Mayor Mamdani upped the ante in a simmering showdown with Gov. Hochul on Thursday, threatening budget cuts if she does not move forward with his plan to raise taxes on wealthy New Yorkers or fork over to the city a larger share of state money.
If Hochul doesn’t grant any of those asks, then “all it leaves the city are the most painful tools,” Mamdani said during a morning PIX11 appearance.
“Cuts could be on the table as a last resort,” the mayor said, also mentioning the prospect of raising property taxes.
Mamdani sounded the alarm Wednesday over a potential $12 billion budget shortfall, mostly blaming ex-Mayor Adams’ fiscal mismanagement. At a press conference, he said he would pursue “savings” and not “austerity” to address that, adding that he would not “entertain” cuts when asked directly about whether he’d cut the police department’s budget.
But on Thursday, the mayor announced a directive for agencies to identify a “chief savings officer” who would identify ways to save — including programs that could be slashed — within 45 days.
Mamdani’s preliminary budget plan is due Feb. 17.
The mayor faces two challenges: He must balance the budget in the face of the potential $12.6 billion budget gap while also making headway in his electoral promises to expand social services, like universal childcare, in order to make the city more affordable.
To that end, Mamdani has pushed for tax hikes on New Yorkers making a million or more — which Hochul has said is a nonstarter —
and on the “most profitable” corporations. He’s also lobbying for the state to give the city more money, arguing that while the city contributes 54.5% of the state’s revenue, it receives 40.5% in return.
“The scale of this fiscal crisis, of $12 billion, this is not an ordinary crisis,” Mamdani said Thursday. “This is not a mayor coming forward and saying it’s going to be a tough budget. This is the likes of which we haven’t seen since the Great Recession. That requires an all-of-the-tabove approach.”
A spokesperson for Hochul referred to her comments Wednesday, where she said she expects the city’s budget gap to be less dire than Mamdani has portrayed: “He’ll do what he needs to do,” Hochul added. “Mayors have their press events, that’s fine.”
Mamdani conceded Wednesday his warning of a $12 billion shortfall did not include the potential for higher-than-expected revenue from taxes on Wall Street wealth.
Some met his approach with skepticism.
“It appears the policy goal is taxing the rich by any means necessary, and the hyperbole surrounding the budget gap is the ruse,” a former City Hall official who worked on budget under several administrations told the Daily News. “The Mayor belied the notion that this is about fiscal solvency by stating that even an infusion of emergency funds from the state would not be enough. It is a bold but risky stratagem, and the Governor may call his bluff.”
Ana Champeny, a vice president at the Citizens Budget Commission, which stands against tax hikes, said that the city does need financial help from the state to “have a sustainable city budget that is affordable.”
“There are steps the state could take, and if he does not get that he has fewer options,” she said of Mamdani’s budget cutting threat.
Champeny also applauded the move to examine the city’s spending, saying that’s good first step towards meeting those challenges.
“It’s a lot easier to raise taxes than to go through the agency budgets and identify the savings and inefficiencies, but that is the critical step necessary both to balance the budget and protect the city’s competitiveness,” Champeny said.
