Mamdani’s Affordability Agenda Hits A Fiscal Wall

NEW YORK — On the campaign trail last year, Zohran Mamdani slammed then-Mayor Eric Adams for refusing to expand rental subsidies for the city’s lowest-income residents. Less than a year later, he’s on Adams’ side.

Confronted with a $5.4 billion budget gap, Mamdani is fighting in court to restrain the rapidly ballooning voucher program — walking back a promise to offer the subsidy to more people who don’t currently qualify.

The situation now playing out is the ultimate illustration of budgetary constraints colliding with Mamdani’s pledge to make the city more affordable for working-class residents. The mayor rode into office vowing to turn the page from his moderate predecessor who often pooh-poohed progressive ambitions, only to encounter the same fiscal tripwires in office.

Even without an expansion, the cost of the vouchers is projected to nearly double by 2030 — topping $3.1 billion that year. And there’s no real off-ramp: faced with scant affordable housing options and a weak job market, few New Yorkers are moving off the subsidy, even as thousands more enter the program each month. The city is on the hook either way — without expanded rental aid, advocates say more people will end up in a shelter system the city is legally required to provide and already struggles to afford.

“We do not have the legal ability — and I’m glad we don’t — to do nothing in New York City,” said Christine Quinn, president and CEO of the shelter provider Win and former speaker of the City Council.

Mamdani ran on a pledge to vastly expand social programs to help New Yorkers stay afloat in a notoriously expensive city. But so far he has spent much of his term grappling with a more immediate fiscal crisis that could imperil other high-profile proposals like universal childcare and free buses.

Housing vouchers offer an immediate solution to an affordability crisis that has been building for decades — and represent one of the only ways many low-income residents can remain in New York. The need is immense, though, and top city officials argue it goes beyond the city’s capacity.

“When you talk about wanting a voucher program to be an entitlement program or a universal program, the only scale of government that can sustainably provide that is the federal government,” Leila Bozorg, Mamdani’s deputy mayor for housing and planning, said in an interview.

New Yorkers in the program, known as CityFHEPS, are holding onto the vouchers beyond a rarely-enforced five-year time limit. Some 90 percent of people who have hit that maximum thus far have retained the subsidy.

The city has been successful using the vouchers to get record numbers of people out of homeless shelters — with the cost more than tripling from just three years ago. But as the city has ramped up the program to now serve more than 150,000 people — spending nearly $2 billion this year to do so — roughly 55,000 long-term New Yorkers remain in homeless shelters, one of the starkest and most intractable side effects of a worsening housing crisis.

“You’re seeing more and more families forced into the shelter system,” said Ted Houghton, an affordable housing consultant and former city and state official. “In the past they never would have gone, they would have figured something out. They’d double up, or find a not-so-good place they could afford living paycheck-to-paycheck. A single adult could find a [single-room occupancy apartment.] Those places don’t exist anymore. Now people can’t find anything.”

The voucher program remains top of mind for Mamdani as he attempts to close the massive city budget gap while pressing Albany for new streams of revenue. Gov. Kathy Hochul, a fellow Democrat, has reportedly asked him to look to the city rental subsidies as one place to find savings.

The New York City Council wants to offer the vouchers to more people who are not yet homeless but are at risk of eviction, as well as those who make higher incomes but still struggle to afford housing on their own. It approved those changes in 2023 — even overriding Adams’ veto — but City Hall refused to implement them.

Mamdani said on the campaign trail he would follow the laws as passed, but his administration hasn’t done so and is instead negotiating the parameters of the program with plaintiffs who sued after the Adams administration refused to make the changes.

Housing advocates and shelter providers like Quinn note that homeless shelters cost far more per night than rental vouchers. Housing a single adult in a shelter costs more than $4,000 per month, for example, while the average subsidy for a one-person household is less than half that amount.

New Yorkers whose incomes are at or below 200 percent of the federal poverty line — about $53,300 for a family of three — are eligible for CityFHEPS, provided they meet other requirements like experiencing or being at risk of homelessness. As of November 2025, the average subsidy for a three-person household was $2,142, while the average household of that size paid $324 in rent.

But the long-term nature of the vouchers raises the stakes of further expanding rental assistance, which is already growing in cost at a rate of 4 percent per month. Fiscal watchdogs including City Comptroller Mark Levine and the Citizens Budget Commission have raised concerns about the rapid pace of growth. Levine has noted that the city is projected to spend more on rental subsidies than the entire annual expense budget of its housing department.

