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Some city lawmakers filed suit earlier this week to make sure the $400 checks are sent out to New Yorkers. The court date has been set for December 11th.

The City Council argues the money should be paid out because it was already approved in the budget.

"My desire is to have checks in the hands of the people of the city of New York as fast as possible in accordance with the agreement that we had," said Staten Island Councilman Vincent Ignizio.

But Mayor Michael Bloomberg counters that the city's economy has worsened since the time the city's budget was approved, and that the city simply cannot afford to payout.

The mayor said today that if the court rules in favor of the council, his administration will follow the law and send out the checks. However, he warns, the city will then have to make more cuts elsewhere.

"There is nobody that would like to send a check to every homeowner in the city more than me," said Bloomberg. "It is not easy to stand up and say, 'Look, we just don't have the money, or we're not really sure whether we have the money.' We can get rid of any cut, any enhancement, but we have to make it up elsewhere."

But even council members who have not yet signed onto the lawsuit say the city needs to deliver the checks.

"To pull it back now, in November or December, is just not right," said City Council Speaker Christine Quinn. "And I think those checks, as soon as possible, should go out in the mail. I think the law is very clear that they cannot be withheld."

Quinn said she needs more time to review it.