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Bold promises to transform the city more affordable for residents catapulted progressive candidate Zohran Mamdani to his surprising win on Tuesday. Included are free buses, universal childcare, and a massive increase in affordable homes.

However, making the city cost-effective for inhabitants is an costly public undertaking, and many financial experts and politicians to Mamdani’s conservative side say he faces numerous obstacles to meaningfully deliver on his signature ideas.

Further complicating the situation 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 make it more difficult to pay for new priorities.

Additionally, the city must secure state legislature authorization to modify many income sources. One expert pointed to the state legislature stopping the municipality from increasing dog licensing fees in a prior year due to a disagreement between the then mayor and a state representative.

“The dramatic way of putting it is the City cannot increase dog licensing fees without state legislature approval, and that held true previously, and it remains the case today,” the expert said.

Nonetheless, he and other experts point to favorable conditions: Mamdani’s proposals are widely supported and would address fundamental issues. Democrats now hold significant control in the state government, and some see economic and political pathways to making the plans a success.

In what ways might Mamdani pay for his bold agenda? We broke it down by funding method and proposal.

Raising Revenue

The Mamdani campaign projects it could raise approximately $10bn by increasing the business tax, levies on the affluent, and current government revenues.

Detractors say businesses and the wealthy will relocate, but this is contradicted by reliable studies. Additionally, the business levy is on earnings made in the state no matter where a business is located, rendering the argument at least partially irrelevant.

Corporate Tax Increase

Mamdani calculates a state tax increase between seven point two five percent and eleven point five percent on business earnings would produce about $5bn, a large portion of which would be directed to the city. State leaders would have to approve the plan. Legislative leaders have in the past backed similar proposals, but the state executive opposes increasing levies.

Yet, the state leader backs universal childcare, a highly favored initiative because childcare is commonly seen as too expensive, stated one policy director. It would be challenging for centrist lawmakers to “oppose enacting a landmark initiative”, he added. “Nobody argues ‘Nothing should be done to make childcare cheaper.’”

The missing element, the expert explained, has been a figure like Mamdani who declares: “Yeah, it costs money, and we will increase revenue to make it happen.”

Increasing Levies on the Affluent

The proposal calls for generating $4bn with a 2% hike on those earning more than $1m each year. Although it’s a city tax, the state legislature must approve the rise, and the proposal is generally resisted by moderate lawmakers.

But there is a feasible route, the expert said. Raising revenue on the wealthy is widely accepted and, as with the business tax hike, using the funds to support favored initiatives makes it easier to sell in the state capital.

Rent Freeze

Regarding cost, a rent freeze on regulated housing is the easiest to implement – it’s nearly free. However, a freeze must be approved by the housing panel, and there might not exist sufficient backing on it before Mamdani fills it with his preferred candidates.

Fare-Free and Efficient Buses

Mamdani projects free buses will require at least $700m, which factors in an evasion rate of 48%. Observers suggest Mamdani could likely cover the cost by optimizing or reducing additional services in the municipal $116bn annual spending plan.

City-Owned Grocery Stores

A trial initiative for five public food markets that would be built in neglected “areas lacking food access” is projected at $60m and could also be paid for by shifting priorities in the one hundred sixteen billion dollar spending plan.

Constructing Low-Cost Homes Units

Numerous people to the conservative side of Mamdani have dismissed the proposal to spend about one hundred billion dollars developing two hundred thousand low-income homes over 10 years, largely because it would necessitate massive borrowing. He said those arguing against this point largely miss that the plan is not to take on one hundred billion dollars at once – the debt would be accumulated and repaid in phases over several government terms.

He emphasized the proposal is not for free housing, but affordable housing that would generate revenue to pay down debt. Furthermore, the developments could partially be funded by private investment.

“This is how the proposal is feasible,” the expert concluded.

Universal Childcare

Implementing childcare access for all would require between $2.5bn and twelve billion dollars by many projections, depending on whether it is a municipal or state initiative and other factors. Financing is the big question mark – will the business and high-earner levies pass the state capital? An expert said he anticipated negotiated adjustments, as often happens with big proposals.

“Proposals that Mamdani promised will likely get a haircut,” the expert said. “Furthermore the governor’s stated opposition to tax increases could face reality – she likely cannot achieve the things she wants on the expenditure front without compromise on the revenue side.”