Mayor Michael Bloomberg and City Council Speaker Christine Quinn agreed on a $70 billion New York City budget for fiscal 2014 that includes $250 million for storm resiliency and an additional $58 million to the Housing Authority, which will offset some federal sequester cuts the agency sustained.
The 51-member council is expected to vote this week on the final budget in Bloomberg’s 12-year tenure. He will not seek re-election. Deadline for enacting a balanced budget is Sunday.
According to Bloomberg, the budget, which calls for no tax increases, relies on more than $6 billion in savings generated through 12 rounds of deficit closing actions city agencies have undertaken since 2007. It also cited an additional debt-service saving of $200 million through low interest rates.
The city will face about a $2 billion budget gap in fiscal 2015, down slightly from last month’s estimate. Moody’s Investors Service rates the city’s general obligation bonds Aa2. Fitch Ratings and Standard & Poor’s rate them AA.
Bloomberg said “fiscal discipline and pro-growth economic strategies” helped New York withstand blows from the Sept. 11 terrorist attacks and the 2008 recession.
Sunday night’s announcement, however, triggered some skepticism.
“Much as we suggested would happen earlier this year, the city’s overly prudent interest-rate assumptions enabled the Bloomberg administration to ‘find’ about $200 million in savings that helped restore funding for programs that had been on the chopping block and seal a budget deal with the City Council. Some may see this as smart budget management, while others might take a more cynical view,” said Doug Turetsky, a spokesman for the Independent Budget Office watchdog agency.
City Comptroller and mayoral candidate John Liu lambasted Bloomberg for leaving expired labor negotiations for his successor.
“On his way out the door, Mayor Bloomberg shows us with this budget agreement that he has left the biggest question – expired labor contracts – for another mayor and another day. Explain to us again why he needed a third term? To pile up the mess?” Liu said. “True, he restored most of his threatened cuts, and perhaps the people of the city of New York should be grateful for those crumbs. But the plain fact of the matter is, the mayor stayed too long at the party, and history won’t forgive him.”
Quinn is also running for mayor.
The $250 million for resiliency measures follows Bloomberg’s June 11 unveiling of a $20 billion plan to protect the city’s shorelines from future storms such as Hurricane Sandy.
About $100 million will support high-priority investments city agencies must make to secure critical facilities. The remaining $150 million will fund resiliency projects, including $47 million for costal protection improvements on Staten Island’s east shore; $40 million to raise bulkheads in low-lying neighborhoods; $19.7 million to expand natural drainage corridors, on Staten Island; and $3.3 million in matching funds for a federally funded ferry landing in the Rockaways.
The $58 million for the Housing Authority will replenish nearly 30% of the $205 million it lost from sequestration. The money will go toward public housing, senior centers and other community programs, Bloomberg said. The city will also provide about $13 million to the Department for Youth and Community Development and the Department for the Aging.
Two weeks ago, the authority, in response to sequestration, announced a series of budget cuts that included layoffs and program elimination.
“The New York City Housing Authority now anticipates fewer immediate layoffs,” the agency said in a statement Monday afternoon. “However, [the authority] continues to be faced with a shortfall in federal funding of nearly $150 million and must proceed with difficult decisions to balance our budget.”
Bloomberg also said the New York State Court of Appeals ruling earlier this month authorizing the city to establish street-hail livery service in the outer boroughs and to sell 2,000 additional medallions for wheel-chair accessible yellow taxicabs will generate roughly $1.4 billion over the next few years, beginning with $300 million in estimated revenue in fiscal 2014.
