The clock is ticking as Mayor Zohran Mamdani and City Council Speaker Julie Menin race against the June 30 budget deadline. The latest hurdle in their negotiations is the expansion of the CityFHEPS rental assistance program, a critical initiative aimed at helping New Yorkers at risk of homelessness.
The absence of a handshake deal by Monday marked a significant escalation in the budget talks, with the City Council’s Progressive Caucus demanding more funding for CityFHEPS. The caucus, a powerful 23-member bloc, issued a stark warning: they need to see movement on this critical program before any agreement can be reached.
Progressive Caucus Demands Action on CityFHEPS
The Progressive Caucus, led by Council Member Sandy Nurse has been vocal about the need for additional funding. In a Saturday statement they emphasized the urgency of the situation: “Every day that this program remains unexpanded, New Yorkers are forced out of homes, unable to keep up with ballooning rent.”
The caucus acknowledged the efforts of Mayor mamdani and Speaker Menin to close the city’s deficit but argued that the emerging budget still fell short. They urged the Speaker and Mayor to ensure that a balanced budget does not rest on the backs of New Yorkers grappling with an historic affordability crisis.
Council Members Unite for CityFHEPS Expansion
The pressure to expand CityFHEPS is not confined to the Progressive Caucus. Majority Leader Shaun Abreu stated that “a budget deal is incomplete without” a deal on CityFHEPS. Other non-caucus members, including Linda LeeEric DinowitzYusef Salaam and Susan Zhuang also issued statements supporting CityFHEPS funding or expansion.
Zhuang, who has been a vocal opponent of a homeless shelter planned for her Southern Brooklyn district, argued that the city is spending money on shelters while fighting a cheaper rental-assistance expansion in court. “The math is simple,” Zhuang said. “It costs the city far more to keep a family in a shelter than to help them stay in their home with a voucher.”
The Legal Battle and Budget Negotiations
The legal fight over the CityFHEPS expansion has become intertwined with the budget talks. The City Council passed a package of laws in 2026 to expand access to the program, but then-Mayor Eric Adams vetoed the bills. The Council overrode him, and the legal battle has continued under Mamdani, despite his campaign promise to drop the litigation.
Mamdani’s administration appealed the case to the state’s highest court in March, arguing that the Council lacked authority to enact the expansion and that the city could not afford its full cost. However, Council Member Pierina Sanchez who chairs the Council’s housing committee, said there were enough members willing to oppose a budget without more CityFHEPS funding to delay the handshake.
As the deadline approaches, both sides are under pressure to reach an agreement. The Office of the City Comptroller urged both sides to reach a deal before the deadline, warning against adding to future budget gaps. “With the deadline fast approaching, I urge the Mayor and City Council to reach an agreement as soon as possible to prevent the potential downsides of a late budget,” the office said in a statement.