A giant question mark hung over New York City Mayor Bill de Blasio’s fiscal year 2021 preliminary budget announcement on Thursday: How would potential state budget cuts affect the city? Gov. Andrew Cuomo’s executive budget presentation, planned for next Tuesday, is expected to explain how the governor will close the state’s $6.1 billion budget gap – which should, in turn, shed some light on how much the city might be forced to bear the brunt of state cuts.

“The word preliminary is crucial in this case,” de Blasio said at the press conference at City Hall, “but it will be very deeply determined by what happens between now and April 1” – the date the state budget is due. “We’ve never seen this kind of threat from the state budget.”

Whatever the future holds, de Blasio gave some cold hard numbers. Here are the highlights:

$1.25 billion: The amount of money in the city’s budget reserves, including $1 billion in the general reserve and $250 million in the capital stabilization reserve, or about the same as last year. The city also has $4.7 billion stowed away in the Retiree Health Benefits Trust Fund. As has become a tradition in recent years, the business-backed fiscal watchdogs at the Citizens Budget Commission urged the mayor to sock away more towards the reserves.

The divide between Mayor Bill de Blasio and Gov. Andrew M. Cuomo has colored many city vs. state squabbles, seeping into disputes over subway repairs, school funding and solving the homelessness crisis.

Now it appears to be threatening the city’s budget.

Mr. de Blasio admitted that his budget plan was missing the “juicy” parts that he has typically highlighted in previous years, especially initiatives to help low-income New Yorkers, but he said he wanted to exercise caution until he sees how things play out with the state.

One area where he wants to add funding: $98 million in capital funds to improve street safety on Fourth Avenue in Brooklyn. The upgrades would be part of his Vision Zero safety plan to eliminate traffic deaths — a program that some worry is faltering after traffic deaths rose in the city last year.

Maria Doulis, vice president of the Citizens Budget Commission, warned that it was still early in the budget process and that the City Council must weigh in.

“What about the City Council’s priorities?” she said. “There are a lot of factors that may provide pressure on the city going forward.”

Dreams are expensive and New York simply doesn’t have the money.

Mayor Bill de Blasio admitted as much Thursday when he rolled out his tentative fiscal year 2021 budget, which features no new big-ticket items and the smallest spending increases he has ever requested as City Hall stares down the barrel of Albany’s massive $6 billion deficit.

The state’s budget crisis is driven by an explosion in costs for running the health insurance program for poor New Yorkers, Medicaid, which the Citizens Budget Commission says have jumped 15.6 percent in just the last two years.

“The budget problem in Albany is real,” said Andrew Rein, who heads the CBC. “We need a sustainable Medicaid program and this is not it in any way, shape or form.”

Recently surveyed competitions finance site and a think tank at the same time released, found that New York state in the nation's largest city, ranked sixth in the "Best Supporting States "; and New York City ranked eighth in the" Most Affordable Cities "ranking.

The wealth management website WalletHub found that New York State ranks sixth behind Minnesota, Massachusetts, North Dakota, Vermont, and New Hampshire in supporting families ; it ranks first in the United States in family fun; and fourth in "affordable".

In another Citizens Budget Commission (CBC) ranking, New York City ranks first among the 20 largest cities in the country in terms of transportation with the cheapest and the eighth most comprehensively affordable. Because housing is expensive in New York City, but cheap transportation offsets it.

The United States economy is booming, unemployment is at its lowest level in over half a century, and the stock market in 2019 had its strongest gains in a decade.

Yet, despite all this good economic news, which has translated into more tax revenue in New York State’s coffers, Gov. Cuomo’s budget for fiscal year 2020-2021 that begins on April 1, is projected to have a $6 billion deficit, about 6% of the $102 billion operating budget.

What’s the cause of this huge unbalance?

According to David Friedel of the Citizens Budget Commission, it’s “really a spending issue.” Revenues, he noted, “are coming in pretty much as expected.

Running up deficits appears to run in the Cuomo family. During Governor Mario Cuomo’s first 10 years in office (1982-1991), his budgets, which grew above the inflation rate from $20 billion to $36 billion, incurred deficits in nine of those years. The state’s accumulated deficit during that period grew from $2.9 billion to $6.2 billion.

A new study sought to figure out where New York City stands compared to other cities in terms of affordability.

A new report released by the Citizens Budget Commission sought to find out which cities across the country were the most affordable, not just through housing costs but also factoring in transportation costs. According to their findings from data in 2016, New York City is the tenth most affordable among the 20 cities that were examined for the study.

New York City as a whole was the fifth most expensive in housing costs when compared to peer cities. While residents of the city have a median income of $69,211 (the eighth highest compared to the other cities examined), they are spending $1778 a month, or 30.8% of their salary, on housing alone.

