State of the State Insights 2026

Governor Kathy Hochul delivered her fifth annual State of the State Address today, marking the constitutionally mandated opening of New York’s 2026 legislative session. Ahead of the release of the full 161-page State of the State (SotS) book, the Governor previewed three major proposals focused on: protecting children online by restricting AI chatbots and addressing the youth mental health crisis; cracking down on 3D-printed guns and other illegal firearms, and; a proposal for universal child care for children under five and free child care for two-year-olds in New York City. While the SotS spans a wide range of policy areas, these initiatives are expected to remain central to New York’s political and policy debates throughout the 2026 legislative cycle and beyond the close of session.

Below is a summary highlighting key initiatives and proposals from the Governor’s speech and accompanying 2026 State of the State Book which is organized around 11 thematic chapters covering affordability, public safety, infrastructure, economic development, education, health, energy, environment, and community resilience. Many of these proposals are expected to be further detailed in the Executive Budget Proposal, scheduled to be released next week. This summary is not intended to be comprehensive but instead focuses on items most likely to impact or be of interest to many of our clients. 

Please do not hesitate to reach out to your B&W team member you work with on any questions or additional information.

Consumer and Worker Protections

Governor Hochul advanced a series of proposals aimed at strengthening consumer protections, enhancing digital safety, and supporting workers through targeted tax relief and stronger enforcement tools. This section highlights initiatives focused on data privacy and artificial intelligence oversight, protections against deceptive online practices and election interference, and measures to combat wage theft and fraud while putting money back in workers’ pockets. The proposals are organized into two subsections: Consumer Protection, Data Privacy, and Artificial Intelligence, and Worker Protections, Wage Theft, and Fraud Enforcement.

Consumer Protection, Data Privacy and Artificial Intelligence 

• Establish a new Office of Digital Innovation, Governance, Integrity, and Trust (DIGIT) to serve as a central authority for digital safety and technological governance, including enforcement of new online protections. 
• Advance legislation requiring data brokers to register with the State and allowing New Yorkers to submit a single, centralized request to delete certain categories of personal data held by data brokers.
• Require labeling of AI-generated content, including provenance data identifying the origin and creation of such content.
• Advance legislation to ban non-consensual deepfakes during specified pre-election periods and prohibit the dissemination of false election information related to voting logistics, eligibility, and registration.
• Propose legislation requiring online discounts to be bona fide, ensuring advertised discounts reflect genuine price reductions rather than inflated reference prices.

Worker Protections, Wage Theft, and Fraud Enforcement

• Propose eliminating state income taxes on up to $25,000 of tipped income for the 2026 tax year, consistent with federal guidance.
• Advance legislation authorizing the Workers’ Compensation Board to provide resources to district attorneys to establish dedicated workers’ compensation fraud units.
• Provide new funding through the Department of Labor (DOL) to support district attorneys’ wage theft investigations, with a focus on smaller and rural jurisdictions.

Health Care

Governor Hochul made affordability in health care services, insurance, and childcare central to her State of the address. This section provides the highlights of these proposals and is broken down into 3 subsections: Childcare and Youth Mental Health, Healthcare System and Aging, and Addictions and Miscellaneous.

Childcare & Youth Mental Health

The Governor builds on her previous work to triple the Child Tax Credit and provide universal school meals through an expansion of several childcare programs touching on expanding eligibility, providing incentives, and workforce development. The following sections provide an overview of many of these proposals including youth mental health initiatives.

Providing for Child Care

• Increase funding by $1.7 billion on top of prior investments as a downpayment  to ensure statewide universal access to prekindergarten for four-year-olds, support the early childhood workforce, and partner with New York City to launch 2-Care, a two-year-old child care pilot program, and provide universal access to 3k in the City.
• Increase state contribution for Pre-K seats through a uniform Pre-K grant funded at either $10,000 or a district’s current selected Foundation Aid per pupil, whichever is higher.
• Provide a $1.2 billion increased investment to the States’ Child Care Assistance Program (CCAP) bringing total available for subsidies to over $ Billion.
• Launch pilot programs to provide county-based local childcare coordination. Childcare providers will be able to enter into contracts that draw down on state and local funding.
• Seek legislation that will uncouple the State’s Child and Dependent Care Tax Credit from the federal tax code so it can be expanded and simplified. Changes to this program are estimated to provide an average benefit of $575 for roughly 230,000 tax filers.