“Once people are on the program, they tend to stay in the program,” said Sean Campion, a director of housing and economic development studies at the nonpartisan Citizens Budget Commission. “To be effective, these voucher programs, kind of by design, have to be permanent rental subsidies for people who need them.”

The city’s Social Services Commissioner, Erin Dalton, was asked at a recent City Council hearing when she thinks the growth of CityFHEPS might plateau. There are “very few exits” from the vouchers, she noted, and given that, if more people keep coming into the program it will continue to grow “essentially endlessly.”

Most of Mamdani’s predecessors have left City Hall with a larger shelter population than they inherited. Former Mayor Bill de Blasio was an exception: the shelter population rose to a then-record 63,839 people on his watch, but fell as the city established rental subsidies including CityFHEPS — a decline that was helped along by a Covid-era moratorium on evictions that limited a shelter influx.

Now, the shelter census has soared to 84,000 people, including about 27,000 asylum seekers who remain in the city’s care even though the larger migrant crisis has subsided.

This comes with significant costs as well: Excluding the migrants, homeless services for New Yorkers, including shelter intake, beds and outreach, are projected to cost $3.4 billion in fiscal year 2026, according to budget figures analyzed by the Citizens Budget Commission. Another $1 billion is budgeted for migrant shelter costs. That’s compared to about $3 billion spent on shelters five years ago.

Meanwhile, the forces that are driving housing instability appear to be worsening as well.

Nearly 30 percent of the city’s renter households pay at least half of their income towards rent, qualifying them as severely rent-burdened. The number of residential evictions in New York City rose by 9.7 percent in 2025. And the share of New Yorkers who live in poverty is inching up each year, according to recent reports from the anti-poverty group Robin Hood.

“As much as the shelter census has gone up, it would have gone up more if we didn't have the existing CityFHEPS program,” said Council Member Pierina Sanchez, who sponsored two of the expansion laws City Hall has declined to implement.

Shelter providers say much of the homelessness they encounter, particularly in family shelters, is driven largely by economic forces.

“We have a very significant number of our homeless moms who are working,” said Quinn. “They’re working and they still are getting evicted and ending up in shelter.”

Vouchers may be a long-term commitment for the city. But it’s also true that people who leave shelter without a subsidy are more likely to return, and in the experience of shelter providers like Win, they often return repeatedly.

In other words, the city is paying either way, Quinn and others argue — and so it makes more sense for that money to go toward a rental subsidy that offers people more stability, whereas homelessness carries with it an array of additional social costs. One recent report found nearly one in seven New York City public school students were homeless during the last school year, and these students dropped out of high school at three times the rate of their peers.

For the tens of thousands of households on the rental subsidies, achieving upward economic mobility and transitioning to self-sufficiency is far from a simple proposition — or one the city can easily solve for.

“In theory we should be able to up-skill people so they can get better jobs. But doing this right is an incredibly labor-intensive and expensive process,” said Seth Pinsky, who led the city’s economic development arm under former Mayor Mike Bloomberg.

“In many cases, we are dealing with people who, for years, have been poorly served by a system that does not properly prepare them for the modern workforce. Making up for this is both time-consuming and difficult,” Pinsky said.

The job sectors that are growing in New York and accessible to people without college degrees are also some of the lowest-paid, like home health care, according to Jonathan Bowles of the Center for an Urban Future, a think tank focused on economic mobility.

As the city struggles to make the finances of CityFHEPS work, cutting off such vouchers when people cannot yet sustain themselves without assistance can have dangerous effects. In 2011, when Bloomberg ended the Advantage rental subsidy after former Gov. Andrew Cuomo cut off state funding for it, the city’s shelter population spiked by more than 30 percent.

“If you arbitrarily start limiting rental assistance in the name of controlling costs, it ends very badly for everyone, most of all the recipients of that aid,” said Catherine Trapani, assistant vice president of public policy for the shelter and supportive housing provider Volunteers of America-Greater New York.

The future of the program will depend in many ways on the state budget deal being negotiated in Albany. Mamdani has been pushing for higher taxes on corporations and wealthy New Yorkers to bring in more revenue for the city, but has faced resistance from Hochul — though she recently proposed a pied-à-terre tax that’s expected to bring in $500 million for the city annually. Without additional tax hikes or more direct aid from the state, Mamdani will have to make difficult choices in order to balance the city’s budget ahead of a July 1 deadline.

Council members who are pushing the voucher expansion acknowledge that further growing the program will increase costs at first, but argue savings will come eventually from decreased spending on homeless shelters.

“It ultimately would save us money in the long term,” Sanchez said, while acknowledging, “not next year, necessarily.”