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Jun 30, 2026

Mamdani’s $126B budget soars nearly 10% from last year, leaving NYC on verge of fiscal crisis

Mamdani's $126B budget soars nearly 10% from last year, leaving NYC on verge of fiscal crisis Email New York Post Read the Latest on Page Six

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Mamdani’s $126B budget soars nearly 10% from last year, leaving NYC on verge of fiscal crisis

By Craig McCarthy and Matt Troutman Published June 30, 2026, 6:51 p.m. ET

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Zo’s busting the budget.

Mayor Zohran Mamdani’s inaugural, record-breaking nearly $126 billion budget was set to pass Tuesday — growing city spending by more than $10 billion from last year despite his past dire warnings about the Big Apple’s financial situation.

The under-the-wire vote by the City Council came just hours before a Wednesday deadline and after frantic last-minute attempts to drum up votes for a spending deal that disappointed lefties and moderates alike.

The budget, which includes no significant cuts, ballooned from last year’s roughly $116 billion spending plan, for an approximate 8.5% increase.

And while the democratic socialist mayor managed to balance the budget, City Comptroller Mark Levine noted that he only did so by using $6.1 billion in one-time tricks and short-term savings.

New York City may Zohran Mamdani and New York City Council speaker Julie Menin announced a handshake agreement on the Fiscal Year 2027 budget at City Hall on Tuesday, June 30, 2026, in New York. 3
Mayor Zohran Mamdani’s inaugural budget appeared poised to pass Tuesday evening. James Keivom for NY Post

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“This agreement gets the city through an exceptionally difficult year, but it does not resolve the structural challenges ahead,” Levine said. 

“With large out-year gaps, limited reserves and significant economic uncertainty, next year’s budget could be even more difficult.”

The city faces a whopping $8.8 billion shortfall for the next budget, according to the city comptroller’s office — setting up Mamdani and the Council for a potential bruising rehash of this year’s topsy-turvy negotiations.

Mamdani and City Council Speaker Julie Menin dutifully smiled for the cameras as they announced their handshake budget deal Tuesday morning, but their grins belied long-simmering tensions.

The budget hit an 11th-hour snag over Mamdani backtracking on a campaign promise to fund the expansion of a housing voucher program — a darling of progressive lawmakers that comes with a hefty price tag.

A skin-of-their-teeth deal preserved the cityFHEPS expansion — adding $175 million to $1.7 billion already on the books — and dropped a contentious lawsuit that Mamdani pursued, much to the dismay of his progressive allies.

And many moderates were blindsided by Mamdani flip-flopping on his promise to add 580 NYPD officers — itself a 180 from his campaign promises that angered his lefty comrades, who mounted a pressure crusade that seemingly led to his reversal.

New York City may Zohran Mamdani and New York City Council speaker Julie Menin announced a handshake agreement on the Fiscal Year 2027 budget at City Hall on Tuesday, June 30, 2026, in New York. 3
Mamdani shook hands with City Council Speaker Julie Menin on the budget after tense talks. James Keivom for NY Post

The final $125.8 billion budget deal for the 2027 fiscal year included several notable funding increases, including:

  • $6.6 billion for the NYPD — a $300 million bump over last year’s adopted budget.
  • $38 billion for the Department of Education, swelling its budget by $3 billion from last year.
  • $4.2 billion for the Department of Homeless Services, a $662 million increase from last year.
  • $2.6 billion for the Department of Health and Mental Hygiene, a $203 million spike from last year.

The budget also puts $350 million in general reserves, a fund that can provide a cushion if belt-tightening is needed last in the year.

But the spending plan ultimately failed to solve the city’s “huge structural budget problem,” said Andrew Rein, president of the Citizens Budget Commission watchdog.

Rein did praise Mamdani’s half-hearted efforts to curb spending growth and waste.

“Unfortunately, that fiscal progress is partly offset by new recurring spending without simultaneous savings to pay for it,” Rein said.

“Two steps forward, one step back slow walks the restructuring needed to stave off a fiscal crisis.”

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