Gotham Gazette http://www.gothamgazette.com/component/tags/tag/110 Thu, 22 Feb 2018 21:12:15 +0000 Joomla! - Open Source Content Management en-gb webmaster@gothamgazette.com (Webmaster) In Albany, De Blasio Budget Testimony Centers on MTA, NYCHA http://www.gothamgazette.com/?id=7460:in-albany-de-blasio-budget-testimony-centers-on-mta-nycha http://www.gothamgazette.com/?id=7460:in-albany-de-blasio-budget-testimony-centers-on-mta-nycha de Blasio Albany budget testimony

Mayor de Blasio testifying in Albany (Ed Reed/Mayor's Office)


Testifying in Albany Monday, New York City Mayor Bill de Blasio responded to Governor Andrew Cuomo’s $168 billion executive budget and outlined the city’s funding priorities for the next fiscal year.

De Blasio was the first to testify at a joint legislative budget hearing on local governments, making his annual journey to the Capitol, where he also met privately with Cuomo for an hour, and was scheduled to meet with three of five legislative conference leaders: Assembly Speaker Carl Heastie, Senate Majority Leader John Flanagan, and Senate Minority Leader Andrea Stewart-Cousins.

In his opening remarks, de Blasio had mixed reviews for Cuomo’s budget, praising some measures while also urging state legislators to help him beat back others as they negotiate toward a new state budget by the April 1 start of the fiscal year. The mayor outlined several of his own top priorities that require state approval, such as design-build authority, electoral reform, and renewal of the speed camera program.

The mayor’s initial testimony and subsequent back-and-forth with lawmakers included significant focus on transportation and housing issues, especially MTA funding and problems at the New York City Housing Authority (NYCHA), though de Blasio also touched on uncertainty coming from the federal government; criminal justice reforms and their connection to the closure of Rikers Island jails; and other fiscal and policy items.

De Blasio noted the burden placed on New York City by the Trump administration’s recently implemented tax plan, and acknowledged the steep impact of the termination of Disproportionate Share Hospitals (DSH) payments, which is expected to cost city hospitals $400 million annually.

“I want to commend the Governor for trying to find ways to blunt the effects of the new tax law and I look forward to working with him, and all of you, on solutions,” he said, adding that the upcoming Trump administration budget proposal is likely to pose additional fiscal challenges for New York City.

De Blasio also outlined more than $750 million in cuts and cost shifts to New York City contained in Cuomo’s executive budget proposal. These include $144 million in additional charter school costs, a $129 million cut to child welfare services, a $65 million cut to special education funding, $31 million less to juvenile justice programs, and a $9 million reduction in rental subsidies for working families leaving shelters. In addition, there is a $211 million gap between what the city was expecting in school aid and the amount designated in the executive budget, according to the mayor’s office.

The mayor criticized the implementation of “Raise the Age,” which requires that 16- and 17-year-olds be removed from adult jails, calling it an unfunded mandate that will cost the city at least $200 million per year. De Blasio noted the executive budget’s elimination of $41 million of state funding for the city’s Close to Home juvenile justice placement program, despite the fact the program’s utilization is expected to triple with the implementation of Raise the Age.

“This cut undermines the signature reform designed to keep kids closer to their families. And it will cost the City $15.3 million in Fiscal 18 and $31 million in Fiscal 19,” said de Blasio. The city’s fiscal year begins July 1, and de Blasio recently outlined his $88.7 billion preliminary budget plan.

De Blasio praised the governor’s inclusion of bail and speedy trial reforms in his executive budget. He said the passage of these measures would reduce the city’s jail population and help to accomplish one of his signature endeavors, “to close Rikers Island for good.”

When questioned about whether he could expedite the closure plan for the jail complex, which is currently seen as a ten-year project, de Blasio told Democratic State Senator Brian Benjamin, of Manhattan, that the passage of all of his policy objectives -- such as parole, speedy trial, and bail reforms, as well as design-build authority for the city -- would allow the city to shrink the timeline.

“Unquestionably, that would take years off the process,” said de Blasio, though he declined to provide an exact projected timeline.

De Blasio also emphasized comprehensive election reform and passage of the Dream Act, which provides tuition assistance to undocumented immigrants, citing threats to immigrants from the federal government. “Given what is happening in our country and New York State can lead by example by helping all of our students,” said de Blasio, speaking on the same day that the Assembly would pass the Dream Act for the eighth time. It continues to stall in the Senate.

On transportation, de Blasio repeatedly cited the “millionaires tax” he wants to see that would create a dedicated funding stream for the MTA and support reduced-price MetroCards for low-income New Yorkers. But he also acknowledged that congestion pricing could work as a revenue-generator for the ailing transportation system run by the MTA.

De Blasio said he was ready to continue conversations and negotiations about how to best support the state-controlled transportation authority, but said that proposals contained in Cuomo’s budget should be taken off the table. He did express support for the general congestion pricing principles put forth by Cuomo’s “Fix NYC” panel, but also indicated he wants to see tweaks.

De Blasio expressed concern that the money could potentially be diverted away from the subways and buses, suggesting a legal lockbox be created to restrict how congestion pricing revenue may be used. He also called for city approval for major transportation projects in the five boroughs.

The mayor took issue with the executive budget shifting the burden of MTA capital costs to the city, and battled with Senate finance Chair Cathy Young, an upstate Republican, over the 1953 law that specifies that city is responsible for all of the subway’s capital costs. While the city technically owns the subway system, the state has controlled it for more than 65 years.

“I absolutely disagree with your legal interpretation,” de Blasio said. “My counsel has looked at it too and has come to a very different conclusion…Let’s face it, the state has been running the MTA for decades now.”

The mayor criticized Cuomo’s “value capture” proposal, “that would grant the MTA the power to raid our property taxes on properties within a one mile radius of certain projects.” He said the proposal would cost the city billions of dollars and force the city to cut back on essential services like police, sanitation, and education.

