New York City's First Deputy Mayor Dean Fuleihan explains how the city is addressing a $12 billion budget deficit through strategic partnerships with the state, pension system restructuring, and targeted taxation of luxury assets like second homes, while maintaining essential services such as universal childcare. The budget approach prioritizes long-term fiscal stability over short-term solutions, requiring collaboration between city and state governments and careful navigation of union negotiations to achieve 100% pension funding.
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Politics Unusual: NYC First Deputy Mayor, former Comptroller LanderAdded:
[music] >> Welcome to Politics Unusual. I'm Morgan [music] McKay. The last several weeks I've started the show by telling you that the New York State budget [music] is still late. And I'm here to tell you again that the state budget is now almost 7 weeks [music] late. But the city's budget is getting back on schedule, which is why our first guest this week is first deputy mayor Dean Fuleihan, who knows all the ins and outs of how the city's budget [music] will impact you at home. And then we're sitting down with New York 10 Congressional candidate Brad Lander to round out our campaign series. And then we're checking in on New Jersey. But first, Mayor Eric L. Adams this week released his [music] executive budget proposal, closing the city's budget gap without raising property taxes or draining the city's reserves. But some experts say he only provided short-term solutions. So, joining us now to discuss is the first deputy mayor Dean Fuleihan.
Welcome to the show. Thank you for having me. Pleasure being here.
>> It's a pleasure to have you. So, you were somebody to that knows the budget in and out, both the state budget and the city budget. And your team this year had to craft the city's budget without really knowing fully what the state is going to give the city because the state budget's still not done. So, you're kind of dealing with some rough estimates.
How difficult was that this year?
So, actually the state was a great partner. And the governor and the mayor, uh, the day of our executive budget on Tuesday, were able to announce what would be in the state budget. So, yes, there are still details that need to be worked out, but the partnership with the governor, with the speaker and the Senate majority leader in both conferences, both houses, was really exceptional and we were able to get there and they were able to provide us both the relief, uh, direct aid, reversing really a decades of the city not getting its fair share, uh, additional tax authorization, as well as other authorizations that we needed to be able to balance our budget.
As you know, we inherited a a budget of over $12 billion deficit that we needed to address.
Certainly not what anybody expected when we walked into the walked in on January 1st. So, diving into the details, the mayor says he's able to close the city's budget gap by achieving savings and getting more aid from Albany. So, starting with that Albany portion, Governor Hochul says she'll now be providing the city with extra revenue and allowing the city to delay certain payments. But, some fiscal experts argue that this is just pushing the city's budget deficit to next year.
What's been the response? So, we don't agree. Um the what they're basically referring to is a restructuring of the city's pension payments. So, the city is funded at 86% and the goal is to get to 100% fully funded. And we should start with under the New York State Constitution, every employee and retiree is entitled to their pension and there cannot be any taking of that back. This is This is really simply how we get to 100% fully funded. Um in 2013, uh the Bloomberg administration and the Cuomo administration agreed to a 20-year payout schedule to get to 100%. Unfortunately, what they did is they back-ended the payment. So, it was a straight line up.
That's not normally what would happen in finance. It would be a level playing or even a a reduction. What we did is said, "Okay, for this mayor, for any administration in the future, let's make it a level pay payment of about 3.5 billion, 3.6 billion a year to get to 100% and extend it for 5 years. So, instead of 2032, it's 2037.
The city is still making a payment in the upcoming fiscal year of 8.5 billion to the pension system.
So, the city has five pension systems, uh five pension funds. And uh the mayor's, like you said, says it's not going to affect anyone's benefits. Um but there's been some pushback from some union leaders, like the police union.
And in order to delay these payments, the city will need to have approval from some of these labor labor unions. What have those talks been like? Uh the talks have been very very productive. Um yes, the state law needs to be changed because it had been put in effect in 2013.
And that law needs to be modified. That is going to happen in the state budget.
And then each pension system, each one of the five pension systems you cited, needs to vote on it. And they have their trustees, and the trustees are being briefed not just by us, but also by the city actuary, who they help appoint. So, the city controller, the the uh the union trustees, and uh and the mayor appoint the city actuary. And the city actuary's briefing all the pension systems. We believe those are very constructive conversations, and that we have a very strong argument for how we're going to continue and get to 100% fully funded system. The administration is hoping to have to delay payments on four out of the five uh pension systems.
