New York’s leaders owe their constituents honesty – about the challenges we face, the ways we got there and the ways out. Under the previous New York City mayor and state governor, we were denied that clarity. But our current leaders can provide it.
Budget Concerns and Past Actions
Former Mayor Eric Adams was intentionally under-budgeting and hiding costs to make the budget seem balanced. Former Gov. Andrew Cuomo repeatedly raided New York City’s revenue to address state-level budget shortfalls. These actions contributed to a recent downgrade of the city’s fiscal forecast by Moody’s.
As the city attempts to address these financial challenges, the state holds key tools for stabilization. Given New York City’s economic importance to the state, addressing the city’s budget is a statewide concern. A potential solution involves raising local taxes by 2% on New Yorkers earning over $1 million annually.
State Approval and Obstacles
Any city-level tax increases require state approval. Currently, Gov. Kathy Hochul presents an obstacle to taxing high-income earners.
Gov. Hochul has consistently opposed a so-called millionaire’s tax, a position she held as recently as 2018 when running for lieutenant governor. Despite this stance, New York has experienced a net gain in millionaires. The governor argues that increasing taxes on the wealthy could lead to an exodus of residents and a decline in the tax base.
Yet, data indicates that middle-class Black and brown families are leaving New York at a higher rate than multimillionaires and billionaires. A 2023 report revealed that New York City’s Black population has decreased by nearly 200,000 people, or about 9%, over the past two decades.
Concerns about wealthy residents leaving in response to tax increases may be overstated, as similar threats have been made in the past without resulting in significant departures. Raising revenue from the wealthiest residents is seen as the most sustainable way to address future budget deficits.
Frequently Asked Questions
What actions did former Mayor Eric Adams take regarding the city budget?
Former Mayor Eric Adams was intentionally under-budgeting and hiding costs to make the budget seem balanced.
What is the main obstacle to raising taxes on high-income earners in New York?
Gov. Kathy Hochul is the main obstacle to taxing the rich.
Has New York experienced a net loss of wealthy residents?
No, New York has gained 13,000 millionaires in the past two years, while experiencing a decline in its middle-class Black population.
Will New York repeat past financial missteps, or will it forge a more responsible path forward?
