Good Morning
Good Morning
NewsNew York

Bloomberg: De Blasio inherits a balanced budget

From left to right: Ursulina Ramirez, Carl Weisbrod

From left to right: Ursulina Ramirez, Carl Weisbrod and New York City Mayor-elect Bill de Blasio attend a press conference at Federation of Protestant Welfare Agencies in which Mayor-elect de Blasio announced his transition team leadership in Manhattan. (Nov. 6, 2013) Credit: Charles Eckert

Mayor Michael Bloomberg said Thursday he is leaving Mayor-elect Bill de Blasio a New York City budget that is balanced through mid-2015, and fiscal watchdogs predicted that would give the new administration more breathing room and flexibility.

Higher-than-expected tax revenue of more than $500 million, plus the sales of city-owned buildings and new taxicab medallions, helped erase a projected $2 billion shortfall for the 2015 budget year, which starts in July 2014, Bloomberg said at City Hall Thursday.

"It reduces the pain and means it is one less thing he has to worry about," Bloomberg said.

Experts, while cautioning they haven't seen the actual budget documents underlying the announcement, said it appeared de Blasio would be spared some of the pressure new mayors typically face.

"It's good news for the next mayor," said Maria Doulis of the nonpartisan Citizens Budget Commission. "Under normal circumstances, he would come in in January and have about a month to put together a budget proposal to balance the budget."

Doulis said de Blasio might even be able to fund his signature campaign pledge -- expanded prekindergarten and after-school programs -- without the plan's other part: tax hikes on income over $500,000.

"Assuming the economy doesn't tank and continues to grow well and he pursues inefficiencies, it's possible that he would be able to find savings from within the budget," she said.

De Blasio's transition team greeted the news gingerly.

"We're reviewing the budget modification released by the mayor today, and remain concerned about the continued impact of sequestration [federal spending curbs set by Congress], high uncertainty around the flow of Sandy recovery aid, and the liabilities from unresolved labor contracts," spokeswoman Lis Smith said. "We will continue to review this new budget information closely in the coming days and weeks."

All 152 open labor contracts have expired under Bloomberg, and unions are demanding retroactive raises, some dating back years.

Bloomberg has warned that granting back pay would blow an $8 billion hole in the budget.

But the no-gap budget projection opens up room for creative compromises, such as work-rule changes or one-time lump-sum payments, said Doug Turetsky, chief of staff of the Independent Budget Office, a city-funded budget reviewing agency.

Municipal unions yesterday complained that Bloomberg achieved balance by shortchanging their members.

"Part of the reason this budget is balanced is that it relies on hundreds of thousands of city workers taking wage freezes for the past several years," said Hector Figueroa, president of 32BJ SEIU, which represents about 5,000 public school cleaners. "Bloomberg basically balanced the budget on their backs."

Said United Federation of Teachers head Mike Mulgrew: "This is a classic Bloomberg budget game" -- lowballing revenue projections, overestimating expenses and then taking credit "for the magical appearance of a surplus."

With Ivan Pereira of amNewYork

More news