New York City Council Speaker Adrienne Adams and Mayor Eric Adams have reached a budget agreement that includes an expansion of the City Fighting Homelessness and Eviction Prevention Supplement (FHEPS) program. The deal, finalized Tuesday, allocates an additional $175 million for the program in the upcoming fiscal year, with subsequent annual funding set at $125 million.
The FHEPS program provides rental assistance vouchers to individuals and families living in homeless shelters or facing eviction. With these vouchers, eligible tenants can secure housing or remain in their current apartments, limiting their rent payments to 30% of their income, while city taxpayers cover the remainder up to "fair market rents."
As of last fall, approximately 65,092 New York City households were utilizing FHEPS vouchers, marking a nearly one-third increase over the previous year. Taxpayer expenditure on the program reached $1.2 billion in 2025, a significant rise from $288 million in 2022.
The newly approved expansion will increase eligibility for the program. A family of three earning up to $76,350, which is half of the area's median income, can qualify if they are facing an eviction case in housing court for a rent-regulated apartment. The program's eligibility criteria will also include runaway youth and individuals recently released from incarceration. Notably, a previous mandate requiring employment as a condition of eligibility has been removed.
To manage costs, the expansion will implement a spending cap. Once the allocated $175 million for the current fiscal year is exhausted, the city will cease issuing new vouchers, irrespective of application numbers. This measure is intended to control the program's overall expenditure.
Critics of the program have raised concerns about its fiscal implications, suggesting that the demand for vouchers could further strain the housing market and potentially increase the number of individuals entering shelters to access assistance. The current shelter population is reported to be near 83,000, a substantial increase from pre-2020 figures.
Council Speaker Mamdani, in conjunction with the budget deal, referenced economist Friedrich Hayek's observation that "if socialists understood economics, that they wouldn’t be socialists." Mamdani responded by suggesting that "socialists . . . understand economics just as well as the capitalists who came before."