New York Gov. Kathy Hochul touched on many issues in her Jan. 9 State of the State address, highlighting affordability, public safety, housing and mental health.

She also laid out her vision for using tax credits to help businesses harmed by shoplifting,  and tax incentives to support affordable housing, and she announced a major artificial intelligence (AI) initiative involving New York's major research institutions.

Hochul said that New York state created more than 600,000 jobs, and reduced unemployment from 7.4 percent to 4 percent, all while not increasing taxes and cutting them for the middle class. She also mentioned her upcoming budget address, in which she vowed to address the state’s structural deficit.

Early in her speech, she addressed the havoc wrought by the “stubbornly persistent” crime of retail theft. The surge in such crime creates fear among customers and workers, she said, as “thieves brazenly tear items off the shelves and menace employees, owners go broke replacing broken windows and stolen goods, driving many out of business.”

“These attacks are nothing more than a breakdown of the social order,” she said. “I say no more. The chaos must end.”

To that end, she proposed a tax credit to help business owners cover additional security costs, while vowing to work with the Legislature to strengthen penalties for assaulting a retail worker or for selling stolen goods online. She also announced a joint operation among federal, state and local law enforcement, along with a new state police unit, to crack down on organized retail theft.

“Let's back our businesses and the workers with the full force of the law and punish those who think they can break the rules with impunity,” she said.

Acknowledging the affordability issues bedeviling many, the governor said that her administration and the Legislature had worked to make New York more affordable by raising the minimum wage and tying it to inflation, as well providing tax relief and utility savings for millions of lower- and middle-class New Yorkers.

On the topic of housing, Hochul blamed New York state’s “obscenely high cost of rents and mortgages” on its “unconscionable shortage of housing … one of the forces driving people out of every corner of our state” to neighboring New Jersey, Pennsylvania and Connecticut.

Hochul contrasted New York City’s recent approach to housing with those of cities such as Boston and Washington, each of which has developed more new housing units per 1,000 residents in the last decade than New York City. And she vowed to do better, saying, "Our plan for New York City includes four components of what I proposed last year: restoring tax incentives to build housing that includes affordable housing; eliminating outdated restrictions on residential density that prevents the city from building more; supporting no-brainer ideas like the conversion of underutilized commercial property into homes; ... and legalizing basement apartments, where New Yorkers already live."

She noted that a year ago, she issued executive orders to execute “innovative solutions” to “free” 5,500 housing units in Gowanus, Brooklyn, and offered financial incentives to builders. She said that she would expand on those efforts by developing state-owned sites, including former correctional facilities, areas near commuter rail stations and underutilized State University of New York (SUNY) properties.

“This initiative alone could create up to 15,000 new housing units,” she said.

Hochul also promised to deal with illegal cannabis shops, which have proliferated since legalization. The state “will empower localities to go after the unlicensed shops, prosecute businesses that sell to minors and padlock their doors faster,” she said.

In addition, the governor announced a plan to protect New Yorkers from fraudsters by proposing what she called the “first significant change to our consumer protection laws in over 40 years.”

“We're going to prohibit unfair and abusive practices like student loan servicers pushing borrowers toward the most expensive repayment options, and debt collectors who manipulate seniors into giving up their protected income…[and we] will establish regulations on the buy now pay later loan industry which often lures customers into spending beyond their means,” she said.

Toward the end of her address, the governor proposed “nothing short of making New York the global leader in AI research and development.”

“AI is already the single most consequential technological commercial advancement since the invention of the internet,” she said. “Global AI has already been valued at $100 billion just last year, and it's brand new. … Whoever dominates the AI industry will dominate the next era of human history.”  

To make her ambition a reality, the governor proposed the creation of Empire AI, a consortium of New York’s leading research institutions that will “drive ethical AI development and do it in a way that protects our workers and make it a force for good in the world.” The endeavor would harness “the power of the private sector, academia and government to galvanize this industry,” she said.

The academic institutions that have already agreed to participate are Columbia, Cornell and New York universities, Rensselaer Polytechnic Institute and the entire SUNY system. “We have geniuses at these schools just ready and poised to innovate and launch new companies,” she said. “And, now, they'll have the power to change the world.”