Child Care Office and Workforce Development

• Establish a new Office of Child Care and Early Education charged with driving implementation of universal childcare. The Office will also manage continued investments in 3-K, the launch of NYC 2-Care, the expansion and improvement of CCAP, and workforce development.
• Support the workforce by expanding the Masters in Education Teacher Incentive Scholarship, making it work for early childhood educators while also expanding part-time Tuition Assistance Program aid for students in approved non-degree teaching and childcare programs.
• Seek to classify early childhood education as an in-demand occupation for the purposes of eligibility for the federal Workforce Pell Grants

Promoting Youth Mental Health

• Offer training for adults who regularly interact with youth in schools and community programs using a nationally recognized curriculum on common mental health challenges for youth.
• Direct the Office of Mental Health to partner with national crisis centers to provide youth with access to trained crisis counselors specialized for the LGBTQ+ community
• Expand the Office of Mental Health’s Youth Safe Space Programs designating two additional community organizations to provide supportive environments with mental wellness resources.
• Establish a Schools of Distinction in Supporting Mental Health designation to recognize and reward schools providing effective mental health supports.
• Open 15 new youth clubhouses to support community-based recovery for youth people suffering from a substance use disorder.
• Direct the Office of Addition Support and Services to establish the first Young Adult Recovery Residences to provide housing and services for up to 35 young adults with substance use disorders.

Healthcare System and Long-Term Care

Governor Hochul continues her investments to stabilize the system, expand coverage, lower consumer costs, and bolster the health workforce. In her speech she builds on these initiatives by: Strengthening the Healthcare Delivery System; Empowering the Healthcare Workers, Improving Healthcare Coverage, Access, and Affordability, Investing in Older Adults; and Improving Equity in Public Health.

Strengthening the Healthcare Delivery System

• Provide additional funding to the Safety Net Transformation Program to support innovative projects focused on regional planning, improved care coordination, reduced duplication of services, and partnerships that leverage Artificial Intelligence.
• Direct the Department of Health (DOH) to establish a consortium of healthcare and AI experts to share data and best practices for the safe deployment of AI tools safely.
• Direct the DOH to streamline and reduce administrative burdens associated with the Certificate of Need (CON) process to expedite healthcare projects.
• Expand DOH’s oversight of “material transactions,” to require ongoing reporting of actual impact of closed material transactions, along with external reviews for high cost, high impact transactions. 

Empowering the Healthcare Workforce

• Propose legislation to expand the scope of practice allowing certified nursing assistants to administer medication in nursing homes, physician assistants with sufficient training to practice independently, and medical assistants to administer vaccines. Changes would also allow the DOH to oversee and make additional decisions about licensed healthcare professionals’ scope of practice.

Improving Healthcare Coverage, Access, and Affordability

• Direct the DOH to mitigate coverage losses due to federal action by applying to the Centers for Medicare and Medicaid Services to return the Essential Plan to a Basic Health Program, preserving coverage for an estimated 1.3 million people. For the 450,000 New Yorkers who would lose their Essential Plan coverage, the DOH will negotiate with the federal government to develop affordable coverage options.
• Reform the prior authorization review process to: require formularies to be posted in a standard, accessible format; ensure prior authorizations for chronic conditions remain valid longer preventing unnecessary reviews for ongoing treatments; expand “continuity of care’ from 60 days for life-threatening conditions or late-stage pregnancy to 90 days of all health conditions and the full postpartum period; expand the data health insurers must report on claims processes including how often claims are subject to prior authorization and frequency request denials; launch a public education campaign.
• Eliminate special authorization for healthcare providers treating workers’ compensation claims, allowing any eligible licensed medical provider in good standing to treat workers’ compensation claims. 

