New York City Comptroller Brad Lander released his office’s Fiscal Year 2026 Executive Budget Analysis and testified to the City Council.
Full remarks to City Council, as prepared:
Speaker Adams, Chair Brannan, members of the Finance Committee and of the City Council, thank you for the opportunity to speak with you today about the Fiscal Year 2026 Executive Budget. I am pleased to be joined by Executive Deputy Comptroller Francesco Brindisi and Deputy Comptroller for Budget Krista Olson, who prepared our Office’s full analysis of the Fiscal Year 2026 Budget and accompanying Financial Plan.
When I came before you in early March, I noted that our city’s need for strong fiscal management had never been more urgent. The threats posed by the Trump Administration to New York City – its people, its economy, and its finances – have only intensified since then. With its dizzying back and forth and actual implementation of tariffs, the Trump Administration has introduced chaos into the national economy and created extraordinary levels of uncertainty. It has attempted to terminate, pause, or rescind hundreds of millions in federal grants already awarded to the City through its flurry of executive orders and policy changes. This is even before considering the potential devastation that the Congressional Budget Reconciliation Bill could have on federal aid flowing not only to the City government, but also to New York State, as well as directly to New Yorkers.
It was in this environment, that the Adams Administration blithely released its self-proclaimed “best budget ever,” with little recognition of the grave reality the City faces from actions in Washington. The Executive Budget and May Financial Plan, while reflecting record-high revenues, adds nothing to the City’s budgeted reserves or to its rainy day fund. When adjusted for pre-payments, spending budgeted for FY 2025 is $1.45 billion more than projected revenues, continuing a pattern of running a deficit for the third year in a row.
The May Plan also reflects larger outyear budget gaps than those projected by the Mayor in January, with no real savings program to address them. And, this is before accounting for the Mayor’s practice of underbudgeting, which totals a whopping $4.05 billion in FY 2026 – $3.60 billion on average in the outyears – when including the costs of rental assistance, overtime, shelter, Carter Cases, MTA subsidies, and more.
At a time when the Mayor should be preparing New York City for a potentially more constrained fiscal reality, the May Plan, in many ways, reflects just the opposite.
My Office remains focused on protecting New York and preparing for the challenges that may come. Given the great economic uncertainty and the risks that changes at the federal level present, my Office has gone ahead and prepared two new economic and revenue forecasts – one that assumes we do not enter a recession and another that accounts for a mild recession. In the no recession scenario, my Office projects that City revenues will exceed OMB’s estimates by $292 million this year and by $108 million in FY 2026, growing to $2.95 billion in FY 2029. Applying the formula my Office previously proposed to establish annual minimum deposits into the Revenue Stabilization Fund would, in this scenario, mean depositing $1.46 billion into the rainy day fund this fiscal year. In the case of a mild recession, where higher tariffs persist into 2026, my Office’s tax revenue estimates fall by $225 million this year, by $2.33 billion in FY 2026, by $2.12 billion in FY 2027,and by $350 million in FY 2028, before rebounding in FY 2029. We would still be making a rainy day fund deposit of $1.34 billion this year bringing the fund balance to $3.30 billion, which could then be used in FY 2026 and FY 2027 if a recession transpires based on the guidelines proposed by my Office.
I am also again calling on the City to add $1 billion to the general reserve in the FY 2026 budget to establish the “Protecting New York City Reserve.” As we brace for potentially devasting cuts not only to direct federal funding to the City but also to federally funded programs that keep millions of New Yorkers housed and fed, these funds would be set aside and could be deployed to mitigate the worst of the likely impacts. Already, the Federal government has announced cuts of hundreds of millions of dollars, and the House Republicans have approved nearly $15 billion in NY State cuts and cost shifts in healthcare and SNAP benefits alone. Together, if implemented, all of this could easily translate to a $10 billion reduction in services to NYC residents. Trump and the members of Congress effectuating his agenda have made no secret of the pain they intend to inflict on working-class people, and there is no reason we should be caught flat-footed. We should be equally uncompromising in our fiscal planning.
In either economic scenario, my Office estimates that budget gaps will be larger than those presented by OMB. In the no recession scenario, we project the City will end FY 2025 with a gap of $1.76 billion, growing to $5.77 billion in FY 2026 and totaling $8.82 billion in FY 2029. This is the result of higher spending estimates, including the deposit into the rainy day fund in FY 2025 and higher general reserve in FY 2026.
