New York Proposes Expanded Child Care Aid and No State Income Tax on Tips Up to $25K

Albany, N.Y. — New York families could see major changes to child care, housing, utilities and everyday costs under a sweeping affordability agenda Gov. Kathy Hochul rolled out as part of her 2026 State of the State proposals.

Hochul’s plan includes a pathway toward statewide universal, affordable child care, new efforts aimed at lowering auto and home insurance costs, tougher renter protections, expanded food assistance, and a proposal to eliminate state income taxes on tipped wages up to $25,000 in tax year 2026.

On child care, the governor proposed a $1.7 billion funding increase, bringing total FY27 investment to $4.5 billion for child care and pre-K services. The administration says the goal is to make pre-K “truly universal” for four-year-olds statewide by the start of the 2028–29 school year, expand subsidies to more families, and launch an Office of Child Care and Early Education to coordinate the work.

For parents who drive, Hochul is backing a crackdown on staged-crash schemes and other fraud that the state says helps push premiums higher, including enhanced coordination among DFS, DMV, State Police and other agencies, plus new tools for prosecutors.

Housing proposals include stiffer penalties for landlords accused of systematic harassment in rent-regulated buildings and raising New York City’s income eligibility limit for SCRIE and DRIE rent-freeze programs from $50,000 to $75,000 (with opt-in options elsewhere in the state).

The package also calls for reforms intended to reduce utility costs, additional support for food pantries, and upgrading EBT cards to chip-based technology to help prevent benefit theft.

What’s next: many items would require legislation and budget action in Albany; families can track updates through the governor’s State of the State materials and agency announcements.

This article was produced by a education parenting today journalist with the assistance of Ai. This is not legal advice. All content is reviewed for accuracy and fairness.