New York City Council, Mayor Work To Finalize Budget Details Before Vote

Following a handshake agreement on New York City's $59.1 billion fiscal 2009 budget Thursday night, the City Council and Mayor Michael Bloomberg worked on Friday to finish details before a vote expected last night.

"The major thing from our point of view is the budget pretty much stayed at the same level as last year, a little less than the rate of inflation," said City Council member and Finance Committee chairman David Weprin, D-Queens.

Total expenditures for fiscal 2008 are expected to come in at $62.6 billion.

The city plans to use some of its projected $4.5 billion surplus to pay for retroactive raises to police unions that amount to $700 million. The raises were part of an arbitration settlement worked out with the city in May, after the release of the executive budget.

Other uniformed unions have the option to reopen their contracts, which could potentially cost the city an additional $400 million. Bloomberg spokesman Stu Loeser confirmed that part of the surplus would be used to pay for the police raises. The story was first reported by Crain's New York Business.

This and the souring economic situation in the city prompted Bloomberg to push to get rid of a 7% property tax cut worth $1.1 billion, but the City Council pushed back and won.

"We don't know if the economy is going to be as bad people are predicting," Weprin said. "Why increase property taxes now?"

Bloomberg's executive budget had identified uses for the surplus prior to the arbitration settlement. It wasn't clear yesterday how the use of surplus would change, but early payment of $2.35 billion of debt service due in fiscal 2010 and 2011 was not affected.

A bitter fight over $450 million of cuts to education spending was resolved with the City Council using $129 million of discretionary funds for school classrooms. Cuts to the education department will remain.

By statute, the city must pass its budget before the end of the fiscal year, which ends today.

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