Slices of the Big Apple

New York City is one of the largest cities in the world, so naturally, the budget is just as enormous and complicated as the city itself.

This primer on the NYC budget aims to help you understand the very basics of the budget, then takes you through a 5-year analysis of just one of the many slices of our own Big Apple.

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Part One: Cutting to the Core

When we hear about the NYC budget, it tends to be presented as a monolith, one object that controls the funding that keeps New York City running. Contrary to that narrative, what we think of as the city budget is not so much one cohesive unit, but many components coming together under the same name—like an apple is made up of a peel, stem, core, seeds, and the fruit inside.

According to the Independent Budget Office, the expense budget is what people tend to think of when they contemplate the budget. The expense budget funds:

  • City employee salaries
  • Pensions
  • Debt service
  • Supplies to run the city

So it’s some of what people think of, but not everything. These funds are set aside for items that remain fairly consistent.

But what about money set aside for things like improving your local library or fixing potholes? Those allocations tend to be made in the capital budget, which covers one fiscal year (we’ll go over fiscal years in the next section), and funds physical infrastructure used in support of:

  • Government operations (funding government offices, schools, fire stations, etc)
  • General public use (roads, bridges, libraries, parks)

The Office of Management and Budgets (OMB) is in charge of approving projects submitted under the capital budget, and in order to meet approval requirements, projects have to have:

  • a value of at least $35,000
  • Probable usefulness for at least 5 years

When considering projects, the OMB will consult technical experts to assess the validity and use of the project, making sure that they actually contribute to the city.

In addition to funding people and projects, the budget also contains a contract budget, which is considered a subset of the expense budget and covers allocations for city entities that hire contractors and other contractual services.

There’s also the financial plan, which is presented alongside the budget and is released on a quarterly basis. This tracks city spending and revenues over a number of years, and each release has its own name depending on when it is released.

The capital program (adjacent to the capital budget) is a plan that manages allocations for capital projects for the current fiscal year as well as the next three. It manages not only new projects from the capital budget, but also projects that have already been started.

Don’t be fooled by its name—the 10 Year Capital Strategy isn’t actually related to the capital program or the capital budget. Instead, it exists to talk about developing facilities for the next ten years, and is issued by the Mayor by April 26th of each odd-numbered fiscal year.

Finally, the revenue budget exists to estimate how much money the NYC government will take in to fund all of these various components—despite not being an allocation budget, it’s an essential piece of the puzzle, which we’ll get more into when we talk about balancing the budget. The revenue budget includes:

  • Collections of taxes (e.g. property taxes, personal income taxes, sales tax)
  • City income from license fees, permits, rent, etc
  • Federal and state funding in the form of categorical grants for programs/services

Though most of these components operate independently of each other, they serve the same function of keeping the city running. Crafting all of these separate sections takes a lot of work, and a lot of time.

When we talk about years in budgeting, you might picture a standard Gregorian calendar like the one on the left. This isn’t usually the case, though.

Rather than beginning at the start of the calendar year, NYC’s budget process begins in the middle and spans across two calendar years, operating on a cycle like most other budgets also do.

Per the City Charter, our budget cycle begins on July 1st and goes through the calendar year all the way until June, where the Executive Budget is adopted by the City Council and becomes what’s known as the Adopted Budget.

By September 3rd, the Mayor is supposed to release the Capital Commitment Plan, which is a plan detailing funds that are legally obligated to be spent on capital projects. If you want to dig into the data on this, it's available on NYC Open Data here.

October has two deadlines, both involving community boards, which we'll be looking into later. According to the Office of Management and Budget, before October 31st, community boards are supposed to complete their capital and expense budget consultations with city agencies. This means that they set up plans to talk about specific projects that will be done in the community as well as their viability. By October 31st, those community boards are also supposed to submit their capital and expense budget priorities to the OMB.

By December 31st, the Mayor is slated to release a Financial Plan, which updates the Adopted Budget. This was part of our portions of the budget explanation, and provides updated numbers of income and expenses for the city.

January is a very busy month for the Mayor's office in regard to the budget: by January 16th, the Mayor releases the preliminary budget for the upcoming fiscal year (in this case, that would be July 2022 - June 2023). If it's an odd-numbered calendar year, they also release the preliminary ten-year capital strategy. On the community board side of things, boards should hear back about their budget priorities—this means it takes approximately two and a half months for them to hear back about their budgets.

Community boards then have approximately one month (from January 16 to February 16) to review the preliminary budget and submit a written response to the Mayor. Here's an example of a written response to the Mayor's preliminary budget from Manhattan Community Board #5!

