New York City Mayor Zohran Mamdani dropped a planned property tax hike from his executive budget on Tuesday, after earlier warning he might raise taxes to help close a multibillion-dollar gap. The budget is for the fiscal year that begins July 1. [1, 2, 3, 4, 5]
Mamdani had floated a property tax increase of nearly 10% earlier in the process, but the final plan no longer includes that broad hike. The budget still leaves room for a tax on second homes or pied-à-terre properties, which could help bring in new revenue without hitting most homeowners. [1, 2, 4, 5]
The mayor said the budget was balanced after new state support from Governor Kathy Hochul and spending cuts elsewhere. Mamdani said, "We have balanced the budget, and done so without shifting the burden onto New York's working class." [1, 6, 7, 3, 4, 5]
The executive budget is about US$124.5 billion, according to reports, and it comes with a projected US$5.4 billion deficit. City officials said the plan includes US$2.3 billion in savings from delaying pension fund contributions, US$500 million from pushing back smaller class sizes and a US$519 million reduction in CityFHEPS housing spending. [6, 7, 5]
Hochul and Mamdani also announced additional state support for New York City, with reports putting the package at about US$4 billion and nearly US$8 billion over two years. The aid helped ease pressure on the city’s finances as the budget deadline approached. [1, 6, 7, 3, 4, 5]
The proposed property tax hike had faced opposition from City Council members, including Speaker Julie Menin. New York City’s credit outlook was also downgraded to negative by credit rating firms amid fiscal concerns. The next key date is July 1, when the new fiscal year begins. [1, 6, 7, 5]
