New York City Mayor Zohran Mamdani and Council Speaker Julie Menin are urging the State to approve a budget that will help fund the multi-billion budget gap that the city is facing — while supporting the State in extending its final budget deadline to June.
Mamdani and Menin appeared Tuesday in the City Hall rotunda to announce a new agreement to lobby for a $1 billion tax rollback and more State aid.
“New York City faces a budget crisis of historic magnitude,” Mamdani said Tuesday during a joint press conference. “We’ve inherited a deficit larger than any since the Great Recession. Years of mismanagement and chronic under budgeting, alongside a structural imbalance between what New York City sends to the State and what we receive in return, have taken a toll. We cannot close this deficit with savings alone. We need new revenue. And we need a structural reset in our relationship with the State. That is the only way to meet our legal obligation to pass a balanced budget and to do so without imposing a financial burden into the backs of working people.”
Mamdani has said in the past that his dire fiscal forecast emerged after a discovery that former Mayor Eric Adams had “poisoned” the budget books by underestimating billions of dollars in recurring expenses.
Adams slammed Mamdani’s socialist views in his response, saying, “Free is a lie.” The former mayor also said earlier this year that he left the city with $8 billion in reserves.
Meanwhile, Mamdani previously said he would investigate every dollar and ways to spend more efficiently.
However, he told NBC New York he does not plan to revise expectations around executing his campaign promises, which would require billions in additional funding beyond the $12 billion needed to close the gap.
“We will not allow the failures of the prior administration to dull the ambitions of our own,” Mamdani said in January.
On Tuesday, Mamdani voiced support behind extending the State’s budget deadline from this upcoming Friday to June 12 “because the crisis of this scale cannot be solved without State action.”
Because of this, the City is asking for an increase in the State’s budget earmarked for the City, including urging for a reduction in the Passthrough Entity Tax (PTET) credit to 75%. This credit allows for businesses to bypass the 2017 Tax Cut and Jobs Act — which limits taxpayers’ state and local taxes deductions from federal income tax — by paying a New York City business tax which is 100% returned to business owners.
Mamdani and Menin argue that if the State would allow the City to reduce the rebate portion to 75%, it would generate nearly $1 billion in additional revenue.
“Today [the Passthrough Entity Tax Credit] serves as a tax cut for the rich; a reduction would ensure the wealthiest pay their fair share,” Mamdani said.
The duo also announced Tuesday their support for restructuring Pension Unfunded Liability, as well as class size mandate relief. They argue that this action would save the City $1 billion. They also pointed out that current or future retiree would not “lose a single dollar in pension benefits as they are constitutionally protected by the New York State Constitution.”
Mamdani and Menin also argued ending the drain of City resources to the State saying that the City currently contributes 55.6% of the state revenue, but only receives 41.7% — all this while the City’s economy grew 110% between 2010 and 2024, almost double the 68% growth in the rest of the state.
Additional cost shifts, including $480 million in MTA costs, have further strained the City’s budget, they said.
“Mayor Mamdani and I are partners in delivering a responsible budget for New Yorkers, and we’re committed to closing the gap,” Menin said. “We are aligned on identifying real savings, maintaining the services New Yorkers rely on, and making clear that New York City deserves its fair share from Albany so we can continue investing in our communities. We will continue that partnership to produce a balanced and fiscally responsible budget.”
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