“The city has laid its fiscal cards on the table, including budget risks my office has raised in recent years. The mayor’s executive budget provides a more transparent accounting for new costs associated with collective bargaining wage increases and asylum seekers. It also shows stronger than projected city revenues and additional savings from the Program to Eliminate the Gap (PEG).

“While the budget is balanced for FY 2024, the city faces challenges in the future as outyear budget gaps have grown and projected savings from the PEG will not be enough to offset these new costs. This suggests it will become even more difficult for the city to find savings without affecting services over time. The budget gaps, which could reach $10 billion in FY 2027, also highlight the importance of further building up reserves, a missed opportunity in the current fiscal year.

“The cost of asylum seekers, unbudgeted at this time last year, is expected to reach $2.9 billion in FY 2024, larger than the Fire Department’s operating budget. The city then budgets $1 billion for migrants in FY 2025 and zero thereafter, creating some uncertainty and highlighting the difficulty with accounting for this cost. The city assumes the state will provide nearly a third of the funding support needed but federal funds are not there and greater clarity from the federal government is needed to manage the situation.

“The delay in the state budget has created additional fiscal uncertainty for the city, which will have to be remedied in the city’s adopted budget expected in June. A swift agreement by the legislature and Governor will provide New York City, and other localities whose fiscal year is set to begin, greater certainty in managing their budgets.”