NEW YORK — New York City plans to spend its first $1 billion in federal funding for Hurricane Sandy recovery on loans and grants to homeowners and businesses affected by the storm, Mayor Michael R. Bloomberg announced Wednesday morning. It will also go toward efforts to protect public housing and critical infrastructure from future storms.

The money will come from a $51 billion disaster relief package that will be distributed to New York, New Jersey, and other affected areas. The first installment for the city will total $1.77 billion; in his presentation on Wednesday, Bloomberg did not say how he would use about $725 million of that initial payment.