Governor Kathy Hochul announced a $254 billion state budget agreement for New York, which includes major public safety reforms, such as facilitating the removal of individuals in psychiatric crisis from public spaces for evaluation, and easing discovery requirements for prosecutors. The budget also introduces a ban on cellphones in schools but faced opposition on mask restrictions due to civil liberty concerns. Financial measures include a child tax credit for families and maintaining tax cuts for middle-class New Yorkers, while larger companies face increased payroll levies to support infrastructure funding. The state anticipates potential budget adjustments in response to federal cuts, with the possibility of a special legislative session to address shortfalls. Additionally, changes to campaign finance laws and election processes for governor and lieutenant governor were incorporated, reflecting ongoing political dynamics as Hochul faces re-election challenges.

The budget agreement, ending a monthlong stalemate, focuses on public safety by making it easier to remove individuals in psychiatric crisis from public spaces for treatment evaluation and easing prosecutor evidence requirements in pretrial phases.

A contentious all-day school cellphone ban was successfully included, while mask-wearing restrictions were diluted over concerns of selective enforcement and civil liberties.

Financial provisions feature a child tax credit up to $1,000 for families with young children, although the initially proposed $3 billion tax refund was reduced, offering New Yorkers $200 to $400 instead.

Despite maintaining middle-class tax cuts, the agreement imposes an increased payroll levy on large companies to fund a $68 billion MTA infrastructure upgrade, while smaller companies benefit from reduced payroll tax burdens.

Anticipating federal budget cuts, state leaders acknowledge the need for a potential special session to address fiscal shortfalls, already contending with a $1.2 billion reduction in federally subsidized programs.

Changes to campaign finance rules now allow matching for donations up to $1,000 and alter the electoral process, enabling gubernatorial candidates to run as a ticket with their lieutenant governor.

Governor Hochul's re-election prospects are challenged by intra-party dynamics and Republican contenders, with her budget plan seeking to address voter concerns over rising living costs and economic stability.