Assisting Older Adults to Age in Place

• Increase investments in preventative home and community-based services including Naturally Occurring Retirement Communities, renew $35 million to reduce waitlists for non-medical in-home services, and launch the Community Aging in Place - Advancing Better Living for Elders (CAPABLE) program, to provide 2,600 older adults with in-home visits.
• Launch a council to identify all benefits across agencies that older adults may be eligible for and explore the option of a universal benefits application.

Improving Equity in Public Health

• Advance legislation to have New York set its own standards on immunization authorizing the Commissioner of health to establish requirements that guide school eligibility, clinical practice, and insurance coverage.
• Update the law related to the installation of fully automated AEDs and create a statewide registry to map the location of every AED in the State, accessible through a mobile application.

Addiction Supports and Miscellaneous

The Governor “doubles down” on investments for addictions services by streamlining access to services and strengthening behavioral health support. This builds on her previous work to launch the Office of Chief Disability Officer, the Deaf, DeafBlind, and Heard of Hearing Office, the opening of 1,000 psychiatric beds for people in need of intensive behavioral health services and increased the number of Certified Community Behavioral Health Clinics to 39.

Strengthening our Addiction Supports

• Integrate care for mental health and substance use disorders by allowing clinics to provide mental health and substance use services under a single, jointly issued license. Legislation will also be introduced to create a Co-Occurring Capable (CoC) designation for OMH and OASAS certified providers who meet standards for treating complex, overlapping cases.
• Curb gambling addiction by requiring treatment addiction disorders to be covered by insurance, establishing a gambling Health Institute, limiting online platforms ability to use AI-powered services for personalized promotions and wagers and launching a statewide study to assess gambling health trends. 
• $71 million to increase rates for OMH and OASAS Supportive Housing Programs.

Helping Put Food on the Table

• Additional funding will be provided for the DOH’s Hunger Prevention and Nutrition Assistance Program (HPNAP) in addition to funding a new competitive capital grant program for infrastructure improvements for New York’s regional food banks. 

Supporting First Responders’ Behavioral Health Needs

• Establish a First Responder Behavioral Health Center of Excellence to serve as a statewide training and technical assistance hub, supporting departments in developing and expanding peer support programs.

Protecting Safe Access to Worship and Healthcare

• Advance legislation to establish buffer zones around houses of worship and healthcare facilities to protect individuals from harassment and obstruction, while preserving the right to lawful expression.

Insurance

Governor Hochul advanced a package of proposals aimed at reducing insurance costs for New Yorkers while strengthening oversight of insurer practices and combatting fraud. The initiatives focus on curbing auto insurance fraud, limiting abusive litigation, increasing transparency around rate-setting and insurer profitability, and incentivizing safer driving and property resilience. This section is organized into two subsections: Cutting Auto Insurance Costs and Tackling Rising Home Insurance Costs.

Cutting Auto Insurance Costs

• Direct and empower relevant state agencies to crack down on fraud through legislation ensuring prosecutors can seek criminal penalties against any individual responsible for organizing a staged accident. Additional efforts will also be made to penalize medical providers who participate in fraud by signing off on phony medical diagnoses through increased medical licensure enforcement.
• Increase the timeframe insurers have to report fraud and reduce barriers to aligning fraud in court, providing more time for insurers to investigate claims and avoid paying fraudulent ones. 
• Cap insurance payouts to drivers who are engaging in criminal behavior at the time of the incident. This includes uninsured motorists, individuals convicted of driving while impaired or committing (or fleeing) a felony at the time of an incident.
• Limit Damages for individuals who are “mostly” at fault aligning with rules in Colorado, Connecticut, Delaware, Massachusetts, and New Jersey
• Tighten the definition of “serious injury” to remove temporary injuries that affect individuals for a short time following an accident. This threshold will be raised and clarified to have a medically sound definition and avoid unnecessary and expensive litigation from individuals attempting to exploit the system. 
• Direct the Department of Financial Services to re-examine the Excess Profit Law, particularly the current threshold trigger.
• Require insurers to notify policyholders about rate changes with an explanation and to offer additional context upon written request. The level of policy increase that would trigger insurance companies to provide this information will be determined by the Department of Financial Services.
• Improve incentives to drive safely by requiring insurance companies to offer discounts on rates when drivers opt into driver safety programs including devices, cameras, or apps to monitor driving behavior.

