The Comptroller’s Office told the Finance Committee it projects a near-term deficit of about $7.4 million for fiscal year 2025 based on its third-quarter gap analysis, a figure that contrasts with the administration’s estimate of a roughly $2.1 million surplus.

Delano Dowd, deputy comptroller, said the principal variances include (1) a conservative approach that did not count an anticipated second tribal-compact advance payment of about $5.4 million until the funds were received and (2) a newly finalized legal obligation—the Ortiz case—estimated at about $6.5 million plus interest that the comptroller’s analysis included but the administration’s third-quarter report did not.

Why it matters: The difference between the comptroller’s and administration’s analyses is about $9.4 million, and it highlights how recognition timing for revenues and obligations can substantially change projected year-end positions.

Details from testimony: Dowd said the administration budgeted $11 million for tribal-compact funds and had in prior months received an advance payment of about $5.6 million; the administration included an assumed second payment in its estimate, while the comptroller’s office did not report it until receipt. On the expense side, Dowd said the Ortiz settlement became payable only after appeals resolved in May; although cash had been set aside earlier, accounting sweeps at year-end had reduced reserved balances on the books and the general fund would need to absorb the posted expense.

Committee members asked when the comptroller’s office learned of the Ortiz development. A city official (identified in the meeting as the Commissioner of Administration and Finance) said he became aware in May, after the comptroller had already published the third-quarter report. That official and Dowd described the matter as a recent development that could not reasonably have been included in the earlier report.

The comptroller’s office said projections could change in the fourth quarter as revenues and expenses finalize.

The committee tabled the item for further consideration.