Fiscal Intelligence

Fiscal analysis that enables educators, small business owners, and community organizers to make informed decisions.

Category: NYC Budget Update

The Coming Budget Crunch

The NYC mayoral candidates have big spending plans. Do we know how they plan to accomplish them? Are they printing money in order to do so?

Bill Thompson wants to put 2,000 extra cops on the street at a cost of $200 million a year. One of his rivals, Public Advocate Bill de Blasio, pledges to introduce universal pre-K in the city’s schools, a project with a $530 million annual price tag. Thompson, deBlasio, and another candidate, New York City comptroller John Liu, want to build at least 60,000 units of new subsidized housing over the next four years. The bill for that could dwarf the cost of the police and school proposals.

This makes anyone wonders if they are aware of the fiscal challenges that the City of New York is facing.

  • Spending from city revenues rose from $28.9 billion when Bloomberg took office to $47.5 billion in fiscal year 2012 and will be an estimated $50.2 billion in 2013—a staggering 70 percent increase per resident.
  • The tab for workers’ health care more than doubled, from $2 billion a year to $4.8 billion. Retirees add another $1.6 billion.
  • According to the Citizens Budget Commission, total city debt hit $105 billion last year—almost double what it was when Bloomberg entered City Hall
  • The budget allocation for annual interest payments on debt jumped from $3.9 billion in 2002 to $5.8 billion in 2012, according to New York City’s Independent Budget Office.

Review of the Financial Plan of the City of New York

Over the past decade, City funding for education has more than doubled, rising from $6.2 billion in FY 2003 to $13.2 billion in FY 2013.

The May Plan assumes that the Department of Education (DOE) will reduce planned spending by a total of $1.2 billion during the financial plan period. This represents 40 percent of the total value of the agency program, which is greater than the DOE’s share of the City-funded budget. The majority of the savings would come from re-estimates of the cost of special education ($672 million) and from non-classroom efficiencies ($368 million). The DOE also intends to raise the price of school lunches by $1.00 for students whose families’ incomes exceed 185 percent of the poverty level.

TAXI MEDALLIONS – Decision upholds constitutionality of state law

 

Oral arguments were heard on April 24, 2013, and the Court issued a ruling in early June. The ruling was in the City’s favor. Therefore, the first sale of taxi medallions is planned for the fall of 2013.

<div style=”margin-bottom:5px”> <strong> <a href=”http://www.slideshare.net/LuisTaverasMBAMS/decision-upholds-constitutionality-of-state-law&#8221; title=”TAXI MEDALLIONS – Decision upholds constitutionality of state law” target=”_blank”>TAXI MEDALLIONS – Decision upholds constitutionality of state law</a> </strong> from <strong><a href=”http://www.slideshare.net/LuisTaverasMBAMS&#8221; target=”_blank”>Luis Taveras MBA, MS</a></strong> </div>

The Taylor Law

The Taylor Law (particularly the Triborough Amendment provision) expires on July 1st. What should Gov. Cuomo do?

The so-called Triborough Amendment, passed in 1982, prohibited public employers from “refus[ing] to continue all the terms of an expired agreement until a new agreement is negotiated” unless – importantly – the union went on strike.

 

The Pension Pain

Budget Options for New York City

The budget options originate in a number of different ways. Some are included because elected officials, advocates, and other individuals have asked IBO to analyze their potential to cut costs or raise revenue for the city. Other options were generated by IBO’s own team of experts. More than a few have been the subject of public discourse for many years. Members of the public can also suggest options and for the first time this year, IBO invited them to send us their ideas via social media. Fans and followers sent in several thought-provoking suggestions; our option to consider development impact fees came by way of Facebook. It is IBO’s hope that in the years to come we will receive more ideas from our online readership for which we can estimate savings or revenue.