By February 25th, borough boards submit their budget priorities to the Mayor and City Council. Borough boards are comprised of the following people:

  • The borough president
  • Council members representing the borough
  • The chairpersons of all the community boards in the borough

On March 10th, two things happen: 1) the City Council submits its operating budget; and 2) the Borough Presidents issue recommendations for the Preliminary Budget.

By March 25th, the city council should start holding hearings, proposing recommendations for the preliminary budget.

On April 26th, things really start moving: 1) the Mayor submits the Executive Budget and the Message of the Mayor; 2) if it's an odd-numbered calendar year, the Mayor releases the 10-year Capital Strategy; and 3) the Community Boards receive responses from the Mayor to their budget priorities.

The City Council holds hearings on the Executive Budget over three weeks (May 6 - 25). During the pandemic, these have been conducted over Zoom and citizens can watch virtually—generally, council members will come to these meetings having heard from their constituents about various topics they care about, and will represent those concerns accordingly at these meetings.

The Executive Budget is adopted by the City Council on June 5, becoming the Adopted Budget.

On June 30, the fiscal year ends and the process begins all over again!

Now that you know more about what the budget process looks like, it's time to really hash out who gets involved in the process and what that involvement looks like.

Who's involved in the process?

Our key players in the budgeting process are the Mayor and the City Council, who have the most responsibility in the process. The Mayor is responsible for releasing several plans throughout the fiscal year, which are reviewed and responded to by the City Council, and in that sense, there’s a lot of back and forth between the two entities. However, they’re not the only players in the process.

The OMB, as noted, is heavily involved in approvals, forecasting budget estimates for upcoming fiscal years, and evaluating how much money is needed to power the city for another year.

Lobbyists, activist groups, and other interested parties also get involved at various points of the process, making phone calls to City Council members in order to get more funds allocated towards—or away from—causes they support or are against.

Arguably, one of the most important people involved in the budget process is… you! That is, if you’re a resident of NYC—there are many ways you can get involved if there’s something in the budget that you care about:

  • Contact your city council member
  • Contact the Mayor’s office
  • If your district supports it, get active with participatory budgeting!

Participatory budgeting is a somewhat new phenomenon, begun in Porto Alegre, Brazil, in 1989. It was implemented in NYC in particular in 2011 by four Council Members, and allows NYC residents in participating districts to vote on capital projects to improve their communities—if you remember our review of the capital budget, this process deals with similar items. The value in this case needs to be $50,000, but the lifespan should still be at least five years.

With participatory budgeting, you get a say in what directly affects you, your neighborhood, and your family. Though the NYC participatory budgeting process doesn't redistribute funds between districts or change what categories (e.g. health, parks) get funding, it does allow for a change in where and how many projects are funded, and does give residents another pathway to having a say in the quality of life of their communities.

Even if you don’t live in NYC, this process can be replicated for your local budgeting process—calling your representatives is the best way to make a change! Because budgets are so directly a reflection of policy, this concept isn’t just economic—it’s political, and nowhere can we see this better than in what portions of the budget can actually pay for.

The executive budget allocation for 2021 was $90B. How big is that?

It is notoriously difficult for us to truly understand very, very big numbers. By virtue of being the tool that runs a city of approximately 8 million people, the NYC budget gets exactly that enormous. Though it's going to be a difficult task, let's give it our best shot.

The brown square in the top left of the big green square you see on your left represents $10 million dollars. The big green square represents approximately $100 billion dollars—it would take 10,000 of those little boxes to fit in the bigger box.

The Independent Budget Office has noted that $10 million—that box, which is so tiny, but could set an individual person up for life—can fund certain amounts of services that improve quality of life for all 8 million people in NYC.

For example, the brown box can fund approximately 7 days of residential garbage pickup.

But that's just one piece of the puzzle. Let's take a look at some other services the city provides and see how much each of them needs in terms of funding.

Each one of those bars is one budget line item that is part of a larger category. For each category, our small brown box can fund a certain percentage of what we use for the year, which is represented by the green. You can interact with the bars to find out more about the service and how far $10 million can take that particular service, including what percentage the green represents. When you're ready, feel free to move on.

The thing about funding in budgets is that funds are limited. To put this in perspective, there are 152 agencies listed in the budget data for Fiscal Year 2021—all of them are vying for a piece of that big green square, but when that little square can only fund one of these categories, the idea that the budget is political comes into play.

If we took every single service here and fully funded it for the year, this is (in theory) how much of the chunk it would take.

We are picking and choosing our priorities when the city council votes on the budget—we can’t fund everything unless we increase our revenue (via taxes or state/federal grant money) because the budget has to be balanced within a margin of $5 million. This is why your vote and your voice are important. If you care about a certain issue, like our environment or education, you can let your city council member know when it comes time to vote on the budget.

