New York City Cash Balance Projection March 1, 2025

The City’s economy continued to grow at a moderate pace, supported by reduced inflation and the gradual easing of the monetary policy in the second half of last year.

In the first half of FY25, the City collected $70.614 billion in revenue and incurred $67.836 billion in expenditures, for a net gain of $2.778 billion. As a result, cash balances rebounded to year-ago levels in December 2024 and have since edged slightly above last year’s values in the first two months of CY25.  In contrast, in our previous Cash Letter, we projected that December 2024 – February 2025 cash balances would be lower than prior years. Federal Covid-related aid, particularly FEMA public assistance payments, came in significantly higher than anticipated, totaling $4.231 billion for the first half of the year.

Tax collections for the period grew 17% due to strong personal income and business income tax receipts (fueled by the strong corporate profitability, especially among Wall Street firms) and continued gains in tourism.  In addition, this year, the commercial real estate market has finally begun to recover.

Conversely, the number of New Yorkers receiving public assistance and social services has grown.  584,554 New Yorkers received public assistance in December 2024, the most in at least five years and up 64%, or 208,988 recipients from December 2020.¹ The increase in social services expenditures is due in part to the provision of shelter and services to asylum seekers, as well as rental assistance, and shelter for non-asylum seekers.

On December 2, 2024, New York City’s unrestricted cash balance reached a seasonal low of $4.602 billion, compared to $5.223 billion in FY24 and $3.966 billion in FY23.  As usual, cash balances recovered quickly at the end of December due to incoming property tax receipts.

Over the last 12 months, cash balances have averaged $10.295 billion, versus $12.115 billion during the same period last year. New York City is starting March 3, 2025 with $9.071 billion in cash, above last year’s figure by $992 million. The cash total includes the Revenue Stabilization Fund (RSF) balance of $1.964 billion.

For more information, please see the accompanying 2Q FY 2025 Quarterly Cash Report.

[1] https://www.nyc.gov/assets/hra/downloads/pdf/ca_recipients.pdf

Projected Cash Balances (December 2nd – March 31st)

The accompanying updated projection outlines expected cash balances in the NYC central treasury from March 3, 2025 to June 30, 2025, after incorporating assumptions from the January 2025 Financial Plan.

Projected cash balances

The City’s cash position is strong. The forecast shows that cash balances will be mostly in line with last year’s figures for the remainder of FY25. Cash flow balances will average $11.181 billion during the next four months, compared to $10.675 billion in FY24, $14.138 billion in FY23, and $7.787 billion in FY22.

It is not possible at this time to predict how Federal spending pauses and cuts might affect the City’s cashflow in the coming months, the economy, and tax receipts in the longer-term.

On February 4, 2025, the City received an $81 million payment from the Federal Emergency Management Agency (FEMA), for reimbursement of shelter and related expenses for noncitizen migrants under the Shelter and Services Program (SSP). On February 11, 2025 the transfer was reversed by FEMA. Prior to the February payment and reversal, the City received $71 million in SSP reimbursement, and continues to be owed the $81 million which was taken back and an additional $36 million which has not yet been paid. NYC has filed a lawsuit against the Trump administration over the revoked FEMA funds. However, the cash projection assumes that no additional Federal aid will be provided to reimburse the City for asylum seeker expenditures over this projection horizon. While other threats to federal aid have been announced, this projection assumes all other Federal aid will be received as anticipated.

In the FY 2026 Preliminary Budget the prepayment is budgeted at $2.344 billion. It is assumed that the FY 2025 contribution to the Retiree Health Benefit Trust for pay-as-you-go OPEB costs will equal $3.594 billion. Pay-as-you go OPEB costs in FY 2024 equaled $3.294 billion.

We project that the City will end FY25 (on Monday, June 30^th) with $11.795 billion in cash, compared to $10.410 billion a year ago. The difference is mostly due to the timing of receipts: in FY24, the last business day of the fiscal year fell on Friday, June 28^th and a significant portion of the real estate tax receipts slipped into July.