Five weeks. That is how long New York City Mayor Zohran Mamdani's $14.8 billion property tax increase survived before the mayor himself began signaling he would not go through with it. After floating a 9.5 percent property tax hike as part of his $127 billion budget proposal last month, Mamdani recently held a series of private meetings with city and state lawmakers to let them know he was "highly unlikely" to pursue the plan, according to a report from SILive, citing the New York Times.
On Wednesday morning, the mayor's office released a package of agency savings proposals, the administration's alternative answer to what City Comptroller Mark Levine has called "the biggest budget gap since the Great Recession." The proposals range from renegotiated telecom contracts at the FDNY to a $100 million audit of dependent eligibility in employee health plans. Whether these measures add up to anything close to the hole Mamdani's budget faces is an open question the administration has not answered.
Mamdani unveiled the property tax increase as the centerpiece of his budget proposal last month, framing it as leverage to pressure Gov. Kathy Hochul into raising income taxes on the wealthy. The idea drew immediate resistance, not just from Republicans or fiscal moderates, but from the mayor's own allies on the left and from centrist Democrats who represent homeowners across the five boroughs.
The backlash illustrated the deep antipathy New Yorkers hold toward the city's property tax system. And it cut across racial and ideological lines. As Newsmax reported, the proposal triggered resistance from lawmakers representing Black homeowners in particular, communities that would bear a disproportionate burden from a broad-based property tax hike.
State Sen. Leroy Comrie put it plainly:
"I don't think he wants to raise property taxes. He knows that it will hurt minority communities the most."
State Sen. Liz Krueger was equally blunt about the political miscalculation:
"This test balloon showed that it wasn't a very feasible proposal."
The Times reported that Mamdani had begun to "quietly retreat" from the concept. That retreat took barely five weeks, a remarkably short shelf life for a proposal the mayor had placed at the center of his fiscal strategy. Lawmakers told reporters that Mamdani held private meetings with city and state officials as City Hall walked the idea back while still seeking more aid from Albany.
With the tax hike off the table, or at least shelved, Mamdani pivoted to a different message. In January, he signed Executive Order 12, which established a chief savings officer at every city agency. The order required agencies to identify savings of 1.5 percent for fiscal year 2026 and 2.5 percent for fiscal year 2027. Agencies submitted their proposals on March 20.
In a Wednesday morning news release, Mamdani framed the effort as fiscal discipline:
"Government must deliver for working people, and every dollar in our budget must work as hard as they do. That's why I directed every agency to find real savings and cut waste to close our budget gap. This is just the beginning of our work to improve service delivery and make city government the most efficient it can be."
The line-items tell a mixed story. Some proposals are genuinely substantive. Others read like a city government discovering for the first time that it has been wasting money on things it did not need.
Start with the big numbers. The Office of Labor Relations will conduct a full audit of dependent eligibility in employee health plans, a review expected to save approximately $100 million. That single item dwarfs everything else on the list. New York City Public Schools will terminate underutilized contracts and impose spending caps, generating $30.3 million in savings for fiscal year 2027, plus another $27.5 million from controls on central office spending across supplies, equipment, professional development, and travel.
Health + Hospitals plans to negotiate contract rebates, reduce reliance on temporary staffing agencies, cut overtime, and improve revenue collection, projected savings of $14.1 million in 2026 and $25.7 million in 2027. The Department of Finance will strengthen verification to ensure recipients qualify for a primary-residence co-op abatement, saving $13 million. The FDNY will begin billing Medicaid for "Treat No Transport" services following recent state and federal approvals, saving $10.1 million.
Then there are the smaller items, the kind that raise a different question entirely. The Taxi and Limousine Commission will cancel its Slack subscription, saving nearly $20,000. The Department of Sanitation will vacate underutilized office space and relocate staff, saving $194,000. NYC Emergency Management will in-source a software maintenance contract for approximately $63,000 and transition certain programs to a cheaper platform for another $70,000.
The Department of Correction will restructure and cancel certain IT and consultant contracts, bringing services in-house, for $4.3 million. The Economic Development Corporation will in-source a marketing contract, saving $626,000. NYC Aging will in-source a consultant contract for $411,000. The Mayor's Office of Nonprofit Services will eliminate a consultant contract for $400,000.
One item stands out for sheer symbolism. The Department of Social Services is terminating its contract with McKinsey, on which nearly $9 million was spent. The same agency will also in-source nearly two dozen IT contracts, saving $597,000, and renegotiate WiFi contracts in shelters for savings of $1.3 million in 2026 and $1.8 million in 2027.
The FDNY negotiated lower rates with telecommunications providers, saving $700,000 in 2026 and $2.2 million in 2027. The Office of Technology and Innovation will renegotiate contracts for $1.3 million in 2026 and $1.2 million in 2027. The Department of Health and Mental Hygiene will renegotiate its naloxone contract based on lower costs achieved in other states, saving $1.15 million in 2027. The Mayor's Office of Management and Budget will reduce office lease costs, saving $90,000.
The property tax debacle is hardly the only source of political turbulence for Mamdani. His young administration has drawn fire on multiple fronts. He has faced criticism over the composition of his administration, including the absence of Black deputy mayors. His Rikers Island Ramadan visit and jail-closure pledge drew sharp backlash. And his resistance to involuntary removals of homeless individuals during extreme cold, a period during which seventeen people died outdoors, raised serious questions about his willingness to prioritize public safety over ideological commitments.
Mamdani has blamed the budget crunch on his predecessor, Eric Adams. That may be partly true. But blaming the last mayor does not close a budget gap. And floating a massive tax increase as a pressure tactic, only to abandon it five weeks later under bipartisan opposition, does not inspire confidence in fiscal leadership.
The administration has not disclosed a total projected savings figure across all listed agency actions. Even a generous back-of-the-envelope tally of the items released Wednesday falls well short of what a $14.8 billion, four-year revenue proposal was supposed to generate. The health-plan eligibility audit alone accounts for the lion's share of projected savings, and audits are projections, not guaranteed returns.
Meanwhile, the budget gap Comptroller Levine described as the worst since the Great Recession remains. The governor has not agreed to the income-tax increases Mamdani sought. The property tax hike is effectively dead. And the savings plan, while containing some sensible housekeeping, is built largely on contract renegotiations, in-sourcing, and the kind of waste elimination that taxpayers might reasonably wonder why it was not done years ago.
Canceling a Slack subscription and renegotiating a naloxone contract are fine. But they are not a fiscal strategy for a city staring down the largest budget shortfall in a generation.
When your biggest policy idea collapses in five weeks and your backup plan includes saving $20,000 on a chat app, the problem is not the spreadsheet. It is the leadership.
