Trump administration pulls $80.5M in FEMA funds targeting New York City migrant crisis

President Donald Trump's administration has clawed back from New York City $80.5 million in emergency migrant funding that had already been paid into municipal coffers and appropriated by Congress as reimbursement, City Comptroller Brad Lander said Wednesday.

The money, part of the funds approved by Congress during the Biden administration to pay the city back for costs connected with the influx of more than 230,000 foreign migrants since spring 2022, was abruptly withdrawn Tuesday at about 4 p.m. from city bank accounts, Lander said.

"This morning, my financial team shockingly uncovered that President Trump and his crony Elon Musk illegally executed a revocation of $80 million in congressionally-appropriated FEMA [Federal Emergency Management Agency] funding from New York City’s bank accounts late yesterday afternoon," Lander said in a statement. "This is money that the federal government previously disbursed for shelter and services and is now missing. This highway robbery of our funds directly out of our bank account is a betrayal of everyone who calls New York City home."

Musk misleads

The federal funds, reimbursement for expenditures already made, represent more than 40% of the $200 million emergency-management money the city has received so far to deal with the migrant crisis. A total of $237 million has been allocated; about $80.5 million was received last week, and there is a balance of $37 million left to claim.

The clawback came after Musk, who heads Trump’s quasi-official Department of Government Efficiency, misleadingly posted that the city had spent $59 million to house migrants in luxury hotels. 

Mayor Eric Adams' spokeswoman Liz Garcia said Tuesday that the city learned Wednesday morning the $80.5 million had been taken back and is "already exploring various litigation options."

"While we conduct an internal investigation into how this occurred, 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."

On Tuesday, Garcia said the city did not pay luxury hotel rates, $19 million was for hotels themselves, with the balance for food, security and related services, and $13 million for congregate shelters and services. Lander noted that the program under which the city was reimbursed has a $12.50-per night cap on hotel and shelter prices, and that's what the city was reimbursed under.

The city has spent over $7 billion on the shelter and services for the migrants and was being reimbursed for only a “paltry” fraction, Lander said.

Adams was set to meet Thursday with Trump's border czar, Tom Homan, to discuss the administration's deportation operation.

"I’m coming up there Thursday to meet with the mayor, either he comes to the table or we go around him," Homan told the "Cats & Cosby" show on WABC/770 AM. "I’m hoping we come to an agreement where his officers can help my officers in removing these public safety threats." 

White House press secretary Karoline Leavitt, when asked at Wednesday’s daily press briefing about the withdrawal of $80 million in funding, said she was unaware of the specific figure but described it as evidence that Musk's DOGE is "just moving very quickly."

'Deep state activists'

Department of Homeland Security Secretary Kristi Noem, in a post on X, appeared to reference the withdrawal.

"I have clawed back the full payment that FEMA deep state activists unilaterally gave to NYC migrant hotels," Noem wrote.

She added: "Mark my words: there will not be a single penny spent that goes against the interest and safety of the American people."

On Tuesday, the Trump administration fired four top FEMA officials, including its chief financial officer, over the migrant funds being transferred.

On Monday, the U.S. Department of Justice ordered Manhattan federal prosecutors to drop its criminal case against Adams but left open the possibility that Adams could be recharged later this year. His critics have said the arrangement renders Adams — and New York City — beholden to Trump.

Adams on Tuesday said, "I would never put any personal benefit above my solemn responsibility as your mayor."

Lander, referencing the mayor’s legal troubles, said he hopes the city pursues legal action to reclaim the money.

"New York City cannot take this lying down. I call on the Mayor to immediately pursue legal action to ensure the tens of millions of dollars stolen by Trump and DOGE are rightfully returned," Lander’s statement said. "If instead Mayor Adams continues to be President Trump’s pawn, my Office will request to work in partnership with the New York City Law Department to pursue aggressive legal action."

With Laura Figueroa Hernandez

By Matthew Chayes

matthew.chayes@newsday.comchayesmatthew

Matthew Chayes, a Newsday reporter since 2007, covers New York City.