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Ambitious promises to transform the city less expensive for residents propelled progressive candidate the incoming mayor to his surprising win on Tuesday. Among them are free buses, childcare for all, and a massive increase in low-cost housing.

However, turning the city more affordable for inhabitants is an expensive government task, and many economists and elected officials to Mamdani’s right say he faces numerous obstacles to effectively follow through on his signature ideas.

Adding complexity to matters is the national government, which will likely withhold financial support for New York in an effort to undermine Mamdani and create funding gaps that complicate efforts to fund fresh initiatives.

Additionally, New York City must secure state legislature approval to adjust many revenue streams. An analyst pointed to the state assembly blocking the city from increasing dog licensing fees in 2014 due to a disagreement between the incumbent at the time and a lawmaker.

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

Nonetheless, analysts point to tailwinds: Mamdani’s ideas are very popular and would solve fundamental issues. Democrats now hold significant control in the legislature, and some see economic and political pathways to implementing the proposals a success.

How could Mamdani pay for his bold agenda? Here’s a detailed look by funding method and proposal.

Raising Income

The Mamdani campaign estimates it could generate approximately $10bn by raising the business tax, taxes on the affluent, and current government revenues.

Critics claim businesses and the high-earners will move away, but that is disputed by reliable studies. Moreover, the business levy is on earnings made in the state regardless of where a business is located, making the point largely moot.

Business Levy Hike

Mamdani estimates a state tax increase between seven point two five percent and eleven point five percent on corporate profits would produce around $5bn, a large portion of which would be funneled to the city. State leaders would have to authorize the plan. State lawmakers have previously supported similar proposals, but the governor is against increasing levies.

Yet, the state leader supports universal childcare, a very popular initiative because childcare is commonly seen as too expensive, stated one policy director. It would be challenging for moderate Democrats to “oppose enacting a historical initiative”, he continued. “No one says ‘We shouldn’t do anything to make childcare cheaper.’”

What’s been lacking, the expert explained, has been a leader like Mamdani who declares: “Yeah, it costs money, and we’re gonna raise taxes to get it done.”

Increasing Taxes on the Wealthy

The proposal calls for raising $4bn with a 2% hike on those earning above one million dollars annually. Though it’s a city tax, the state legislature must authorize the rise, and the proposal is typically resisted by centrist lawmakers.

But there is a feasible route, the expert said. Increasing revenue on the wealthy is widely accepted and, similar to the corporate tax increase, allocating the proceeds to fund favored initiatives helps to sell in the state capital.

Halt on Rent Increases

In terms of expense, a rent freeze on rent-controlled apartments is the easiest to enforce – it’s minimally costly. But, a freeze must be authorized by the rent guidelines board, and there may not be sufficient backing on it before Mamdani fills it with his preferred candidates.

Fare-Free and Efficient Transit

Mamdani projects free buses will cost a minimum of $700m, which includes an evasion rate of forty-eight percent. Observers say Mamdani could probably cover the expense by optimizing or cutting additional services in the city’s one hundred sixteen billion dollar city budget.

City-Owned Food Markets

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

Building Low-Cost Homes Units

Numerous commentators to the right of Mamdani have dismissed the plan to spend approximately $100bn developing two hundred thousand affordable units over a decade, mainly because it would necessitate massive debt. He clarified those opposing this aspect largely miss that the initiative is does not involve to take on $100bn immediately – the debt would be accrued and paid down in tranches over multiple administrations.

He also stressed the plan is not for no-cost homes, but cost-effective residences that would produce income to pay down debt. Moreover, the projects could partially be funded by private investment.

“This is how the proposal adds up,” the expert said.

Childcare for All

Establishing childcare access for all would require from two point five billion dollars and twelve billion dollars by many projections, based on whether it is a city or state program and additional variables. Financing is the big question mark – can the corporate and wealth taxes pass the state capital? One analyst said he expected negotiated adjustments, as often happens with big proposals.

“The things that Mamdani promised will probably get a haircut,” the expert remarked. “And the governor’s expressed resistance to tax increases may just face reality – she probably cannot achieve the objectives she desires on the expenditure front without compromise on the revenue side.”