“I was encouraged by the Governor’s recent comments that portrayed this as a choice for the city, not a mandate,” de Blasio said. “I would urge you to remove this provision from the enacted budget altogether.”

De Blasio made a similar argument about city services when asked by several lawmakers, including Young and Assemblymember Nicole Malliotakis, who lost to de Blasio in last year’s mayoral race, about capping property tax increases in the city. The city is the only area of the state not subject to a cap of 2 percent annual property tax growth. De Blasio, who again pledged that he is about to launch a property tax reform effort, has said that the city must continued to take advantage of increases in property tax values to fund city services.

De Blasio, who designated $200 million for new boilers and heating systems in public housing after thousands of residents suffered outages this winter, called for the state to commit to matching the city’s investment in NYCHA. He also complained that the state has taken months to fulfill a request from the city to allocate funds earmarked for NYCHA from two budgets ago. The city had itself delayed its ask for the funds by several months beyond when it could have filed the request.

The mayor was grilled intensely by lawmakers on his public housing record. Senator Diane Savino, of Staten Island and the Independent Democratic Conference, called the living conditions “deplorable.” In another testy exchange, Senator Young drew attention to lapses in lead inspections at NYCHA apartments, and reports that children living in these residences were found to have high levels of lead in their blood. The scandal has prompted calls for de Blasio to fire NYCHA Chair and CEO Shola Olatoye, including from Young on Monday. “Why is Shola Olatoye still at NYCHA?” Young repeatedly asked the mayor.

De Blasio acknowledged the mistakes but reaffirmed his previous statements, noting that the lapses began with the previous administration and credited Olatoye for turning the near-bankrupt housing agency around.

When Young pressed the mayor on issues at NYCHA, including unsafe conditions and crime that have “stacked up over the years,” the mayor responded tersely.

“Respectfully, I think it’s very reductionist to add certain facts up and say someone needs to be dismissed, even though they are getting a lot of work done for the people they serve. When you run a facility as big as NYCHA with years of disinvestment, of course there’s problems,” he said, adding that public safety has dramatically improved at NYCHA.

[Related: What's the State Role in NYCHA Oversight?]

During more than two hours of question-and-answer de Blasio was also asked about the financially-struggling public hospital system, where a new CEO has taken over who is promising to build on reforms already underway. The mayor was also asked to support supervised injection facilities for drug addicts and said that a city report is due back soon on the topic. He said it had to be very carefully dealt with.

While the mayor faced many tough questions, especially from Young, he also received a number of kudos, especially from city-based Democratic legislators, like Senator Liz Krueger of Manhattan, who said that you wouldn’t know from many of the questions that the city is actually doing quite well.

Later in the day, de Blasio met for an hour with the governor to discuss how to resolve transportation and fiscal challenges in the coming weeks and months.

“It was a productive meeting, we talked about a lot of the same issues that came up in the testimony and, you know, hopefully we can all work together,” de Blasio told reporters when he emerged from Cuomo’s office.

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by Rachel Silberstein, State government reporter, Gotham Gazette
     

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In Albany, De Blasio Budget Testimony Centers on MTA, NYCHA Mon, 05 Feb 2018 05:00:00 +0000
What's The [Data] Point? $88.7 billion, with Mara Gay http://www.gothamgazette.com/?id=7454:what-s-the-data-point-88-7-billion-with-mara-gay http://www.gothamgazette.com/?id=7454:what-s-the-data-point-88-7-billion-with-mara-gay whats the data point


What's The [Data] Point? Episode 29 -- $88.7 billion, with Mara Gay [You can download What's The [Data] Point? wherever you get your podcasts, including on iTunes]

Mara Gay Wall Street Journal

On Thursday, Feburary 1, Mayor Bill de Blasio unveiled his preliminary budget proposal for city fiscal year 2019, which begins July 1. On Friday, February 2, Mara Gay of the Wall Street Journal joined the podcast to break it down, discuss de Blasio's budgeting practices, and look ahead to the key policy and budget issues of the next few months. The budget, which calls for $88.7 billion in spending, will be the topic of hearings and negotiations over the next several months. De Blasio will also have to deal with federal and state budgetary decisions -- and he'll go to Albany on Monday, February 5, to testify at a state legislative budget hearing. We discuss it all on this episode.

Listen to the conversation and let us know what you think: Ben Max of GG (@TweetBenMax), Maria Doulis of CBC (@MariaDoulis) and guest Mara Gay (@MaraGay). Listen below or download wherever you get your podcasts!

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by Ben Max, Gotham Gazette
     

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What's The [Data] Point? $88.7 billion, with Mara Gay Fri, 02 Feb 2018 05:00:00 +0000
Under 'Threat' from D.C. and Albany, De Blasio Presents $88.67 Billion Preliminary Budget http://www.gothamgazette.com/?id=7455:under-threat-from-dc-and-albany-de-blasio-presents-88-67-billion-preliminary-budget http://www.gothamgazette.com/?id=7455:under-threat-from-dc-and-albany-de-blasio-presents-88-67-billion-preliminary-budget de Blasio budget presentation Feb 2018

De Blasio's Feb 2018 budget presentation (photo: Ed Reed/Mayor's Office)


As the state and federal governments continue to pursue policies that threaten the city’s fiscal future, Mayor Bill de Blasio again said he is investing in making New York City the “fairest big city in America” as he proposed spending $88.67 billion for the next city fiscal year, which begins July 1.

On Thursday afternoon, the mayor released his preliminary budget proposal for next fiscal year, which increases city spending by nearly $3 billion from the last time the current year’s budget was modified in November. The modified budget of $85.99 billion was itself a modest increase over the $85.24 adopted budget that was approved in June.

The mayor is proposing an additional $750 million in spending from what was previously projected for fiscal years 2018 and 2019 combined, all of which, he said, is offset by identified savings. He promised additional savings before the budget is adopted in June.