CBC noted that the high demand for housing in New York City puts the city at high risk for less affordability in the future.

Despite the high cost of housing, New York City proved to be more inexpensive than other cities in terms of transportation costs. According to the data, city residents are only paying $832 a month, or 14.4% of their income, on transportation. When factoring this cost, the affordability of New York City compared to the others in this study increases.

Gov. Andrew Cuomo’s warnings that cities could absorb more Medicaid costs have triggered questions about the effects on New York City’s budget.

Cuomo, in his State of the State address last week, suggested such a move would be necessary to close a projected $6 billion budget gap, two-thirds of which is tied to the Medicaid program for low-income people. The state covers about $2 billion of New York City’s costs.

Watchdog Citizens Budget Commission has called on H+H to overhaul its own funding mechanisms.

According to CBC, a multiyear, benchmarked approach could reduce a three-year deficit by up to $1.8 billion. The city’s Office of Management and Budget and H+H leadership “should develop a new approach to financial planning and budgeting,” it said in a report.

While the cost of living in New York City has notoriously been high for many years, a new report by a think tank found that when considering both housing and transportation costs, the city ranks 8th in affordability compared to some of the country’s largest cities when ranked by the size of their economies.

The Citizens Budget Commission, a nonprofit nonpartisan group which studies local budgets, analyzed the combination of housing costs, transportation costs, and income of 20 peer cities—coming up with what they call “location affordability.”

In New York City, the CBC found that when combining housing costs, transportation costs and income, the median household spends 45.3% of its income on housing and transportation. The median income in New York City is $69,211—the eighth highest compared to other cities examined.

A committee of NYC Health+Hospitals' board voted Thursday to create an independent practice association that would be able to negotiate more favorable contracts with insurers and develop the health system's relationship with community physicians.

The plan was presented by Israel Rocha Jr., CEO of OneCity Health and Elmhurst Hospital, as a way to continue working with community partners even if the federal government does not approve a second round of the state's Delivery System Reform Incentive Payment program.

"There has been an evolution from DSRIP. We're ending our first five-year run. Maybe there will be a DSRIP 2.0, maybe there won't," Rocha said. "The IPA is an extension of that effort to continue the coordination of care."

It will be almost impossible for Gov. Andrew Cuomo to make $1.7 billion in spending cuts before the end of the fiscal year in any responsible way, wrote Crain's columnist Greg David. One possible cut could be halting or delaying funding to vulnerable hospitals, David Friedfel of the Citizens Budget Commission told Crain's.

He did institute a 1% reduction in Medicaid reimbursements on Dec. 31, which will save a whopping $62 million by the end of the fiscal year March 31.

No wonder the governor focused his State of the State message on plans large and small—including the one to expand Penn Station for which he has no plan, no cost estimate and no funding source.

What is the governor going to do? In the short term, the best guess by David Friedfel of the Citizens Budget Commission is that to find the $1.7 billion in cuts Cuomo will eliminate or defer payments the state makes to especially vulnerable hospitals. He may try to offset the pain with some capital money for those institutions, but the impact on those hospitals won’t be good.

State lawmakers are looking to drastically scale back a pair of outer borough subsidy programs that became huge points of contention during Amazon’s attempted move to Queens.

New York’s Relocation and Employment Assistance Program – or REAP – and the state’s Industrial & Commercial Abatement Program – ICAP – are scheduled to sunset this summer and in early 2022, respectively.

Maria Doulis, vice president at the nonprofit civic group Citizens Budget Commission, said that if REAP is renewed, it’s important that it gets regularly evaluated in order to determine what benefits it is offering New York and whether it is still necessary.

“At a minimum, if it’s reauthorized, it needs to include a commitment to regularly and routinely evaluate the program,” she said.

Gov. Andrew Cuomo took to the stage for his 2020 State of the State address Wednesday, highlighting a reel of his administration’s accomplishments over the last decade and introducing dozens of his proposals for the new legislative session.

Cuomo’s agenda was ambitious, he admitted, including investing in environmental protections, expanding women’s rights and legalizing recreational marijuana — an initiative he pushed for last year, but was foiled by the Legislature over disagreements on regulating the industry and where revenue should go.

But to Republican lawmakers, other government officials and citizen groups, Cuomo skimmed over one of the biggest issues facing the state this year: a $6.1 billion budget gap, largely attributed to a $4 billion deficit from Medicaid costs.

In their own proposal to balance the 2020 budget, Citizens Budget Commission recommended reducing Medicaid costs to close the budget gap, and commended the reinstitution of the Medicaid Redesign Team.

But they warned against shifting costs back onto localities, with David Friedfel, director of state studies, saying such a move would be “regressive.”