New York City Mayor Zohran Mamdani unveiled a balanced $124.7 billion executive budget on Tuesday and announced he has dropped his plan to raise New Yorkers’ property taxes.
“We have balanced the budget, and we have done so without placing the burden on the backs of working New Yorkers,” Mamdani said at a news conference at City Hall on Tuesday. “This budget does not raise property taxes and it refuses to slash services.”
The decision to drop the tax hike came as Mamdani unveiled the latest version of the mayor’s spending plan for the fiscal year that begins July 1.
According to Bloomberg, Mamdani’s new budget proposal includes roughly $4 billion in additional aid from the state that the mayor and Gov. Kathy Hochul announced Tuesday, including $500 million from a surcharge on expensive second homes in New York City.
That so-called pied-à-terre tax is being considered as part of state budget negotiations, and details of how it could be implemented are still unclear, Bloomberg noted.
Mayor Faced Skepticism
The budget announcement is an important milestone for Mamdani, who had faced skepticism that he could come up with a plan to close the deficit without cutting services or imposing substantial tax increases, Bloomberg noted. The plan still requires approvals by state lawmakers and the City Council — and with political pushback to the pied-à-terre tax from wealthy businesspeople like Citadel founder Ken Griffin, Bloomberg said.
Among the biggest pieces of the new state aid is $2.3 billion saved over two years from a proposal to amortize city pension payments. That change would require state approval, as well as signoff from five affected pension funds.
The mayor also is planning to receive $68 million from a reduction in the city’s unincorporated business tax credit.
Mamdani called the pied-à-terre tax and the change in the unincorporated business tax credit, which would mostly affect affluent taxpayers, “common-sense measures.”
The mayor said the city is working with state leaders in Albany on plans to administer the second-home levy.