Tackling Rising Home Insurance Costs

• Create a check on home insurers’ profitability, increasing transparency of profits. Carriers with more than two consecutive years of outsized profits will be required to lower rates or submit a justification to the Department of Financial Services.
• Require commercial property insurers to report core data metrics annually regarding their multi-family housing businesses, including claims, premiums, and rates. These reports will be made public while templates and technical definitions will be developed administratively.
• Expand discounts to homeowners and commercial multifamily property owners who invest in safety and weatherproofing upgrades requiring insurers to offer and inform policy holders of reductions including fire resiliency solutions, theft prevention products, water damage prevention tools, and roof improvements.
• Require insurers to notify policyholders about rate changes with an explanation and to offer additional context upon written request. The level of policy increase that would trigger insurance companies to provide this information will be determined by the Department of Financial Services.

Artificial Intelligence & Technology

Governor Hochul remains committed to “cementing New York as the center for innovation,” highlighting her initiatives like Empire AI and the establishment of the NY Creates Albany Nanotech Complex. Artificial intelligence and technology remain central through her State of the State to identify costs-savings and efficiencies in government and healthcare while driving innovation in the economy.

Safeguarding Kids Online

• Propose legislation that expands age verification requirements beyond social media platforms to online game platforms, establishes new safety and child-oriented design features to shield children from online harms and enhance privacy standards, restricted the use of AI Chatot features on social media by children, limit direct messages to minor accounts, default children to the highest privacy settings including restrictions on real-time location sharing, implement parental controls on children’s ability to make or receive payments on online platforms.
• Direct the Gaming Commission to explore ways to ensure young people are not illegally downloading or otherwise using betting apps, including the use of biometric security to verify the correct user is logging in to the account.

Promoting Technology

• Launch a downstate Semiconductor Chip Design Center to serve as an incubator for early-stage firms, training chip designers, and connecting startups to the larger semiconductor sector.
• Establish four regionally based quantum hubs research and innovation hubs across New York that will serve as incubators and foster development and commercialization of quantum technologies providing early-stage companies with critical resources, including mentorships and access to local networks and computing.
• Launch Empire AI Beta, the world’s most advanced academic supercomputer. Along with Empire AI Alpha, these programs allow member institutions to conduct critical AI research

Promoting Biotech

• Establish a Statewide Clinical Trial Consortium to leverage New York’s research institutions to expand access to cutting-edge therapies in medical innovation.
• Seed skills-training programs for fellowships and workforce development to equip New Yorkers with skills to fill roles from production to c-suite in biotech.
• Create a Commercialization Grant Program to support companies in bringing biotech innovations to market

Economic Development, Infrastructure, and Housing

Governor Hochul advanced a comprehensive set of proposals aimed at accelerating housing production, modernizing infrastructure, and driving economic growth while reducing regulatory barriers and improving government efficiency. The initiatives focus on streamlining environmental review and permitting, expanding housing supply and renter protections, investing in community and transportation infrastructure, and modernizing procurement and development oversight. This section is organized into the following focus areas: Launching the “Let Them Build” Agenda; Streamlining Environmental Review and Permitting; Expediting Major State Infrastructure Projects; Building More Housing; Protecting Renters and Rent-Stabilized Housing; Investing in Communities; Launching the Next Phase of the Autonomous Vehicle Pilot Program; and Driving Economic Growth and Modernizing Government Operations.

Launching the “Let Them Build” Agenda 

• Amend the State Environmental Quality Review Act (SEQRA) to exempt certain housing projects that comply with local zoning and do not pose significant environmental impacts from additional SEQRA review. 
• Expand SEQRA Type II classifications to fast-track a broader range of infrastructure projects without additional review, while preserving environmental standards. Eligible projects would include clean water infrastructure, green infrastructure and stormwater management, parks and recreational paths on previously disturbed land, and new or renovated childcare centers on previously disturbed sites.
• Establish a two-year maximum deadline for completing a SEQRA environmental impact statement, from the issuance of a positive declaration to final agency decision. 