De Blasio’s guiding philosophy in his budget was his promise to make the city fairer. “The city becomes fairer when more kids get the start in life that only some families can afford right now. The city becomes fairer when people who built their neighborhoods up in good times and bad are able to stay in the neighborhood and in the city they love. The city becomes fairer when we reverse the decades-long neglect of public housing in this city. The city becomes fairer when we heal the wounds of the past and we build trust between police and communities through transparency. And the city becomes fairer when we care for New Yorkers who are too often left behind but they’re just as much New Yorkers as any of us,” he said. “These ideas permeate our budget process but it was always against the backdrop of having to be prudent, having to be fiscally responsible, again given the extraordinary level of uncertainty that we’re facing.”

In keeping with previous budgets, de Blasio proposed “strategic investments” in affordable housing, the New York City Housing Authority, the NYPD, tenant harassment safeguards, public health initiatives, criminal justice reforms, seniors and early childhood education.

De Blasio had already announced a few of the new spending initiatives prior to Thursday’s release. After having successfully implemented universal pre-kindergarten in his first term, the mayor hopes to expand the program to all three-year-old through the ‘3-K for All’ program, over the course of several years and with funding help from the state and federal governments. De Blasio had previously begun the program by funding it in two districts, which was then expanded. The preliminary budget proposal funds the program in four more districts -- for a total of 12 districts by 2020 funded at $46.4 million.

Additionally, the city is also increasing funding for anti-bullying efforts in schools to $8.2 million in the new budget, and through the separate capital budget, which funds infrastructure, the city will build four new pre-k locations, with $46 million in capital funding in the current fiscal year and $26 million in fiscal year 2019.

In a news conference on Tuesday, de Blasio said the NYPD would be moving up the rollout of its body camera program by one year, increasing funding from $5.9 million in fiscal year 2018 to $12 million in the fiscal year 2019 budget proposal, to ensure that nearly 18,000 patrol officers are equipped with the cameras by the end of this calendar year.

Responding to withering criticism over boiler failures at NYCHA developments which left residents without heat during a cold snap in the last few weeks, de Blasio recently pledged $200 million for capital upgrades and $13 million in direct spending for boiler repairs, which are included in the budget.  

The mayor also put another $750 million towards his affordable housing plan, the target for which was enhanced in recent months from 200,000 affordable units preserved and built by 2024 to 300,000 by 2026. The Department of Buildings will receive $5.2 million, up from $1.6 million currently, to prevent landlords from using construction to harass tenants. The city will also fund a $2.4 million pilot program in East New York to convert basement units into legal and functional apartments, which was agreed upon when the neighborhood went through a comprehensive rezoning in April 2016.

The budget proposal also addresses the criminal justice system by providing $1.54 million, up from $430,000, to expedite mental competence examinations of criminal defendants, and increase from $200,000 to $5.72 million to provide better services to incarcerated women and their families. Another $4 million will fund health screenings for detainees in jail diversion programs, an increase from $700,000.

Over the years, the de Blasio administration has repeatedly touted “historic” levels of reserve funding socked away for times of economic uncertainty, and the mayor continued in that vein on Thursday. The budget proposal includes $1 billion put away each year in the general reserve, $250 million annually in the Capital Stabilization Reserve (created by this administration to manage costs of capital construction) and $4.25 billion in total in the Retiree Health Benefits Trust Fund. De Blasio has indicated some reserves may have to be used not because of an economic recession but because of federal cuts to the city.

The new spending plan for 2019 also includes $900 million in savings between fiscal years 2018 and 2019 -- from a partial hiring freeze that was implemented last year, agency efficiencies and from savings in debt payments -- and also promises to identify another $500 million by the time the next iteration, the executive budget proposal, is released in a few months (The November modification similarly included $500 million in savings.)

All those funds may be more crucial than before with the city’s economy showing signs of slowing down coupled with actions by the Republican-led U.S. Congress, President Donald Trump, and the state government in Albany. “If all we had to think about was ourselves, this might be a much prettier picture,” de Blasio said Thursday, after touting the city’s economic success in recent years. Citing the federal and state budget challenges, he added, “I think I can safely say, we’ve never quite seen anything like this.”

While budget officials have yet to fully assess the effects of the “draconian” federal tax code overhaul that passed in December and other measures taken by the federal government, they estimate that the city risks losing as much as $700 million. The city’s ailing municipal hospital system, New York City Health+Hospitals, could face a $400 million cut alone, they estimate, if Congress does not restore Disproportionate Share Hospital funding which reimburses local hospitals for care provided to low-income and uninsured patients.

Federal tax reform also cost the city the ability to refinance debt on tax-exempt bonds, which local governments use to fund infrastructure projects. The change could mean an additional burden of $100 million for the city, while another $200 million in capital funding could be lost because the tax law also inadvertently reduced the value of a tax credit that encouraged private entities to invest in affordable housing. Additionally, the legislation capped the State and Local Tax (SALT) deduction that residents of high-tax states such as New York rely heavily on.

“A lot of these are double jeopardy dynamics,” de Blasio said. “Your taxes go up and your benefits go down. It’s a dangerous combination and I think we should not underestimate how all this may play out.” He also expressed concern about what the upcoming federal budget may hold for the city.

Governor Andrew Cuomo’s recent executive budget proposal for the state’s next fiscal year, which begins April 1, makes the situation more precarious by including about $400 million in cuts and cost shifts, de Blasio said. De Blasio pegged the “total potential risks from Albany: at “over $750 million” while also questioning limited growth in the governor’s proposed school aid and saying that he is not even included MTA-related cost-shifts that Cuomo is pursuing.

