While praising New York City for closing a $4.6 billion fiscal 2013 budget gap and narrowing its gap for the following year to $2.5 billion with reserves and other one-shot measures, New York State Comptroller Thomas DiNapoli warned Monday that debt service costs are rising and reserve funds to balance future budgets are limited.

“New York City is in better fiscal shape than many cities because it has managed its finances well, but challenges remain,” DiNapoli said in his review. Challenges, he said, include a high unemployment rate, federal budget uncertainty and ongoing Wall Street fallout from the financial crisis.

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