Speaker Menin and Mamdani commit to collaborative approach while preliminary hearings set stage for final bargaining
The preliminary budget process formally begins this week as New York City Mayor Zohran Mamdani and City Council Speaker Julie Menin set the stage for months of negotiations that will determine how the remaining $5.4 billion fiscal gap is closed. Both leaders have publicly committed to collaborative engagement, setting a more constructive tone than sometimes characterizes the budget process.
The Structure of NYC Budget Negotiations
New York City’s budget process follows a structured timeline designed to allow extensive public input and legislative scrutiny. The mayor presents a preliminary budget, which is followed by City Council preliminary hearings where council members and the public can comment and ask questions. The council then develops its own preliminary budget response outlining the body’s fiscal priorities and proposed modifications to the mayor’s plan. The mayor incorporates council feedback into an executive budget that forms the basis for renewed council hearings. Following the second round of hearings, the mayor and council engage in intensive negotiations to develop a mutually agreeable adopted budget that the council then votes to approve. This entire process, from preliminary budget through final adoption, typically unfolds over approximately five months. The timeline allows time for community input, allows for flexibility as economic conditions change, and provides both executive and legislative branches with meaningful input into fiscal decisions.
Speaker Menin’s Collaborative Approach
City Council Speaker Julie Menin has emerged as a key voice shaping the budget process tone. As a former agency administrator herself, Menin brings experience navigating the gap between executive branch fiscal capacity and legislative branch priorities. “The budget dance is that: It’s somewhat of a dance, which is unfortunate. It always would be better if there could be more coordination and not so much of that back-and-forth,” Menin said in recent comments. Despite acknowledging the structural tensions inherent in the budget process, Menin has positioned herself as willing to work constructively with the mayor. She noted that she has been “talking very constructively with the mayor about that,” signaling openness to closer coordination than sometimes occurs. The language of constructive engagement represents an important signal that the council is not looking for confrontation for its own sake but rather seeking genuine partnership on fiscal questions.
The Agency Savings Requirement
As part of his preliminary budget process, Mamdani has required all city agencies to develop comprehensive “agency savings plans” identifying opportunities for operational efficiency and spending reduction. These plans must be developed within 45 days of the directive and will form the basis for agency-specific budget negotiations. The mayor has already hinted at some specific savings priorities, such as eliminating spending on an artificial intelligence chatbot launched by the previous administration that the mayor characterized as wasteful spending. Agency budget director Sherif Soliman has indicated that significant savings will come from reducing spending on outside contractsan area where many agencies historically accumulate inefficiencies and unnecessary expenditure. This approach contrasts with less precise fiscal strategies that rely on across-the-board cuts affecting all agencies equally. By targeting specific inefficiencies and wasteful spending, the Mamdani administration is attempting to protect core service delivery while reducing unnecessary expenditure.
Council Speaker Menin’s Policy Priorities
Council Speaker Menin has already signaled that the council will prioritize protecting small property owners and neighborhood businesses from property tax increases. In a statement responding to the preliminary budget, Menin emphasized: “At a time when New Yorkers are already grappling with an affordability crisis, dipping into rainy day reserves and proposing significant property tax increases should not be on the table whatsoever.” She added that “the Council believes there are additional areas of savings and revenue that deserve careful scrutiny before increasing the burden on small property owners and neighborhood small businesses, which could worsen the affordability crisis.” This language signals that the council will push for alternative approaches to closing the budget gap rather than accepting property tax increases as inevitable. The council’s position aligns with the mayor’s stated preference for raising taxes on wealthy New Yorkers and corporations rather than property taxes, creating potential common ground on the fundamental question of whose shoulders the fiscal burden should rest upon.
Preliminary Hearing Schedule
Preliminary budget hearings are expected to begin in late February or early March, with the council hearing from the mayor’s budget office about the proposed budget’s assumptions and spending allocations. Agency commissioners will also testify about specific departmental budgets and the agency savings plans. Community groups, unions, and other stakeholders will have opportunities to speak during the hearing process, bringing diverse perspectives on how budget resources should be allocated. The preliminary hearing process will likely surface conflicts between the council and mayor over specific program areas and spending priorities. Housing advocates may push for additional homelessness services funding. Education advocates will stress school funding needs. Unions will resist service-cutting measures that affect public sector employment. Healthcare providers will advocate for expanded health services funding. These competing priorities are typical of budget processes and force decision-makers to make explicit choices about which priorities will prevail.
The Negotiation Timeline
Following preliminary hearings, expected to conclude in early March, the council develops its own preliminary budget response outlining the body’s fiscal and policy priorities. The mayor then presents an executive budget incorporating feedback from preliminary hearings and council input. This executive budget launch typically occurs in late March or early April. A second round of council hearings follows the executive budget release, after which intensive negotiations begin between the mayor and council leadership. These negotiations typically continue through May and into early June, with the adopted budget vote typically occurring by June 30, the fiscal year start date. This compressed negotiation timeline means that significant work must occur in a relatively short window. The parties must resolve fundamental disagreements about which services to prioritize, whose income should be taxed, and whether property tax increases are acceptable.
Key Negotiation Questions
Several critical questions will likely dominate budget negotiations. First, whether the state legislature will approve Mamdani’s proposed tax increases on high earners and corporations. If the state approves these taxes, the city’s fiscal situation improves dramatically. If the state refuses, Mamdani must either accept property tax increases or find alternative savings. Second, the extent to which council will accept specific agency budget reductions. Some council members will push to protect specific agencies or programs while seeking cuts elsewhere. Third, whether the city’s financial reserves will be drawn down or preserved for future emergencies. The city maintains a “rainy day fund” that provides fiscal flexibility in emergencies, but drawing down reserves means reducing future flexibility.
Public Input and Stakeholder Engagement
Throughout the budget process, the public will have opportunities to testify and participate in decision-making through the formal hearing process and through engagement with council members. For guidance on participating in NYC budget advocacy, see the Southern Voice Community Council and United Neighbors of Brooklyn, which coordinate budget advocacy and community input. Community participation historically shapes budget outcomes, particularly when organized constituencies articulate clear priorities and demonstrate constituency support for their positions.
Looking Forward
The preliminary budget presentation marks the formal beginning of a process that will occupy City Hall and the council for the next four months. By the time an adopted budget is approved in June, New Yorkers will have a much clearer picture of which services will be maintained, which will face cuts, and who will bear the fiscal burden of the inherited fiscal crisis. The constructive tone signaled by both Mayor Mamdani and Speaker Menin suggests this budget cycle might avoid some of the acrimony that sometimes characterizes budget negotiations. However, the fundamental conflicts around fiscal priorities and burden-sharing remain and will likely surface during the preliminary and executive budget hearing processes.