Streamlining Environmental Review and Permitting

• Direct the Department of Environmental Conservation (DEC) to develop Generic Environmental Impact Statements (GEISs) to guide environmental review for select housing and renewable energy projects.
• Launch Smart Access, a consolidated digital platform allowing applicants and agencies to track permits and environmental reviews in real time. 

Expediting Major State Infrastructure Projects

• Establish a new program to oversee and coordinate permitting for large-scale statewide infrastructure projects, including the Nuclear Generation Project and the Interborough Express (IBX). 
• Require (DEC), Empire State Development, Homes and Community Renewal, OPMI, and other agencies to collaborate on tracking timelines and identifying additional policy or process reforms to accelerate project delivery.

Building More Housing

• Allocate $250 million in new capital funding to accelerate and expand the development of affordable housing statewide.
• Provide additional funding for the MOVE-IN NY program, which supports factory-built, modular, and prefabricated housing to reduce constructions costs and timelines.
• Increase the cap on authorized land banks to 45 statewide, expanding local capacity to acquire and redevelop vacant and underutilized properties.
• Create a Manufactured Homes Park Improvement Revolving Loan Fund to finance infrastructure improvements in manufactured housing communities.

Protecting Renters and Rent-Stabilized Housing

• Propose aggravated criminal penalties for landlords who engage in systematic harassment of rent-regulated tenants across multiple buildings, as well as repeat offenders under existing anti-harassment law.
• Overhaul New York City’s J-51 incentive to support capital repairs on rent-stabilized housing.
• Increase the income eligibility limits from $50,000 to $70,000 in New York City for the Senior Citizen Rent Increase Exemption and the Disability Rent Increase Exemption. The same option will be available as a local opt-in outside of the City.

Investing in Communities

• Propose legislation to modernize the Alcoholic Beverage Control Law to facilitate consumer choice. This includes increasing opportunities for alcoholic beverage manufacturers by allowing all producers to own up to three restaurant or tavern licenses and open establishments at their manufacturing facilities.
• New round of investments into the Downtown Revitalization Initiative and New York Forward
• Expand County Infrastructure Grant Program investing and additional $50 million in funding to help counties modernize and rebuild essential public infrastructure.
• Overhaul the system for tracking and reporting of investments made through Industrial Development Agencies and Authorities to enhance transparency, integrity, and efficiency. Proposal is estimated to recoup $11 million in excess sales tax exemptions not currently policed.
• Finance a new round of Building Recreational Infrastructure for Communities, Kids and Seniors (BRICKS) program to support construction and renovation of community centers. 
• Establish the Saving Performing Arts and Cultural Experiences (NY SPACE) program to help nonprofit performing arts organizations rent or purchase performance venues.
• Advance plans to reimagine Jamaica Station as a state-led transit complex integrating the LIRR, NYC Transit and the JFK AirTrain.
• Continue investment in the Second Avenue Subway Phase 2, extending the Q line along 125^th Street with new stations serving Harlem and Upper Manhattan.

Launching the Next Phase of the Autonomous Vehicle Pilot Program

• Advance legislation to allow for the limited deployment of commercial, for-hire autonomous passenger vehicles outside of New York City. Companies seeking to pilot autonomous vehicle services would be required to submit applications demonstrating local support and compliance with stringent safety standards.

Driving Economic Growth and Modernizing Government Operations

• Propose procurement reforms to shorten state contracting timelines, including raising discretionary purchasing thresholds, increasing the New York State Contract Reporter threshold, and eliminating certain Office of the State Comptroller pre-approvals for centralized contracts.
• Pilot the use of artificial intelligence and other technologies in permitting and procurement processes to improve efficiency while preserving human oversight.