The Cuomo administration pushed back after the mayor's presentation, claiming that the city is actually doing quite well vis a vis the governor's budget plan. “While closing a $4.4 billion gap, this year’s budget sends $16.5 billion in aid to the City– more than 40 percent of funding awarded to all local governments – and a half billion dollar increase over last year," said Morris Peters, a spokesperson for the state Division of Budget, in a statement. "The state’s budget includes a $248 million increase in school aid, $212 million more for the state takeover of Medicaid, and $60 million in additional tax revenue – calling this significant increase a cut is disingenuous and the City should check its math.”

Fiscal watchdogs and independent monitors have generally praised the city’s financial management under de Blasio, but some have repeatedly warned that the city is not putting away sufficient rainy day funds and that ballooning costs from a massive expansion of city government has not been met with adequate cost-saving measures. With this newest budget proposal, the city’s spending will increase by almost $16 billion in comparison with the last budget modification under former Mayor Michael Bloomberg, which was $72.7 billion in November 2013.

“New York City’s Preliminary Budget for Fiscal Year 2019 continues the ‘wait-and-see’ approach of the previous budget update in November,” said Citizens Budget Commission President Carol Kellermann, in a Thursday statement, “it neither addresses issues spawned by the recently enacted federal tax law and possible budget cuts nor pending State actions that could reduce resources available for city services. Most importantly, no additions will be made to the City’s reserves.”

Kellermann credited the fact that “the cost of new agency needs will be offset by the Citywide Saving Program,” but said the “program relies too much on dwindling debt service savings, and State and Federal reimbursement and not enough on making government more efficient. Before the going gets tough, the Mayor should get going by limiting spending growth, bolstering the savings plan, and adding to reserves.”

CBC wants to see the city do more to build reserves and to alter the capital budget plan to account for new fiscal realities. “Spending growth continues to surpass inflation and the finances at H+H and NYCHA remain precarious,” Kellermann said of the public hospital and public housing systems.

Over the next few months, the preliminary budget proposal will be evaluated by the City Council in dozens of hearings where administration officials and city agency heads will testify. After the Council issues its formal response, the mayor will release his executive budget, which will also undergo another round of hearing before negotiations move behind closed doors.

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by Samar Khurshid, City government reporter, Gotham Gazette
     

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Note - this article has been updated.

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Under 'Threat' from D.C. and Albany, De Blasio Presents $88.67 Billion Preliminary Budget Thu, 01 Feb 2018 05:00:00 +0000
What’s The [Data] Point? $14.3 Billion, with Robert Mujica and Dean Fuleihan http://www.gothamgazette.com/?id=7438:what-s-the-data-point-14-3-billion-with-robert-mujica-and-dean-fuleihan http://www.gothamgazette.com/?id=7438:what-s-the-data-point-14-3-billion-with-robert-mujica-and-dean-fuleihan whats the data point


What's The Data Point? Episode 28 -- $14.3 Billion, with Robert Mujica and Dean Fuleihan [You can download What's The [Data] Point? wherever you get your podcasts, including on iTunes]

robert mujica cbc panel jan23

State Budget Director Robert Mujica and New York City First Deputy Mayor Dean Fuleihan spoke at a CBC event on Wednesday, January 24 to discuss the implications of the recently-passed federal tax reform on the state and city. Mujica and Fuleihan discussed how the state and city are responding, with a great deal of budget fallout to come. Ben and Maria were there and provide an intro and brief discussion of the speeches, and this episode then brings you the full remarks from Mujica and Fuleihan, with enlightening audience Q&A after each. You can also catch the video of the entire event, which included two-panel discussions, at the CBC website.

Listen to the conversation and let us know what you think: Ben Max of GG (@TweetBenMax), Maria Doulis of CBC (@MariaDoulis). Listen below or download wherever you get your podcasts!

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by Ben Max, Gotham Gazette
     

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What’s The [Data] Point? $14.3 Billion, with Robert Mujica and Dean Fuleihan Thu, 25 Jan 2018 05:00:00 +0000
'Open Budget,' Economic Development Transparency Bills Become Law http://www.gothamgazette.com/?id=7346:open-budget-economic-development-transparency-bills-become-law http://www.gothamgazette.com/?id=7346:open-budget-economic-development-transparency-bills-become-law de Blasio public hearing City Council bills

De Blasio at a public hearing (photo: Ed Reed/Mayor's Office)


Four government transparency bills that were passed by the City Council on October 31 aged into law on Friday, having gone 30 days without any action in favor or against them by Mayor Bill de Blasio. The bills all relate to increased disclosure by the administration of billions in city government spending and have been praised by good government advocates.

Among the bills was one that requires the administration to publish annual budget documents in a user-friendly, machine-readable format to the city’s online Open Data Portal, allowing the public easier access to information that is currently listed in thousands of line items in the $86 billion city budget. The bill’s lead sponsor was Council Member Ben Kallos.

The three other bills -- with lead sponsors Council Members Helen Rosenthal, Dan Garodnick, and Corey Johnson -- formed a package aimed at improving transparency at the Economic Development Corporation, a city-run entity that manages and promotes the administration’s job-creation and business-development initiatives. The bills allow the City Council added oversight of EDC, which provides many millions of dollars in financial benefits to projects and businesses each year and also handles the sale and lease of city-owned land. They mandate that EDC provide fiscal impact statements and job creation estimates for projects receiving financial assistance; require EDC to detail their efforts to clawback funds from those agreements that fail to meet their goals; and allow the City Council time to review and comment on proposed economic development agreements.

“These new City laws will make it much easier to understand both the big picture of how the City is spending money and the specifics of hundreds of millions of dollars in subsidy deals the City makes with businesses,” said John Kaehny, executive director of Reinvent Albany, a good government group, in a statement Friday. “It will be much easier to see if the taxpayer is getting a good deal. These new laws are a blueprint for what the state should do.”

The City Charter provides that if the mayor takes no action on a bill after it is approved by the City Council, within 30 days, it automatically becomes law. In fact, it’s “pretty common” for bills to age into law without the mayor’s signature, said mayoral spokesperson Freddi Goldstein, in an email on Friday. She added that if the mayor signed every bill, “we’d be doing bill signings like every day.”  

