Mayor Zohran Kwame Mamdani released the city’s Fiscal Year 2027 Preliminary Budget on Tuesday, spotlighting a $12 billion fiscal crisis inherited from the previous administration and proposing two stark paths to balance it: taxing the wealthy and corporations while reforming state funding imbalances, or hiking property taxes and tapping reserves at the expense of working New Yorkers.
The $127 billion budget addresses underfunding in critical areas like rental assistance, shelter operations, and special education, which ballooned the gap across FY 2026 and 2027. Mamdani’s team implemented savings measures, including Executive Order 12 mandating a Chief Savings Officer in every agency, projecting $1.77 billion in efficiencies. Upward tax revenue revisions of $7.3 billion, plus $1.5 billion from Governor Kathy Hochul and $97 million in state aid, narrowed the remaining two-year shortfall to $5.4 billion.
Mamdani advocated for “the most sustainable and fairest” option: higher personal income taxes on those earning over $1 million annually, increased corporate taxes, and correcting the city’s lopsided contributions to New York State. Without new revenue powers from Albany, the budget resorts to a 9.5% property tax hike—yielding $3.7 billion in FY 2027—plus $980 million from the Rainy Day Reserve in FY 2026 and $229 million from the Retiree Health Benefit Trust in FY 2027.
Of $14 billion in agency expense adjustments over two years, most plugs prior shortfalls. Targeted investments total $576 million (4%), including $100 million for snow removal in FY 2026, $5 million for homeless warming centers, $11.9 million for mental health outreach units in FY 2027, funding for 200 new attorneys to cut tort liability, and $54 million to triple the Community Food Connection program. The five-year capital plan reaches $113 billion all-funds, with $662 million in FY 2027 for 3,200 affordable housing units and $48.2 million to expand Bellevue Hospital’s psychiatric emergency program.
The budget is available here.
Kishor Panthi
View More PostsKishor Panthi is the founder and editor-in-chief of Khasokhas and NepYork. He is the author of three books, “Kampan,” "UNTRANSLATABLE" and “Zero Mile.” He writes about social issues, immigration, and politics.
