New York State Comptroller Thomas P. DiNapoli released a statement today on the release of New York City’s budget update.

“The $124.7 billion New York City Fiscal Year 2027 Budget and Financial Plan lays a path towards a stronger fiscal picture that does not come at the cost of making the city less affordable. The FY 2027 budget removes actions that would broadly increase the property tax burden or weaken the city’s ability to withstand an economic downturn. However, the choices made to balance the FY 2027 budget highlight fiscal stresses that still exist and will require proactive steps to achieve budget balance over the course of the four-year financial plan.

“Importantly, the city is no longer relying on a 9.5% property tax hike, which would have broadly added cost pressures for households and businesses, and hindered efforts to make the cost of living more affordable. The city also removed rainy day funds and retiree health benefits trust as one-time revenue to close the budget gaps, which had concerned my office as imprudent. These judicious changes were made possible by actions anticipated at the state level and other one-time choices that will help the city to balance its budget through FY 2027, but they also underline the cost pressures that remain in the later years of the financial plan.

“The city’s budget is reliant on several significant actions that are expected to be included in the state budget, which has not yet been drafted into law and remain at risk until approved. More state aid, additional tax revenue from city high value properties, extending the class size mandate and the smoothing of the city’s pension payments all require state approval. The city also anticipates an unusually large write-down of prior year payables for its labor reserve in a prior year. The use of several one-time actions highlight the difficulty in closing the budget gap in the coming years. These steps also punctuate the importance of the city achieving the planned savings it announced earlier this year and laying out clearly its cost containment strategies to address growth in city housing vouchers and educational due process case spending.

“Given various uncertainties that exist for the city’s budget, particularly in light of the potential for continued economic risks to strain the city’s revenue outlook and increase demand for social services, efforts to identify further savings that align with the Mayor’s focus on efficiencies, which will take time to identify, are warranted. Bending the cost curve on the city’s largest sources of cost growth, such as those planned for housing vouchers and due process cases in this budget, will make it easier to achieve balance without significant one-time actions in future years, putting the city’s finances on a more sustainable trajectory.

“My office will release a full analysis of the city’s financial plan in the coming weeks.”