Mayor Eric Adams stood onstage at the Apollo Theater earlier this month and pledged to compassionately address New York City’s homelessness crisis and make it so no one would need to spend a night on the subway or street.
A week later, he submitted a budget that underfunds a crucial rental voucher program by roughly $500 million.
The program, called CityFHEPS, provides direct rental assistance to people on the brink of homelessness as well as some people already in shelter through city-funded vouchers. It has more than $1 billion in funding this fiscal year, but the mayor’s proposed budget for the coming fiscal year cuts that roughly in half.
While funding numbers typically change throughout the year, housing and budget experts say the city is playing too fast and loose with an important program.
“We know that the city budget for a long time has not been budgeted in a truthful or transparent way,” said Christine Quinn, the former City Council speaker who now runs Win, a family shelter and supportive services provider. “It is intellectually dishonest and fiscally irresponsible.”
Since its inception in 2018, the voucher program has typically been allotted more funding throughout the year than initially laid out in the budget. Adams added $325 million to the current fiscal year’s budget for rental assistance, including CityFHEPS, this month, bringing CityFHEPS’ total funding over $1 billion.
But the city’s accounting often leaves hundreds of millions of dollars in the freefall of uncertainty.
CityFHEPS is the only program of its kind — in support of housing — that is not fully accounted for at the outset of the annual budget process. Police overtime, which is currently at the center of another scandal facing the Adams administration, is another area that is often criticized for being underbudgeted.
The city’s dire yearslong housing shortage has become a focal point for Adams and other politicians. With the passage of his City of Yes plan, Adams’ administration expects to bring more than 80,000 homes to the city over 15 years.
“It is a big cliff,” said Sean Campion, director of housing and economic development studies at the Citizens Budget Commission, referring to the gap between the current fiscal year’s CityFHEPS funding and the mayor’s proposal. “They’re not recognizing that this is a recurring cost.”
To researchers, it’s unclear why a program of this scale and substance isn’t fully funded from the beginning.
“That’s the billion-dollar question,” Campion said.
In a statement, a spokesperson for the mayor defended his administration’s record on affordable housing, saying citywide use of CityFHEPS vouchers is at an all-time high.
“We will continue to closely monitor [the Department of Social Services’] budget and will be addressing funding needs through the city budget process — which has just started — to make sure that homeless New Yorkers continue to have access to the vouchers they need,” said spokesperson Amaris Cockfield. “Our work is far from done, but we are moving in the right direction at an unprecedented rate.”
The City Council has attempted to rectify the funding practice by negotiating a $540 million baseline in funding for CityFHEPS, which members announced last June.
“This is a program that deserves permanency in the budget,” said Deputy Speaker Diana Ayala, who chairs the Council’s general welfare committee. “I’m not concerned that the program will run out of money because that hasn’t been the case. I just don’t understand why the reluctance to just add the full amount right to the budget. Like it just doesn’t make any sense to me.”
The program began delivering vouchers to eligible applicants in 2018, during then-Mayor Bill de Blasio’s second term. According to a recent audit from state Comptroller Tom DiNapoli, the city’s Department of Social Services said the program had helped more than 87,000 people find housing between its launch in 2018 and January 2024.
The program has also become more expensive over time as more people have signed on and as voucher holders have continued to rely on the program. In the current fiscal year, which runs through June, the city has spent or committed to payments totaling $566 million for CityFHEPS, according to Checkbook NYC, the spending tracker managed by the city comptroller.
“We’ve been seeing consistent underbudgeting in several areas over the last few budget cycles,” said Councilmember Justin Brannan, the finance committee chair, in a statement. “The administration is well aware of the current levels of utilization for CityFHEPS and what it costs so it is puzzling that they continue the practice of adding money throughout the year rather than just funding what they know is needed now.”
The city’s management of the voucher program has also been rife with “systemic inefficiencies and irregularities,” resulting in widespread delays for people waiting for housing, according to the DiNapoli report released in October. Advocates have long lamented long waits for vouchers for people depending on them for housing.
“Some people will qualify the minute they move into a shelter, but then don’t see a shopping letter for months and months,” said Stephanie Rudolph, an attorney with the Legal Aid Society’s Homeless Rights Project. She was referencing a letter that tells people what types of homes they can rent with CityFHEPS and how much money they will receive. “Anecdotally, we see months of waiting for a shopping letter, even after being found eligible.”
One of the things that separates CityFHEPS from other voucher programs like Section 8 is that it tends to be more inclusive of families of mixed immigration status, as other types of vouchers can have higher barriers to access.
“We know that those vouchers get people out of shelter and into permanent housing. We also know that a night in a shelter is more than three times the cost of a night in a permanent apartment that you’re paying for with a voucher,” Quinn said.
“So this move not only will hurt homeless people, homeless families, homeless children,” she added. “It, in the long run, will cost the city more money.”
