{"id":161035,"date":"2026-03-12T02:17:20","date_gmt":"2026-03-12T02:17:20","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ny\/161035\/"},"modified":"2026-03-12T02:17:20","modified_gmt":"2026-03-12T02:17:20","slug":"moodys-downgrades-nyc-financial-outlook-to-negative-citing-budget-deficit-3","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ny\/161035\/","title":{"rendered":"Moody\u2019s downgrades NYC financial outlook to \u2018negative\u2019 citing budget deficit"},"content":{"rendered":"

Moody\u2019s Ratings has projected a negative outlook<\/a> for New York City\u2019s finances, chalking it up to the city\u2019s large and persistent projected budget gaps \u2014 and citing Mayor Mamdani\u2019s plan to draw down from reserves<\/a> in order to balance the budget this year.<\/p>\n

The negative outlook won\u2019t have any immediate impact on the city\u2019s borrowing abilities or bond rating, which remains strong.<\/p>\n

But it serves as a warning shot to the city over its financial footing, and could be a precursor to the rating being downgraded.<\/p>\n

Mamdani and other officials have warned the city is in dire financial straits<\/a>, largely blaming chronic underbudgeting under the previous mayoral administration. The undisclosed spending under ex-Mayor Eric Adams made the budget appear balanced when it was actually was operating at a loss.<\/p>\n

To balance the city\u2019s books, Mamdani has proposed taking nearly $1 billion from the city\u2019s \u201crainy day\u201d fund<\/a> \u2014 an idea the City Council and comptroller have pushed back on.<\/p>\n

\u201cMoody\u2019s decision to revise the outlook on New York City\u2019s credit rating \u2014 while maintaining it at Aa2 \u2014 is premature,\u201d said Dora Pekec, a spokeswoman for Mamdani, citing $5 billion in additional funding for the five boroughs that state lawmakers are pushing for in Albany.<\/p>\n

\u201cThese proposals reflect a real commitment by Albany to investing in the services New Yorkers rely on, and the fiscal health of our city. We look forward to continuing our productive conversations with our partners in Albany and the City Council as we work to close the inherited deficit and restore the city to firm financial footing after years of underbudgeting and mismanagement.\u201d<\/p>\n

The mayor has been pressing the state to hand over more money to the city, including through tax hikes on the richest city dwellers and corporations.<\/p>\n

While the upper and lower chambers have stood mostly in agreement with Mamdani\u2019s stance, Gov. Hochul, who needs to sign off on the final state budget determining how much the city will get in state funds, has been stood firmly against tax hikes on the wealthy.<\/p>\n

\u201cMoody\u2019s decision to revise New York City\u2019s outlook to negative is a sobering wakeup call about the fiscal challenges ahead for us,\u201d Comptroller Mark Levine said in a statement, noting it\u2019s happening as the Big Apple is in a time of \u201crelative health.\u201d<\/p>\n

Speaker Menin has criticized the mayor for turning to the city\u2019s reserves and looking at a property tax hike, saying neither are feasible options.<\/p>\n

\u201cMoody\u2019s revised outlook is a clear warning sign that New York City must take its long-term fiscal challenges seriously,\u201d Menin and Council Finance Committee Chairwoman Linda Lee said in a joint statement in response to the new Moody\u2019s outlook, adding that it agrees with the credit ratings company in that drawing from reserves in fiscally irresponsible.<\/p>\n","protected":false},"excerpt":{"rendered":"Moody\u2019s Ratings has projected a negative outlook for New York City\u2019s finances, chalking it up to the city\u2019s…\n","protected":false},"author":2,"featured_media":161036,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[66396,66395,9,24,56,63,65,64],"class_list":["post-161035","post","type-post","status-publish","format-standard","has-post-thumbnail","category-new-york-city","tag-financial-footing","tag-negative-outlook","tag-new-york","tag-new-york-city","tag-ny","tag-nyc","tag-nyc-headlines","tag-nyc-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/161035","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/comments?post=161035"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/161035\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media\/161036"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media?parent=161035"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/categories?post=161035"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/tags?post=161035"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}