New York City is using AI to help with administering SNAP benefits, officials testified before the City Council on Thursday.
The tech was developed with consulting firm McKinsey & Company, which the city is formally ending its contract with at the end of the fiscal year. That work will then be brought in-house as the city’s Department of Social Services looks toward rolling it out further, according to Human Resources Administration official Scott French.
The AI is being used to help identify mismatches in calculations before a case is processed, French said, with an aim at improving the error rate, which measures the accuracy of eligibility and benefit determinations.
The McKinsey contract was among those highlighted by Mayor Mamdani as unnecessary spending that could help close the city’s budget gap. Cutting the contract is part of a total $1.7 billion in savings found by chief savings officers across different city agencies.
The Trump administration has implemented changes to the food benefits programming that threaten thousands of New Yorkers’ access and complicate funding the program for states.
Those changes include a revamped funding formula that grants states money for the programming based on their payment error rate, with higher rates meaning states must shoulder more of the costs.
New federal work requirements also threaten access to benefits for roughly 40,000 New Yorkers, Mamdani administration officials said. The administration announced earlier this week it was ramping up canvassing and phone-banking efforts to notify those at risk of losing SNAP.
Mamdani touted scrapping the $9 million contract with McKinsey in a video in March, saying: “A contract with McKinsey at the Department of Social Services. No more. That’s $9 million that we won’t be spending next year.”
The city is using the AI technology, from AWS, to flag potential issues to workers and to “actually determine, is something not aligning, or is it — and if they do need to make changes, they can make those changes before they officially submit that,” French said.
Around 70 staffers are testing the tech to see if there are any “unintended consequences” and, if so, make fixes before the technology is rolled out further.
City Hall has enlisted McKinsey’s services in the past. In 2014, the firm was hired to bring down violence on Rikers Island — which it failed to do and then lied about it with phony data. Ex-Mayor Adams also hired the company to study garbage containerization in 2022.