The mayor reveals a $12 billion hole in New York state’s budget over the next two years and draws some political battle lines.
Zohran Mamdani gives a press conference about New York’s preparations for last week’s snowstorm.
(Michael Nagle/Bloomberg via Getty Images) The honeymoon is officially over.
That was the deeper meaning of Mayor Zohran Mamdani’s somber speech Wednesday morning. Town hall press conference revealing not-so-shocking news that New York will face a $12 billion hole in the city’s finances over the next two fiscal years. The budget deficit itself was old news, first revealed by Controller Mark Levine nearly two weeks ago, in an announcement whose details owed much to his predecessor, former comptroller Brad Lander. final reportwhich had forecast “a gap of $2.18 billion for fiscal 2026…a gap of $10.41 billion” [in FY 2027]$13.24 billion for fiscal year 2028 and $12.36 billion for fiscal year 2029.”
Lander’s mid-December warning garnered little media coverage, except for one New York Post editorial board singing that looming deficits “will surely dent Mayor-elect Zohran Mamdani’s gift-filled socialist agenda.” But the mayor’s dramatic account of his predecessor’s tax manipulations was crafted with a clear political agenda in mind: to both highlight the scale of the problem and identify the bad guys responsible for this perfidy. “In the words of the Jackson 5, ‘it’s as simple as ABC,'” the mayor said, repeating a tune from his interview earlier in the week with ABC’s Jonathan Karl. “It’s a budget crisis Adams.”
I’ll leave that to the youngest Nation readers to decide whether our mayor’s code-switching allusion was contrived, as Gothamist suggestedto attract aging baby boomers “most likely to care deeply about the details of a major financial issue” or a call to the TV network for insight into its next moves. Regardless, as Mamdani stood in the Blue Room Wednesday — his third official news conference in as many days — flanked by First Deputy Mayor Dean Fuleihan and Budget Director Sherif Soliman, the scale of the problem was abundantly clear. Accusing Eric Adams of “underestimating known expenses” so he could claim the city’s budget would balance, as it does required by law— the mayor explained that “these are not differences of opinion between accountants. They amount to more than 7 billion dollars beyond what he published.”
“It’s not just about bad governance,” Mamdani continued. “It’s negligence,” adding that “once we looked under the hood [of the city’s finances]the full picture was astonishing.
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Adams wasn’t the only culprit, either. Using charts and graphs to detail what he calls a 10-year period in which the state “extracted resources from our city,” Mamdani broke his self-imposed ban when saying Andrew Cuomo’s name. “In fiscal year 2022 alone, the city sent $68.8 billion to Albany and got $47.6 billion back,” Mamdani said. Blaming his former rival for the “$21 billion chasm” that restricts what New York City can spend on services to its citizens, the mayor called Albany’s approach a “punishment.”
“New York City is facing a massive budget crisis,” the mayor said. To remedy this, we would need to “recalibrate the broken financial relationship between the state and the city.”
But when asked by reporters for details on what that recalibration might look like — or, given Gov. Kathy Hochul’s stated opposition to raising taxes (especially as she’s running for re-election), whether he had a Plan B — the mayor declined to go beyond citing what he described as “encouraging” conversations with the governor and legislative leaders in Albany.
The mayor also hasn’t given details about which city programs he’s willing to sacrifice — even grudgingly — although some of those potential cuts will no doubt be disclosed by Feb. 17, when the city releases its preliminary budget.
Still, for a mayor and administration that spent the first half of this week celebrating their largely successful navigation through the worst snowstorm and cold snap the city has seen in years, it was a stark change in tone. Keeping the streets clear of snow isn’t really complicated. But it’s a challenge that some of Mamdani’s predecessors failed to meet – and publicly. And like the political scientist Christina Greer recently noted”if you can’t cross the bar that is the baseline, then I think we know where we are.”
By the time Eric Adams was indicted, New Yorkers had learned not to expect much from his administration. And while Andrew Cuomo has been more successful in maintaining the illusion of competence, he has also offered little hope of resolving the long-standing crises of affordability, inequality, and decades of declining quality of municipal services.
Mamdani promised an urban renaissance. And while the extent of the city’s financial woes may have surprised him, it shouldn’t have. Because Andrew Cuomo wasn’t the only governor to bleed the city to fund Albany’s priorities. It was Kathy Hochul who decided to retain the Federal Enhanced Medical Assistance Percentage funds that the city uses to offset its share of Medicaid costs. It also increased the city’s contribution to public transportation costs by more than half a billion dollars per year, and
