NYC mayor delays CityFHEPS program expansion citing budget pressures and fiscal constraints
Mamdani Shifts Course on Rental Voucher Expansion
Mayor Zohran Mamdani has signaled a reversal of his campaign promise to expand the city’s rental assistance program, delivering a significant blow to housing advocates who championed the Democratic socialist’s path to City Hall. The move reflects the fiscal pressures confronting the new administration as it wrestles with a projected 7 billion dollar budget deficit.
The Campaign Promise
During his mayoral campaign, Mamdani pledged to immediately drop the city’s legal challenge to a 2023 City Council law that expanded eligibility for the City Fighting Homelessness and Eviction Prevention Supplement program, known as CityFHEPS. The law would broaden access to vouchers for people facing eviction and households with higher incomes. His campaign materials were explicit: “Zohran will drop lawsuits against CityFHEPS and ensure expansion proceeds as scheduled and per city law.” He called efforts to delay implementation “a ridiculous waste of time during a housing crisis.” The program currently serves approximately 65,000 households representing 140,000 New Yorkers, making it one of the largest locally funded rental assistance initiatives in the nation.
The Fiscal Reality
On Wednesday, speaking before state legislators during what is known as Tin Cup Day, Mamdani acknowledged that circumstances had changed. Rather than dropping the lawsuit as promised, his administration is now negotiating a settlement that would narrow the scope of the program expansion. City lawyers have requested an adjournment of the case while parties work to find a compromise. This apparent reversal comes amid the administration’s acknowledgment of serious fiscal constraints inherited from former Mayor Eric Adams. Mamdani blamed his predecessor for creating the conditions that forced difficult choices, pointing to chronic under-budgeting and mismanagement. According to the mayor’s office, the city’s projected deficit was narrowed from 12 billion dollars to 7 billion dollars through aggressive revenue collection efforts and targeted efficiencies. However, even with these improvements, the expansion remains a fiscal challenge.
Program Growth and Costs
The CityFHEPS program has seen extraordinary growth in recent years. The initiative cost approximately 25 million dollars in 2019 but has ballooned to more than 1.2 billion dollars in 2025. State Comptroller Thomas DiNapoli’s audit concluded that weak administrative oversight and ballooning demand drove much of this increase. Homelessness advocates argue the program represents the most effective intervention available to prevent families from entering shelters. Christine Quinn, president and chief executive of WIN, the city’s largest shelter and supportive housing provider, warned that delays would prove devastating. She stated that WIN would release a report arguing it is more cost-effective to house people through vouchers than to maintain expensive shelter stays. WIN estimates that using vouchers to move families into permanent housing could save the city as much as 635 million dollars in shelter costs over five years.
Political Fallout
The reversal has disappointed progressives who invested significant political capital in Mamdani’s victory. City Council Speaker Julie Menin and Councilwoman Tiffany Caban, who sponsored the expansion legislation, expressed concern about the administration’s pivot. “The Council passed this law to be fully implemented, not endlessly litigated,” Menin said in a statement. Caban emphasized that the bills were designed at the scale necessary to address the housing crisis and would ultimately save money. Jeremy Saunders, co-executive director of VOCAL-NY, a statewide tenant organization, said advocates remained hopeful Mamdani would implement the expansion or a version thereof. Edward Josephson, a lawyer for the Legal Aid Society that brought the original lawsuit, criticized the settlement approach as producing only further delays. “Meanwhile all the people in eviction proceedings that would have been covered by this law will not,” he said.
Housing Shortage Context
The city’s affordable housing shortage has worsened significantly. Rents have risen sharply, and the share of apartments renting below the median and available to rent represents less than one percent of the total market according to HUD Housing Resources. More than 86,000 people remain in city shelters. Affordable housing policy experts note that robust rental assistance programs play a crucial role in addressing these systemic challenges.
Moving Forward
Mamdani’s administration has focused on other housing initiatives, including establishing the Mayor’s Office to Protect Tenants and creating task forces to accelerate housing development on city-owned land. These efforts represent important steps, advocates say, but they do not substitute for expanding rental assistance. The mayor appointed Cea Weaver, a nationally recognized tenant organizer who led successful campaigns for rent stabilization and Good Cause Eviction protections, to direct the tenant protection office. On his first day in office, Mamdani also intervened in the bankruptcy proceedings of Pinnacle Group, a landlord responsible for more than 5,000 housing violations, demonstrating commitment to holding negligent operators accountable. However, these actions have not satisfied those who expected the mayor to immediately fulfill his explicit campaign commitment. The CityFHEPS expansion remains a defining test of whether Mamdani can deliver on his ambitious housing agenda amid fiscal constraints. Housing advocates continue calling on the administration to find a path forward that honors the council’s intent and addresses the city’s severe affordability crisis. The coming weeks will reveal whether negotiated settlement terms can satisfy both fiscal hawks and advocates demanding genuine expansion of assistance for the city’s most vulnerable renters. See also: City Limits Housing, THE CITY NYC News.
