NEW YORK (BLOOMBERG) -- New York City is staring down a $2.18 billion budget deficit for the current fiscal year and another $10.4 billion gap for the next one, newly installed Comptroller Mark Levine said, confirming estimates by his predecessor.
The expected shortfalls point to major financial challenges ahead for the city, Levine warned. He blamed middling economic growth for contributing to the deficits and criticized the fiscal management of former Mayor Eric Adams.
“We are raising the alarm now about the scale of these gaps,” Levine told reporters Friday.
Levine stood by the estimates of former Comptroller Brad Lander two weeks after Mayor Zohran Mamdani took office with an ambitious — and expensive — policy platform with proposals including free buses and childcare. Mamdani has proposed raising additional revenue through increased taxes on wealthy individuals and corporations.
Tax adjustments would require approval from New York Governor Kathy Hochul and the state legislature. Hochul, who is seeking reelection in November, has helped advance parts of Mamdani’s agenda, such as expanding childcare. But she pledged not to raise taxes during her state of the state address on Jan. 13.
Deficit predictions were based on projected moderate-to-slow economic growth in New York, Levine said. A faster expansion would help ease the crunch, he added.
“We are going to have to make some tough decisions and there will be trade-offs,” he said. “If we can grow our economy, we can help avoid these trade-offs.”
Levine also blamed the fiscal “practices of the previous administration” under Adams, citing an over-reliance on one-shot budget measures.
The new comptroller, who like Mamdani took office Jan. 1, is responsible for monitoring the city’s finances. The comptroller’s office conducts audits of local government agencies, acts as a steward for New York’s five public pension funds and provides oversight for the city budget.
New York has historically under-budgeted the cost of recurring expenses such as public assistance, rent aid, special education and police and fire overtime, according to the city and state comptrollers.
Mamdani named Sherif Soliman, a veteran of three mayoral administrations, as budget director in December and must submit a budget plan by Feb. 1.