What happens if you guys only get two out of the four?
Uh that's not what we see happening at this point. We're we're very hopeful. As a matter of fact, we'd like to get all five pension systems to vote for this.
And the conversation's been very positive. Um so, we're we're assuming that this will happen, but we're hopeful it's going to happen. And we'll continue to have good conversations.
Now, the city's budget's also accounting for a new tax that's still being sort of worked out by the states. It's a tax on luxury second homes, also known as pied-à-terre tax, and the governor finally releasing some details last night. The homes will be taxed based on their market value, so not the price a home was purchased for, and it would target second homes with a market value of $1 million or more.
What are your thoughts on the details so far? Do you think that this tax will generate the $500 million annually that the administration's banking on? Yes, we do believe it'll generate 500 million.
We should also talk about that market value, and I believe the governor's spokesperson put out the point that that because of the complications of the city tax system, the property tax system, the the million-dollar value is actually much closer to a $5 million value.
If at least a $5 million value, it's and that is one of the things that we're committed to fixing moving forward, which is reforming the property tax system, so the actual value is reflected. Now, this tax on luxury second homes, it will be a yearly tax on top of the property taxes a person's already paying on the home.
This could this end up hurting the housing market, and could more people end up just renting properties instead of buying here in the city? We don't believe that's going to be the case.
We're talking about We're talking about significant wealth.
Um it's a We actually don't This is a market that has been doing very well in the city, but but like all things, we will continue to monitor, we will watch. We want a New York City economy that's growing, but we also want a city that's providing affordability. We are very proud in this budget of the 1.2 billion for child care to to fix to allow for parents to have a city that they can afford. So So it's a balancing of that.
Budgets are a priority, they are a statement of values, and we believe that the wealthy can pay a little more to achieve the both the affordability, but also to to bring stability to the New York City budget, and that's what we've achieved with this budget. Now, the state legislature is also moving forward on a bill that would add another tax onto people buying a home worth more than $1 million here in the city, which I feel like is quite a few homes here in the city. Um but if they buy it using cash, so it would tax them if they're buying the home using cash. Is this again hurting investments here in the city, people investing trying to buy put long-term roots here in the city?
>> So, it's cash of over a million dollars, and it's simply saying if everyone else is paying a mortgage recording tax on the same transaction for the cash, let's do the exact same tax. That should not be preventing anyone from making from making that purchase.
Now, the administration was also able to find savings, and there were some various fee increases. So, there was something that caught my eye. Mondaire is proposing to increase ambulance fees, and charge ambulance fees so if someone is treated at the scene by EMS, they will still be charged for an ambulance even if they don't take it. Is that fair when healthcare costs are already so high? The goal here is on insurance companies and Medicaid payment. It is not to put any burden on any individual.
It's simply to say that if it if if the ambulance goes to the hospital, the billing process includes insurance companies and Medicaid. That's all it's doing. It's saying, "Okay, if that doesn't happen and treatment occurs there, the insurance companies and the Medicaid should be paying." It's not about the individual paying.
If an individual is forced to pay though, is there going to be something there that that helps them out? That is not the the at all, so we'll make sure that's not that is not happening and that this is simply targeted at at getting the appropriate Medicaid payments and the appropriate insurance company payments. Well, for our viewers, now that the mayor has released his executive budget, the city council will hold budget hearings later this month, and then they have to vote on the budget before July 1st. So, thank you so much for your time, and I really appreciate for stepping in there.
>> Thank you for having me.
>> Thank you. Coming up next, the New York primary is quickly approaching. We'll be joined by former New York City Comptroller Brad Lander to talk about his campaign to unseat Congressman [music] Dan Goldman.
>> [music] >> Welcome back to Politics Unusual. The primary race for New York's 10th Congressional District is one of the most closely watched races here in the city. The district includes Prospect Park, Bay Ridge, all of Lower Manhattan in the East and West Village. It is currently represented by Congressman Dan Goldman, but he's being challenged this year by former City Comptroller Brad Lander, who is joining me now. So, welcome to the show.
>> Great to be with you, Morgan. So, you have such an extensive history in this district. You have represented the New York 10 area in different capacities since 2010.
