Gov. Hochul Seeks Large NYC Projects, Housing, Climate Change Goals in Her FY25 Proposed Budget
By JOHN JORDAN – January 25, 2024
ALBANY—Gov. Kathy Hochul used her two spotlight appearances here this month to lay the groundwork for what her administration will seek in the annual budget battle with the Legislature. Her 2025 Executive spending plan address on Jan. 16 echoed the same elements of her State of the State address on Jan. 9—covering a wide gamut of issues, including the housing shortage, climate change, transportation spending, crime and consumer protection among a host of hot-button issues.
The governor also revealed her intent to move forward on a number of large infrastructure projects, including the more than $8-billion westward expansion of the Second Avenue subway project in Manhattan. (See sidebar report, FY2025 Transportation Spending in Focus, for major categories listed in the Executive Budget.)
The $7.7-billion Phase Two of the Second Avenue Subway is a fully funded project that is ready for construction, she reported. Looking to the future, the governor stated that the MTA will evaluate, scope and plan for another extension of the Second Avenue Subway west along 125th Street, adding three new stops at Lenox Avenue, St. Nicholas Avenue, and Broadway in Harlem. This extension would create connections with seven existing lines and serve 240,000 daily customers, with more than 90% of them from equity communities. It would also significantly reduce bus congestion along 125th Street, where more than 30,000 people ride the bus along this corridor every day.
The Gothamist reports that the westward expansion would be years away and comes with an estimated price tag of $8.1 billion, which includes the cost to buy a new fleet of trains.
This project scored well on the MTA’s 20 Year Needs Assessment, particularly for its cost effectiveness. In advance of environmental review and preliminary engineering, MTA will evaluate the feasibility of performing the initial tunneling work as a continuation of the Phase Two tunneling work and extending the tunnel boring machine’s westward path beyond Park Avenue to Broadway. If viable, this approach could save over $400 million over the life of the project, state officials said.
The governor is also seeking to have the MTA initiate formal engineering of the $5.5-billioin Interborough Express project in Brooklyn. In 2022, Gov. Hochul proposed the Interborough Express—a new service in Brooklyn and Queens that would use the existing right-of-way of the Bay Ridge Branch, connecting ethnically and socioeconomically diverse neighborhoods such as Bay Ridge, Sunset Park, Borough Park, Kensington, Midwood, Flatbush, Flatlands, New Lots, Brownsville, East New York, Bushwick, Ridgewood, Middle Village, Maspeth, Elmhurst and Jackson Heights. This project has the potential to provide connections to up to 17 subway lines, reducing travel times between the two boroughs by 30 minutes and serve 40 million riders a year.
The governor is also directing the MTA to expand a successful pilot hiring program to include the Second Avenue Subway Phase Two project, providing more jobs to workers in East Harlem. The existing pilot program has the MTA requiring contractors working on the New Jamaica Bus Depot, Rockaway Line Resiliency & Rehabilitation, a group of four ADA station improvements across the city, and the Broadway Junction station revitalization projects to commit to goals of 20% of the working hours to be performed by workers who live near the construction site or in lower income communities.
The chronic housing shortage is another chief area of concern for the governor. Following the failed “New York Housing Compact” last year, the Executive Budget includes a host of proposals geared at incentivizing housing development in New York City. In both her SOTS and budget addresses, she called for a new iteration of the 421a tax incentive in New York City to spur housing construction there as well as increased state funding for affordable housing projects. Her four-part housing proposal is geared to help New York City increase its housing supply by incentivizing construction of new housing, including affordable housing; encouraging affordable units in office conversion projects; allowing New York City to add residential density on certain projects; and legalizing basement and cellar apartments.
Other components of the governor’s housing initiative call for the creation of a $500-million capital fund to support the development of up to 15,000 units of housing on state-owned land, including at former correctional facilities, areas near commuter rail stations and under-utilized SUNY properties.
She also hopes to strengthen the Pro-Housing Communities program by making the certification a requirement for accessing $650 million in state discretionary funding.
The governor characterized her housing proposals as a “good start, but it is not enough to fix our affordability crisis.” She added that she and other legislative leaders must come forward with a sense of urgency to address the housing shortage and affordability crisis that is prompting thousands to relocate to neighboring states.
“Even with these historic investments, our state still needs hundreds and hundreds of thousands of new homes to solve our housing crisis. The answer, my friends, is not blowing in the wind, it’s shovels in the ground. And I know we can do this,” she said.
In some of her other business/ real estate proposals, the governor is proposing to launch the first of its kind “Empire AI” consortium that would unlock the economic potential of artificial intelligence; bolster state efforts to prepare workers for the jobs of tomorrow by establishing a network of four advanced manufacturing training centers along the I-90 Corridor in Upstate New York and growing statewide business attraction efforts with a $100-million expansion of the FAST NY program to prepare sites to be shovel-ready.
The governor said the Empire AI consortium would consist of seven founding institutions— Columbia, Cornell, New York University, Rensselaer Polytechnic Institute, the State University of New York (SUNY), the City University of New York (CUNY), and the Flatiron Institute. Empire AI will be funded through a combination of public and private investment totaling more than $400 million, including up to $275 million from the state in grant and other funding, and more than $125 million from the founding institutions and other private partners.
FY2025 Transportation Spending in Focus
Highlights of what Gov. Hochul wants:
- $7.9 billion in State operating aid for the MTA.
- $7.6 billion for the third year of the five-year $32.9 billion Department of Transportation Capital Plan, the largest in New York’s history.
- The 2024/2025 NYSDOT Highway Letting Program will total $2.5 billion.
- $577.8 million in funding for the Consolidated Highway Improvement Program (CHIPS) and the Marchiselli Program.
- $551 million for non-MTA transit in the downstate region.
- $323 million for transit systems in upstate New York.
- $100 million for the Pave our Potholes (POP) Program.
- $45 million for engineering on the Interborough Express project.
- $16 million to move forward with the planning of the Second Avenue Subway extension to Broadway.
- Introduced a comprehensive safety package to address the remaining legislative recommendations from the Stretch Limousine Passenger Safety Task Force.