Adams and Adams shake on $112.4 billion FY 25 budget that reverses some deeply unpopular cuts

The plane has landed. Nearly delayed, and not without some turbulence, New York City’s budget deal came down to the wire following months of tense negotiation and spirited rallies. But on Friday afternoon, New York City Mayor Eric Adams’ administration and the City Council announced they officially struck a deal for the upcoming fiscal year.

With wide smiles and a prop airplane in tow, City Council Speaker Adrienne Adams and Mayor Adams stood side by side at City Hall for the ceremonial handshake as they announced the $112.4 billion operating budget for fiscal year 2025. This year’s budget exceeded last year’s adopted budget of $107 billion by roughly $5 billion, making it once again the largest in city history, though the city’s expense budget typically grows with modifications throughout the year. Airplane metaphors abounded throughout this year’s negotiation process, with the mayor comparing himself to the pilot and the speaker to his co-pilot. 

“We guided the plane through the turbulence,” Mayor Adams said Friday. “Adams and Adams United is here to say we have a deal.” Negotiations spilled into the eleventh hour as the City Council pressed the Adams administration to reverse cuts to various services like public libraries, early childhood education, cultural institutions and parks. 

“Eric, we have taxied to the gate, we are ready to deplane, and the council did not have to go on autopilot,” Speaker Adams added.

Nearly an hour into the press conference, the plane metaphor started wearing a little thin. Responding to a question about the difficulty of these negotiations, Mayor Adams launched into the plane metaphor again, garnering a dramatic eye-roll to the press from Speaker Adams.

Cuts restored

Detailed budget documents were not provided to the press as of Friday afternoon, but on Thursday night, signs that City Hall would accede to some of those demands to reverse cuts began to trickle out. In what may be a sign of some of those cuts’ deep unpopularity, Gothamist first reported that the full $58 million cut to the city’s library systems would be restored, as would $53 million in funding to cultural institutions. It was also reported that the city’s parks would see an additional $15 million in funding, restoring some previous cuts. Advocates decried the cuts that remained, however. “We are grateful that the City Council's dedication to parks fully restored second shifts and staved off an even-more severe cut and devastating agency-wide hiring freeze,” a joint statement from New Yorkers for Parks Executive Director Adam Ganser and New York League of Conservation Voters President Julie Tighe read. “However, there is no doubt that every New Yorker will notice the effects of such a shortsighted and harmful parks budget.”

City Hall and the council also agreed on a $2 billion boost to the city’s capital housing budget, dedicated to building and preserving affordable and supportive housing. The budget will also expand eligibility for the city’s Fair Fares program, which provides low-income New Yorkers with half-priced MetroCards.

The budget deal also added $20 million to create new seats for the roughly 1,600 children who didn’t receive a pre-K and 3-K seat for next school year, but stopped short of restoring the full $170 million slashed from early childhood programs. An additional $25 million in funding was allocated to expand 3-K and pre-K seats into full-day and full-year seats to better meet working parents’ needs, as well as an additional $9 million to expand Promise NYC, which provides free child care to undocumented families, and $30 million for preschool special education seats to move current children off of waitlists and increase access to services. While not a funding commitment, the deal also includes a plan to implement reforms to the early childhood education system that will better ensure providers are paid on time, improve outreach efforts to families and make the allocation of seats more flexible to meet actual needs – something the City Council has long argued is needed to address the thousands of vacant seats. A biweekly working group is also slated to focus on addressing persistent problems. 

“We knew that it was going to be challenging, but we didn’t know how challenging it would be,” Speaker Adams said on the timing of the eleventh hour deal. “This council needed all the time that we took to make sure that we got this right and to make sure we got what New Yorkers needed from us.”

The mayor’s conservative budget outlook

In his two-and-a-half years in office, Mayor Adams has instituted multiple rounds of citywide cuts – known as Programs to Eliminate the Gap, or PEGs – in light of yawning budget deficits and, more recently, the city’s spending on services for migrants, the administration has said. But both this year and last year, the City Council has pushed back on the administration’s budget projections as too pessimistic and needlessly conservative, saying that they’ve caused unnecessary cuts to spending on key services and eliminations of vacant, but still needed, positions across city agencies. That has led the council to focus on clawing back cut funding during negotiations. Some of that clawing has worked.

 The current fiscal year 2024 budget, which was negotiated last spring, included restorations of some – but not all – budget cuts. And through the multiple stages of negotiating the fiscal year 2025 budget this year, the Adams administration has restored and reversed some cuts, including nixing an entire round of cuts planned for April, citing higher than expected tax revenue projections and managed spending on services for migrants. The city has not provided many details on where its savings on migrant spending are coming from.

The administration’s budget approach has proven highly unpopular in polls. A recent survey by Slingshot Strategies found that 51% of respondents disapproved of the way the mayor has handled the city’s budget. Whether the administration’s last-minute reversal of some cuts will register with voters – or whether the mayor will continue be associated with unpopular cuts – remains to be seen.

Council leaders expressed frustration that their focus during negotiations had to be on restoring funding. “It is imperative for our city’s future that the budget process moves away from restoring and towards strengthening and building,” Speaker Adams said.

The City Council’s Progressive Caucus said members were proud that the council successfully fought to reverse many cuts to services as well as secured an additional $2 billion in housing, but the budget is still “a fraction of what our communities need.”

“The council has offered feasible, popular solutions to our city’s affordability crisis. At every turn, the mayor has lied about revenue estimates and insisted on fiscal austerity, despite the fact we are on track to have a multi-billion dollar surplus,” caucus members said in a statement. 

The Adams administration’s revenue projections garnered widespread criticism for being overly pessimistic from the City Council, the Independent Budget Office and other fiscal watchdog groups. While the Mayor’s Office of Management and Budget has long released cautious preliminary projections, a report from the Fiscal Policy Institute this week said the city’s revenue projections have grown “more pessimistic” in recent years, leading to billions of dollars in unnecessary budget cuts.

New York City Comptroller Brad Lander, who is rumored to be looking at jumping in the 2025 Democratic primary against Mayor Adams, squared his criticism on the mayor. “Because of broad public outcry and City Council leadership, today’s budget agreement restores critical funding to our public libraries and adds new funding for affordable housing,” Lander’s statement read. “Unfortunately, this budget – and the process that Mayor Adams followed to advance it – still fails to provide the long-term fiscal responsibility, transparency, or enough investments in critical services like early childhood education and CUNY that New York City’s future demands.”

Though the lack of a detailed budget book made the budget difficult to evaluate on Friday afternoon, fiscal watchdog Citizens Budget Commission said in a statement that some fiscal risks were likely left unaddressed. “The baselining of some programs is welcome, but insufficient,” President Andrew Rein said in a statement. “All programs should be budgeted at expected service levels and costs; full stop. As we await detailed information, we still question whether ongoing programs continue to be dramatically underbudgeted, giving a rosier than real picture of New York City’s fiscal future.”

The City Council is expected to vote to pass the budget Sunday afternoon, the last day of the fiscal year. Last year, multiple progressive members voted to reject the budget, using the vote to protest what they called unnecessary austerity. Dissenting members also complained that their offices didn’t have sufficient time to review the budget, as they voted to approve it the day after the deal was announced. It is unclear at this point whether any members will vote against this year’s deal, but members overall seem to be more pleased with where things shook out.

“It sucks that we have to be restoring things,” Deputy Speaker Diana Ayala told reporters. “But overall I think it was a really good budget, we got a lot of wins in it.”