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Budget Watch Continues (UPDATE)
June 26th, 2008

So Mayor Michael Bloomberg’s schedule this morning is centered on the city’s new aqua-exhibit, sending him zipping around the a.m. broadcasts.

But maybe he might be able to squeeze in a budget announcement later this afternoon following a courtesy visit with Nobel Laureate Dr. Rajendra K. Pachauri, chairman of the Intergovernmental Panel on Climate Change.

The News reports that there was a tentative compromise on cuts to the Department of Education, and the Politicker predicts a handshake could happen today or tomorrow.

Others are less optimistic.

Councilmember John Liu, who is outside of City Hall today tending to other obligations, said he doesn’t think there will be an agreement before the weekend. Liu said the city would likely reach an agreement on Monday to fulfill its legal requirements (the budget deadline is June 30 at midnight).

What’s at stake? Liu says everything is on the table, from libraries to parks, except education cuts. Those, he said, are nonnegotiable for the City Council.

These negotiations, he added, have been particularly tough this year.

“I would rather have three root canals,” said Liu. “It’s a torturous process that has too much rhetoric… It’s not enough money to take care of everyones wish lists or to even maintain the wish lists from last year.”

UPDATE: Members of the budget negotiating team are about to go behind closed doors to mull over the city’s finances some more.

While, I imagine, some may be getting gradually impatient, others don’t mind taking the time to make sure everything is done right. Before going into the meeting, Councilmember Gale Brewer said she likes the slow process, so every program and program cut can be checked and double-checked.

“I’m not interested in just cutting, and I care about the people,” said Brewer. “To me, it’s not the rush.”

Brewer said, right now, cuts will not be made to classrooms, but reductions to both libraries and the New York City Housing Authority are still up in the air.

By on June 26, 2008, 2:10 pm
In category: Economy,Education,Gotham City,Public Finance,Social Services | 4 Comments »

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4 Responses to “Budget Watch Continues (UPDATE)”

  1. Larry Littlefield Says:
    June 26th, 2008 at 6:56 pm

    “These negotiations, he added, have been particularly tough this year.”

    Wait until next year. Or in a worse scenario, not even until next year.

  2. Daniel Millstone Says:
    June 27th, 2008 at 6:46 am

    As I understand it, as through a glass darkly, it is the current multi-billion dollar surplus which makes Mr. Bloomberg’s proposed cuts so unpalatable — as well as on to whom the cuts fall. As we’ve often noticed, it’s those least able to bear costs on whose backs Mr. Bloomberg seeks to float his boat.

    Council Members who, in a time of demonstrated need might be willing to consider service cuts are reluctant at present when actual revenues in hand have not fallen off.

  3. Larry Littlefield Says:
    June 27th, 2008 at 8:54 am

    (Council Members who, in a time of demonstrated need might be willing to consider service cuts are reluctant at present when actual revenues in hand have not fallen off.)

    They’re going down, believe me. If the surplus allows the city to avoid catastrophe, they’ll be grateful a year from now.

    The counter argument is that the state will direct additional pain to the city to offset that surplus despite sacrifices already made here, to impose equal additional sacrifices compared with less responsible parts of the state. In effect redistributing the $4.5 billion to Long Island.

  4. Larry Littlefield Says:
    June 27th, 2008 at 9:47 am

    Here’s what I mean:

    “Lehman Brothers Holdings Inc. Chief Executive Officer Richard Fuld and President Herbert “Bart” McDade will forgo 2008 bonuses, the biggest chunk of their pay, after the fourth-largest U.S. securities firm reported its first quarterly loss since going public.”

    “I’d be surprised if other CEOs didn’t give up their bonuses this year…Fuld is preparing his guys for what’s coming for them. He’s setting an example because the troops will also get shrunk bonuses.”

    Can those losses be offset against future income, as they can on personal income tax returns? If so, we won’t be getting much in the way of corporate income taxes for a long time. The city and state budgets had become very dependent on money earned on Wall Street. Except that they didn’t really earn it, they merely got it, and they won’t be getting it any more.

    And that means in order to pay for pensions, retire health care, and debts, public services and benefits for the poor and moderate income people will be slashed, and taxes on the middle class will soar.

    And believe it or not, many other parts of the country will be even worse off. Lots of chickens coming home to roost.

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