In the recession scenario, the FY 2025 gap would increase modestly by $112 million to $1.87 billion. With rainy day fund withdrawals of $1.65 billion in each of the next two years partially offsetting lower revenues, gaps would increase to $6.45 billion and $9.30 billion in FY 2026 and FY 2027, respectively. Gaps in FY 2028 and FY 2029 would be closer to the no recession scenario.
I want to turn now to an issue that perhaps exemplifies the Mayor’s disregard for this political moment and what it means for New York more than any other: immigration. The detention of Dylan, a New York City public school student attending ELLIS Prep in the Bronx, underscores exactly what’s at stake. Dylan did everything right—he followed all the rules, showed up to court as required, and was still arrested by ICE agents outside the courthouse. His case is a chilling reminder that even New Yorkers who play by the rules are vulnerable and need legal representation. It’s exactly why we must invest in immigration legal services—so no unaccompanied minor has to show up to immigration court alone.
It is unconscionable that the Mayor’s budget does so little to protect immigrant New Yorkers or to shore up the dedicated legal services organizations working under increasingly challenging circumstances to support them. While the Mayor has consistently failed to right-size resources for immigrant legal services, escalating anti-immigrant actions taken by the Trump Administration – and aided by Mayor Adams – make these omissions in the Executive Budget all the more shameful.
The City should begin to fill the holes in immigrant legal services in this year’s budget. This includes $7 million for ICARE, so that immigrant children like Dylan have access to attorneys that will ensure their cases have a fighting chance. Thanks to Musk and DOGE, who abruptly terminated federal contracts funding legal representation for unaccompanied children in removal proceedings, more and more immigrant children are facing deportation alone. These children, some not even out of diapers yet, are left to navigate immigration proceedings alone in a foreign language. We can debate the relative merits of many worthy initiatives, but I hope we can agree that we cannot be a city that accepts this reality for our most vulnerable kids.
Funding should also be allocated to restore ActionNYC in schools, hospitals, and libraries and to support MOIA’s Immigrant Rights Workshops. And while I commend the Council for providing funding to keep the Rapid Response Legal Collaborative going, full mayoral funding should be restored to match the growing demand. The administration must also increase funding for CCHR and DCWP to protect working New Yorkers and bolster resources for street vendors, including funding to support processing of permits and increased outreach and education.
Furthermore, I urge the Speaker to increase the Trans Equity Fund to $10 million using Council Discretionary funds and to work with the Mayor to increase funding for LGBTQ youth and young adult housing and ensure that New Yorkers can still access gender affirming care despite potential changes in federal policy.
The City budget must reflect our shared values. It should not be used as a tool to further one executive’s apparent desire to collude with Trump, but rather should be used to invest in our families and children and protect our most vulnerable New Yorkers.
Yet resources for DOE, and 3-K in particular, continue to be among the casualties of the Mayor’s perennial budget games. Although the May Plan included some additional funding for 3-K and Pre-K, my Office estimates that more than $150 million is needed annually in FY 2026 and forward to sustain programming at current levels. Meanwhile, the Executive Budget also fails to reckon with reality by leaving child care vouchers, which enable tens of thousands of families to access affordable care, at risk. While the State encouraged the City to increase enrollment, it is now requiring the City to pay half of the bill. Poor planning and communication on the part of both the City and the State have led to families facing uncertainty. The State appropriated an additional $350 million for the program, but for State fiscal year 2026 only, and at the same time increased the City’s minimum contribution – resulting in funding needs of at least $275 million for the program in FY 2026 and growing to at least $625 million in future years, unless additional funding is provided. None of which is included in the Executive Budget.
To be clear: New York City families need and deserve City leadership that is working toward a vision of truly accessible universal child care, not pointing fingers over the shortcomings in the existing system. Although the Mayor has failed to articulate a plan to overcome the funding gap, this budget can still – and must – take necessary steps to ensure that no families currently receiving subsidies lose them.
The Executive Budget for FY 2026 lacks even the most basic elements to guard against the risks we now face. By beginning to set aside critical reserves while protecting services that are a lifeline for the most vulnerable in our city, I believe we can deliver a budget that is closer to what New Yorkers expect of us and deserve.
Thank you.
