Mamdani's new Albany ultimatum draws Hochul's opposition

And the state's highest court reversed a child sex abuse finding based on 'deepfake' concerns.

Good afternoon — It’s Tuesday and Cabbage Day.

In today’s CapCon:

• New York City Mayor Zohran Mamdani said Tuesday the state could either allow tax hikes on high-income earners or see property taxes skyrocket.

• The Court of Appeals reversed a child sex abuse finding Tuesday over “deepfake” concerns. A stark warning then came from a dissenting judge.

• New York City hasn’t received any of the nearly $2 billion allocated by the state to implement Raise the Age. A new bill would change that.

• This Week in New York History: The ‘Miracle on Ice’ and Malcolm X.

Names in today’s CapCon: Zohran Mamdani, Kathy Hochul, Jumaane Williams, Brahvan Ranga, Thomas P. DiNapoli, Andrew Rein, Rowan Wilson, Shirley Troutman, Emily Wall, Jabari Brisport, Marc Molinaro

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🚨 CapCon Note: If you’re a regular reader of this newsletter, you know the state budget is a year-round focus of our reporting. The next state budget is due at the end of March but a lot will happen before then.

The state Division of Budget, state Senate and Assembly will review newly revised revenue projections, lawmakers will release their one-house budget and negotiations will begin in earnest.

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Mamdani presented his preliminary budget Tuesday (New York City Mayor’s Office)

💵 Mamdani’s ultimatum to Albany draws opposition from Hochul

New York City Mayor Zohran Mamdani gave Gov. Kathy Hochul two choices for closing the city’s multibillion-dollar budget gap as he presented his preliminary budget Tuesday.

She can either get on board with Democrats in the state Legislature to approve a tax increase on high-income earners and large corporations or see property taxes rise in the five boroughs by 9.5%, Mamdani said.

“There is no third option of failing to balance the budget,” Mamdani said.

The city’s budget gap is currently projected at about $5.4 billion — less than half of what the Mamdani administration had anticipated it to be in January.

That number could shrink again next month. Mamdani has created a new position of chief savings officer in each of the city’s agencies. They’ll spend the next month identifying more ways the city can cut costs, with an initial analysis due March 20.

“If we find additional savings, we will absolutely use them,” Mamdani said. “However, responsibly, I cannot tell New Yorkers that is the likelihood over these next few months.”

A lot can happen between now and then. For one, as mentioned above, the Hochul administration and lawmakers will soon revise their revenue projections for the upcoming fiscal year. That could translate to more revenue for the city.

But in lieu of an unexpected solution, Mamdani is urging Hochul and the state Legislature to approve a tax increase on high-income earners.

Hochul has been staunchly opposed to that idea and has shown no signs of changing her position. She also wasn’t warm to Mamdani’s second option Tuesday.