall, lawmakers in New York debated how they could soften the blow for the state.

New York, alone, was facing a $17.9 billion budget gap in 2009 due to the crisis, now more commonly known as the Great Recession. Lawmakers closed it through a combination of federal aid, spending cuts and new revenue.

One of the most controversial revenue actions enacted that year was what became known as the “Millionaire’s Tax,” a higher state income tax rate for high-income filers.

The tax was expected to raise about $4 billion and expire after three years in hopes that the state’s economy would rebound and replace that revenue. It wasn’t the first time the state had used a tax increase to fill a deficit.

It wasn’t the last time either. New York has since extended and raised those once-temporary taxes on high-income earners. The last increase was during the economic downturn from the coronavirus pandemic.

New York is now facing budget gaps that rival what then-Gov. David Paterson and the state Legislature had to manage in 2009, state Comptroller Thomas P. DiNapoli said last week.

I’ve noticed that much of the reporting on DiNapoli’s finding has been incorrect, with many writing that he was referring to the state’s $34.3 billion budget gap through the end of fiscal year 2029. He was not.