By: Jordan Baker

Mayor Zohran Mamdani’s proposal to raise New York City property taxes by 9.5% could deliver an unexpected hit to residents already struggling with the high cost of living — by driving up their electric and gas bills, according to experts cited by the NY Post.

As the NY Post reported, the first-term Democratic socialist mayor is floating the property tax hike for the first time in decades as part of his sweeping $127 billion preliminary budget. Mamdani has framed the move as a necessary fallback to close a looming multibillion-dollar gap. But critics warn the increase would not simply affect property owners — it could cascade down to everyday New Yorkers through higher utility bills.

Energy utilities such as Con Edison and National Grid pay substantial property taxes on their infrastructure across the five boroughs. According to the NY Post, former state Public Service Commission chairman John Howard said those costs are routinely passed along to customers.

“You’re not taxing Con Edison. You’re taxing the customers,” Howard told the paper, arguing that utility property taxes in New York City are already unusually steep. He described the structure as excessive and said most ratepayers don’t even realize the property tax component is embedded in their monthly bills.

The New York State Public Service Commission (PSC), which regulates utilities, has acknowledged that such taxes ultimately fall on consumers. A PSC spokesman confirmed to the NY Post that property taxes paid by Con Edison and National Grid are incorporated into the rates customers pay.

Residents are already bracing for higher energy costs. As previously approved by the PSC, Con Edison will raise electric rates by 10.4% and gas rates by 15.8% over the next three years. The NY Post reported that the average city ratepayer could end up paying roughly $600 more annually by 2028, regardless of whether Mamdani’s property tax proposal moves forward.

Utility representatives have emphasized how significant taxes already are in their overall billing structure. A Con Edison spokesperson told the NY Post that taxes and fees exceed $3 billion annually — accounting for roughly 30% of delivery charges. National Grid noted it had not yet seen a formal proposal but acknowledged that taxes and fees already represent about a quarter of customers’ monthly bills.

A PSC report released last fall found that taxes on New York utilities — largely property taxes — are three to four times higher than the national average of about 8%. The report concluded that utilities in New York, and their customers, shoulder an outsized burden of non-income taxes compared to other states.

Mamdani’s financial plan would increase the overall property tax rate from 12.83% to 13.45%. The documents do not indicate that utilities would be exempt from the higher rate, the NY Post noted.

The mayor has described the property tax hike as a “plan B,” saying he would prefer that Albany raise income taxes on millionaires and increase corporate tax rates instead. He has been pressing Gov. Kathy Hochul and the state Legislature for approval of those revenue measures to fund his policy agenda, which includes initiatives such as free bus service.