More money, still problems for Mamdani’s first budget

New York City Mayor Zohran Mamdani will waltz into City Hall on Tuesday with his first preliminary budget plan. 

It’s the first real step in the annual budget dance between City Hall and the City Council – with lawmakers in Albany keeping the music playing (or so Mamdani hopes) and fiscal watchdogs scoring from the sidelines.

But Mamdani has already tried out a little footwork before showtime. The preliminary budget is typically due in January, but Mamdani has a little more time to deliver it in his first year. And he’s already gotten some results.

Late last month he held a budget address in which laid out his case for why former Mayor Eric Adams and former Gov. Andrew Cuomo were to blame for the city’s current budget woes, which included a $12 billion gap to close across this fiscal year and the next, he said. Then last week, he traveled to Albany to repeat that case – and to advocate for raising taxes on high earners and large companies, as well as for additional state funding. Also announced last week: a $5 billion shrinkage of that budget gap, achieved through updated economic forecasts reflecting new revenue, projected savings and dipping into in-year reserves.

And on Monday, Gov. Kathy Hochul announced in a joint statement with Mamdani that the state would provide $1.5 billion in additional aid over two years. That includes $510 million in recurring funds aimed at redirecting costs borne by the city to the state. “A strong New York City means a stronger New York State. This investment protects services and puts the city on stable financial footing,” Hochul said in the statement. 

“This is what it looks like to begin a new, productive and fair relationship between City Hall and Albany – focused on delivering for working New Yorkers,” Mamdani added.

But it’s Tuesday’s address that will hopefully provide clarity on questions Mamdani has yet to answer at those earlier events. 

Among them: How much of that $7 billion gap is present in the current fiscal year ending June 30, and how much has been staved off to next fiscal year? 

And will the $1 billion in savings the administration has identified in city spending sound any echoes of the last administration’s politically unpopular budget cuts, such as eliminating vacant positions from the agency budgets or even cutting program spending? 

City agencies were ordered to appoint “chief savings officers” to identify areas for spending cuts and efficiencies within 45 days. So far, Mamdani and his budget director Sherif Soliman have only hinted at what those savings might look like. Mamdani has referenced an AI chatbot launched under Adams as wasteful spending, while Soliman said last week that they would be looking at reducing spending on outside contracts.

Though Mamdani will be in the spotlight for Tuesday’s preliminary budget announcement, the City Council and its speaker Julie Menin will soon take the floor. Preliminary budget hearings are expected to kick off late this month or early March, where the City Council will poke and prod at the mayor’s proposal, culminating in the council’s preliminary budget response. After that, the mayor will present an updated proposal, the executive budget, triggering another round of hearings by the council, before negotiating an adopted budget that the council will vote to pass.

“I think the budget dance is that: It’s somewhat of a dance, which is unfortunate,” said Menin, a former agency leader, last week. “It always would be better if there could be more coordination and not so much of that back-and-forth. I do believe we can do that. I’ve been talking very constructively with the mayor about that.”

Mamdani is set to brief both Menin and the full City Council ahead of his afternoon address on Tuesday.