Tell our viewers about yourself and your background.
I love organizing with my neighbors to make our lives in common better. I mean, the way I see it, being a good congressman is a lot like being a good neighbor.
Uh I worked in this district for 15 years before I ran for office, fighting evictions by corporate landlords, helping people get good jobs, building affordable housing. Then I represented the neighborhood in the city council, where I made us the first city in the country to give stable schedules to fast food workers or living wages to delivery workers and Uber drivers. We desegregated the middle schools of our district. We built the most affordable housing anywhere around the Gowanus Canal.
As controller, you know, I stood up for New Yorkers when Elon Musk stole $80 million for New York City. I caught it, and you know, forced the Adams administration into court to get it back.
Um I like fighting for my neighbors against bullies, whether they're ICE or Donald Trump or corporate interests trying to screw working people. Now, you ran for mayor just last year. You lost in the primary, but why did you decide to run again so soon? Well, you know, that race didn't go exactly as I mapped it out, but I felt proud at the end to cross-endorse Zohran so that Andrew Cuomo would not be our mayor, to show people Jewish New Yorkers and Muslim New Yorkers don't have to be divided, and politics doesn't have to be some bitter ego trip. It could be a team sport for a city everyone can afford and where everyone is welcome. And right now, we are at a five-alarm fire for our democracy. Donald Trump is abducting our neighbors and kicking people off SNAP and Medicaid and taking us into reckless, illegal wars, and in my opinion, establishment Democrats like Dan Goldman aren't getting the job done.
What do you think is the most important issue facing our district? Uh housing. I mean, the price of housing, you know, on the Manhattan side is $5,000 a month. My kids can't afford it. Working people can't afford it, and they're pissed off cuz they see the money's going somewhere, you know? So, private equity landlords are taking that money.
Um and so yeah, I mean, you know, the cost of living in general, but in this district, uh housing affordability especially. Now, you mentioned it earlier, Mayor Mondaire has endorsed you. Governor Hochul has endorsed Goldman, sort of uh splitting the political leaders here in the city, but are you hoping that the support from the mayor that it translates over to your campaign? Are you hoping his same supporters vote for you as well? Uh look, I think Mayor Mondaire is doing a very good job so far. That expansion of universal child care so people will not have to pay $25,000 a year for their two-year-old or their three-year-old.
People are excited about that. And yeah, I mean, you know, uh Representative Goldman couldn't even vote for Zohran or endorse Zohran. We was the and nominee for mayor. Um this is a district that voted overwhelmingly for him. Look, I'm running on my record. Uh, I deliver for this district. I will take on Donald Trump. I will take on the wealthy corporate interests that are driving up prices. Uh, but I'm very proud to have Mayor Mondani's support. Now, an issue that's really come up during this race is Israel and the war in Gaza. Now, you've said that you want the war to end. Where do you stand when it comes to continuing uh, military aid to Israel?
Yeah, I mean, I think we should end US military aid to Israel, and that's a real distinct difference between me and Representative Goldman, who has voted for every single aid package, not just defensive aid, but for the 2,000 lb bombs that leveled every hospital, every school in Gaza. I'm a proud Jewish New Yorker, uh, but I think unconditional US military aid, uh, has been horrible, obviously disastrous for Palestinians, but bad for Israelis, and now this reckless and illegal war that Netanyahu and Trump took us into have shredded US credibility in the world, uh, with harm for international law, and also driven prices up of oil and food. It's a disaster.
Um, and so folks who want the candidate who would not continue to sending more and more taxpayer aid to Israel, but would actually hold them accountable for human rights and international law, I definitely hope will vote for me. Does that include defensive aid for Israel?
Uh, it does. I mean, I think Israel should be able, you know, the war shows they could purchase uh, Iron Dome on their own.
Um, and yeah, I don't think that the US should provide any additional taxpayer aid to Israel while they are breaking international law and violating human rights. I hope they stop. I want there to be a Jewish and Democratic Israel, but it is incompatible with Israel's occupation of the West Bank and Gaza, um, with the destruction of Gaza, which I do consider a genocide, um, and with ongoing reckless and illegal war.
