Senate open to zoning overrides but Assembly opposed, sources say

Housing is now dominating budget talks as state leaders work towards passing a budget that’s more than two weeks late

Assembly Housing Committee chair Linda Rosenthal speaks at a rally calling for the inclusion of 'good cause' eviction in the state budget, outside the Capitol on April 18, 2023.

Assembly Housing Committee chair Linda Rosenthal speaks at a rally calling for the inclusion of 'good cause' eviction in the state budget, outside the Capitol on April 18, 2023. Rebecca C. Lewis

With talks over the late state budget stretching into the 18th day, housing has emerged as the new sticking point as legislative leaders and the governor attempt to find a compromise on Gov. Kathy Hochul’s plan to build 800,000 units of new housing. Sources with knowledge of negotiations told City & State that the state Senate is largely on board with one of the key tenets of Hochul’s housing plan, but the Assembly is standing in the way of a final deal. 

Under Hochul’s original proposal, the state would have the ability to override local zoning laws if localities failed to hit growth targets for new housing of 1% per year upstate and 3% a year downstate. But on Tuesday, both Spectrum News and Politico New York reported that as part of discussions around a housing deal, the budget would not include growth mandates for municipalities to hit. Instead, the state would implement more robust incentives for municipalities. Other parts of Hochul’s plan including basement conversions, allowing greater residential housing in New York City and targets for transit oriented development remained on the table. 

According to multiple sources with knowledge of budget talks, the state Senate was open to finding a compromise around the local zoning override and was close to figuring out a deal with Hochul on the matter. But per the sources, the Assembly vehemently opposed the idea of any mandates and stopped the potential compromise dead in its tracks.

A spokesperson for Assembly Speaker Carl Heastie called the characterization that the Assembly killed a pathway to compromise on local zoning overrides “inaccurate,” while a spokesperson for state Senate Majority Leader Andrea Stewart-Cousins did not immediately return a request for comment. Hochul released a statement on Tuesday morning confirming that legislative leaders still opposed key parts of her plan, including the housing requirements, but did not explicitly deny the reports that the mandates would not be part of a final deal. “We have not yet come to a final agreement, but it remains clear merely providing incentives will not make the meaningful change that New Yorker’s deserve,” Hochul said. “I will continue to discuss other elements of the plan and policy changes that will increase supply and make housing more affordable.”

Later on Tuesday, all three leaders met for a closed-door budget discussion, with Stewart-Cousins and Heastie avoiding the waiting press when they exited the meeting. But reporters from the Times Union and Spectrum News caught Heastie in the halls of the Capitol, when he offered sparse comments on the latest reporting and the state of talks. “It was just another check in on the conference, I told the governor where the conference was and we’re gonna keep at it,” Heastie told the Times Union. When asked specifically about the reports on housing, the speaker added that he didn’t think “anything has been finalized (or) unfinalized.” He later told Spectrum, “I don’t think we’re close on housing.” An Albany insider told City & State that they expect the fight over housing to be even more complicated and contentious than the fight over bail.

Earlier in the day, tenant advocates and lawmakers rallied for “good cause” eviction protections to be included in the final housing deal. “We are not leaving, we are not surrendering, we are saying this is vital,” Assembly Housing Committee chair Linda Rosenthal said at the rally. “We don’t need a budget without ‘good cause.’” Rosenthal didn’t go so far as saying that she would vote down the budget if it does not include the tenant protections, but told City & State, “I don’t know that we should have housing in there if we don’t have ‘good cause.’” She said that Heastie has “remained steadfast” in communicating and fighting for the wishes of the conference during negotiations, including over “good cause” eviction. State Sen. Julia Salazar, who sponsored the good cause legislation, was also in attendance at the rally “(The) Senate isn’t considering doing a housing deal without (good cause),” Salazar said in a text message. 

Although Rosenthal declined to say whether the tenant protections would be a line in the sand for her, other lawmakers at the rally indicated their willingness to vote down a budget that didn’t include “good cause” eviction. “What we’re saying collectively is that we can’t go back to our districts without ‘good cause,’” Assembly Member Anna Kelles said. “And that is how we’ll vote.”