Reports

After a brief period of financial stability secured by an infusion of State funds last year, the Metropolitan Transportation Authority (MTA) now faces growing fiscal uncertainties and risks that create projected budget gaps. Those gaps could grow much wider if various budget risks that the MTA has identified come to pass. A faster-than-expected return of ridership remains one of the key means for improving the fiscal stability of the system and highlighting the importance of continued investment in the assets of the system.

The Annual Comprehensive Financial Report for the State of New York for the fiscal year ended March 31, 2024.

The Annual Comprehensive Financial Report for the New York State and Local Retirement System (the System or NYSLRS) for the fiscal year ended March 31, 2024.

The MTA must find billions in new funds even as the State tries to resolve the $15 billion gap in revenue created by the pause on congestion pricing. This report lays out possible sources to fund the MTA’s substantial capital needs and emphasizes areas of capital work expected to receive funding in its next capital program.

New York City’s finances continue to benefit from better-than-projected revenues and savings generated through initiatives launched in response to its financial challenges, but the continued influx of asylum seekers, elevated demand for City programs and a declining surplus demand preparation to navigate future uncertainty.

As required by Section 196 of the Navigation Law, the Comptroller prepares an annual report to the State Legislature and the Governor. The report includes: a description of the costs and damages paid by and recovered for the Fund; the monies spent pursuant to Section 186 (including amounts spent for oil spill prevention, training activities and equipment purchased), and the economic and environmental impacts on the State.

New York’s Clean Energy Fund (CEF), established in 2016 to help New York reach its clean energy goals, has made good progress on reaching its goals for distributed solar capacity and leveraged funds, but is behind in meeting its energy efficiency targets for 2025. Since 2016, the CEF spent $3.4 billion through 2023 and has achieved 45% of its total efficiency goals.

New York City’s contract spending (excluding capital projects) has grown significantly in recent years, rising to $24.3 billion in fiscal year (FY) 2023, an increase of nearly $7 billion from FY 2019, representing an outsized share (41%) of total citywide operating spending growth in this period. Total contract spending for goods and services represented nearly 22% of operating spending in FY 2023, compared to 16% in FY 2010.

New York’s financial outlook is in a relatively stable position, but continues to have a structural budget deficit, with a cumulative three-year budget gap of $13.9 billion forecasted by the Division of the Budget. Action is needed to align projected state spending with revenues and address factors that challenge the state’s finances, economic competitiveness, and ability to offer services effectively over the long term. While economic conditions continue to remain favorable, policymakers have an opportunity to take further steps to improve the State’s structural financial position, and to improve the performance of critical State programs.

With the loss of $15 billion in congestion pricing revenue, the MTA has to reprioritize its 2020-2024 Capital Program. This report identifies over $21 billion in projects that potentially relied on congestion pricing revenue and are under review and suggests the Authority prioritize keeping the system in a state of good repair.

New York State agency overtime costs in 2023 were $1.2 billion, down 11.6% from 2022, marking the first decrease in total overtime earnings since 2016. This decrease was led by three of the five largest users of overtime and was further reduced by other agencies, whose role in responding to the pandemic waned in 2023. In 2023, overtime as a share of payroll was at its second highest rate since 2007.

Higher-than-projected revenue and cost-saving initiatives have helped New York City’s fiscal year (FY) 2024 budget generate a projected year-end surplus of $3.9 billion that will be used to prepay expenses for the next fiscal year, helping the City balance its FY 2025 executive budget. While some of the fiscal challenges facing the City are not in its direct control, including the continued influx of asylum seekers, preparation and transparency remain paramount to navigating future uncertainty. Ultimately, future economic growth in the City, and thereby the State, relies on enhancing affordability and opportunity for all New Yorkers.

This report summarizes data for fiscal year 2022, the most recent data reported by IDAs through the Public Authorities Reporting Information System. The report also contains a brief discussion of local development corporations, a related type of local authority. For regional and IDA-level summary data, see our Interactive Map. For more detailed IDA and project-level data, see IDA 2022 | LDC 2022.

The estimated $237 billion Enacted Budget for State Fiscal Year 2024-25 increases spending for vital state services like Medicaid and school aid and includes new funding and policy changes to spur the creation of much needed housing, but the State’s financial outlook includes several risks. At the State level, certain revenue streams that have been critical to maintaining budget balance are either scheduled to expire or be depleted in the years ahead, meaning current spending levels will be difficult to sustain. Finally, the Budget also includes troubling provisions that limit transparency and accountability.

The MTA’s capital program for maintaining and upgrading the regional transit system faces significant delays due to potential funding shortfalls caused by the late implementation of congestion pricing. The MTA should explain how it intends to prioritize its needs so that its choices do not result in disinvestment in the system, noting that bringing riders back would be one of the most direct routes for the MTA to reduce its debt burden over the long term.

New York City’s full-time government workforce is expected to increase for the first-time year-over-year since the COVID-19 pandemic. However, high turnover and vacancy rates exist at several City agencies. The City should continue efforts to increase and expedite hiring where needed to ensure critical agencies and departments can meet demands and provide quality services to residents.

Historic federal pandemic relief funds, though being spent down, continued to boost New York’s balance of payments in Federal Fiscal Year 2022. For every dollar New York sent to the federal government in tax receipts, it received $1.06 back in federal spending, as compared to a national average of $1.28, ranking New York 39 out of 45 states with a positive balance of payments. This report is the eighth in a series by the Office of the State Comptroller that examines the flow of funds between the federal government and the states.

Interactive Map | Excel file with supporting data

The majority of New York City’s capital projects are over their initial budgets and behind schedule, suggesting better monitoring and reporting could lead to adjustments to improve capital project delivery. Recent reforms to the City’s capital planning process have focused on improving the delivery of projects, but little detail is available in public documentation about what is fueling these cost and schedule overruns. With closer, more uniform monitoring of capital projects, the City can better identify where additional improvement is needed.

In the throes of the economic uncertainty and fiscal turbulence caused by the COVID crisis, legislation was enacted as part of the SFY 2021-22 budget authorizing the use of State-supported bonding with final maturities up to 50 years for capital purposes for the Metropolitan Transportation Authority. This legislation has been reauthorized and proposed again in the State Fiscal Year 2024-25 Executive Budget. As we approach the State’s coming 2024-25 fiscal year, the budget proposal authorizing such 50-year borrowing should be rejected, and the State should return to long-standing bond financing norms. The budget also includes a proposal to severely restrict the State Comptroller’s terms and conditions oversight of private sales of State debt, which should be rejected.

Between 2013 and 2022, there was a 23% increase in the number of individuals served by the State’s public mental health system. The rising need for mental health services coincided with a loss of 990 beds, a 10.5% drop in capacity, in inpatient psychiatric facilities statewide between April 2014 and December 2023. Ensuring the availability of inpatient mental health services is a critical component of the State’s effort to address the ongoing mental health challenges facing the State and improve the lives of vulnerable New Yorkers.