Albany Passes $229 Billion Budget

May 3, 2023 Last Edit: June 5, 2025

Albany Passes $229 Billion Budget

After being more than a month late, Governor Hochul, Speaker Heastie, and Senate Majority Leader Andrea Stewart-Cousins struck a deal on New York’s Fiscal Year 2024 State Budget. Lawmakers passed the record-breaking $229 billion on May 2^nd, more than 30 days past the April 1^st budget deadline. The budget was held up due to major policy disagreements around criminal justice reforms, housing, charter schools, minimum wage, and environmental issues. While many policies were kicked out of the budget, several issues of importance were included in the final package. NFIB engaged with the Governor’s office, leaders, and individual lawmakers throughout the entire budget process and implemented robust grassroots and media campaigns on minimum wage, all-electric buildings, Unemployment Insurance taxes, and the MTA payroll tax. Here is a breakdown of the major issues impacting small businesses: Minimum Wage There was a well-funded and organized effort by labor unions and far-left advocates to increase the minimum wage 42% over three years, reaching $21.25 per hour. NFIB strongly opposed this initiative and pressured leaders to reject the radical proposal, but we were unable to stop a minimum wage increase altogether. The final budget includes the following minimum wage increase:

In New York City, Long Island and Westchester, the minimum wage will increase to $16 in 2024, $16.50 in 2025, and $17 in 2026. Beginning in 2027 and thereafter, there will be annual increases tied to inflation.
In the remainder of New York State, the minimum wage will increase to $15 in 2024, $15.50 in 2025, $16 in 2026. Beginning in 2027 and thereafter, there will be annual increases tied to inflation.

MTA Payroll Tax Governor Hochul’s original budget proposal included an increase in the metropolitan commuter transportation mobility tax, better known as the MTA Payroll Tax, for all businesses within the entire 12-county MTA region. The final budget limits the payroll tax increase to certain businesses in the five boroughs. The tax rate will remain the same for businesses in Bronx, Kings, New York, Queens, and Richmond counties with less than $375,000 in quarterly payroll expenses. The tax rate for employers with quarterly payroll expenses between $375,000 and $437,500 will increase to 0.23 percent, and the tax rate for businesses with more than $437,500 in quarterly payroll expenses will increase to 0.60 percent. All-Electric Buildings Beginning Dec. 31, 2025, most new buildings below seven stories will be prohibited from installing fossil-fuel equipment and building systems, including gas-powered appliances and heating systems. The prohibition will apply to buildings seven stories and above after Dec. 31, 2028. Buildings or part of a building that is used as a manufacturing facility, commercial food establishment, laboratory, car wash, laundromat, hospital, other medical facility, and critical infrastructure is exempt from the electrification requirements. The new law will also not apply to existing buildings or new commercial or industrial buildings greater than 100,000 square feet. Small Business and Entrepreneurs Grant Program The final enacted budget includes a two-year pilot program that will award up to $25,000 in grants to entrepreneurs and small businesses to cover startup costs or expansion of an existing business. Empire State Development, New York’s economic development agency, will develop additional rules and regulations to implement the program. The budget did not include any money to address New York’s depleted Unemployment Insurance (UI) Trust Fund or the state’s $8 billion federal UI debt. NFIB will continue to strongly advocate for UI tax relief and elimination of interest assessments throughout the end of the legislative session. For NFIB’s budget reaction, click HERE.

Topics:

Taxes

State:

New York

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