Bruising budget battle in New York deepens Democratic divide

ALBANY, N.Y. — Each day in recent weeks, the sounds of rallies and protests by activists and Democratic lawmakers have filled the cavernous granite and concrete halls of the New York State Capitol — most of the noise aimed at halting Gov. Kathy Hochul's agenda.

Progressives are demanding the first-term governor expand immigration rights, increase the minimum wage, tax the rich and drop a proposal to toughen controversial bail laws. Suburban, moderate lawmakers want her to revamp a sweeping, first-in-the-nation plan that would require municipalities to build more housing.

Budget season in Albany always leads to warring factions, but this year’s battle is particularly perilous after Hochul narrowly won a full term as the state's first woman governor and after Democrats became the target of national party scorn when Republicans flipped three House seats, helping the GOP claim the majority.

At a moment when many are looking to Hochul to unite Democrats in New York, fearing disaster in 2024, the governor is having the opposite effect. Progressives from New York City, who largely control the state Legislature, feel emboldened to push a left-leaning agenda after a decade of strong-arm tactics from ex-Gov. Andrew Cuomo. And Hochul, long a moderate, is struggling to advance priorities that include tough-on-crime policies and making the state more affordable.

It's a volatile mix that’s left the governor with limited political capital and her party as splintered as it has been in years.

“I wish she would listen to the voters and not the high rollers,” state Sen. Jessica Ramos (D-Queens), a leading progressive and chair of the Senate Labor Committee, said in an interview, adding that Hochul is being influenced by corporate interests who helped her raise a state record $50 million for her election.

Hochul still has the power to shape budget negotiations in coming days and weeks since she holds the purse strings ahead of the April 1 start of the fiscal year. New York lawmakers typically wrap most major legislative proposals into the state budget each year, so winning support for her agenda will be her highest priority as discussions wrap, likely in April if a deal isn’t reached in the next few days.

Hochul has struggled all year to get traction in the Legislature. She got rolled by Democrats in the state Senate last month when they resoundingly rejected her pick, Hector LaSalle, to be the state's top judge — a first-of-its-kind rebuke by lawmakers who deemed him too moderate for their taste.

Hochul’s trying a new tactic this month by aligning herself with former New York City Mayor Mike Bloomberg, who is pumping $5 million into ads and mailers in lawmakers' districts to boosther priorities. While the move will certainly put pressure on lawmakers worried about how their constituents will view the messages, it’s also serving to anger fellow Democrats who think the mailers cross a line.

“What's she's doing is weaponizing her identity and allowing billionaires to use her to continue the same old Albany politics,” Assemblymember Ron Kim (D-Queens) said at a news conference last week referencing Hochul’s status as the first woman governor.

Hochul appears ready to dig in on her priorities, looking to beat back opposition to toughening bail laws on violent suspects and making the high-cost state more affordable by forcing new housing in the suburbs.

She also wants to show that she’s got a firm grip on her office as she looks to set the tone at the Capitol for her four-year term and takes the reins of a divided state Democratic Party after succeeding Cuomo, who resigned in 2021.

Democratic values get “clouded” when “people from the socialist side” say they represent what the party stands for, Hochul said.

"My job is to bring it together, instill confidence in voters in the Democratic Party and go forth into a whole new era," the governor said earlier this month, when asked by POLITICO about the party's future.

Some New York City Democrats are still calling for the resignation of state party chairman Jay Jacobs, who lost all four House seats in his Long Island backyard and is fighting with liberals by blasting them as too far left for the state as a whole.

"There is a concerted, clear and definite unrelenting effort by folks from the far left to unseat moderate, progressive incumbents," Jacobs said in a recent interview. "And it's all about power."

Jacobs said that, if the Legislature keeps pushing the party further left, it will alienate moderate voters in the suburbs and upstate — which, he said, was the reason Republicans flipped four House seats on Long Island, in the Hudson Valley and upstate.

"The people who abandoned the Democratic Party, for the most part, abandoned the Democratic Party because they felt that our party has moved too far to the left," he continued. "The more we continue to do that, the more voters in these areas we will lose."

So far, Hochul has stood by Jacobs, but his presence continues to irk liberals. Some groups said Hochul needs to make New York a progressive capital in the nation to counter Republicans in Washington and in red states.

"The governor in the last election struggled to communicate most directly with voters, and now this is a movement in the budget to say: message received," said Sochie Nnaemeka, the director of the labor-backed Working Families Party.

Some Democrats said it's important that the party find common ground heading into 2024, when all 26 House seats and 213 state legislative seats will be on the ballot again.

"We have to take back the House in 2024. We need to make Leader [Hakeem] Jeffries … Speaker Jeffries, and in order to do that, we have to figure out what didn't go so great and what did well and how we do more of that," Sen. Jamaal Bailey, the Bronx Democratic Party chairperson, said.

The tension at the Capitol is almost palpable. And it was apparent as soon as the six-month legislative session started in January.

"In a lot of areas, the governor was a drag on the ticket. That's just a fact. So how much does that contribute to what we're seeing now? I don't know. I think the people who are most aggrieved aren't here anymore. They lost," said Sen. James Skoufis, a Hudson Valley Democrat and part of the conference's more moderate faction.

"But it's clear, regardless where it comes from, there is tension between a lot of the Legislature and the governor."

How does it end up?

"There are two paths forward," Skoufis surmised in the wake of the LaSalle rejection. "The place proverbially blows up for session, and the other is we hit a reset button. Obviously, I hope it's the second."