Categories: New York City
01.18.2024
On January 16th, Mayor Adams released the FY 25 Preliminary Budget, totaling $109.4 billion-- $2 billion less than the current fiscal year.
Most city agencies were directed to identify 5% savings in this plan as part of the Program to Eliminate the Gap (PEG). NYPD, FDNY, and DSNY were exempt from submitting PEGs, whereas essential homelessness and housing agencies such as DSS, DHS, DOHMH, and those overseeing critical affordable and supportive housing initiatives, like HPD, were mandated to do so. The Mayor announced that all mandated city agencies met their PEGS.
The Mayor announced cost savings of $1.7 billion, as a result of his controversial 60-day rule for migrant families, and the city’s objective to transition the Humanitarian Emergency Response and Relief Centers (HERRCs) to nonprofits, for additional cost savings.
Reported growth in 2023 generated better than expected tax revenue, up by $1.3 billion in FY 24 and $1.6 billion in FY 25. Mayor Adams suggested that with sufficient funding from the state, the city can cancel its directive for agencies to identify an additional 5% PEG in the FY 25 Executive Budget.
See below for more details relating to relevant city agencies, supportive housing programs, and the Network’s budget priorities.
Human Services Contract Increases/COLA
While the State Executive Budget included a 1.5% increase across most human services contracts, the City did not include a COLA for our essential workforce. Per the FY 24 adopted budget, there is an additional $50 million workforce enhancement included for human services contracts.
NYC 15/15 Reallocation
There were no updates to the budget that would indicate the City is currently planning to reallocate funding for the 6,000+ unawarded 15/15 scattered site units to additional congregate, preservation, and overlay. Read the Network’s policy brief on NYC 15/15 Reallocation here.
Department of Homeless Services
Although faced with significant PEGS and budget re-estimates of $89 million and $747 million, respectively, the agency’s overall budget increased to $3.9 billion, up 5%.
Housing Preservation and Development (HPD)
HPD saw an overall reduction in funding of $23 million for a FY 25 total of $1.78 billion. Headcount was nominally reduced by 6 staff.
HPD Capital: There was no change to HPD capital in FY 25, at $2.7 billion. However, there seem to be significant reductions in the HPD capital budget in the out-years.
Department of Social Services
The Department of Social Services (DSS, which includes HRA and HASA) saw an overall reduction of $2 billion, a 16% decrease from FY 24, for a total budget of $3.9 billion. This is partially the result of a reduction in federal funding. Reductions also include a 13% decrease in funding for domestic violence services and a 69% decrease in homelessness prevention. However, there was a 22% increase in funding for substance abuse services, and the city committed $442 million to fully fund CityFHEPS in the remainder of FY 24.
HASA: While overall HASA funding for case management, transitional housing, and other programs saw a 19% budget decrease, HASA scattered site housing retained its $81 million funding and HASA supportive housing programs saw a nominal $12 million increase, up to $97.2 million in the preliminary budget. We are seeking clarification on how these fluctuations impact supportive housing contracts.
PEGS: DSS identified $64 million dollars in the November plan and $26 million in the Preliminary Budget. Reductions in FY 25 came from rental assistance efficiencies, including the rollout of Current NYC, a landlord and provider agency portal for rental assistance and applications and payments, as well as a shift in federal HOME funding. Headcount was reduced by 129 staff. DSS has confirmed that PEGS in the Preliminary Budget do not impact any supportive housing contracts.
Department of Health and Mental Hygiene
DOHMH saw an overall decrease in its budget of $645 million, a 24% reduction from FY 24; this includes a significant reduction in federal aid. Also included is a 9% reduction in funding for mental health services. While there was a $20 million increase for supportive housing in FY 24, there are no substantial increases for supportive housing in FY 25 or the out-years.
There were slight fluctuations in DOHMH supportive housing budgets and we are seeking clarification on potential impact. We will share updates when we know more.
PEGS: DOHMH found $38 million in savings as part of the Adams administration’s directive to identify PEGS. These savings were realized through a combination of contract reductions, hiring freezes, vacancy reductions, and administrative and programmatic efficiencies. DOHMH’s staffing levels were reduced by 5%, or 335 staff.
As we receive information, we will update the Network membership. Preliminary budget hearings are expected to begin in the City Council in February/March and we will continue to advocate for our priorities leading up to the Executive Budget this spring and the final budget adoption on July 1st.
For questions, please contact Tierra Labrada, tlabrada@shnny.org.