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Eric Adams’ relationship with NY tech community hits snags

BusinessEric Adams' relationship with NY tech community hits snags

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New York City Mayor Eric Adams speaks during an interview on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., February 28, 2022.

Brendan McDermid | Reuters

New York Mayor Eric Adams met with a small but influential group of tech executives last year at the swanky Le Pavillon with a clear message: Tech should stay and invest in the city because he’s allied with their industry.

Since then, however, Adams’ often-positive relationship with New York’s tech community has soured in some ways. In the view of some key members of the New York tech community, much of that stems from Adams and his administration failing to live up to the tight relationship they appeared to promise the industry before and after he was sworn in early last year, according to people familiar with the matter.

Some leading tech officials, including some executives from Airbnb and Uber, have grown tired of meetings with Adams and members of his administration that they believe have led to few concrete results, according to people briefed on the matter. These revelations come as Adams’ unfavorable ratings rise among New Yorkers, according to a new poll.

Reached for comment on this story, Adams’ press team provided a statement defending his track record on tech.

“Mayor Adams strongly believes we must harness technology to address some of the most pressing issues facing our city — and his record, 18 months into his term, speaks for itself,” the statement says. It also notes a wide range of initiatives, including how Adams appointed the city’s first chief technology officer and how he has “overseen the rollout of the MyCity platform to streamline access to public benefits programs and issued rules to permit drone usage for private use as well as for city agencies.” Adams’ team also pointed to the work they’ve done with the tech sector to bring more jobs to New York.

Adams’ team also referred CNBC to two New York tech leaders: Andrew Rasiej, the chairman of NY Tech Alliance, and George Fontas, the CEO of tech lobbying shop Fontas Advisors. NY Tech Alliance is a massive tech trade group with 60,000 members, according to their website.

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Rasiej pushed back on the notion that Adams relationship with New York’s tech community has soured. He sees Adams as the first mayor that “truly understands how technology can be implemented” and pointed to Adams creating the Office of Technology and Innovation. Rasiej said that having that new agency and a chief technology officer running it was a better move for Adams that just appointing a deputy mayor because the CTO is in charge of all of the city’s technology under one office rather than just a portfolio of agencies under one deputy mayor.

“I think the tech community should be grateful that they have a Mayor who is focused on making sure technology serves and reaches all New Yorkers equitably,” Rasiej said. “It’s unfortunate that some companies feel they aren’t getting enough and the same attention they get from Washington through their lobbyists and donations.”

Fontas, who has lobbied for his tech clients in New York politics for years, told CNBC that just because a company doesn’t get what they want from their meetings, doesn’t mean it’s on the Adams administration to appease their concerns.

“Ultimately, the city’s perspective is we have millions of people that we’re managing but we’re also managing an over $100 billion budget,” Fontas said. “The city’s goals might not always align with where your corporation wants to be. It really is incumbent on the company to align their goals to the city’s success.”

Josh Gold, a spokesman for Uber, told CNBC: “We are committed to working with the Mayor to continue to advance the City’s recovery.” An Adams City Hall spokesperson told CNBC that while they don’t comment on private conversations, many of the city’s regulations on short-term rentals and rideshare companies predate Adams’ administration.

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A spokesperson for Airbnb did not return requests for comment before publication.

What happened to the tech czar?

Some of the issues with Adams appear to be rooted, in part, in overtures he made during the transition period following his election in 2021. At the time, he was in touch with longtime tech advocate Julie Samuels about her perhaps becoming a deputy mayor for technology, according to a person briefed on the matter. She showed interest in taking on such a role, this person explained.

The position would have served as a key liaison between the mayor’s office and the tech industry, according to people familiar with the matter.

But it never happened.

Samuels, who advocated in a 2021 op-ed for a New York deputy mayor for technology, was never officially offered the job. The position itself hasn’t materialized. Adams appointed Matt Fraser, who once worked as a deputy commissioner for the New York Police Department, as the city’s chief technology officer. Fraser leads the city’s Office of Technology and Innovation.

New York 1 first reported on Samuels being considered for the post. Samuels, who continues to be an ally of Adams, is the president of nonprofit tech advocacy group Tech:NYC. The group lists founding members such as Google, Meta, Union Square Ventures and Yahoo.

Since the tech czar role hasn’t materialized, some industry leaders don’t see that Adams has lived up to what executives saw as a promise to be the advocate he said he would be, following years of tension between business and Adams’ predecessor, Bill de Blasio.

Adams may have too much on his plate to interact with the tech world as much as he wanted to, according to Kevin Ryan, the CEO of venture capital firm AlleyCorp who’s also known as the “Godfather of NYC Tech.”

“I think that because tech is succeeding in New York and everything is going well, there’s no crisis. So you can easily ignore it,” Ryan told CNBC in an interview. “At some point, you don’t want to ignore and have a missed opportunity to be a cheerleader to a fast growing and soon to be the most important industry in the city,” he said.

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NYC and tech head to court

As strain between the Adams administration and some tech leaders has grown, a few tech companies have taken the city to court.

The Washington Post reported earlier this month that Uber, DoorDash and Grubhub each filed motions in New York Supreme Court for temporary restraining orders against a proposed rule that would require those companies to pay their delivery workers almost $18 an hour.

The New York Times reported in June that Airbnb is suing New York City for a law that was passed in 2021, the last year of the de Blasio era, which would require hosts to go through a lengthy process to register with the city for shorter term rentals. The law is set to take effect in the coming weeks.

Both Uber and Airbnb have privately engaged with the Adams administration during the buildup to the legal proceedings, according to people familiar with the matter.

Airbnb officials, for instance, spoke with close advisors to Adams starting last summer and then through this year, according to a person with direct knowledge of the matter. In September, Airbnb’s billionaire co-founder Nathan Blecharczyk met with Frank Carone, Adams’ then-chief of staff.

Blecharczyk and the other Airbnb officials tried to explain to Carone that their company and the administration could work together to figure out their differences on short term rentals. Carone seemed interested in working with Airbnb on solutions through these types of meetings, including possibly pursuing a legal framework that the company proposed.

But, again, the talks yielded little progress. “Talks were positive, solutions were hard to come by,” said a person familiar with the matter.

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