Gov. Kathy Hochul barreled into her first full term last January with bold plans to spark new housing across New York and a flush budget to pump up spending on public schools and health care.

The budget she’s set to present on Tuesday is unlikely to be so bold or flush.

Buoyed for a few years by $12.5 billion in federal pandemic relief, New York is coming to the end of that aid and faces an estimated budget deficit of $4.3 million. Closing it will likely force cuts in the spending plan Hochul introduces and then negotiates with lawmakers to try to finalize a budget by April 1.

On the policy side, she’s hemmed in by the political reality of even-year budgets: all 213 senators and Assembly members are up for election in November, and Hochul’s fellow Democrats in the Democratic-led legislature don’t necessarily want any controversial moves in Albany to cause re-election headaches.

“Generally, the discussion will be about things that are achievable and that will help Democrats win seats,” Hank Sheinkopf, a longtime Democratic consultant, predicted.

Hochul’s policy centerpiece last year was a set of proposals to speed housing construction, cast as a crucial strategy to combat the state’s biggest affordability problem: soaring rents and housing prices.

That push ultimately failed, stopped by suburban opposition to mandates she said were vital to the plan’s success. She wanted to set housing growth targets for every municipality and require zoning for dense housing around commuter train stations.

Those mandates are unlikely to reappear in Tuesday’s budget. Instead, Hochul sketched other ways to expand the housing supply in her State of the State speech last week: reviving other pieces of last year’s plan and pressuring municipalities to meet growth targets by making that a requirement for state grant programs.

Confronting NY’s budget woes

How will Hochul close the budget gap?

She gave no specifics in her State of the State speech, saying only that there must be belt tightening.

“We cannot spend money we do not have,” she said. “Pandemic funds from Washington have dried up. Inflation didn’t just hit families, it hit State government operations as well. It’s on all of us to make hard yet necessary decisions and use taxpayer dollars creatively and responsibly.”

Budget watchdogs urged cutbacks and warned against raising taxes to close the deficit.

“Spending restraint is needed to put New York on a path to fiscal stability,” Andrew Rein, president of the New York City-based Citizens Budget Commission, said in a statement after Hochul’s speech.

Housing push: How Kathy Hochul plans to speed home building in NY — and the resistance she’ll face

Ken Girardin, research director for the fiscally conservative Empire Center for Public Policy, argues the deficit is even bigger than forecast in November, totaling $7 billion after factoring out the unspent funds used in the state’s estimates.

His prescription: undo the big Medicaid and school funding hikes in last year’s $229 billion budget.

“Both Medicaid and school spending levels are out of line with national norms,” Girardin told the USA Today Network by email.

A left-leaning think tank posed a counter-argument in its response to Hochul’s address.

Nathan Gusdorf, director of the Fiscal Policy Institute, said in a statement that the state was fiscally stable and should spend more — not less — on housing, education and health care to support the working and middle classes.

“While constrained spending may appear fiscally wise in the short-term, the State’s long-term economic competitiveness depends on strengthening the public programs and infrastructure that sustain New York’s workforce,” Gusdorf said.

What about funding for asylum seekers?

Hochul said nothing about the state’s handling of steadily arriving migrants in her State of the State speech, other than that she would address that topic in her budget.

Last year, the state budgeted $1 billion for that purpose, largely to cover a portion of New York City’s expenses for housing thousands of migrants who have arrived on buses from the nation’s southern border. That commitment nearly doubled later in the year as the number of asylum seekers in the city’s care ballooned and new shelters were opened for them.

Hochul has given no recent indication of how her next budget will address that ongoing responsibility. In October, her budget director, Blake Washington, said in an internal memo that was made public that the state must consider shifting its funding for migrants to legal services, job assistance and other forms of support besides “indefinite stays in hotel rooms.”

Without federal support, Washington wrote, the state “can only shoulder this financial commitment for a limited duration without putting other areas of the State budget at risk.”

Late budget: Minimum wage, bail, cigarettes: As NY passes budget, here’s what stayed and what got cut

Sheinkopf, the Democratic consultant, argues that Hochul and state lawmakers have little political incentive to rescue New York City Mayor Eric Adams — who’s contending with his own budget crisis — by hoisting spending for migrant housing and care in the state budget.

What is more likely, he predicted, is that the state initially may propose an increase but then reduce and reconfigure the forms of that aid as the final budget is hashed out.

Chris McKenna covers government and politics for The Journal News and USA Today Network. Reach him at cmckenna@gannett.com.

This article originally appeared on Rockland/Westchester Journal News: NY budget faces deficit, gap. How will Hochul handle spending in 2024?