Gov. Sarah Huckabee Sanders used a national television appearance last week to attack New York City’s fiscal condition and to argue that Arkansas is gaining residents at the expense of Democratic-led states.
Sanders appeared Thursday on Fox News’ “America Reports” with host Sandra Smith. The roughly six-minute segment focused on the cost of New York City Mayor Zohran Mamdani’s agenda.
“It is absolutely insane what is taking place in New York right now,” Sanders said. “They have a bigger budget deficit for next year of $7 billion than our entire state’s annual budget that we project for the whole year. So what they are doing is bankrupting their city.”
She closed by saying Arkansas has been “number one for people moving into our state per capita from any other state in the country” for two consecutive years.
Arkansas Breaking News reviewed the underlying data behind each claim. Here is what the records show.
Claim: New York faces a $7 billion deficit next year
Verdict: Accurate on the number, with important context.
The figure tracks with official projections. New York City’s Office of Management and Budget projected a $7.07 billion budget gap for fiscal 2028 in its May financial plan. Fiscal 2028 begins July 1, 2027, and is the next budget city officials will write.
New York City Comptroller Mark Levine’s office projects an even larger gap. Using its own revenue forecasts and estimates of underbudgeted costs, that office puts the fiscal 2028 shortfall at $8.76 billion.
But a projected gap is not the same as a deficit. New York State law requires New York City to adopt a balanced budget every year. The city did so on June 30, when Mamdani and Council Speaker Julie Menin agreed on a $125.8 billion fiscal 2027 budget. The Council approved it 45 to 6. The plan added $350 million to the city’s General Reserve and did not raise property taxes.
Out-year gaps appear in every New York City financial plan. City budget documents show the last plan under Michael Bloomberg projected gaps equal to 2.7% and 1.7% of revenue. The last plan under Bill de Blasio showed 4.1%, 3.8% and 2.9%. The final plan under Eric Adams showed 5.3%, 6.8% and 6.7%, the largest in 12 years.
The current gaps are real and larger than historical norms. Moody’s Ratings revised the city’s outlook to negative in March, citing what it called sizable and persistent projected shortfalls. Standard & Poor’s and KBRA followed within two weeks.
Claim: That deficit is bigger than Arkansas’ entire annual budget
Verdict: True only for one slice of the state budget. Arkansas’ total budget is roughly six times larger.
Sanders is comparing New York’s projected gap to Arkansas’ general revenue budget. The General Assembly approved a $6.7 billion general revenue budget for fiscal 2027 during the April fiscal session. Sanders signed the Revenue Stabilization Act the day it passed. On that measure, a $7.07 billion projected gap is indeed larger.
The general revenue budget is not the entire state budget. It is the portion over which the governor and Legislature have the most direct control.
Arkansas’ total funded budget was just under $40 billion in fiscal 2023-24, according to the Bureau of Legislative Research. Federal revenue accounted for $12.2 billion of that, or 30.7%. General revenue accounted for $6.5 billion, or 16.4%.
Scale also matters in the comparison. New York City has roughly 8.5 million residents. Arkansas has about 3.1 million. New York City’s adopted budget for the current fiscal year is $125.8 billion.
Claim: New York is bankrupting the city
Verdict: Not supported.
Moody’s affirmed New York City’s Aa2 issuer rating in March, the third-highest investment grade, on about $49 billion in general obligation debt. The negative outlook signals concern about the trajectory, not imminent insolvency.
Levine, a Democrat and the city’s elected fiscal watchdog, has been among the loudest voices warning about the gaps. He also said in March that the city’s bonds remain secure and its present financial position is solid.
Both the city and state comptrollers attributed the more than $12 billion in inherited gaps to underbudgeting under the Adams administration rather than to spending decisions made this year.
Claim: Arkansas is No. 1 per capita for in-migration two years running
Verdict: Misleading. The ranking comes from a moving company, not a per-capita measure.
Atlas Van Lines ranked Arkansas first for inbound movers in both its 2024 and 2025 Migration Patterns studies. Arkansas posted a 65% inbound rate in the 2024 study and 68.2% in 2025.
That study measures one company’s shipments. It compares inbound moves to outbound moves handled by Atlas customers. It is not a per-capita figure and does not count all people moving into a state.
A competing industry study reached a different conclusion. United Van Lines ranked West Virginia first for inbound migration in 2024 at 66%. Arkansas came in at 58% in that study.
The U.S. Census Bureau, which builds its estimates from IRS address changes, Medicare records and survey responses, tells a different story. In Vintage 2025 estimates released Jan. 27, South Carolina, Idaho and North Carolina led the nation in net domestic migration per capita for the period from July 2024 to July 2025. Arkansas ranked in the top 10 but not first, placing eighth in one published analysis of the Census figures.
By raw numbers, North Carolina gained 84,064 domestic migrants over that period. Texas gained 67,299 and South Carolina gained 66,622.
Arkansas’ overall growth also slowed. The state topped 3.1 million residents for the first time, but its population grew 0.6% in 2025, down from 0.9% in 2024. Domestic migration rose while international migration fell by about half.
The Atlas data also complicates the tax-flight framing. Atlas reported that 38% of all inbound moves to Arkansas went to Bentonville, home of Walmart’s headquarters. Arkansas was the only state where such a large share of inbound moves went to a single city. Atlas linked its top inbound states to return-to-office mandates at Fortune 500 companies including Walmart, CVS and Amazon.
On taxes
Sanders’ broader point about Arkansas tax rates is accurate. Lawmakers approved cuts during a special session this spring that lowered the top individual income tax rate from 3.9% to 3.7%, retroactive to Jan. 1, 2026, and the top corporate rate from 4.3% to 4.1%, effective Jan. 1, 2027.
The Department of Finance and Administration estimates the cuts will reduce general revenues by $191.8 million in fiscal 2027 and $144.8 million in fiscal 2028.
Arkansas closed fiscal 2026 with a $655 million surplus and total reserves of about $4 billion.
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