Strengthening New York City’s ‘value proposition,’ not just focusing on tax levels

New York City Budget Director Sherif Soliman joined Citizens Budget Commission President Andrew Rein for a fireside chat at this month’s CBC breakfast, just a week after his boss, Mayor Zohran Mamdani, introduced the city’s $124.7 billion executive budget for FY27, and without a finalized state budget.

Soliman, arriving at the breakfast, held on May 18, 2026, at Club 101 in Midtown Manhattan, was barely four months into the job. But as Antonio Weiss, co-chair of the CBC’s Special Policy Committee, pointed out when introducing Soliman, the city’s latest budget director brings more than 30 years of public-sector experience to his new role. He most recently was senior vice chancellor and CFO of the City University of New York. Prior to that, Soliman worked within Mayor Eric Adams’ administration as chief policy and delivery officer and as director of the Mayor’s Office of Policy & Planning. He also worked in various roles during Mayor Bill de Blasio’s administration, going back to 2018. Before that, Soliman was director of communications at the city’s Employees’ Retirement System, as well as an assistant legislative representative within the Office of State Legislative Affairs during Mayor Mike Bloomberg’s administration.

Weiss and Soliman discussed what it was like returning to City Hall to work for the Mamdani administration, the spending priorities of this latest executive budget, the new pied-à-terre tax, and what’s expected from Albany in terms of support for the city.

This interview has been edited for length and clarity.

What surprised you coming into the role?

I’ve spent many years in city and state government and worked closely with the Mayor’s Office of Management and Budget, so I wasn’t surprised by the professionalism of the team. I was grateful to lead such a strong group.

What did surprise me was something more practical—the time it takes just to walk from City Hall to the gate. As budget director, even stepping out for something simple like grabbing lunch, you’re constantly approached with issues and questions. It requires budgeting more time than expected.

More broadly, though, the role itself and OMB’s function were familiar to me, and it’s been a privilege to serve.

What is your big-picture strategy for closing the budget gap?

When we came into office, we immediately assessed the city’s fiscal situation. It confirmed what had already been identified: there was significant and chronic underbudgeting, especially in social services, education, and subsidies like the MTA.

The Mayor believed it was essential to be transparent with New Yorkers. We needed to acknowledge the full scope of unbudgeted costs to bring predictability and reduce risk in the financial plan.

Initially, we identified a $12 billion gap, driven by roughly $17.5–$18 billion in unaccounted expenses. From there, we pursued a multi-pronged strategy: savings initiatives through “chief savings officers,” revenue adjustments from strong Wall Street performance, and state support of about $1.6 billion early on. This reduced the gap to $5.4 billion. Additional state commitments—about $4 billion—helped bring the budget into balance.

The core strategy has been honesty, transparency and addressing structural issues directly.

Are you confident the state will deliver on promised funding?

Yes, we are confident. We’ve been in constant communication with the governor’s office and the Legislature. From the beginning, the state has worked in good faith. There’s strong recognition that the city’s success is tied to the state’s success. Based on those discussions, we expect the commitments to be included in the enacted budget.

Your revenue forecasts are higher than others. How do you assess that risk?

We added about $7.2 billion in projected tax revenue across FY26 and FY27—one of the largest increases in recent memory. This was based on strong economic indicators, including Wall Street profits. We also prioritized transparency rather than holding back revenues for later adjustments.

We are aware of risks, such as geopolitical events and federal policy changes. However, we’re still seeing positive indicators—strong financial transactions, leasing activity, and market momentum. For FY27, we kept projections flat rather than increasing them further, balancing optimism with caution.

On the pied-à-terre tax, are you concerned about market impacts?

The property tax system is complex and inequitable. The pied-à-terre proposal reflects that complexity. The goal is to raise approximately $500 million. While there could be behavioral changes in the market, we believe the tax is implementable and the revenue target achievable. We will monitor the impacts carefully—both economically and in terms of equity.

Are high taxes hurting New York’s competitiveness?

The mayor’s focus is on making New York a place where people want to live and work. We’re investing in affordability—childcare, housing, and quality of life improvements—which support employers and workers alike.

While taxes are part of the equation, data shows that even after recent tax increases, the number of high-income residents has grown. We’re also seeing strong commercial activity. Our approach is to strengthen the city’s value proposition overall, not just focus on tax levels.

What spending priorities were funded in this budget?

Most of the $17 billion in added expenses addressed previously unbudgeted or underbudgeted costs. Less than 10% went to new programmatic investments. Key areas included social services and legal obligations, snow removal and emergency responses, and homeless services and outreach. We also made targeted investments in libraries, parks, cultural institutions, and CUNY support—essential services the Mayor believes should be prioritized.

Are the savings initiatives delivering real results?

Yes. Instead of top-down targets, we introduced “chief savings officers” to evaluate programs deeply—looking at effectiveness, metrics, and necessity. This included program reviews, contract evaluations, and space and lease reductions. The result was $1.77 billion in recurring savings. Importantly, this is an ongoing process—not a one-time exercise.

Why extend pension payments and shift costs to the future?

The change smooths pension payments into predictable, level amounts. Originally, payments would rise significantly and then drop sharply. The adjustment extends the schedule by five years, creating stability and $2.3 billion in near-term savings. New York City consistently meets its required pension contributions, and the system is well-funded—about 86%, above the national average. While there are trade-offs, we believe this approach balances fiscal stability with long-term responsibility.

What is your long-term strategy for closing future budget gaps?

We’ve already reduced gaps significantly from initial levels that exceeded those seen during the Great Recession. We are focusing on recurring revenue sources, sustained savings efforts, and state funding reversals of past cost shifts. Out-year gaps remain, but we’ve brought them to more manageable levels—around 7% of tax revenue, consistent with historical norms. Closing them will require continued discipline and structural solutions.

How are you addressing risks to the public hospital system?

We are working closely with the state to understand potential impacts from federal changes, particularly Medicaid. We’ve made investments to help connect residents with available benefits and are preparing for possible shifts in coverage. Ensuring stability for the public hospital system is a priority, and we remain ready to support it as needed.

What is your approach to property tax reform?

We are developing a proposal based on prior commission recommendations, focusing on fixing inequities in valuation methods, ensuring similar properties are taxed similarly, and providing targeted relief to homeowners. We are also considering impacts on rental housing and overall revenue stability. The goal is a fairer, more transparent system.

How will you support job growth for recent graduates?

We’re focused on aligning workforce development with economic growth, including housing development, childcare expansion, and technology and innovation sectors. We are working with institutions like CUNY and employers to create stronger pathways from education to employment.

How will you handle City Council budget negotiations?

We respect the Council’s role and will engage in good-faith negotiations. The mayor has already funded key priorities upfront—like libraries and parks—rather than leaving them for negotiation. We expect discussions to continue as part of the normal budget process.

How will you accelerate housing production?

We are addressing delays through the ‘City of Yes’ and ‘SPEED’ initiatives, identifying and removing permitting bottlenecks, investing in staffing across agencies, and expanding capital funding for housing. We are also tackling cost pressures, such as insurance, and working more collaboratively across agencies.