The city says it was triggered by the gross negligence and dereliction of duty by the city's comptroller.
Under the state of emergency, neighboring towns will have to respond to 911 calls and collect trash.
On Friday, New York Governor Andrew Cuomo directed state agencies to temporarily deploy response assets to Mount Vernon.
"Mount Vernon's citizens are suffering as the city resolves longstanding issues over the funding of its services, and this administration is stepping in to ensure government continues to function," Cuomo said. "State agencies will deploy trucks to Mount Vernon to make sure the city is able to keep the streets clean and collect its trash for the next two weeks."
The mayor claims the comptroller has failed to pay critical maintenance of police, fire, and public works vehicles to the tune of about a half-million dollars.
"If she paid the bills on time and regularly collected the taxes that she has been elected to do then we would not have this kind of cash flow problem in the City of Mount Vernon and interruption of services," said Shawyn Patterson-Howard, Mayor of Mount Vernon.
The comptroller is not named in the emergency declaration document, although the position is currently held by Deborah Reynolds.
The city plans to resume trash collection Saturday for Mount Vernon's Southside and Tuesday for the Northside.
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