New lineup in New York's state Senate may shift priorities

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Full Democratic control of New York's legislature could alter the state’s fiscal priorities, according to analysts.

Democrats, who have long had a firm hold on the Assembly, also seized control of the state Senate on Election Day for the first time in a decade. While some races are still not finalized, the Democrats are in line to pick off eight Republican-held seats and go from a 32-31 minority to a 39-24 majority. Gov. Andrew Cuomo easily won re-election to a third term.

Jerry Kremer, president of Empire Government Strategies, said the Albany shift will likely increase New York City’s chances of obtaining home rule policies such as expanding red light cameras and adjusting rent control rules, which have been held up in recent years by the GOP-controlled Senate. Democratic control of both chambers will also increase the chances of New York next year becoming the latest state to legalize recreational marijuana after Cuomo indicated support of the policy during his re-election campaign, according to Kremer.

“This could increase in the following years a substantial amount of revenue,” said Kremer of the growing likelihood New York will legalize cannabis. “That is definitely going to have an impact on future state budgets.”

State Senate Democratic Leader Andrea Stewart-Cousins, D-Yonkers, is expected to become the next majority leader when the session begins in January. She first assumed office in 2007 and was elected to lead the Senate Democratic Conference in December 2012.

While the new legislative makeup will likely bring new fiscal policies that affect revenues, Kremer cautioned that increasing spending will be tough because of a decline in bank settlement funds that were used to shore up recent state budgets. Kremer also said lawmakers will face increased political challenges in increasing tax revenues because of the new federal legislation that caps deductions for state and local taxes at $10,000.

“There is going to have to be a dose of fiscal reality of what the state can afford,” said Kremer. “There will be much less money to toy with.”

Long Island was ground zero for the blue wave Tuesday with Democrats now controlling six of the region’s nine state Senate seats, up from two.

“This block of suburban Democrats, along with some upstaters, will keep the Senate leadership from pushing overly progressive policies that might cause taxes to increase,” said Larry Levy, executive director of Hofstra University’s National Center for Suburban Studies. “In the suburbs, the top three political concerns typically are taxes, taxes and taxes, followed by crime and the environment and unless the freshmen Democrats want to be one-term wonders, they won't go along with any dramatic expansion of existing revenue sources.”

New York is rated Aa1 by Moody's Investors Service, and AA-plus by S&P Global Ratings, Fitch Ratings and Kroll Bond Rating Agency.

Kremer said that Cuomo governing for eight years with a Republican-led Senate led to a property tax cap and fiscally conservative budgets, which may now change with Democrats who want to increase spending on certain state programs.

"The Senate was on many issues an ally to the governor,” said Kremer of Cuomo's fiscally conservative policies. “He is now going to have less control of the process.”

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