Mayor Zohran Mamdani told state lawmakers Wednesday that New York City’s projected budget shortfall has dropped from $12 billion to $7 billion over two years, after the city updated revenue estimates and tapped into reserves.
The announcement came during Mamdani’s first “Tin Cup Day” appearance in Albany as mayor, where he joined mayors from across the state requesting funding from the legislature. The former Queens assemblymember found himself on the opposite side of the negotiating table, now asking his former colleagues for help.
“By assuming an aggressive posture in savings without compromising city services, incorporating updated revenue and bonus estimates and using in-year reserves, we have lowered that $12 billion gap to $7 billion over two fiscal years,” Mamdani said inside the wood-paneled hearing room at the state capitol.
The revision marks a significant shift from last month, when Mamdani declared a “serious fiscal crisis” and used the dire projections to push for higher taxes on wealthy New Yorkers. The mayor blamed the budget mess on his predecessor Eric Adams and what he called chronic state underfunding of the city.
Mamdani explained that the $5 billion reduction came from three sources: $3 billion in revised revenue projections, $1 billion in savings, and $1 billion from reserves. He said the city would continue making “meaningful progress towards shrinking the gap.”
The smaller deficit reduces pressure on Gov. Kathy Hochul to raise taxes this year to help the city balance its books, as required by law. But Mamdani maintained his call for a 2% tax increase on New Yorkers statewide making $1 million or more.
City Comptroller Mark Levine had sounded the alarm in January, predicting the city would end the current fiscal year in June with a $2 billion deficit that would balloon to nearly $10 billion the following year.
Mamdani’s pitch to Albany echoed his budget message from last month. He argued the city deserves a bigger share of state money, claiming Albany collects billions more in tax revenue from city residents than it returns in funding.
“The cumulative goal of this work — and all that will follow — will be a city that works for the many, not just the few,” he said. “One where we restore New Yorkers’ faith in our democracy.”
State lawmakers peppered Mamdani with questions about everything from budget priorities to the city’s response to recent snow and extreme cold. The mayor brought backup, deferring at times to First Deputy Mayor Dean Fuleihan and Budget Director Sherif Soliman to explain the city’s financial needs. Intergovernmental Affairs Director Jahmila Edwards also joined the session.
Assemblymember Patrick Burke, who represents parts of western New York including Buffalo, challenged Mamdani’s argument that the city doesn’t get back what it contributes to the state budget.
“If someone says, ‘well, people in Manhattan are contributing most of the tax base, so therefore they should get more than people in Staten Island or the Bronx or Brooklyn,’ that’s not so good,” Burke said.
Burke added that people in smaller cities like Dunkirk on Lake Erie worry about losing badly-needed money if more goes to New York City. “It should be needs based, it should be human beings and what they need.”
Mamdani countered by pointing to vast wealth disparities within New York City, saying more money is needed to “take care of working people.”
The state’s fiscal year begins April 1, with the budget typically finalized before then, though delays are common. New York City operates on a different timeline, with its fiscal year starting July 1.
Mamdani will release his first preliminary budget on Feb. 17, kicking off months of hearings and negotiations with the City Council. The process continues with an executive budget proposal from City Hall and ongoing council negotiations before a final budget deal sometime in June.
The mayor’s Albany appearance marks a crucial test of his ability to secure state funding as he tries to balance progressive policy goals with fiscal reality. His success in cutting the projected deficit by $5 billion gives him more breathing room but still leaves the city facing significant financial challenges ahead.
