Just days after Trump istration officials said they would suspend funding to New York City used to house and assist migrants, the Federal Emergency Management Agency went a step further and revoked $80 million in payments that had already cleared, city Comptroller Brad Lander said Wednesday.
Lander, who is among candidates challenging Mayor Eric Adams in June’s Democratic primary, said officials in his office were the ones who identified the unprecedented clawback of money — which was a reimbursement for funds the city has already spent.
Lander said the city had been promised $237 million in such reimbursements by the Biden istration, out of roughly $7 billion the city has spent to deal with an influx of more than 200,000 migrants since 2022.
Of the $237 million, $37 million has yet to be reimbursed, according to Lander, while $80.5 million of $200 million paid out is newly in contention after billionaire Elon Musk, recently tapped by President Donald Trump to lead a review of federal spending, claimed without evidence that the grant went to luxury hotels and said that it violated the law and went against a presidential executive order.
“This highway robbery of our funds directly out of our bank is a betrayal of everyone who calls New York City home,” Lander said ahead of a press conference outside his office building in Lower Manhattan. He noted that the funding was capped at $12.50 per night.
Asked Wednesday about FEMA’s withdrawal of funds from the city’s coffers, mayoral spokesperson Liz Garcia said City Hall is conducting an investigation into how the funding clawback had occurred and that city lawyers are exploring their legal options.
“Our office has already engaged with the White House about recouping these funds and we’ve requested an emergency meeting with FEMA to try and resolve the matter as quickly as possible,” Garcia said in a statement.
The White House and FEMA press offices didn’t respond to emails from THE CITY seeking information on the move.
But Department of Homeland Security Secretary Kristi Noem took personal credit for the funding reversal, alleging without providing proof that the payments were allocated “unilaterally” by FEMA “activists.”
“I have clawed back the full payment that FEMA deep state activists unilaterally gave to NYC migrant hotels” Noem posted on X.
The New York Times reported Tuesday that four FEMA officials were terminated — including the agency’s chief financial officer — in relation to the funding allocation to New York City, even though, according to Lander, the funds came as part of two grant agreements made by the Biden istration in fiscal years 2023 and 2024 that simply hadn’t been paid until last week.
FEMA records posted online show that other cities, states and organizations — including in Texas and Arizona — received allocations under the same program from the prior istration. But New York City is the only grantee publicly targeted by Musk.
The funding kerfuffle came just two days after the U.S. Department of Justice ordered the Manhattan U.S. Attorney’s office to dismiss “without prejudice” its corruption case against Adams, who was indicted in September on charges that included bribery.
A memo written by acting U.S. Deputy Attorney General Emil Bove Monday said the Justice Department acted because the case interferes with Adams’ ability to run for re-election and to cooperate with Trump’s immigration enforcement efforts.
Bove’ said the case was essentially being postponed, without an examination of its merits, and that it would be reviewed in November after the mayor’s race to see whether prosecution should resume. The Manhattan U.S. Attorney’s office hadn’t publicly commented or acted on the memo as of Wednesday afternoon.
Adams on Tuesday portrayed the outcome as having cleared him of any wrongdoing, but his mayoral challengers and a host of other Democrats have expressed concern that by not fully dropping the case, Trump’s DOJ holds significant leverage over Adams’ actions as mayor.
On Monday, before the Bove memo was made public, Adams met with top officials in his istration and ordered them to not be publicly critical of Trump. He has previously said any disagreements he has with the president over policy would be discussed privately, rather than publicly aired.
Lander called the funding spat the first real test of Adams’ independence. He said the funding was pulled on Tuesday afternoon, and that his office isn’t sure how the feds accessed money from the city’s bank — though he likened it to a credit card company reversing a payment.