Goldstein noted that out of the 25 bills passed by the Council on October 31, all but one aged into law. The only one the mayor signed was Council Member Rafael Espinal’s bill to repeal the city’s antiquated Cabaret Law, which used to require establishments to obtain licences from the city to allow dancing. De Blasio signed the bill on November 27 at Elsewhere, a popular nightclub in Brooklyn.

Often, the mayor holds bill-signing ceremonies at City Hall, affixing his signature to numerous bills at a time. At one such ceremony on October 16, for instance, de Blasio signed a dozen bills into law. “It’s really just a timing thing,” Goldstein said in a later email, estimating that perhaps close to 100 bills have similarly lapsed into law in de Blasio’s first term.

City Council spokesperson Robin Levine declined to comment for this article.

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by Samar Khurshid, City government reporter, Gotham Gazette
     

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'Open Budget,' Economic Development Transparency Bills Become Law Fri, 01 Dec 2017 05:00:00 +0000
Amid Ongoing Uncertainty, De Blasio Makes Modest Budget Adjustment http://www.gothamgazette.com/?id=7330:amid-ongoing-uncertainty-de-blasio-makes-modest-budget-adjustment http://www.gothamgazette.com/?id=7330:amid-ongoing-uncertainty-de-blasio-makes-modest-budget-adjustment bdb budget presentation

De Blasio during a budget presentation (photo: Mayor's Office)


Mayor Bill de Blasio will release the mandated November budget modification on Tuesday, showing minor adjustments to the city’s nearly $86 billion budget for the current fiscal year, which runs through the end of June.

Spending for fiscal year 2018 (FY18) will be projected up from the $85.24 billion agreed upon by de Blasio and the City Council in June to $85.99 billion, according to the mayor’s office. The increase is largely due to more federal funding coming to the city for recovery from Superstorm Sandy and Homeland Security grants.

Otherwise, the budget adjustment includes a variety of new spending by the city and several areas in which the city is marking additional savings, according to the mayor's office. The city is projecting a $207 million reduction in city tax revenue, mostly in business taxes, while there is a projected increase in property tax revenue that will partially offset those shortfalls. The city budget has grown quickly under de Blasio and other November modifications have included larger increases in spending. The minimal nature of this mid-fiscal year adjustment appears indicative of the level to which de Blasio has funded his programs and priorities and the ongoing questions surrounding federal policies.

The November Plan, as it is known, will not reflect potential federal cuts or the possible effects of federal tax reform plans currently being debated, nor will it show any major new city spending.

"We came into office four years ago promising to bring opportunity to those who had been left without for so long. Today, we're on track to invest more in affordable housing than any administration in decades, we've created an entirely new grade and, bringing police and community together, we've seen the lowest crime rates in history,” de Blasio said in a statement. “While we will continue to provide for New Yorkers however we can, we must do so thoughtfully and strategically while the threat of funding cuts from Washington continues to loom."

The plan will show the addition of $47 million in city funds for FY18, largely for agency spending and an increase in pension contributions. The de Blasio administration says that the increases are more than offset by savings related to health care costs, debt service, and agency adjustments. While overall expenditures are projected to increase by $747 million, the FY18 budget remains balanced, as it must.

New spending highlights provided to Gotham Gazette by the mayor’s office include $7 million to upgrade the city’s 311 system and other major projects supported by the Department of Information Technology and Telecommunications; $4 million for sending supplies and city works to Puerto Rico to assist with hurricane recovery; $4.5 million to develop a construction site safety program; and $10 million for creating the new procurement system, PASSport. There is also $7.5 million to reflect additional costs from new collective bargaining agreements with certain employees at the Department of Environmental Protection.

The modification does not include any significant additional expenditures toward fighting homelessness or any of de Blasio’s other major priorities, like expanding pre-school to three-year-olds, closing the Rikers Island jails, or spurring 100,000 good-paying jobs over ten years.

Some of the agency savings outlined in the modification include the Department of Transportation saving $400,000 by using less expensive video cameras and computer analysis contracts for projects where manual traffic surveys are insufficient and the Financial Information Services Agency saving $500,000 due to lower maintenance of new computer equipment, according to the mayor’s office.

The November Plan will show $59 million in additional projected spending for FY19. The FY19 budget process will kick into gear in January when the mayor releases his preliminary budget. Hanging over the current and next city budgets are potential changes in state aid to the city and a great deal of uncertainty in terms of federal aid and policy out of Washington D.C. The city budget has grown about 18 percent under de Blasio, up to the nearly $86 billion now projected for this fiscal year, in large part due to increases in the city personnel headcount (thousands more teachers, police officers, and others) and additional programmatic expenditures (including related to homelessness and other social services, where expenditures have increased dramatically).

The budget adjustment does not reflect any federal cuts, as most of what has been proposed in Washington, D.C. has yet to come to fruition. The high-profile threat to city taxpayers that is the proposed reduction of state and local tax (SALT) deductions from federal tax filings is still being debated in Washington and around the country. De Blasio, a recently reelected Democrat, is working to fight the proposed tax reforms, which are being pushed by President Donald Trump and many of his fellow Republicans in Congress. Even if there is significant reform to SALT, it would not cut federal funding to the city. It would, however, put additional financial stress on many city taxpayers, whose overall tax burdens would increase, in some cases significantly. This stress would likely lead to calls for reductions in city and state taxes, which could lead the city to lower taxes under its control and thus have less revenue to spend.

De Blasio’s prior November Plan budget modifications were more significant in scope -- his first, in November 2014, showed almost $2 billion in additional planned expenditure, largely having to do with federal Sandy aid, as well as tens of millions of dollars in added spending on de Blasio priorities like NYPD retraining of officers, cutting greenhouse gas emissions, and a rental assistance program for domestic violence survivors.

