Stringer: Outyear Budget Gaps May Narrow

Projected higher tax revenues and pension savings may narrow outyear budget gaps, according to an analysis of New York City's adopted budget that city Comptroller Scott Stringer released late Monday afternoon.

Stringer is scheduled to discuss his analysis Tuesday at a meeting of the New York State Financial Control Board, established during the 1975 crisis to oversee and approve the city's budget.

"An improving economy, strong pension returns and prudent budgeting by Mayor [Bill] de Blasio have put New York City on a responsible path early on in his administration," Stringer said in a statement. "The administration found ways to fund critical programs and services while also setting money aside for the city's future."

Earlier Monday, Stringer said the city's five public employee pension funds achieved a 17.4% return for fiscal 2014.

The $75 billion budget includes several changes since the modified executive budget released in May, including the deposit of an additional $864 million into the retiree health benefit trust, an increase to the general reserve by $150 million and the withdrawal of $1 billion from the health stabilization fund for corresponding labor expenses.

The analysis by Stringer's office identifies additional resources over the 2015-2018 financial plan period, including $1.1 billion in pension payment savings and a projected $4.5 billion more in tax revenues, primarily personal income tax and property taxes. The city may realize about $748 million of additional resources in fiscal 2015.

The additional resources, said Stringer, will be more than enough to cover the risks to the financial plan his office identified, such as federal Medicaid reimbursement coming in below city budgeted revenue and understated overtime expenses for uniformed personnel. The additional resources can also help close the outyear budget gaps by $961 million, $1.3 billion and $1.9 billion in fiscal 2016 through 2018, respectively, said Stringer.

Moody's Investors Service rates the city's general obligation bonds Aa2. Fitch Ratings and Standard & Poor's rate them AA.

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