Hochul refuses higher taxes on wealthy residents despite NYC’s $12 billion budget deficit.
State and City Leaders at Odds Over Budget Solutions
Governor Kathy Hochul has firmly rejected Mayor Zohran Mamdani’s calls for increased taxes on wealthy residents and corporations, despite the city’s announcement of a staggering $12 billion budget deficit. In an exclusive interview with NBC New York, Hochul doubled down on her long-held opposition to raising tax rates, saying she does not believe in taxing for the sake of revenue generation. The disagreement highlights the challenge that Mamdani faces in addressing what he calls the city’s worst financial crisis since the Great Recession, inherited from the Adams administration. Hochul’s firm stance suggests that the mayor must find alternative approaches to balancing the budget without state-level tax changes.
The Scale of NYC’s Fiscal Crisis
Mamdani announced the city is facing a combined $12.6 billion shortfall across the current and next fiscal years. The mayor blamed former Mayor Eric Adams for what he characterized as deliberately hiding billions in recurring expenses, describing the practice as poisoning the budget books. Adams, in response, attacked Mamdani’s socialist positions and claimed he had left the city with $8 billion in reserves. The Citizen’s Budget Commission, a fiscal watchdog, suggested the actual deficit may be closer to $8 billion but cautioned that efficiency improvements should come before seeking additional revenue.
Hochul’s Position on State Support
The governor acknowledged meeting with Mamdani and his budget team, noting that she had advised the mayor to first demonstrate how the city would achieve internal efficiencies before requesting additional state support. Hochul emphasized that she had been stunned by stronger than expected Wall Street revenues, suggesting that investment income may help close the gap. She encouraged Mamdani to wait and see how much revenue growth could contribute to solving the problem without new taxes. Hochul’s approach prioritizes using existing revenue streams rather than expanding the tax base.
Political Considerations and Campaign Promises
Mamdani has stated he will not abandon his campaign commitments despite the budget constraints, pledging to move forward with ambitious programs for housing, transportation, and worker protections. The mayor rejected suggestions that he should significantly curtail spending on priorities he promised to New York voters. He insisted he would investigate every dollar in the budget and find efficiencies, while maintaining that aggressive revenue measures remain necessary. Hochul, facing her own reelection challenges from both Republican nominee Bruce Blakeman and her own lieutenant governor Anthony Delgado, insisted she has no concerns that Mamdani might withhold an endorsement. For more on NYC budget challenges, see NBC’s full interview. Learn about the Budget Commission’s analysis and New York State resources. The governor’s fiscal philosophy reflects longstanding debates about the proper balance between taxation and public spending in major American cities.