Upon release of this November Plan, the City Council will review the budget adjustments and is expected to vote them through.

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by Ben Max, Gotham Gazette
     

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Amid Ongoing Uncertainty, De Blasio Makes Modest Budget Adjustment Mon, 20 Nov 2017 05:00:00 +0000
De Blasio's Record on Budgeting and Fiscal Health http://www.gothamgazette.com/?id=7300:de-blasio-s-record-on-budgeting-and-fiscal-health http://www.gothamgazette.com/?id=7300:de-blasio-s-record-on-budgeting-and-fiscal-health de Blasio city budget

De Blasio during a budget presentation (photo: Michael Appleton/Mayor's Office)


This article is part of a series on Mayor de Blasio's first term record as he seeks reelection this fall, in partnership with WNYC radio and City Limits. Find all pieces of the series here.

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Mayor Bill de Blasio inherited a city with a healthy economy and strong tax revenues, allowing him to add billions in new spending for his priorities and increase the size of city government while also saving substantial funds for a rainy day. Though fiscal monitors and budget experts generally agree that the city’s budget has been handled responsibly, they are cautious about the future. This is a mayor who has encountered few budgetary challenges, and numerous loom on the horizon, from slowing economic growth to federal policies that threaten to create a sharp financial crunch. There are also ongoing financial crises at the city’s public housing authority, NYCHA, and public hospital system, New York City Health + Hospitals.

As de Blasio seeks a likely reelection on Tuesday, budget watchdogs warn that the incumbent Democrat might face his biggest tests in a second term, to which there are no easy solutions.

Under de Blasio, the city’s operating budget grew to $85.2 billion for fiscal year 2018, an increase of $12.5 billion or 17.2 percent from the last budget that was modified under Mayor Michael Bloomberg. Much of the new spending has come from an increase in the municipal workforce. The administration has added more than 31,000 employees in de Blasio’s first term for a total headcount of about 328,267 full-time and full-time equivalent employees, the highest it has ever been. That number is expected to grow to 329,055 by the end of the fiscal year on June 30, 2018. These new employees also come with future obligations in terms of pension and health care costs.

The administration has simultaneously put aside what the mayor and others often refer to as “historic” levels of reserves. This includes $1 billion each year in the general reserve, $250 million each year till 2021 in the capital stabilization reserve, and $4 billion in the Retiree Health Benefits Trust fund. Those reserves added up to a $9.8 billion or 11.1 percent budget cushion (reserves as a percentage of adjusted expenditures) at the start of fiscal year 2018, according to City Comptroller Scott Stringer’s report on the adopted budget. Stringer noted that the cushion remained at the same level as fiscal year 2017 since increased savings were matched by expenditures. He recommended an optimal cushion of between 12 and 18 percent, and has emphasized that the administration needs to create more savings through efficiencies at city agencies.

De Blasio has eschewed targeted cost-efficiency initiatives at city agencies, which were a signature of previous administrations. He has opted instead for a voluntary Citywide Savings Program which identifies savings at agencies, more often through re-estimates of expenditure rather than efficiencies. He recently announced a partial hiring freeze at city agencies, though some see this as something of a gimmick given how many employees he’s already allowed to be hired.

“My broad assessment is that [de Blasio] and budget director Dean Fuleihan have done an excellent job of managing the city budget,” said James Parrott, director of economic and fiscal policy at the New School’s Center for New York City Affairs. “They’ve been fortunate that the revenue situation has been accommodating to an ambitious agenda and they’ve been fiscally responsible to build reserves.”

In keeping with his progressive agenda, de Blasio has massively increased funding for social services and related to homelessness, education, public safety, and mental health services, among other major investments.

The combined budgets for the Departments of Homeless Services and Social Services increased to $11.5 billion in the fiscal year 2018 budget, up from $10.6 billion in the modified fiscal year 2014 budget that de Blasio inherited from Bloomberg. Department of Education spending increased by $4.4 billion in the same period, owing in large part to the implementation of universal pre-kindergarten and its planned expansion to three-year-olds. NYPD funding increased by $600 million, largely from the hiring of 1,300 more officers, while the Department of Corrections saw a nearly $340 million increase in its budget despite a continued drop in the city’s jail population.

“I think we're in a sustainable position,” de Blasio told the New York Daily News editorial board in an interview last month. “I think it also interacts. I think the investments we're making are strengthening our tax base. Safer city, better schools, stronger tax base. So it works. It's not limitless. You're absolutely right. It's not like you can just add all the time. There's a point -- and we'll have to watch Washington in particular very carefully – there’s a point where we may have to make tough decisions. But to date, I feel they've been responsible, and thank god, and I knock on wood as I say it, the economy continues to cooperate.”  

Parrott noted that the administration’s strongest achievement, begun early in 2014, was the settling of 99.1 percent of expired municipal labor contracts, which provided thousands of employees with retroactive raises and dispelled significant uncertainty about how the administration would handle a “daunting challenge” in a fiscally prudent manner. “That was an amazing feat,” Parrott said. “He gets four gold stars just for that, even if he hadn’t done anything else.”

But, with an increase in the employee workforce and the new union contracts, the city also added significant long-term funding obligations. The last budget under Bloomberg predicted that salaries and wages would be about $26.3 billion in fiscal year 2018, while latest estimates show them to be about $1 billion higher. In total, the city will spend about $47 billion in salaries, wages, pensions and benefits for the city’s workforce this year, increasing to $52.5 billion by fiscal year 2021. (The city’s pension contributions are estimated to be about $9.57 billion this year and are expected to grow to about $10 billion by 2021. City employees receive guaranteed pensions, funded by taxpayers, but the administration can do little to reform pension obligations since they are controlled by the state government.)

“I think he’s just been very lucky,” said Nicole Gelinas, senior fellow at the Manhattan Institute. “He’s had a good economy. He hasn’t had to make any decisions. He’s just increased spending on everything.”

