Gov. Kathy Hochul is giving another $1.5 billion in state funding to New York City, one day before Mayor Zohran Mamdani is poised to unveil plans to balance his first city budget and less than a week after he traveled to Albany begging legislators to approve additional dollars for the city. 

“A strong New York City means a stronger New York State. This investment protects services and puts the city on stable financial footing,” Hochul said in a press release. “New Yorkers expect the state and the city to work together, and I’m proud to partner with the Mayor to deliver for working families.”

What You Need To Know

Gov. Kathy Hochul is giving another $1.5 billion in state funding to New York City, one day before Mayor Zohran Mamdani is poised to unveil plans to balance his first city budget and less than a week after he traveled to Albany begging legislators to approve additional dollars for the city

Budget sources told NY1 the amount will be broken up into $1 billion next year and $510 million in the 2027-2028 fiscal year

 The move also follows Mamdani’s all but dead on arrival pitch to Hochul and state lawmakers to greenlight new taxes on the wealthy and big corporations last Wednesday during “Tin Cup Day” in Albany

Budget sources told NY1 the amount will be broken up into $1 billion next year and $510 million in the 2027-2028 fiscal year.

But the move also follows Mamdani’s all but dead on arrival pitch to Hochul and state lawmakers to greenlight new taxes on the wealthy and big corporations last Wednesday during “Tin Cup Day” in Albany.

Mamdani argued the city needs $7 billion to close its gap, revealing a financial hole $5 billion smaller than he projected and no longer on par with the “Great Recession” of the early 2000s, as Mamdani described the comparison during a Jan. 28 press conference at City Hall. 

Last year, City Hall approved an over $116 billion budget.

After Mamdani delivered testimony and took questions for over four hours, Hochul’s office said her “position has not changed” when it comes to opposing new taxes. 

Mamdani said in a statement Monday that “working New Yorkers did not create this budget crisis and they should not be the ones to pay for it.”

“After years of staggering fiscal mismanagement under the previous administration, our city deserves responsible and collaborative leadership,” he added. “This is what it looks like to begin a new, productive, and fair relationship between City Hall and Albany — focused on delivering for working New Yorkers.”

The new deal reflects a decent relationship between the moderate Democratic governor and the democratic socialist mayor. Hochul endorsed Mamdani before he won in November, and Mamdani just backed Hochul in her reelection bid, over her progressive would-be primary opponent who later dropped out of the race. 

Reports also revealed Mamdani won’t attend a “Tax the Rich” rally in Albany on Feb. 25, with sources arguing it’s a nod to Hochul, who already promised financial assistance to the city, including two years’ worth of a free child care pilot program for city programs, a major campaign promise from Mamdani. 

State sources said the new $1.5 billion in funding could change Hochul’s $260 billion state budget projection unveiled in January, due in what’s known as 30-day budget amendments on Thursday, Jan. 20.

In a statement, Citizens Budget Commission president Andrew Rein called the funding increase “good news for the city.” 

“The $1.5 billion will put a real dent in the City’s budget gap, which the Mayor said is $7 billion. Governor Hochul is rightly reversing some historical cost-shifts from the State to the City,” Rein said. 

“Mayor Mamdani still has a heavy lift ahead of him to balance the budget,” he added. “And while this is a fair thing for the State to do, the recurring support will widen future State budget gaps.”