Eric Adams' relationship with the NY tech community hits some snags

The mayor has been accused of being too cozy with the tech industry, which many residents believe is responsible for the city's high cost of living.

Eric Adams' relationship with the NY tech community hits some snags

Important Points

Adams' team of press provided a brief statement to defend his record in tech when Adams was contacted for comment.

New York City Mayor Eric Adams met a small group of influential tech executives at the swanky Le Pavillon last year with a message that was clear: Tech should remain in the city and invest because he is allied with the industry.

Adams' positive relationship with New York City's tech community, which was once very strong, has soured since then. According to some members of New York's tech community, this is due to Adams and his administration not living up to the close relationship they promised the industry both before and after Adams was sworn into office early last year.

According to those briefed about the issue, some leading tech officials have become tired of meeting with Adams and his administration, which they feel has led to little concrete result. According to a recent poll, Adams' unfavorable rating is on the rise among New Yorkers.

Adams' team of press provided a brief statement to defend his record in tech when Adams was contacted for comment.

The statement states that "Mayor Adams believes we must harness the power of technology to tackle some of the most pressing problems facing our city - and his record speaks for itself, 18 months into this term." The statement also mentions a number of initiatives. For example, Adams was appointed as the first chief technology officer of the city and he "oversaw the rollout the MyCity platform in order to streamline the access to public benefit programs. He has also issued rules that permit drone use for private as well as city agencies." Adams' team has also highlighted the work that they have done with the technology sector to bring jobs to New York.

Adams' team referred CNBC also to two New York technology leaders: Andrew Rasiej is the chairman of NY Tech Alliance and George Fontas is the CEO of Fontas Advisors, a tech lobbying firm. According to their website, NY Tech Alliance has 60,000 members.

Rasiej refuted the idea that Adams' relationship with New York City's tech community had soured. He believes Adams is the first mayor who "truly understands the technology that can be implemented", and he cited A dams' creation of the Office of Technology and Innovation. Rasiej stated that Adams' decision to create the Office of Technology and Innovation with a Chief Technology Officer running it, was better than appointing just a deputy mayor. The CTO will be in charge of the entire city's tech under one office instead of just a few agencies under a single deputy mayor.

Rasiej stated, "I believe the tech community should feel grateful to have a mayor who is committed to ensuring that technology serves all New Yorkers equally." It's unfortunate that certain companies feel like they don't get enough attention and the same as they do from Washington via their lobbyists or donations.

Fontas has been lobbying for his clients' tech companies in New York politics since years. He told CNBC, however, that the Adams administration is not responsible for appeasing their concerns just because they don't receive what they wanted from their meetings.

Fontas stated, "Finally, the city's point of view is that we manage millions of people but also a budget exceeding $100 billion." The city's goals may not always coincide with what your company wants to achieve. "It is the responsibility of the company to make sure that their goals are aligned with the success of the city."

Uber's spokesman, Josh Gold, told CNBC that Uber was "committed to working with Mayors to continue the recovery of the City." A spokesperson for Adams City Hall told CNBC that, while they do not comment on private conversations or short-term rental regulations and rideshare firms prior to Adams' administration, most of these regulations predate Adams.

What happened to Tech Czar?

Adams's issues may be partly rooted in the overtures he made in the transitional period that followed his election in 2021. According to a source briefed on this matter, Adams was in contact with Julie Samuels, a long-time advocate for technology. He asked her if she would be interested in becoming deputy mayor for the field of technology. This person said that she expressed interest in such a position.

According to sources familiar with the situation, the position would have been a vital liaison between the Mayor's Office and the tech sector.

But it never happened

Samuels was never offered the position he advocated for in an op-ed from 2021. The position has not been created. Adams named Matt Fraser, a former deputy commissioner of the New York Police Department who was appointed as the city's Chief Technology Officer. Fraser is the director of the Office of Technology and Innovation.

New York 1 was the first to report that Samuels had been considered for this post. Samuels is president of the nonprofit advocacy group Tech:NYC. He continues to be an Adams ally. The group's founding members include Google, Meta and Union Square Ventures.

Some industry leaders believe that Adams, who was supposed to take on the role of tech czar, has not lived up to his promise. This follows years of tensions between the business community and Adams' predecessor Bill de Blasio.

Kevin Ryan, CEO of AlleyCorp, also known as "Godfather NYC Tech," said that Adams might have had too much to do to keep up with the tech industry as much as he would've liked.

There is no crisis, I think, because New York is a tech hub and things are going well. Ryan said in an interview with CNBC that you can ignore the crisis. He said that at some point you do not want to ignore the industry and miss the chance to be its cheerleader. It is growing fast and will soon be the biggest in the city.

NYC and Tech Head to Court

A few tech companies are suing the city because tensions between the Adams administration, and certain tech leaders have grown.

The Washington Post reported that earlier this month, Uber, DoorDash, and Grubhub had each filed a motion in New York Supreme Court seeking temporary restraining order against a rule that would have required these companies to pay their deliveries workers almost $18 per hour.

The New York Times reported that Airbnb was suing New York City in June for a law passed in 2021 - the last year under the de Blasio administration - that would have required hosts to undergo a lengthy registration process with the city in order to rent short term. The law will take effect on July 1.

People familiar with the situation say that Uber and Airbnb engaged privately with the Adams administration in the lead-up to the legal proceedings.

According to someone with first-hand knowledge, Airbnb officials spoke to close advisers of Adams beginning last summer, and continuing through this year. Airbnb's billionaire founder Nathan Blecharczyk and Frank Carone, Adams’ then-chief of staff, met in September.

Blecharczyk, along with the other Airbnb officials, tried to explain Carone how their company and administration could come together to resolve their differences regarding short-term rentals. Carone appeared to be interested in working on solutions with Airbnb through these meetings, such as possibly pursuing the legal framework that was proposed by the company.

Again, however, there was little progress in the discussions. A person with knowledge of the situation said that "talks were positive and solutions had to be found."