City Hall, NY – Ahead of the City Council’s Executive Budget hearing jointly held by the Committee on Housing and Buildings and the Committee on Finance on Wednesday at 10 AM, the Council identified remaining gaps in housing funding within the Mayor’s Fiscal Year 2026 Executive Budget that leave key initiatives and services unfunded. The Executive Budget included a $1.56 billion operating budget for the Department of Housing Preservation and Development (HPD), which is $132.5 million less than the amount proposed in the Mayor’s Preliminary Budget. HPD’s Five-Year Capital Plan now includes approximately $3.25 billion for FY 2026, a slight decrease from the Preliminary Budget. While 18.3% more capital funding was added for FY 2027 compared to the Preliminary Budget, the overall amount still drops significantly to $2.27 billion. 

For FY 2028 and 2029, capital funding in the plan remains unchanged and below $2 billion. The Capital Commitment Plan includes HPD’s $825 million share of city funding secured through the Council’s City for All housing plan. However, this capital funding was intended to be additional to the City’s baseline commitments, but the declining commitment in the outyears beyond FY 2026 would produce 1,750 fewer new affordable housing units per year (15,750 units fewer over 10 years). 

The Mayor’s Executive Budget for the agency’s operating budget recognized $100 million in federal funding for Section 8 housing vouchers and allocated $46.6 million over three years to reform the 15/15 supportive housing program to shift from scattered to congregate sites, which the Council has advocated to support. However, key capital and program investments remain missing, as New York City continues in a severe housing crisis, with a shortage of homes that fuels record homelessness, rising evictions, and widespread housing insecurity. The following programs, outlined in the Council’s Preliminary Budget Response, were left out of the Mayor’s FY 2026 Executive Budget. 

Housing Preservation and Development Litigation Team

The 33 positions currently budgeted in this division are inadequate to address the needs of the City’s renters and to hold bad-actor and negligent landlords accountable. Additional resources are required to ensure building owners meet the needs of their tenants and that the City holds them responsible when they fail to do so. The Council has urged the Administration to hire additional attorneys that bolster HPD’s litigation office, including $2.2 million in FY 2026 to increase the size of the agency’s litigation team by 20 attorneys.

Third Party Transfer Expansion

The Third Party Transfer program can be a valuable resource in rehabilitating properties and increasing the City’s supply of available and inhabitable housing. The Council has requested that HPD significantly expand and amend the Third Party Transfer program by providing an additional $600 million in capital funding to hold landlords accountable and preserve stabilized housing for the City’s most distressed properties.

Council-Funded Initiatives

The Council’s over $17 million in housing-related budget initiatives address service gaps across the city to protect tenants and homeowners. These include the over $3.6 million Community Housing Preservation Strategies initiative that prevents the loss of affordable housing, the $1.5 million for the Community Land Trust initiative, and over $5.1 million to prevent deed theft and foreclosures amongst low- and moderate-income homeowners. It is critical that this funding, left out of the Mayor’s Executive Budget, is included in the final budget through a continued full commitment towards Council discretionary funding. 

“New Yorkers are living through a housing crisis, but the Mayor’s Executive Budget does not go far enough to invest in the solutions that will make our neighbors whole,” said Council Member Pierina Sanchez. “While I am thrilled to see additional funding for supportive housing, the Mayor’s Executive Budget still falls short of the investments needed to build and preserve affordable housing at the necessary scale. Despite committing an additional $100 million for CityFHEPs in Fiscal Year 26 as part of City for All, this investment is still entirely absent from the budget. 

Council Member Sanchez continued, “The Executive Budget also fails to include any additional support for a reformed and expanded third party transfer program that will hold the worst landlords accountable — despite HPD testimony that additional resources are needed. Meanwhile, HPD has a staff vacancy rate of 14% — nearly triple the 5% average across all agencies — which hamstrings their ability to fulfill core agency functions. As we enter the final month of budget negotiations, I expect the Mayor to fulfill his promises to New Yorkers, close these funding gaps, and deliver the critical programs we need to deliver safe and dignified living conditions for all.” ###