Photo by Ed Reed/Mayoral Photo Office on Flickr
Mayor Zohran Mamdani said New York City would raise property taxes if Albany doesn’t tax the rich. The mayor on Tuesday released his first preliminary budget, presenting a grim outlook for the city’s fiscal health, including a $5.4 billion budget gap. Mamdani framed the proposed 9.5 percent property tax as a “last resort” if he cannot convince Gov. Kathy Hochul and state lawmakers to increase income taxes on New York’s richest residents.
During a presentation on Tuesday of this proposed $127 billion budget for fiscal year 2027, Mamdani presented “two paths to bridge” the budget gap, which he blamed on former Mayor Eric Adams for underbudgeting essential services.
“The first path is the most sustainable and fairest: raising taxes on the wealthiest and corporations, and ending the drain by fixing the imbalance between what the City provides the State and what we receive in return,” Mamdani said.
If Albany does not act, Mamdani said the city would be forced to raise the property tax by 9.5 percent and draw down reserves.
“If we do not go down the first path, the City will be forced to go down a second, more harmful path of property taxes and raiding our reserves — weakening our long-term fiscal footing and placing the onus for resolving this crisis on the backs of working and middle-class New Yorkers. We do not want to have to turn to such drastic measures to balance our budget. But, faced with no other choice, we will be forced to.”
Increasing property taxes would raise an additional $14.8 billion over four years, as the New York Times reported. According to The City, Mayor Michael Bloomberg was the last mayor to increase property tax rates in the early 2000s.
The increase would affect more than 3 million residential units and over 100,000 commercial buildings, according to the mayor.
Mamdani originally said the city faced a budget deficit of more than $12 billion, but earlier this month said the gap shrunk by $5 billion because of higher-than-projected Wall Street bonuses. On Monday, Hochul announced $1.5 billion from the state to help fill the gap, helping to further reduce the deficit.
Hochul has repeatedly said she would not support a wealth tax this year, and on Tuesday, said she rejected raising property taxes. The governor told the Times the mayor is “required to put options on the table; that does mean that’s the final resolution.”
The mayor also proposed tapping into the city’s reserves to fill the remaining gap, which drew criticism from NYC Council Speaker Julie Menin and Council Member Linda Lee, chair of the Committee on Finance. In a joint statement, the elected officials said while the mayor’s budget marks the start of a conversation, “dipping into rainy day reserves and proposing significant property tax increases should not be on the table whatsoever.”
They said the Council “believes there are additional savings and revenue that deserve careful scrutiny before increasing the burden on small property owners.”
The budget plan would take effect July 1, following negotiations with the Council.
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