Unresolved labor contracts for all of New York City’s municipal unions are posing a big financial risk for the city in the years ahead, Comptroller John Liu warns in the “State of the City’s Economy and Finances: report released on Friday.
Each of the city’s municipal unions is currently working under an expired contract. If just the United Federation of Teachers and Council of School Supervisors and Administrators receive retroactive pay raises, it could cost the city $3.495 billion in Fiscal Year 2014.
“The city’s budget is not truly balanced until this issue is resolved,” Liu said in a press release. “This is a problem that will not go away simply by ignoring it as the outgoing administration has done.”
On the positive side, the comptroller anticipates robust growth with tax revenues in the current fiscal year, exceeding the mayor’s forecast by $724 million. The estimate for personal income tax receipts exceeds the mayor’s forecast by $528 million.
More than 300,000 jobs have been added in the city since the worst of the recession, the report shows, with strong growth seen in the health, technology, and education sectors. Total private-sector employment now stands above its pre-recession peak.
At the same time, Liu said the city’s unemployment rate remains unacceptably high at a seasonally adjusted 8.7% while wages have not kept up with inflation.
The report is due from the comptroller each Dec. 15, as mandated by City Charter. Liu will deliver his State of the City address on Tuesday, Dec. 17.
