Mayor Zohran Mamdani is set to officially scrap his plans to raise property taxes on New York City homeowners, according to a City Hall source familiar with the mayor’s strategy on how he would like to close the city’s $5.4 billion budget deficit.
Mamdani’s will present his plans Tuesday, a big test for the Democratic socialist mayor within his first 150 days in office. The source told NBC New York that included in the the mayor’s budget presentation will be other ways to close the budget gap, noting that raising property taxes will not longer be necessary.
In February, the mayor said raising property taxes by 9.5% would generate $3.7 billion in revenue. He insisted it would be the only way to balance the city budget, unless Albany agreed to raise taxes on corporations and the wealthy.
Mamdani hasn’t brought up raising property taxes in a few months, and may not have been able to move forward with the idea because City Council Speaker Julie Menin immediately said it was off the table.
While property taxes are the only taxes the city has the authority to raise without permission from Albany, Mamdani would still need Council approval to do so. With Menin opposing the idea from the start, the idea did not seem likely to get off the ground.
Mamdani appears to have found a third path by identifying more savings or securing more revenue from Albany, or more likely a combination of the two.
A portion of the funds may come from the pied-à-terre tax introduced by Gov. Kathy Hochul in April, which is estimated to generate $500 million a year. It came as a concession from Hochul, who otherwise resisted Mamdani’s calls to tax the rich.