There's been such a talk as well about taxing the rich here in New York, increasing taxes on millionaires and corporations. But there's also been a fight on the federal level. Congressman Goldman said that he personally thinks it's better to tackle it on the federal level rather than the state level. What do you think? Do you think it hurts New York's competitiveness?
>> I think that's a cop out. I certainly support doing it at the federal level.
I'm proud to have support from I'm endorsed by Senator Elizabeth Warren and Senator Bernie Sanders. I support their wealth taxes which would raise $6 trillion for housing and health care.
But boy, yes, I support the pied-a-terre tax that even Governor Hochul agreed to to do in Albany. So I was very surprised to see that that Representative Goldman doesn't think that we should I guess have a pied-a-terre tax or that we should tax the rich in New York. We're lucky to have a thriving growing city.
But if we're going to pay for universal child care, for affordable housing, for our libraries, the rich need to pay their fair share. So I'll fight like hell to win it in Washington, but in the meantime, I'll support it in New York as well.
Now when it comes to ICE, you were arrested when it came to helping assist migrants go to immigration court. What else have you been doing when it comes to helping fight for migrants in your district? So I've been going back just about every week as part of a big movement. This isn't just me. I mean, thousands of people are showing up to bear witness, to accompany people, to make sure they know their rights. I was just there on Monday and there was a young man from Mauritania, you know, who's going to his hearing and ICE agents were right there waiting to detain him. And several of us waited with him through his trial. And those ICE agents left and did not abduct him.
I don't know that it's because we were there, but we were there providing him support and thousands of people are doing that. It is a movement all across the country after Renee Gooden and Alex Preddy were killed. I went to Minneapolis. That's part of the same movement of good neighbors working together to push ice out of our courts, out of our workplaces, out of our neighborhoods, out of our city. So, we are almost a little more than a month away from the primary. If in a sentence or less, uh tell our viewers why and what sets you apart in this race.
>> Yeah, I mean, this is a five-alarm fire, and New Yorkers want leaders who will put their body on the line to stand up to Trump's corruption and autocracy, uh who will take on the wealthy special interests who are making our city less affordable instead of taking contributions from them, and who love representing and organizing with their neighbors, who are team players for our city. That's what I've been doing for 30 years. That's what I'm going to do in Congress. Well, I can't thank you enough. I uh appreciate you coming on the show and hope to have you back on again very soon. Thank you so [clears throat] much.
>> Thank you. Coming up next, getting a seat at Garden State restaurants just got easier. We'll have reaction to a new law just signed by Governor Sherrill.
>> [music] >> Getting a reservation at a New Jersey restaurant [music] may have gotten a lot easier and cheaper. Governor Mikey Sherrill just signed bipartisan legislation barring third-party party services from listing or selling reservations at Garden State restaurants without the eatery's consent. Violators will face fines up to $500. Lawmakers pushed to finalize the law before the state begins hosting World Cup matches next month. We asked New Jerseyans what they thought about the issue. I think it's a good law. I didn't even know that the restaurants had this issue, and I mean, you know, if they're not controlling their own reservations, no one else should.
>> It's a bad idea cuz it makes no sense.
You're taxing, you're charging additional costs where it eventually gets passed on to the consumer. I think 500 is a bit steep, but I actually do think it's a good idea. I've worked as a host for 4 years, and a lot of the times we get blindsided by these other companies making reservations without us really knowing. Next up, we're going to test your knowledge, so stay with us.
Finally tonight, we're testing your knowledge. Last week we asked you, why is Houston Street pronounced How-sten instead of Houston? The answer, How-sten Street is named after William How-sten in 1788.
How-sten was a Revolutionary War patriot from Georgia, but had the street named after him because of who he was married to. How-sten's wife was Mary Bayard, whose family owned what is now SoHo and the Lower East Side. Now to this week's question, the Titanic was supposed to dock at what pier in New York City? Now, don't Google the answer, but if you want to take a shot at it, go ahead, scan that code on your screen. That's going to take you to our website fox5ny.com, where you can type in your answer, then check back here next week to see if you're right. That does it for this episode of Politics Unusual. If you missed any part of the show or just want to check it out again, we are now on Spotify and any other platform you listen to podcasts on, so be sure to follow us. Thank you so much for joining us. I'm Morgan McKay. Have a safe weekend. We'll see you next week.
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