“The mayor has not used the good times to make any reforms in government spending, particularly on health care costs for government workers,” she added. The city will bear $10.1 billion in the cost of health care benefits this year, which will grow to $11.7 billion by 2019, and Gelinas insisted that the mayor should look to reduce that cost in the current round of contract negotiations. “The city should really be thinking about how to bargain that workers pay some of the costs without putting the burden on taxpayers.”

Currently, city employees pay no portion of their health care premiums, a fact that has been a point of contention over time but de Blasio has not shown any interest in changing.

“I think it’s easy to be responsible when times are so good,” she added. “The real test will be if we have a recession. No two-term mayor has avoided at least a mild recession.”

Most experts agree that some form of slowdown will hit the city’s economy, which is currently in the ninth year of an unprecedented expansion. Gelinas warned that though the city has reserves set aside, “it’s kind of easy to run through those.” In the 2008-2009 recession, she said, about $3 billion in tax revenue “sort of disappeared overnight.” In a similar situation, de Blasio would have to make some difficult choices, and signs of lower revenues are already evident. At the annual meeting of the State Financial Control Board in August, de Blasio said his administration had already projected a $416 million reduction in revenue in the 2018 fiscal year.

The biggest uncertainty the city faces is cuts in federal funding and changes in federal policy on health care, taxes and infrastructure, though those have all remained a nebulous since before budget season. Efforts by the Republican-led Congress to repeal the Affordable Care Act have repeatedly failed; and a tax overhaul currently making it’s way through the two houses faces bipartisan opposition over a proposal to change the state and local tax deduction, which is a boon to filers in high-tax states like New York. Should it pass, however, tax revenues in the city will take a major hit.

De Blasio made no significant adjustments for federal policies in his 2018 budget, insisting that the city periodically adjusts its budget to account for economic trends. The next budget modification is expected later this month. “We have an obligation and responsibility to provide New Yorkers with quality services now,” said Freddi Goldstein, a mayoral spokesperson on budget issues, in an email. “We cannot and will not let threats of cuts to federal funding that have yet to be realized deter us from strengthening New York’s future.” The city has been cautious in revenue estimates, and tax revenues are expected to grow at 4.5 percent over last year, in keeping with the administration’s plans.

Carol Kellermann, president of Citizens Budget Commission, a nonpartisan fiscal watchdog, echoed Gelinas’ assessment of the mayor’s fiscal management. “He hasn’t really been tested in terms of fiscal policy,” she said, “because times have been so good so he hasn’t had to exercise as much restraint as CBC would’ve liked.” CBC gave the mayor’s last budget “mixed marks” over the growth in employee headcount and compensation costs.

Kellermann emphasized that many of the programmatic expansions made by the de Blasio administration are permanent and escalating in cost, making them harder to pare down in the future. “It’s very hard for public officials to cut back,” she said. “Every program has its constituency and it’s very hard to take those things away, and it’s very hard to layoff public employees.”

Both Kellermann and Gelinas also pointed out that the mayor has repeatedly touted the Retiree Health Benefits Trust fund as a reserve, even though it should be solely used to fund retiree health benefits and not in cases of a general shortfall.

The mayor has also significantly expanded capital investments to support his agenda. The ten-year capital budget increased by about $6 billion this year to $95.9 billion. The increase includes $1.9 billion in additional funding for affordable housing, $1.1 billion to create new borough-based jail facilities, $300 million to renovate 30 homeless shelters, among other investments. These investments also add to the city’s debt service -- the money spent to satisfy debt from borrowing each year -- which is $6.5 billion for fiscal year 2018, and is expected to grow to about $8.3 billion by fiscal year 2021. “If the interest rates go up, that’s gonna be a big burden down the road,” Kellermann said.

Assemblymember Nicole Malliotakis, de Blasio’s Republican challenger in the mayoral race, has repeatedly criticized the mayor’s ballooning budget and his “tax-and-spend” policies. At the first mayoral debate in the general election, on October 10, she attacked the mayor for the 300 new special assistants he has hired at City Hall, and his administration’s overall expenditure. “When we’re spending $15 billion more and we still have roads that are broken, we have subways that don’t run, we a homeless crisis, we have so many issues that are plaguing our city, then that is...the epitome of mismanagement,” she said, insisting that the city needs to streamline agencies.

She particularly noted the Department of Design and Construction’s consistent cost overruns for capital projects, which was a source of concern for the City Council as well when this year’s budget was adopted.

Two crucial areas where the city already faces a budget crunch, which would be further exacerbated by federal budget cuts, are NYCHA and Health + Hospitals. “These are two so-called independent authorities that all mayors, particularly this mayor, have forthrightly stepped forward to subsidize,” said Kellermann. “They were both meant to be self-sustaining and depend on federal revenue streams.”

NYCHA has a $17 billion capital backlog and though the mayor has made large capital investments -- including more than $1 billion to repair roofs at all NYCHA developments -- the agency’s woes are far from solved. The NextGen NYCHA plan has born some fruit, clearing the agency’s operating deficit for the first time in years, but progress would be threatened if the Trump administration follows through with funding cuts to the Department of Housing and Urban Development.   

NYC Health + Hospitals, the municipal hospital system, handles about 5 million patient visits each year and serves about 500,000 uninsured New Yorkers. But the cash-strapped hospital systems depends heavily on the city bolstering its finances. Even though the city has increased funding to the system from $1.3 billion in 2013 to $1.8 billion this year, Health + Hospitals projects an expected budget deficit of $1.6 billion in fiscal year 2019, growing to $1.8 billion by fiscal year 2020.

“[De Blasio’s] been hoping and saying that they will reinvent themselves into a new model, but it’s just not happening,” Kellermann said, referencing the city’s plan to overhaul the hospital system. “It’s the same thing with NYCHA. The [NextGen NYCHA] plan has the prospect of bearing fruit. But will it fill the $17 billion need? No...Both are open questions for which there are no answers at this point.”

