DeBlasio Says N.Y.C. Will Keep to Prudent Fiscal Course

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New York City will hold to a prudent financial course while maintaining a progressive social program, Mayor Bill de Blasio told municipal bond market participants on Tuesday.

"I have a real passion for fiscal responsibility … and it's something I've felt for a long time," DeBlasio said at Municipal Forum of New York luncheon Tuesday. "I saw what happened when this city was not fiscally prudent."

DeBlasio said he saw "a huge dislocation that occurred" in the 1970s, when New York faced its fiscal crisis. "I saw all the things the city wasn't doing, all the ways that you couldn't help people, all the negative impact of irresponsible government."

That era left a lasting mark on his vision for government and for finances, said DeBlasio, who was born in 1961.

"That was for me a very sobering and important experience," de Blasio said. "And it generated in me a deep feeling that 'we have to get it right,' that all of us in government, and all of us who lead in government, have a responsibility to make prudence one of the underlying elements in what we do."

He said he did not feel financial responsibility was a burden, and when he meets with his team from the Office of Management and Budget, "we recognize we have a unique opportunity – whether to or make an investment or whether to put in more reserves. It's part of the greater process of government and it's part of about being smart about today and tomorrow simultaneously."

He said he appreciates the value of keeping a strong reserve fund. He cited the fact that in last 15 years, the city went through huge dislocations – Sept. 11, the Great Recession and Hurricane Sandy.

"It's a good reminder to choose carefully and always appreciate the value of keeping a strong reserve," he said, "to be prepared for the moments that we do not know that are coming."

Last month, the City Council approved a final $82.1 billion Fiscal 2017 budget, which included unprecedented reserves, including an additional $250 million in the Retiree Health Benefits Trust Fund that will raise reserves to $3.9 billion, as well as $1 billion for the General Reserve, and $500 million for the Capital Stabilization Reserve.

The city's general obligation bonds are rated Aa2 by Moody's Investors Service and AA by S&P Global Ratings and Fitch Ratings.

De Blasio also lauded the Forum for sponsoring the Urban Leadership Fellows program, which assists public high school students who are interested in public finance careers.

"I appreciate that you've done something important for our young people," he said, praising municipal bond professionals for funding a program that has given out over 650 scholarships since 1992 to help young people get a head start in their careers.

In terms of public finance, he said it was a smart choice for a new generation.

"Even though people may not think it's the most sexy choice of professions, I would say … if you want everything else to happen, if you believe in the power of government to do good in people's lives, if you believe in a more compassionate, inclusive society – guess what – maybe public finance is the proper way," he said. "Being in these kinds of roles actually allows you to be a catalyst for a lot of other good that we have to do."

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New York
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