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Mayor Eric Adams announced a deal on a $112 billion budget with the City Council on Friday, reversing a small but notable fraction of his unpopular cuts as he looks toward a difficult re-election bid next year.
The spending plan for Fiscal Year 2025 also makes some new investments at the urging of lawmakers, including $2 billion for housing. City Hall’s willingness to add spending marks a major shift from last year, when Adams’ dire warnings about future-year deficits and the costs of the migrant crisis led him to impose some unusual mid-year cuts across city agencies.
“We’re delivering a budget that invests in the future of our city and the working people who live here,” the mayor said at City Hall Friday afternoon, moments after a symbolic handshake with Council Speaker Adrienne Adams. The council pushed successfully to undo $350 million of the $7 billion in cuts the mayor had ordered — including controversial reductions like the $58 million from public libraries that would have ended weekend service, and $53 million from cultural groups like museums and botanic gardens.
Early childhood programs like pre-K and 3-K will get $100 million, short of what some advocates had asked for, as the city dips into its own funds to shore up expiring federal money that had helped pay for those programs. Council Speaker Adrienne Adams warned that the city would need help from the state government to sustain that funding in the future.
All the restorations total just $350 million, leaving in place the vast majority of the mayor’s $7 billion cuts. The not-yet-finalized $112.4 billion deal is a modest increase from the mayor’s previous $111.6 billion proposal from April.
Still, Speaker Adams sounded triumphant, saying the council had won funding for all of its biggest priorities. The deal for libraries and cultural institutions also includes recurring, or “baselined” funding into the future, potentially sparing them from the annual budget battles they have seen in recent years.
“It is imperative for our city’s future that the budget process moves away from restoring and towards strengthening and building,” Speaker Adams said on Friday, in a modest dig at the mayor’s hawkish approach. She and the mayor grinned as they shook hands and displayed a model airplane, a reference to the mayor’s frequent pledge that they would “land the plane” by passing the budget on time.
The City Council will pass the budget on Sunday, hours before the official deadline, after weeks of negotiations that stretched down to the wire. Lawmakers have argued for months that the mayor was relying on overly pessimistic tax-revenue forecasts to justify the cuts, noting that a range of budget watchdogs agreed that the city would have more money in the coming years than City Hall had projected.
By April, the mayor did release a rosier forecast that he said made it possible to cancel additional cuts and undo previous reductions that would have affected police, pre-schools and trash-can pickups. But Adams is no doubt mindful of the political hits he has taken: A poll released this week by Slingshot Strategies showed that a majority of registered Democrats opposed his handling of the budget, while only about one-quarter approved.
The same poll put Adams’ job approval at just 36%, the latest in a string of dismal results for the mayor that have emboldened State Sen. Zellnor Myrie and former comptroller Scott Stringer to both announce they plan to challenge him in next year’s Democratic primary.
New funding for housing
The new investment in housing came after a campaign by progressive lawmakers and advocates, who warned that rising construction costs would cause production to drop next year — undercutting one of Mayor Adams’ key priorities — unless funding were increased. That campaign had focused on funding programs that preserve existing rent-stabilized units, but the agreed-upon budget deal would instead mostly fund programs that finance new construction.
The deal includes $470 million over two years for new mixed-income housing and $272 million for extremely low and low-income projects, part of a total $1.3 billion commitment to the Housing Preservation and Development department, according to details shared with Crain’s. Another $700 million will go to the New York City Housing Authority, which has an enormous funding backlog.
Rachel Fee, executive director of the New York Housing Conference, said she agreed with the decision to focus on capital programs that could fund shovel-ready development, given that city housing officials have admitted there are more than 700 affordable projects sitting in the pipeline awaiting financing.
“Because we have that huge backlog, it makes sense to advance the projects that are ready to go,” Fee said in an interview. “We’re absolutely thrilled, and we do see this as a historic investment at a time when it really couldn’t be needed anymore.”
Other cuts still in place
About $2 billion of the mayor’s previous cuts came from efforts to reduce spending on migrants through policies like time limits on shelter stays, and the council made no major push to undo those rules.
Only a high-level view of the budget deal was available by Friday afternoon, leaving the funding levels for most city programs unclear. But some early criticism came from city Comptroller Brad Lander — who may run against the mayor next year — who said the plan failed to fully restore previous cuts to early childhood education and the City University of New York.
“A budget dance of unnecessary cuts and last-minute restorations, with little focus on real long-term savings and priorities, fails to set New York City on firm fiscal footing nor prioritizes the most critical investments for our future,” Lander said.
The hawkish Citizens Budget Commission was critical from the opposite perspective, noting that city leaders decided not to add any money to the “rainy day” fund — a reserve meant for future emergencies, which currently contains $2 billion.
“Choosing not to save when the revenues are strong will mean unnecessarily severe cuts during the next recession,” said Andrew Rein, the watchdog’s president, in a statement. Rein added that the new budget appeared likely to continue a longstanding trend of understating future expenses like overtime pay and housing vouchers that consistently cost more than what the city allots.
Adams announced plans last summer to impose 15% across-the-board budget cuts to most city agencies, weeks after he had said that the city expected to spend $12 billion over two years caring for asylum-seekers. But he began to reverse himself starting in January, when he made the unusual move of rolling back his own cuts before he had even begun negotiations with the council on the next year’s budget.
The back-and-forth fueled claims from critics that Adams had been negotiating against himself, potentially in an unsuccessful bid to win more federal aid for the migrant crisis. City Hall officials rejected those arguments, saying they were only able to back off more severe cuts thanks to their own belt-tightening.
Nick Garber , 2024-06-28 21:14:47
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