In mid-February, 390 school districts around the state received an unwelcome letter from the state Education Department: They were about to lose $25 million combined from their next state aid payments.

Those districts had been overpaid between the 2011-12 and 2017-18 school years, and the state was taking its money back. The payments were for services for special education students.

Another 255 districts learned that they had been underpaid by the state during that same time period — about $11 million total, according to an analysis by the Association of School Business Officials. In fact, New York state owes more than $300 million to schools statewide in outstanding claims.

But those districts won’t receive the money any time soon. That’s because of an accounting practice called “prior year adjustments.”

Nearly four months after Governor Kathy Hochul unveiled her proposed budget, lawmakers yesterday passed a $254 billion final agreement — after having just a few days to comb through thousands of pages of fine print and the hundreds of billions of dollars at stake for New Yorkers.

The largest budget in state history came in a couple billion dollars higher than Hochul had proposed in January, but several billion less than the Senate and Assembly suggested in their one-house proposals.

This year’s budget avoids increasing personal income taxes but does raise taxes on large New York City businesses to fund the Metropolitan Transportation Authority’s massive capital plan. Middle-income households will see small rate cuts. The child tax credit for parents with kids under four will also go up. Most residents will get a one-time inflation rebate check from $150-$400.

Two of the budget’s biggest sticking points — rolling back discovery reforms and expanding involuntary commitment — made it through, as did a provision to restrict mask-wearing in public.

The state budget approved by legislators this week gives $350 million in additional funding to help New York City continue providing child care vouchers to low-income families — if the city throws in the same amount of its own money.

There’s another major caveat buried in the fine print: The state is raising the minimum amount that New York City must spend on the program to $328 million a year. Even if the city doesn’t want to pay to get the matching funds, the new requirement could force it to.

Right now, New York City contributes just under $53 million to the Child Care Assistance Program, which is largely funded by the federal and state governments and covers almost the entire cost of child care for low-income families. That means the state is mandating the city increase its spending more than sixfold.

It’s often said that a budget is a declaration of values. So how much do New York lawmakers value fighting climate change?

About 0.4 percent, according to the newly approved state budget.

For the first time ever, New York’s budget this year includes a dedicated climate action fund: $1 billion, which will go mostly toward greening buildings and transportation. That includes more than $200 million for “thermal energy networks,” which can allow entire neighborhoods to switch to efficient, electric heating and cooling. Shovel-ready projects at public universities are high on the priority list — a hard-fought win for green groups and building trades unions who have demanded funding to clean up state buildings for the last two years.

Governor Kathy Hochul has touted the sum as “historic.” But her spokesperson Paul DeMichele told New York Focus the fund is intended as a one-off — and in the context of a $254 billion budget, it’s a relatively small one.

As Washington has gutted federal support for a wide array of social services, New York state’s budget has seemingly moved forward in a vacuum.

That has been by design, according to Governor Kathy Hochul. Her office has been steadfast in its position that the state cannot afford to backfill federal cuts, especially those now being hashed out in Congress for behemoth programs like Medicaid.

While advocates were successful at getting legislators in both houses to back their calls for higher levels of state funding for a variety of programs, the final budget largely reflects the governor’s less robust proposals.

Senator James Skoufis was among several legislators who openly blasted Hochul during this year’s delayed budget season, calling her “all-powerful” and running “roughshod over a legislature that is effectively relegated to making suggestions and pleading for scraps.”

Hochul’s policy win makes New York the largest state to enforce a cellphone ban in schools. It’s one of several major changes to education wrapped up in the state budget — which includes $37 billion overall for education.

Others include a controversial move to roll back rules meant to ensure that nonpublic school students receive the same basic education in core subjects like English and math – despite pushback from the state Education Department. Thanks to a deal made during state budget negotiations, some members of the Ultra Orthodox community — and their lobbyists — succeeded in their bid to fight requirements that yeshivas and other religious schools provide a “substantially equivalent” education to public schools.

And, for the first time since its implementation in 2007, the complicated formula the state uses to distribute most education funding — Foundation Aid — is getting an update.

The new formula will update how poverty is measured and include additional funding for districts with English Language Learners. The total cost: $26 billion.

Labor unions and business lobbyists successfully convinced Governor Kathy Hochul to pay off New York’s $6.2 billion unemployment insurance debt — and boost unemployment benefits for the first time in six years — as part of her final budget agreement with the state legislature.

State law requires that unemployment benefits remain frozen when the system is in debt, so weekly unemployment benefits have since 2019 been capped at $504, a lower benefit than neighboring states provide and less than a full-time minimum wage salary. The budget agreement will increase weekly benefits to a maximum of $869 this year, with more increases in future years.

“On the business side, this is a huge victory” since employers will no longer face additional taxes to pay off the debt, said Assembly Labor Committee Chair Harry Bronson, who had been advocating for the plan. “On the worker side, this is a huge victory,” because the weekly benefit will increase, he said.

The 2025 state budget includes a new law requiring companies to offer easy cancellation methods for subscriptions ranging from cable TV to Spotify. Critically, the final version of that law, which will take effect in November, removes a sweeping loophole initially proposed by Governor Kathy Hochul that would have exempted some of the country’s largest companies.

In February, New York Focus reported that Hochul’s original proposal to streamline cancellations didn’t cover companies regulated by the Federal Communications Commission — meaning that corporate giants like Amazon, Apple, Comcast, and Verizon would have been off the hook. Consumer advocates warned that this omission would leave New Yorkers no better off when it came to some of the most subscription-hungry companies.

The state Senate’s March budget proposal eliminated that loophole, after New York Focus informed the chamber’s consumer protection committee chair about the exemption and she said she’d look into it.

That version won out in negotiations.