The collective bargaining deal struck last week between Mayor Eric Adams and the city’s largest police union could deepen the city’s eye-watering budget shortfall by another $700 million, a new analysis shows.

The new costs would come from larger raises that were promised to the Police Benevolent Association by City Hall in the new labor agreement, which has yet to be ratified by the PBA’s rank-and-file.

Adams scored plaudits from budget watchers for keeping wage increases below the rate of inflation; however, they also have cautioned that the Big Apple’s precarious finances mean that each new deal increases the budgetary pressure Hizzoner faces.

“While these raises are reasonable given economic conditions, the City missed the opportunity to identify productivity savings during collective bargaining to fund them,” said the Citizen Budget Commission’s Ana Champeny, who performed the analysis.

State Comptroller Tom DiNapoli has warned that City Hall faces a budget deficit that could reach $8.9 billion in 2025 and explode to $13.9 billion by 2027 — numbers that were tallied before the PBA deal was struck.

In response, Adams has ordered two rounds of budget cuts at most city agencies in a bid to find an estimated $6 billion to help close the gaps.

Gotham’s budget headache is fueled by several factors following the onset of the COVID-19 pandemic in 2020: Work-from-home has caused tax revenues from office buildings to plummet, inflation is pushing up the cost of everything from supplies to labor and officials say that the city’s ever-worsening housing shortage has caused rents to soar and made it virtually impossible for people to move here.

Capping it all off, City Hall says the arrival of nearly 54,000 migrants since last spring has stuck the city with potentially $4.3 billion in new costs for shelter and social services as required by decades-old court decrees.

Against that bleak fiscal backdrop, the PBA won a 3.5% wage increase that takes effect in August and a 4% hike that takes effect in August 2024. That’s larger than the 3% increases for each year netted by another major labor union, DC37, in the first deal struck by the city in February.

If all of the city’s public safety and uniformed agencies win the same raises as the PBA, city government’s overall labor costs will jump by $17 billion over the next five years, up from the $16.3 billion increase projected if the DC37 contract had been replicated citywide.

The larger raises for the uniformed agencies would cost City Hall $300 million in 2024 alone, the CBC estimated.

“Mayor Adams has stood shoulder to shoulder with working people his entire life for decent wages and better benefits,” responded City Hall spokesman Jonah Allon, “and the administration’s contract agreements with civilian and uniform unions set an economic framework that is fair to city workers and taxpayers.”