Taxman Calling?

Good morning from New York City, where tomorrow is Evacuation Day.

Back to today, much is being made about Governor Kathy Hochul’s comments last week on taxes. “When it comes to the taxes question, which I know is the burning question on all your minds, I have to keep an eye on what is happening in Washington,” she told reporters, blaming Washington “uncertainty” for putting a potential corporate tax hike on the table. That federal uncertainty, clearly not favorable to New York State, is matched by pressure from New York City, where Mayor-elect Zohran Mamdani is entering office with plenty of promises, including big ideas and an even bigger price tag.

Hochul has been firm in her opposition to a personal income tax hike on wealthy New Yorkers—a measure Mamdani supports—but is opening the door to a corporate tax hike, all while her office touts higher-than-expected revenue.

“So I can stand here today and say we can do quite a few things without any source of additional revenue based on the revenue coming in,” Hochul said. “But I don’t know what Washington is going to do. Are they going to jam us up for another $3 billion in Medicaid costs? This is the uncertainty that makes it challenging to do what we’re doing.”

Much more to come on this, but it's already generating flak from business groups. Incoming Partnership for New York City head Steve Fulop, in a post on X, declared raising the corporate tax rate “absolute suicide” for New York City, emphasizing that with an already existing city business tax, combined with a higher state rate, would drive taxes far higher than those imposed on New Jersey businesses: “I can’t think of an easier narrative to torch supporters of this idea (both politically and governmentally),” Fulop said. “Even if [they] believe companies won’t move, what remains 100% indisputable is they certainly won’t create a single new job in NYC.”  Fulop knows all about New Jersey taxes as he currently serves as the Mayor of Jersey City.

Hochul may be moving in Mamdani’s direction on free buses, as well.

In the helter skelter world of relationships today (see Zohran Mamdani and Donald Trump—more on that below), Hochul is also getting plaudits from the Wall Street Journal Editorial Board.

With the 2025 Elections behind us, welcome to the 2026 Elections!

First, good luck to our friend Assembly Member Stacey Pheffer Amato, who announced she will not be running again in 2026. The Chair of the New York State Governmental Employee Committee offered: “I have had the joy of meeting with and delivering for thousands of our neighbors when they need help. But after 10 years in this position, it is time to move on and serve my community in other capacities.” This Rockaway, Queens district will be a competitive seat in the General Election.

Pheffer Amato joins her colleague Deborah Glick in leaving public service, while, by my count, at least five other members of the Assembly—MOA Rivera, Bores, Lasher, Simone, and González-Rojas—are leaving to run for seats in Congress and the state Senate. Expect a couple more of these—retirements and new campaigns—over the next couple of months, while rumors abound that various members of the state Legislature may soon join the Mamdani administration. 

Speaking of competitive races, Assemblymember Jessica González-Rojas got a major boost in her campaign last week with two major Congressional endorsements: “I’m deeply honored to have the support of two trailblazing Latinas—Congresswomen Alexandria Ocasio-Cortez and Nydia Velázquez—who have long been champions for working families and a more just and equitable Queens,” González-Rojas said in a statement.

“We need a fighter in Albany who won’t flinch when it comes to standing up for New Yorkers, and for the future of Queens,” Ocasio-Cortez said. “I’m proud to endorse JGR for State Senate because Queens deserves someone who will always show up and fight for us.”

Ocasio-Cortez and Velázquez are only the latest to support JGR; she already has endorsements from City Comptroller Brad Lander, Public Advocate Jumaane Williams, and Queens Borough President Donovan Richards.

This seat is currently held by Jessica Ramos, fresh off an unsuccessful mayoral campaign, but one who should not be counted out. We will be watching this race.

Even more lively will be some interparty Congressional clashes for Democrats in New York City, with several marquee races likely to draw national attention. In NY-12, a crowded Democratic field includes Jack Schlossberg, grandson of President John F. Kennedy, making a high-profile bid for the Manhattan-based seat currently held by Jerry Nadler.

Schlossberg’s announcement certainly garnered clicks, but three current elected officials have had more impressive launches: Assembly Member Micah Lasher, a former aide to Mayor Mike Bloomberg and Governor Kathy Hochul is seen by many to have the inside track to Nadler’s endorsement, sure to be influential; Council Member Erik Bottcher has an impressive record in the NYC Council, is a leader in the LGBTQ community, and kicked off with an impressive fundraising haul; Assembly Member Alex Bores may have had the most impressive launch of them all. The young Assembly Member raised a remarkable $1.2 million in the first 24 hours after he announced. Having earned a national reputation for his leadership on tech issues and as the sponsor of the groundbreaking AI safety RAISE Act, Bores’s experience and leadership may fit the moment, especially for Democrats dismayed by President Donald Trump’s relationships with the big tech establishment.

NY-10 is also going to be a battle as New York City Comptroller Brad Lander, he of Mamdani bromance and a second place NYC Mayoral Primary finish, and Alexa Avilés, a nonprofit executive already endorsed by the DSA, position themselves against incumbent Dan Goldman, the wealthy Levi Strauss heir and staunch supporter of Israel.

Equally interesting is City Councilmember Chi Ossé’s bold challenge to House Democratic Leader Hakeem Jeffries in Brooklyn’s NY-8. This race has the Left in a tizzy, as many, including Mamdani and AOC, have urged DSA not to endorse Ossé’s campaign, saying it is not the time. Others are leery of the Council Member’s more recent endorsement of DSA principles, but enthusiastic about this being the time and every place being the place.

Over in NY-15, perennial candidate Michael Blake is mounting a campaign against Representative Ritchie Torres in the Bronx. Blake had moved on from his own previous support of Israel to be in a position to challenge Torres because of his support of Israel.

In NY-6 in Queens, Grace Meng is facing a lively primary challenge from Chuck Park, a former diplomat and government worker. 

Another interesting race is NY-13, where the Justice Democrats, a major part of Alexandria Ocasio-Cortez’s 2018 rise, are backing Darializa Avila Chevalier’s bid to unseat Representative Adriano Espaillat. Again, support for Israel is a hot point as Avila helped lead protests against the Israel-Hamas war at Columbia University. She is a Ph.D. student and an investigator in a public defender's office in Harlem. The well-respected Espaillat is the first Dominican American to serve in Congress and a leading Latino voice in the Democratic Party. 

Another major race is in NY-7, across Queens and Brooklyn, where Representative Nydia M. Velázquez, a Democratic trailblazer who was the first Puerto Rican woman elected to Congress, announced she will not seek re-election in 2026 at the completion of her 16th term. Velázquez, 72, cited the calls for generational change in her party as a reason to retire.

Of course, not all the 2025 business is quite done. The behind-the-scenes race for New York City Council Speaker remains open for the taking after intense politicking at Somos and, as such, is spilling into public view.

Council Members Julie Menin, Crystal Hudson, Amanda Farías, Chris Marte, and Selvena Brooks-Powers appeared together for the first time at an Association for a Better New York forum and at one sponsored by Common Cause NY.

While full of transparency, much of this decision-making—and wheeling and dealing—happens behind closed doors. Crystal Hudson and Julie Menin are widely considered favorites.

Whither Mamdani? The mayor-elect is playing it cool: “I'm looking forward to working with the council and the speaker to fulfill the agenda that we ran on.”  Other power brokers are not. Reps. Nydia Velázquez and Yvette Clarke endorsed Hudson Monday night, while Rep. Greg Meeks made clear last week he’s backing Menin.

-Jack O’Donnell

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