New York City Mayor Zohran Mamdani announced on Thursday that his administration has achieved $100 million in contract savings over two years, attributing the reductions to eliminating duplicative services and renegotiating deals. The announcement came as students returned to school.

"We are canceling the contracts that no longer serve our students, teachers, and school staff," Mamdani stated at a first-day-of-school news conference. "These changes will save more than $100 million over the next two years alone—$100 million we will be able to reinvest in our school system and use to support our educators, our staff and students as they prepare for another year of school."

However, the savings represent a small percentage of the city's education budget. This year's savings account for approximately 0.12% of the Department of Education's total budget. The identified savings also amount to 0.38% of the $13 billion spent annually on outside contracts.

Details regarding specific contracts that were terminated or renegotiated were not immediately available from City Hall or the Department of Education. The city's approved school spending plan for the upcoming year is $38.9 billion, which was increased by $700 million during budget negotiations. This occurred without addressing a campaign pledge to control contract spending.

Mamdani previously discussed the need for fiscal responsibility concerning contracts, noting that of the DOE's approximately $40 billion budget, about $10 billion is allocated to contracts and consultants. He suggested that some of this spending could be reduced through a review of duplicative processes.

The handling of these contracts has been a point of contention between Mayor Mamdani and City Council Speaker Julie Menin. The administration reportedly delayed providing Speaker Menin's office with access to review the extensive list of outsourced contracts for several weeks before eventually complying.

Mamdani and NYS Governor Hochul were present at the Highbridge Recreation Center in Queens for the announcement on the first day of school.