This idea has been proposed both for New York City and for just Manhattan.
22 February 1921, New York Times, pg. 2:
WANTS STATE OF MANHATTAN
Senator Cotillo Cites Transit Bill in
Demand on Congress
ALBANY, Feb. 21. - Senator Cotillo of New York City wants Congress to create a forty-ninth State - the State of Manhattan, with all territory within the city of New York included. In a concurrent resolution introduced tonight, Senator Cotillo asked the Legislature to memorialize Congress to take the necessary action. Similar bills in former years have reached the scrap heap quickly.
October 1921, Current Opinion, pg. 429:
The State of Manhattan
A PROPOSITION is being urged to create a new, forty-ninth, state of the Union.
This state would include New York City, Long Island, Westchester and contiguous parts of New Jersey, and would have a larger area than Rhode Island or Delaware.
It would have a population of about 8 millions, nearly equaling the great state of Pennsylvania.
It would be the center of the greatest wealth in the United States, indeed in the world.
23 May 1942, New York Times, pg. 15:
Calls City "the 49th State"
"Mindful of the fact that New York City, at the insistence of the Mayor, is set up as a forty-ninth State in the civilian defense program, but also mindful that you, as Governor, have a duty to all citizens of the State, even those who find themselves in 'No Man's Land,' the forty-ninth State, I believe the time has come for you to take official notice of the impasse that exists between Mayor La Guardia and President Roosevelt's Office of Civilian Defense," Kennedy said.
(Representative Martin J. Kennedy, Democrat of New York - ed.)
6 June 1951, New York Times, pg. 33:
IS THREAT TO STATE
A threat that New York City, angered at its "shabby" financial treatment by the state, would seek to secede from New York State and become "the forty-ninth state of the Union" was hurled at Governor Dewey yesterday by Acting Majority Leader Charles E. Keegan in the City Council.