BYE-BYE, 5% BUDGET CUT
But Adams still plans to slash $600M migrant spending
Mayor Adams called off a plan Wednesday to cut all city agency budgets by 5% this spring — but also announced he’s going to slash nearly $600 million in projected spending on housing and services for recently arrived migrants.
Under a plan first rolled out by City Hall in fall 2023, all agencies were slated to get 5% budget reductions in April of this year — on top of two previous rounds of 5% cuts in November and January — to offset costs associated with caring for the migrants.
Agency heads have warned for months that they’re already struggling to carry out basic services due to the January and November cuts, saying they’d face existential problems if they were subjected to another 5% trim in April.
Against that backdrop, the mayor said in a Wednesday afternoon statement that he’s canceling the April cuts. He said he’s able to do so thanks to “better than expected” city tax revenues as well as a successful effort by his administration to reduce the city’s projected spending on the migrant crisis by 20%, or about $1.7 billion, through the end of June 2025.
“Our administration was able to successfully make the strong fiscal decisions to navigate us to prosperity,” Adams’ statement read. He did not field questions from reporters on the budget announcement as he was in Missouri on Wednesday to meet with executives at a tech company that contracts with the city.
In addition to backing off the April agency-level cuts, the mayor said he’s easing a city governmentwide hiring freeze that has barred all agencies from taking on new employees, with some exemptions for public health and public safety.
Under the new modified freeze, agencies will be able to hire one new employee for every two vacancies that exist for a specific role, the mayor said.
The revenue projections released by Adams last month showed that over the 2024 and 2025 fiscal years, the city’s on track to rake in about $2.9 billion more in property, personal, business and sales taxes than his office previously estimated. The greatly improved revenue figures already prompted Adams last month to exempt some agencies, including the NYPD, from the January cuts.
Adams’ upgraded revenue picture was even rosier than projections presented by City Council Democrats, who have long said the mayor’s previous estimates were too low and that many of his planned and enacted budget cuts were therefore unnecessary.
After the mayor’s Wednesday announcement, City Council Speaker Adrienne Adams and Council Finance Committee Chairman Justin Brannan said they were “relieved” he’s abandoning the April cuts and easing the hiring freeze.
But the two top City
Council Democrats, who are about to officially start negotiations with the mayor on the 2025 fiscal year city budget, suggested the cuts that were already enacted by him should never have happened.
“Blunt cuts that had a disproportionately negative impact on vital programs were never necessary,” they said in a joint statement. Speaker Adams (D-Queens) and Brannan (D-Brooklyn) previously promised to push the mayor in this spring’s budget talks to reverse some of his previous cuts.
Among various service reductions, the November and January cuts that remain in place have forced public libraries to eliminate Sunday hours at all their branches. They’ve also resulted in the number of available slots for the city’s free 3-K program to be cut and a reduction in hours of summer youth initiatives.
Though he’s backing off the April agency cuts, the mayor said he’s enacting a new 10% reduction in planned spending on housing and services for migrants over the current 2024 fiscal year and the next 2025 fiscal year, which starts July 1. That’s on top of the 20% reduction in spending in that category he ordered last year.
Through the end of the 2025 fiscal year, the Adams administration has projected the city will spend about $5.8 billion on housing, feeding and providing other services for migrants. With the new 10% belt-tightening order, that means the administration must figure out a way to trim that price tag by about $586 million.
The mayor’s statement didn’t share details on how exactly his administration will be able to achieve that spending reduction target.
His office has said the administration will achieve the previous target of cutting 20% in projected migrant spending by shifting away from for-profit contractors for migrant-related services and outsourcing them to nonprofits. It’s unclear, however, how many such contracts the city has since entered into, and the administration continues to rely on multiple for-profit companies, including the controversial DocGo firm, for migrant services.
Adams has said he’s looking at all types of ways to slash migrant costs, including by finding cheaper ways to serve food in shelters. He has also tied his administration’s falling migrant cost estimate to his 60- and 30-day notice policies, which limit how long migrants, including families with children, can consecutively stay in a city shelter.
Even as he touted his administration’s fiscal management, Adams said the city is “not yet out of the woods” as hundreds of migrants continue to arrive every week. “We still need Albany and Washington, D.C., to play their roles in providing New Yorkers with additional support,” he said in his statement.
With that in mind, Andrew Rein, president of the fiscally hawkish Citizens Budget Commission, argued that canceling the April cuts isn’t prudent. “The administration was right to implement the previous two rounds of [cuts] and reduce costs for asylum seeker and migrant services,” he said.
“But more spending restraint and program prioritization is still needed to stabilize the city’s finances.”
Gov. Hochul has already committed some $2.5 billion in additional migrant crisis-related aid for the city from the state.
The federal government, however, hasn’t provided aid to the city beyond a few hundred million dollars last year.
Adams has for months accused President Biden of not doing enough to help New York. Democrats on Capitol Hill, though, have blamed the relative lack of action on the federal level on Republicans maintaining a legislative gridlock in Congress on immigration issues.
To date, the city has spent more than $3 billion on housing and providing other services for migrants since they first started arriving in waves from the U.S. southern border in spring 2022, according to Adams’ office. Some 65,000 migrants, most of them Latin Americans fleeing poverty and violence, remain housed in city-run shelters, pushing the city’s total shelter population to an all-time high.