Coronavirus spike, expanded furloughs the latest shoes to drop in New York City

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New York Mayor Bill de Blasio expanded furloughs to all managerial and non-represented employees while City Hall also faces an alarming coronavirus spike in some neighborhoods.

Wednesday’s furlough announcement, coupled with one last week for mayor’s office employees between October and March, will affect 9,000 employees and save $21 million, de Blasio told reporters Wednesday.

“We are forced to make these difficult decisions as we face a massive budget shortfall with no help in sight,” he said Wednesday. “We need Washington and Albany to step up. We need a federal stimulus and we need long term borrowing.”

"We need a federal stimulus and we need long term borrowing," New York Mayor Bill de Blasio said.

The latest news from the health front was ominous. In an area covering southern Brooklyn and parts of Queens that the city's Health Department is calling the “Ocean Parkway Cluster,” the positivity rate for coronavirus has climbed to nearly 5%.

Neighborhoods of concern include Midwood, Borough Park, Bensonhurst and Williamsburg in Brooklyn, and Kew Gardens, Edgemere and Far Rockaway in Queens.

“Now, we have a bigger problem on our hands,” de Blasio said. “it's something we have to address with a very aggressive public health effort right away.”

Citywide, the rate is 0.75%.

The revelation comes within days of a planned reopening of kindergarten and other lower grades under the city’s staggered school reopening.

The federal government is gridlocked over further coronavirus rescue aid and New York State officials have been hesitant to allow the city to borrow to cover an operations gap projected at roughly $9 billion through fiscal 2021.

The city has already cut $7 billion from the budget between February and the $88.2 billion FY 2021 adopted budget, finalized in July. De Blasio said his administration continues to work with labor groups to find savings and prevent layoffs.

De Blasio has said with neither up to 22,000 people could lose their jobs.

Further economic and psychological blows to the city came Wednesday with the announcements that the Metropolitan Opera canceled its entire 2020-21 season, and that the iconic New Year's Eve ball-dropping in Times Square would go virtual.

The effects of the pandemic have affected New York's standing in the capital markets. Moody's Investors Service and S&P Global Ratings lowered their outlooks on the city's general obligation bonds to negative since the coronavirus escalated.

Moody's rates city GOs Aa1. S&P Global Ratings and Fitch Ratings rate them AA.

According to data on the Municipal Securities Rulemaking Board's EMMA website, a block of Series D fiscal 2013 GO bonds maturing in 2024 that originally priced at 125.904 cents on the dollar sold to a customer Wednesday at a price of 110.399.

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Budgets Coronavirus City of New York, NY Bill de Blasio
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