With Hochul's help, Mamdani delivers massive NYC budget

In Zohran Mamdani's first executive budget in office, the city is relying heavily on state assistance to dig itself out of a multi-billion dollar hole.

The mayor, alongside Gov. Kathy Hochul, announced almost $8 billion in extra state aid over the next two years. The governor had recently said the city needs to look at their spending when Mamdani asked for more help.

Here's everything to know about Mamdani's spending plan.

Mamdani's budget gap

On May 12, the executive spending plan was released by the mayor's office with a balanced budget, which is a legal requirement. In total, the FY2027 executive budget amounts to $124.7 billion.

Mamdani has previously claimed that his office had inherited a $12 billion budget gap from the previous administration that "consistently and intentionally understated" the deficit.

The mayor, in his new budget plan, showed heavy reliance on Hochul, who is running for re-election soon.

On the same day of the budget's release, Tuesday, May 12, the pair had announced that Hochul and the state legislature "secured an additional $4 billion in gap-closing support, bringing the total new state assistance to nearly $8 billion over two years."

The move was seemingly a backtrack for the governor. Late last month, Mamdani asked for more state help to fill the budget gap, which still totaled around $5 billion. In response, Hochul said that the city needs to look more at their expenses.

In February, Hochul committed to sending an additional $1.5 billion to NYC over two years to assist with the budget crisis.

“We put in $1.5 billion of fairly unrestricted money to the city so they could plan on that,” she explained in late April after Mamdani called on the state for more help. “What they're doing is trying to find a path forward, and we've encouraged the speaker and the mayor to do what every other city has to do is look at your expenses."

"We have helped them. And if they need some changes in our Budget to help give them the legislative authority to do certain things like amortization of pensions, amortization of police vehicles, we have already said we are happy to put that in the Budget, but it doesn't have to be in the Budget."

Alongside asking the state for budget help, the Mamdani administration wanted the NYC Passthrough Entity tax credit chopped from 100 percent to 75 percent, with the city keeping the other 25 percent.

That shift would put about $1 billion back into the city’s pocket, “while still allowing New York City residents to save on federal taxes,” the city said in a news release.

But Hochul quickly shut down the idea when confronted on Mamdani's call.

"We're not changing PTET," she said at a news conference last month. "It's not happening."

The pair have otherwise had a well-kept working relationship, announcing in April a new pied-à-terre tax proposal, which plans to add an annual charge on one to three family homes, condos and co-ops valued above $5 million if owners have another primary residence outside of the city. It's one of the ways Mamdani has looked to tax the rich, and is projected to bring in $500 million annually.

Hochul's office did not immediately respond to a request for comment by USA TODAY.