NEW YORK, NY — Mayor Zohran Mamdani announced a sweeping savings plan aimed at reducing the City’s budget gap, with agencies identifying more than $1.7 billion in proposed cuts and efficiencies.
The plan follows an executive order requiring every city agency to find savings of 1.5 percent for fiscal year 2026 and 2.5 percent for fiscal year 2027.
Officials said the proposals are under review for inclusion in the city’s executive budget.
Mark Levine has described the current shortfall as “the biggest budget gap since the Great Recession.”
Under the plan, agencies are targeting cost reductions across five areas: public service efficiencies, contracting, technology, space use and financial adjustments.
Several agencies proposed cutting or restructuring contracts.
The Department of Correction plans to cancel certain technology and consulting agreements and bring services in-house, saving $4.3 million in fiscal year 2026.
The Department of Social Services will terminate a consulting contract and shift IT work internally, while also renegotiating agreements tied to WiFi services in shelters.
The Fire Department reported it secured lower telecommunications rates and will begin billing Medicaid for certain emergency responses that do not result in hospital transport, following recent approvals from state and federal regulators.
At New York City Public Schools, officials plan to eliminate underused contracts and impose spending limits on central office operations, generating tens of millions in projected savings across two fiscal years.
Health officials said the city will renegotiate contracts for naloxone, a medication used to reverse opioid overdoses, to align with lower prices seen in other states.
Other measures focus on reducing office space and consolidating operations.
The Department of Sanitation reported it will vacate underused offices and relocate staff, while the Office of Management and Budget plans to cut lease costs.
The Office of Labor Relations plan to audit dependent eligibility in employee health plans and remove ineligible participants, a move expected to save about $100 million in fiscal year 2027.
In January, Mamdani signed an executive order creating a chief savings officer at every agency to oversee the effort, with a focus on eliminating waste and improving efficiency.
“This is just the beginning of our work to improve service delivery and make city government the most efficient it can be,” Mamdani said.