NYC budget grows to $129.2 billion as Wall Street taxes pour in, but savings fall short

New York City's budget for this fiscal year has grown to $129.2 billion, about $3 billion more than the plan the City Council adopted in June, Mayor Zohran Mamdani's administration said Thursday in its November budget modification, the routine midyear update that keeps the budget balanced, City & State reported.

The update leans on Wall Street. Tax collections tied to the market came in nearly $1 billion above projections in the first quarter of fiscal 2027 alone, city Comptroller Mark Levine said in a statement. Fiscal watchdogs said the city still has not found the savings it promised and faces large gaps in the years ahead.

What changed since June

• Spending: The New York Post put the increase at $3.3 billion over the $125.8 billion adopted budget: $1.15 billion in city funds, $1.48 billion from the federal government and $635 million from the state, according to City Hall.
• Where it goes: The administration highlighted more money for administering SNAP because of federal cuts and new funding for juvenile justice facilities, City & State reported. The Education Department is expected to spend more than $400 million above its earlier budget, the Post reported.
• Revenue: City Hall's forecast adds about $956 million in tax revenue for fiscal 2027 thanks to Wall Street gains, according to the Post; Bloomberg Law put the figure at $965 million.
• Savings: The update includes about $429 million in cuts for the year, roughly 0.33% of the budget, the Post reported. Mamdani had ordered every agency to find 2.5% in savings, about $1 billion.

The gaps ahead

The mayor's own forecast shows a budget gap of about $6.2 billion in fiscal 2028, the year that starts next July, growing to nearly $9 billion by 2030, the Post reported. "The November update emphasizes the extent to which our budget relies on Wall Street surging," Levine said. "The City has much more work to do to achieve meaningful savings." His office will update its own projections in the coming weeks.

Levine's office also modeled an "AI Shockwave" scenario in which artificial intelligence guts mid-level banking jobs and wipes out $3.4 billion in city tax revenue, the Post reported. State Comptroller Tom DiNapoli warned that revenue growth could slow given how volatile AI-driven gains on Wall Street are, according to City & State.

The Citizens Budget Commission was blunter. "Disappointingly, four months after the Mayor directed agencies to find savings, what's included is a small fraction of the target," president Andrew Rein said, adding that only a quarter of the actions make government more efficient. The commission put the savings identified for next fiscal year at about $250 million, City & State reported.

What the mayor says

"We are investing in the essential services New Yorkers rely on to protect their health, safety and wellbeing, while pursuing an aggressive savings plan to put our city on stronger financial footing," Mamdani said in a statement.

What comes next

THE CITY reported ahead of the update that rising Wall Street revenue, along with an $8 billion windfall in the state's own collections, could ease the mayor's budget problems and bring him closer to his goal of raising taxes on the wealthy. The Citizens Budget Commission had said a key test would be whether the administration detailed the $1 billion in savings it ordered.