NYC Mayor Mamdani's latest pitch to tax the rich "not happening," Gov. Kathy Hochul says

The budget battle between New York City and New York state lawmakers is intensifying. 

New York City Mayor Zohran Mamdani and City Council Speaker Julie Menin are calling for a new way to tax the rich. They want the state to reduce something called the Pass-Through Equity Tax credit, aka PTET. 

"The PTET is essentially a loophole"

"The PTET is essentially a loophole that allows high-income earners to reduce their federal tax burden," Mamdani said. 

Menin joined the mayor in calling for the new revenue stream, which could mean another $1 billion to help close the city's budget gap. 

Gov. Kathy Hochul slammed the door on their proposal. 

"That's not happening," Hochul said. "We are not changing PTET." 

Hochul to NYC: "Look at your expenses"

Hochul said she has already found over $4 billion in state aid for the city, and that Mamdani and Menin have a spending problem. 

"And we've encouraged the speaker and the mayor to do what every other city has to do, [which] is look at your expenses. What is growing exponentially? They have programs that are growing not 4% a year, but 4% [in] months. And so they have to do whatever the other city is doing," Hochul said. 

Budget watchdogs agree with Hochul, saying that instead of trying to tax their way out of the budget problems, they should stop spending so much. 

"Right-size spending. Stop spending on programs that don't help New Yorkers. We've increased spending $16 billion more than inflation over the last 10 years," said Andrew Rein, president of the Citizens Budget Commission. 

Despite Hochul's reluctance, Mamdani still wants more state aid, even if were to actually get this new tax. 

"We cannot proceed with balancing that budget without the additional revenue and cost shifts from Albany," Mamdani said. 

May 1 deadline will be missed

The mayor is supposed to unveil a new budget proposal by May 1. He won't make the deadline. Mamdani and Menin agrees to postpone the budget announcement until May 12, hoping that the state reaches a budget agreement and they'll know exactly wht they're getting. 

Hochul had another surprise for Mamdani. She has agreed to meet this week with billionaire Ken Griffin. Mamdani has made Griffin the poster boy for why he wants a pied-à-terre tax on people who own multimillion dollar second homes in New York City. 

Griffin was so upset with Mamdani's attacks his hedge fund company threatened to pull out of a $6 billion NYC development project.