Education

The Governor continues her push to make New York a successful learning environment including her distraction-free school, expanding the Tuition Assistance Program, and implementing free community college for students ages 25-55 to help New Yorkers pursue careers in high-demand fields. Her proposals in education remain central to workforce development in other fields like technology, health, and energy.

Advancing Student Learning and Supports

• Establish a 3-year pilot program connecting school districts with colleges and universities to provide in-service professional learning to help ensure all students are receiving high-quality instruction to address student literacy issues.
• Support partnerships between high-need school district and tutoring providers. Opportunities will be limited to interested districts and support literacy and math.
• Create a sustainable teacher pipeline for individuals who want to become educators and already hold a bachelor’s degree. This pathway will require work in high-need classrooms getting teachers to where they are needed most. 
• Launch a new funding opportunity in the Clean, Green Schools Program supporting infrastructure and nature-based solutions to combat extreme heat in schoolyards transforming asphalt playgrounds to shaded permeable green space.

Student Loans & Financial Protections

• Propose legislation requiring student loan lenders to provide clear, standardized notices outlining the pros and cons of refinancing.
• Establish a standardized cosigner release process for private student loans, including required disclosures and eligibility for release after a reasonable number of on-time payments.

Connecting Higher Education and Opportunity

• Provide operating aid to SUNY and CUNY campuses to keep tuition flat.
• Expand SUNY and CUNY Reconnect to include additional fields like logistics, air traffic control and transportation, emergency management, and nursing degrees.
• Expand the Education Debt Consumer Assistance Program helping to educate borrowers on student loans.

Energy & Environment

The Governor continues to focus on affordability and reliability in the energy and environment policy space. Key to this area is her proposal to establish a Nuclear Reliability Backbone for a Zero-Emission Grid. Supporting offshore wind and solar power is also key to maintaining grid reliability and providing emissions free energy for major economic development and technology initiatives.

Advancing Nuclear Power

• Advance the new Nuclear Reliability Backbone initiative, directing agencies to integrate advanced nuclear generation to support grid reliability. The Backbone will be developed by a new Department of Public Service (DPS) process to review and facilitate four gigawatts of new nuclear energy. Combined with the New York Power Authority’s previously announced one gigawatt project, an estimated 8.4 gigawatts of nuclear power would constitute this backbone.
• Launch NextGen Nuclear New York to develop a skilled nuclear workforce expanding partnerships across K-12 schools, higher education institutions, and labor organizations.

Tackling Utility Costs

• Authorize DPS to develop a plan for data centers to connect to the grid while requiring data centers to supply their own power and cover any costs they create.
• Invest $50 million in the Empower+ program, which helps low- and moderate-income households to finance energy improvements to their homes. 

Supporting Solar Energy in Public Schools

• Update how State Building Aid is applied so school districts have greater flexibility to install renewable energy systems, reducing energy costs, cutting emissions, and invest in clean infrastructure.

Sales Tax Exemption for Electric Vehicle Charging Stations

• Support legislation to establish a sales tax exemption on the retail sale of electricity used to recharge and electric vehicle by a commercial EV charging station.

Environmental Funding and Initiatives

• Maintain the Environmental Protection Fund at $425 million.
• Advance another round of the Green Resilience Grant program assisting municipalities to mitigate flood risk, protect water quality, and improve public spaces.
• Advance FloodSafe NY to better manage flood risk by aligning watershed studies, implementation grants, and stream monitoring.
• Build on the Resilient NY program and the Resilient Watersheds Grant Program to help identify and support mitigation strategies for flood-prone areas.
• Advance a new round of grants to invest in coastal resiliency to local communities.
• Provide new support to help communities implement Local Waterfront Revitalization Plans focused on restoring natural shorelines, improving public access, reducing flood risk, and revitalizing waterfront areas.
• Launch the Adaptation and Resilience Network, a one-stop online hub consolidating guidance, tools, and resources across agencies, simplifying access to information on permitting, funding opportunities and best practices for climate-resilient infrastructure.
• Establish and new competitive grant program to support community-based organizations in environmental justice and disadvantaged communities to strengthen local preparedness and response capabilities.