Let's review what we learned:

Ready to move on?

Part Two: Chewing on the Slices

Now that you've gotten to know the budget a little better, let's dig into the numbers! A very important thing to know before we proceed is that there are two main categories of overall allocation in the budget data: the Adopted amount and the Modified amount. The adopted amount is what was initially allocated when the Adopted Budget was approved by the City Council, while the modified amount reflects changes made throughout the year.

It may not come as a surprise to you to learn that, over the majority of the past five years, the adopted budget amount has been steadily increasing. After all, costs increase every year, and plenty of agencies vie for funding throughout the process. But let's take a journey through the yearly total allocation and see what happened.

In 2017, $83.9 billion was adopted overall.

The following year, that increased by $3.2 billion.

In 2019, we saw another $3.9 billion increase.

2020 saw another $3.6 billion increase, but it was a unique year—because of the way fiscal years work, as we went over, allocation was done before the pandemic, and nowhere is that felt more…

… Than in the allocation for fiscal year 2021, which saw a $4.6 billion decrease from the prior year.

The COVID-19 pandemic affected so much about the world we live in now, but it also affected the way our budget is structured and how much was allocated in funding. So much about budgeting is about forecasting, and with the apportionment for 2020, there was no way to tell in the previous budget cycle that a global pandemic was about to take place.

These are the top 5 agencies and departments by modified budget in 2021. We're using the modified numbers here to get a more holistic picture of what actually happened financially during that fiscal year. Though each of these agencies delivers important functions that keep our society running smoothly, we tend to miss smaller stories that impact our communities by focusing on the biggest spenders. So let's try looking at something a little closer to the ground!

You may remember that, when we were going over the fiscal year calendar, community boards were mentioned quite a bit. The table that was just added in is a total of how much is allocated to each borough's community boards to give an idea of the range of values.

If you don't already know what a community board is or why it matters so much, let's talk about that! Otherwise, interact with this text to move on.

In New York City, we have several levels of government ranging from federal to state to city to community. At the closest level, we have community boards. Though community boards are not necessarily their own actual function of government, they play an important role in keeping our lives running smoothly.

Community boards are a group of up to 50 non-elected active, involved members from your local community who hear complaints, process permits for block parties and street fairs, address land use and zoning, meet with city agencies to make recommendations in the budget process, and advocate for residents when problems arise. Half of the members are nominated by their district's City Council members, and the other half is selected and appointed by the president of whichever borough they belong to. Aside from their primary responsibilities, some community boards are also responsible for other items like organizing tenants' associations as well as managing some public works projects and other initiatives.

Does location matter when it comes to your community board's budget?

This jitterplot contains all of the community boards' modified budget amounts from the years 2017-2021. You can interact with a dot to find out which board it is, and what year it belongs to.

You might be saying: this is great and all, but I want to know about my community board (or if you're not an NYC resident, you might want a bird's eye view of the city). If you don't already know what community board your residence belongs to, find out with this tool by Lou Huang!

Now, if you have your community board ready, let's take a geographical approach.

Use the range slider to see how funding for our community boards has changed over the past five years. You can interact with one of the community boards on the map below (either by tapping or clicking on the board area) to see that board's allocations over the past five years in one place.

Going back to our initial question—location does seem to impact the amount that a community board will get allocated to them, particularly if the board is located in Manhattan. But why do community boards in Manhattan receive more funds than community boards in other boroughs? Is it systemic inequality or is it that the cost of being located in a place known for accommodating the wealthy impacts even our own governments?

This is what the office for Manhattan Community Board #12 (one of the community boards with the most funds allocated) documented as their expenses for the fiscal year. You can interact with the rectangles to see the labels for smaller, less immediately visible portions.

Time for a sandbox moment! You can use the dropdowns to select a community board and compare two of them against one another. When you select two different boards, you'll be able to see the total for each one, plus a comparison of what the dollar difference is between them.

For each of these treemaps, you can see that some community boards have more categories than others—for many community boards, there simply aren’t allocations for things like rentals. However, there are general-purpose categories, which aren't completely enlightening. This project will eventually have another sandbox component that allows you to fully dig into that, but for now, we can say that we learned that:

Ok, I'm informed! What now?

  • Get involved! You can attend a community board meeting even if you don't actually reside in the area—this can be a great way to get a sense of issues in other communities.
  • Do you have opinions on how budgetary funds should be allocated? Check out if your City Council district offers participatory budgeting!
  • If you think your community board isn't getting enough funding, find your city council member with the embedded tool below and contact them to let them know!

If you've made it to the end of this explainer, thank you so much for reading! You can check out the links below to learn more about how this project was made.