Mayor Mamdani on Tuesday ordered every city agency to find savings cuts of 2.5% as the city is projected to face a multi-billion-dollar budget gap in the upcoming fiscal year.
Chief Savings Officers, who were appointed earlier this year, will be heading these efforts. The officers have found $1.77 billion, or 1.5% in savings in the current fiscal plan. The 2.5% in reductions will be for the coming fiscal year as well as future years.
“Budget season may have just ended, but our work to build a government that delivers more for New Yorkers is never finished. Every dollar we save by making government work better is a dollar we can put toward services New Yorkers rely on,” Mamdani said in a statement.
“By setting these ambitious savings targets early, we’re giving agencies ample time to thoughtfully review their operations, eliminate inefficiencies and strengthen the important work they do without compromising service.”
Mamdani has claimed victory for balancing the budget books for the current fiscal year, which started July 1. He sounded the alarm on a $12.4 billion budget gap early in the year, then repeatedly walked that estimate back with unaccounted-for revenues and help from the state. The city is legally obligated to balance the budget every year.
The mayor’s office framed the savings goal as a way to eliminate waste rather than slash from critical services. The city will be launching a survey for agency employees to identify areas that can be cut. Those surveys will be reviewed by savings officers to “inform future savings plans,” City Hall said.
City Comptroller Mark Levine’s office has estimated the budget gap for fiscal year 2028, which starts next summer, could be as much as $8.8 billion. The city’s own estimates put that gap as a bit lower, at $6.4 billion.
“These kind of measures are never easy,” Levine said in a statement on social media. “Launching a savings program now, early in the fiscal year, is the right thing to do. Kudos to the mayor for this prudent step.”
Andrew Rein, president of budget watchdog Citizens Budget Commission, called the savings target a “good first step.”
“Mayor Mamdani is exactly right to start finding these savings now, as we have been urging,” Rein said. “The City’s budget gaps are large and growing. It will need these savings and even more to balance next year’s budget and become fiscally sound.”
The mayor, despite coming into office at the start of the year with a checklist of costly campaign pledges to accomplish before the end of his four-year term, has sought to establish himself as a fiscal pragmatist. This focus on nuts-and-bolts governance has set up a somewhat unexpected dynamic between him and the more politically moderate City Council speaker, who has at times pushed the mayor on what are typically seen as progressive issues.
In a statement, Speaker Julie Menin applauded the savings plan.
“Identifying savings early is the kind of fiscally responsible planning our City needs as we prepare for a potential fiscal gap next year. The Council has long emphasized finding efficiencies without cutting services.” Menin said.