Budget watchdog groups are raising concerns that Mayor Mamdani’s administration has significantly underestimated the financial obligations owed to the Metropolitan Transportation Authority (MTA) in his initial budget. This comes as he attempts to deliver on his campaign promise to provide free city bus rides.
The New York City Comptroller’s Office indicates that in fiscal year 2027, the city is projected to owe approximately $621 million more in MTA subsidies than what the Mamdani administration has allocated. This discrepancy highlights long-standing issues of insufficient funding within the budget plan.
Nonetheless, Mayor Zoran Mamdani remains committed to making buses free for city residents, a plan that could end up costing around $800 million.
During a press conference on Tuesday, Mamdani emphasized the importance of making the city navigable for working people, especially when questioned about any potential budgetary solutions for the Fair Fares program, which offers reduced or no fare options for low-income residents.
“We need a budget that outlines our first year in office while guiding us through a fiscal crisis that’s unlike anything we’ve dealt with in over a decade,” he added.
Critics, particularly transportation advocates, have expressed disappointment with Mamdani’s proposed budget, which maintains the city’s fair fare contribution at $96 million for fiscal year 2027.
New York City is legally required to support various transportation initiatives, including paratransit and reduced fares, through state laws and agreements; however, actual funding levels can fluctuate.
The preliminary budget plan seems to ignore the rapid increase in the city’s financial support for the MTA. According to the Independent Budget Office, subsidies are set to rise from about $1.2 billion in fiscal year 2023 to $1.4 billion in fiscal year 2024, with subsequent increases anticipated.
Furthermore, funding for the Access-A-Ride program skyrocketed from approximately $250 million in 2023 to $465 million in 2024 due to state budget changes that raised the city’s contribution to 80 percent. By the fifth month of fiscal year 2025, the city had already spent $218 million on paratransit, based on IBO data.
Student fare costs are also on the rise. The amount the Department of Education will contribute for a one-time student OMNY card payment to the MTA is set to increase from $45 million to $50.5 million, coinciding with new student tap privileges starting in the 2024-25 school year and fare hikes that took effect in January.
MTA officials have indicated that increases in fares may occur sooner rather than major cuts in spending, with a previously approved $21.3 billion operating budget for 2026 expecting a series of approximately 4% fare increases, while also anticipating a budget deficit in the latter half of the decade.
This budgeting strategy raises concerns about the MTA’s ability to fund new obligations, such as Mamdani’s free bus initiative, amid ongoing challenges like soaring overtime costs and nearly $1 billion lost to fare evasion each year.
Ultimately, Mamdani’s budget must gain approval from the city council, which has been hesitant about his proposals. The final spending plan for New York City is expected to be finalized by June.
“We have an executive budget and it will be adopted by the end of June,” Mamdani affirmed. “I strongly believe in making public transportation more affordable for everyone.”
