The New York City Council says Mayor Eric Adams underestimated tax revenues for the current and upcoming fiscal years by more than $3 billion, as budget hearings get under way this week at City Hall.
That means the city would have a surplus of more than $1.3 billion for the current fiscal year, according to the Economic Tax and Revenue Forecast report released by the Council on Sunday.
The Council’s projection of a 3.3% growth rate for the city’s tax revenue more closely matches the 3.1% growth rate forecast by the Independent Budget Office. Both rates surpass the 2.2% rate predicted by the mayor’s Office of Management and Budget.
The contrast in anticipated revenue comes on the heels of additional cuts to migrant-related spending by Adams, who in late February said that his administration would suspend an anticipated third round of cuts to city agencies due to better-than-expected revenues and an additional 10% spending cut on newly arrived migrants.
Some elected officials and progressives have repeatedly questioned the mayor’s numbers as justification for cuts to city services. The emergence of projections for the city coffers from outside of the mayor’s office challenges the administration’s earlier assumptions.
Education cuts in particular threaten to damage the mayor politically. Adams has not been polling well of late — specifically around pre-K and 3-K funding, Politico recently reported.
When asked where the Council might direct its spending in light of the surplus, Councilmember Justin Brannan, the finance committee chair, singled out education and libraries as potential focus areas.
“Early childhood education — 3-K, UPK, all the way to CUNY — to our cultural sector, our libraries,” he said. “I think stronger than expected tax revenues allow us to restore these cuts and then we can build from there. So, I think that’s what you’ll see the Council focusing on.”
The Council estimates that the surplus for the next fiscal year, which begins in July…
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