Office of the New York City Comptroller Releases Fiscal Year 2026 Annual Comprehensive Financial Report

The Office of New York City Comptroller Mark Levine issued the Annual Comprehensive Financial Report (ACFR) for the fiscal year ending June 30, 2026. The report contains the City’s audited financial statements, providing the public and policymakers with a detailed assessment of the City’s fiscal performance.

This year’s report comes amid growing economic uncertainty in the near-term, due in part to the rapid adoption of artificial intelligence (AI), changes in federal economic policy, stricter immigration enforcement, and geopolitical conflicts.

“The ACFR provides a clear-eyed accounting of how New York City’s public dollars are spent each year,” said New York City Comptroller Mark Levine. “We are on solid financial ground, but sustaining this requires a principled and disciplined approach to future budgets. Structural imbalances continue forcing New York City to spend more money than it’s taking in, and our reserves lack the funds to weather the fiscal shock of a recession. I am grateful to the dedicated staff within my Office who spend months preparing this report and have an unwavering commitment to safeguarding the City’s fiscal health.”

During Fiscal Year (FY) 2026, the City experienced considerable economic growth resulting in a 7.4% increase in General Fund tax revenues, primarily driven by AI-related investment activity, high asset prices, continued concentration of high-income earners, and strong business profitability. Persistent budgetary issues including the deterioration of the General Fund surplus, governmental funds balance, as well as the available fund balance metrics used by rating agencies in assessing the City’s credit all serve to undermine the current financial position.

While the City took meaningful steps to reduce the budget gap of $12 billion for fiscal years 26 and 27 initially estimated by the Comptroller’s Office in January, the General Fund closed the last fiscal year with expenditures growing by $8.32 billion or 7.0% (adjusted for transfers to eliminate future fiscal year projected gaps) compared to FY 2025, and revenues growing by $6.17 billion or 5.2%. Consequently, the FY 2026 surplus recorded the fourth consecutive and largest drop since FY 2022.

Two large cost increases between FY 2025 and FY 2026 signal the need for concrete plans to control reoccurring expenses. Over the course of the fiscal year, rental assistance expenditures grew 40.5% (from $1.34 billion to $1.88 billion) and the New York City Department of Education’s special education due process case expenditures more than doubled from $1.14 billion to $2.36 billion. Failing to establish clear controls for these budget items would create further uncertainty for future financial plans.

Additional highlights of the FY 2026 ACFR that paint a clear picture of the City’s fiscal standing are as follows:

General Finances

• The General Fund had revenues and other financing sources of $123.831 billion and expenditures and other financing uses of $124.794 billion, resulting in a deficit of $963 million, before the adjustment for restricted fund activities.
• Including the adjustment for restricted fund activities resulted in an operating surplus of $5.2 million. This amount increased the General Fund’s committed balance — the Revenue Stabilization Fund (RSF), the City’s rainy-day fund — to $1.974 billion.
• General Fund revenues were $6.171 billion higher than in FY 2025, an increase of 5.2%. The growth in revenues was driven by an increase of $5.916 billion in tax revenues.
• Actual FY 2026 General Fund revenues were $8.729 billion more than projected in the FY 2026 Adopted Budget (+7.6%). The increase was driven by a $4.909 billion variance in tax revenues (+6.0%), a $1.753 billion variance in federal categorical grants (+23.5%), a $1.370 variance in state categorical grants (+ 7.2%), and an $873 million variance in miscellaneous City revenues (+14.1%).
• Overall, the City availed itself of $16.803 billion in additional resources in FY 2026. The additional resources also include $1.930 billion attributable to the write-down of prior-year accrued expenses and revenues, which play an increasingly large role in achieving the General Fund balance.

Local Economic Conditions

• New York City’s job market grew by 71,100 jobs from June 2025 to June 2026. The total number of jobs in the City exceeded the pre-pandemic level by 145,000 (3.1%), with jobs in education and health services driving the lion’s share of growth.
• In contrast to previous fiscal years, jobs in the City’s office-using industries grew, led by a turnaround in the Professional and Business Services sector, which added 17,000 jobs after having lost about 10,000 in the prior fiscal year.
• New York City’s seasonally adjusted unemployment rate averaged 5.6% over the 12 months of FY 2026, a notable increase over the 4.9% average over the two prior fiscal years.
• The average level of the Consumer Price Index (CPI) in the New York City Metropolitan Area in FY 2026 was 3.7% above the prior year, a deceleration from the FY 2025 growth rate of 3.9% and 1.1 percentage points slower growth than the U.S. average, which accelerated during the same period.
• The Manhattan office vacancy rate fell by more than 3 percentage points in FY 2026 to 19.3%, the lowest level in five years.
• Tourism in New York City was little changed in calendar year 2025, according to NYC Tourism & Conventions, with an estimated 65 million visitations, up less than 1% from 64.5 million in calendar year 2024. A 1.6% increase in domestic visitors was offset by a 3.1% dip in visitations from abroad, with a steep (19%) drop in visitors from Canada.

Pension Fund Performance

• As of the end of FY 2026 the City’s pension funds saw an aggregate return net-of-fees of 13.0%, greater than the 7.0% actuarial target for FY 2026.
• Outperformance will lower required pension contributions by an estimated $4.302 billion through FY31.
• The five Systems held a combined portfolio value of $326.26 billion as of the end of FY 2026.
• The funds are 96.1% funded to meet their long-term obligations.

Municipal Finance

• The City’s borrowing and refinancing schedule continued at a steady pace despite market fluctuations, and retail investor participation in sales remained strong.
• Two of the four major credit rating agencies (Fitch, and Moody’s) currently maintain a negative outlook on the City’s GO bonds’ rating. To date, there has been no change in the City’s GO and TFA ratings.
• In FY 2026, the GO and TFA credits issued a combined 10 new money transactions, for a total principal amount of $15.33 billion, which raised $15.91 billion of proceeds for the City’s capital needs.
• During FY 2026, the City and TFA issued five refunding transactions that generated over $482 million of debt service savings over the life of the bonds.

For the 46th consecutive year, the Government Finance Officers Association (GFOA) awarded the City of New York the prestigious Certificate of Achievement for Excellence in Financial Reporting.

The full Annual Comprehensive Financial Report (ACFR) for Fiscal Year 2026 is now available at https://comptroller.nyc.gov/reports/annual-comprehensive-financial-reports/.