NY misses budget deadline, payday for state workers looms

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A view of New York State Capitol Building and office of Governor Andrew Cuomo. (Photo by Roy Rochlin/Getty Images) (Getty Images)

ALBANY, N.Y. (AP) - Having missed an April 1 deadline to have a budget in place by April 1, New York lawmakers were still working Friday toward an agreement with Gov. Andrew Cuomo, with the Legislature’s proposal to raise taxes on millionaires remaining a key sticking point.

Elected officials will have to act soon to avoid the risk that state employees who work in health care and correctional facilities and other state institutions might not get their paychecks on time next Thursday.

"We have alerted the Governor and the state Legislature that if a state budget is not adopted on Monday, about 39,000 state workers may have a delay in receiving their paychecks," State Comptroller Tom DiNapoli said. "Many are essential workers who must show up at work every day and put in long, hard hours. For the workers that get paper checks or have payments set up on direct withdrawal, I urge them to be mindful of the impact of a late state budget on their personal finances."

Another 146,000 state employees at administrative and executive state agencies are expecting their pay day April 14.

Cuomo, a Democrat, has warned that a tax hike on top earners could drive out New Yorkers who pay a high share of the state's tax revenues. But Democratic lawmakers say there's a lack of evidence that tax hikes drive out the wealthy, and say it's time for New York to raise more revenue to prevent spending cuts in years ahead once federal relief runs out.

Minority Republicans argue that Democrats’ spending and tax increases will decimate the state’s still-recovering economy. The economic shutdown from the pandemic has devastated New York’s hospitality, leisure and restaurant industries, though tax revenues are on the upswing.

Cuomo and lawmakers say this year’s budget will be critical as the state faces pressing questions on issues from healthcare, to help for small businesses, to housing, to schools. Democrats wield a veto-proof supermajority in the Legislature and could have more leverage this year compared to past budgets, when the governor pushed for smaller spending increases than wanted by the party’s left wing.