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Bold promises to make the city less expensive for residents propelled progressive candidate the incoming mayor to his surprising win on election day. Included are free buses, childcare for all, and a large-scale increase in low-cost housing.

However, making the city more affordable for residents is an expensive government task, and many financial experts and politicians to Mamdani’s conservative side say he faces numerous obstacles to effectively follow through on his key proposals.

Further complicating matters is the federal administration, which will almost certainly withhold financial support for New York in an effort to undermine Mamdani and open up funding gaps that complicate efforts to fund new priorities.

Additionally, New York City must secure state legislature approval to adjust many income sources. One expert pointed to the state legislature blocking the municipality from raising pet registration costs in 2014 due to a disagreement between the incumbent at the time and a lawmaker.

“The dramatic example of stating the issue is New York City cannot increase dog licensing fees without state legislature approval, and it was true then, and it remains the case today,” he noted.

However, analysts point to favorable conditions: Mamdani’s proposals are widely supported and would address fundamental issues. The Democratic party now hold large majorities in the legislature, and some see economic and political pathways to making the proposals a success.

How could Mamdani finance his bold agenda? Here’s a detailed look by revenue source and proposal.

Generating Revenue

His team estimates it could generate approximately $10bn by increasing the corporate tax rate, taxes on the wealthy, and existing fee and tax collections.

Critics claim companies and the wealthy will relocate, but that is disputed by reliable studies. Additionally, the corporate tax is on earnings made in the region no matter where a company is located, making the argument largely moot.

Business Levy Hike

Mamdani estimates a state tax increase from seven point two five percent and eleven point five percent on business earnings would produce about five billion dollars, a large portion of which would be funneled to the city. The legislature and governor would have to authorize the proposal. Legislative leaders have in the past backed comparable ideas, but the state executive is against raising taxes.

However, the state leader backs universal childcare, a very popular proposal because child services is commonly seen as too expensive, stated an expert. It would be challenging for centrist lawmakers to “resist passing a historical initiative”, he continued. “Nobody argues ‘Nothing should be done to reduce childcare costs.’”

The missing element, he said, has been a figure like Mamdani who declares: “Yeah, it costs money, and we’re gonna raise taxes to make it happen.”

Increasing Taxes on the Affluent

Mamdani’s plan aims to raising $4bn with a 2% increase on those earning above $1m each year. Though it’s a city tax, the state government must authorize the rise, and the proposal is generally opposed by moderate lawmakers.

But there is a feasible route, the expert said. Raising taxes on the wealthy is broadly popular and, as with the business tax hike, using the funds to fund favored initiatives helps to promote in the state capital.

Rent Freeze

In terms of cost, a rent freeze on rent-controlled apartments is the easiest to enforce – it’s minimally costly. But, a halt must be approved by the housing panel, and there may not be enough support on it before Mamdani appoints members with his preferred candidates.

Fare-Free and Efficient Buses

Mamdani projects free buses will cost a minimum of seven hundred million dollars, which factors in an fare-dodging percentage of forty-eight percent. Observers say Mamdani could likely cover the cost by streamlining or cutting other programs in the municipal one hundred sixteen billion dollar city budget.

Publicly Run Food Markets

A trial initiative for several city-owned grocery stores that would be established in underserved “areas lacking food access” is estimated at sixty million dollars and could also be paid for by adjusting priorities in the $116bn spending plan.

Constructing Low-Cost Homes Properties

Numerous people to the conservative side of Mamdani have dismissed the plan to spend about one hundred billion dollars developing 200,000 affordable units over a decade, mainly because it would necessitate substantial debt. The expert clarified those arguing against this aspect largely miss that the initiative is not to take on one hundred billion dollars immediately – the liability would be accumulated and paid down in phases over multiple administrations.

He also stressed the plan is not for no-cost homes, but affordable housing that would produce income to reduce debt. Moreover, the developments could partially be funded by private investment.

“That’s the way the proposal is feasible,” he concluded.

Universal Childcare

Establishing childcare access for all would require between $2.5bn and twelve billion dollars by most estimates, based on whether it is a municipal or state initiative and additional variables. Financing is the major uncertainty – will the corporate and wealth taxes be approved in the state capital? An expert commented he expected some compromise, as is typical with big proposals.

“The things that Mamdani pledged will likely get a haircut,” he remarked. “Furthermore the governor’s stated opposition to revenue hikes could confront practical limits – she likely can’t get the objectives she desires on the spending side without compromise on the revenue side.”