Parrott, who recently co-authored a report on Health + Hospitals for the New York State Nurses Association, said the city’s approach to restructuring the system has been flawed since it only focuses on finances without taking into account the larger eco-system of healthcare. The city and state must work together, he recommended, to create an integrated system that involves private hospitals doing their fair share for a more equitable health care system overall.

“The testing of the ability to manage these things will come sooner or later,” said Kellermann. “He gets an incomplete,” she added about de Blasio’s budget record, “That’s the grade I would give.”

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This article is part of a series on Mayor de Blasio's first term record as he seeks reelection this fall, in partnership with WNYC radio and City Limits. Find all pieces of the series here.

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by Samar Khurshid, City government reporter, Gotham Gazette
     

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De Blasio's Record on Budgeting and Fiscal Health Sun, 05 Nov 2017 04:00:00 +0000
A More Transparent City, with A Page for Every Capital Project http://www.gothamgazette.com/?id=7288:a-more-transparent-city-with-a-page-for-every-capital-project http://www.gothamgazette.com/?id=7288:a-more-transparent-city-with-a-page-for-every-capital-project capital project dbalkin

Construction in Corona Plaza (photo via DOT)


Few things impact the lives of New Yorkers more than the city’s “capital projects.” These projects create, maintain, and improve the infrastructure New Yorkers use every day, including: streets, bridges, tunnels, sewers, parks, and so much more. In 2018, the capital budget will be $16.2 billion, approximately 17% the size of the city’s $85.2 billion “expense budget.” What are these projects? How can you find out about them? It’s not easy, but it should be.

The Capital Budgeting process is a complex endeavour. The City maintains a 10 Year Capital Strategy that it updates every two years, and an Annual Capital Budget that is passed every year by the City Council, and a Capital Commitment Plan that is prepared by the Office of Management and Budget (OMB) three times a year, which outlines precisely how and when funds are being allocated to agencies on a project by project basis. The Commitment Plan is the most interesting because it’s the closest to the reality of how the city is planning to spend our money. It comes in fourvolumes” of PDFs containing 2,162 pages of table after table of information describing nearly 10,000 different projects. Printing this out results in a stack of paper about one foot tall.

In 2017, why isn’t all this information in an easy-to-use spreadsheet or database? The only reasonable answer is that the city doesn’t want the public to scrutinize this information too deeply.

Fortunately, recent advances in technology have made it much easier to turn PDFs into spreadsheets, and spreadsheets into web applications. And that’s what I’ve done at projects.votedevin.com, where you can now find a web page for every single capital project, organized by agency and sortable by project’s cost. Of course, our ability to display useful information about projects is limited by the information in the capital budget reports - but there’s more than enough information to pique any budget conscious New Yorker’s interest.

Here’s an example: Project HBMA23216 from the DOT is a $312 million construction project for the “Promenade over FDR E81st - 90th St Bin 2232167.” That’s a lot of money for a promenade. By Googling the project’s name, description, and various internal codes (FMS Number, Budgetline and Commitment Codes) we can find a lot more information, like the RFP Notice, proposed architectural plans, and more.

As you browse the budget, sorting the most expensive projects by agency, more questions arise: Why does the City’s 311 system need a “Re-Architecture” that costs over $20 million this year? Why isn’t the press reporting the over $120 million in renovations planned for the Brooklyn Detention Center (search BKDC)? Why does the “Vision Zero Street Reconstuction” [sic] go from $2 million in 2018 to $100 million per year in 2021-2023?

I’m sure good answers exist for these and other, more probing, questions. These projects are, after all, funded by us taxpayers. Making this information more accessible would not only create more opportunities for civic engagement, it would also allow the public, journalists, academics, and others to serve as watchdogs, which might result in millions of dollars of identifiable cost savings.

A quick trip to the New York City Charter reveals that the City is required by law to document its capital projects in a very specific way. Presumably the City follows its Charter, which means this information exists, so shouldn’t the city share more of it? Cost shouldn’t be the reason we don’t have access to this information. If the City spent just 1/100th of 1% of the capital budget on public documentation, they could easily fund an exceptional website with a team of data organizers and content publishers who could keep it up-to-date.

What would that website look like? It would certainly have a lot more information than what the city currently publishes in its PDFs and on their “Capital Project Dashboard,” which offers very little additional information about the 189 “active projects over $25 millions.”

Imagine if the City maintained a web page for every capital project that contained all related public information: project status, project scope summaries, location on a map, lists of hired contractors and their fees, and an activity log so we, the people, could watch as projects move through their various stages. Now that’s the types of transparency we should expect from our city government!

Who has the power to make this information public? Certainly the Mayor's Office, but it's easy to see why it doesn't. The Mayor is responsible for directing the people and agencies leading  these projects, so creating more avenues for additional scrutiny, which could easily lead to bad press, is hardly a priority. Fortunately, New York City’s Public Advocate, which is an entirely independent office, has some statutory jurisdiction within the Capital Budget process and could force the city to better document the capital budget.

Section 216 of the New York City Charter states, “Upon the adoption of any such amendment by the council, it shall be certified by the mayor, the public advocate and the city clerk, and the capital budget shall be amended accordingly.” While I’m not a lawyer, it sounds like the Public Advocate could threaten to stop certifying amendments to the budget until the city releases a database of all capital projects with additional information to help New Yorkers better understand how their tax dollars are being spent.

That’s precisely what the Public Advocate should do, and as a candidate running for that position, I commit to making that demand when elected. It’s up to you, the public and the media, to ask other Public Advocate candidates how they’d use their oversight power over the Capital Budget. Will they also pledge to demand "A Page for Every Project"?

Until the city offers a page for every capital project, I’ll will keep updating projects.votedevin.com so New Yorkers can learn more about what the city does with our money. It’s a tough job but somebody’s gotta do it.

combo capital project

(image of the city's capital commitment plan vs. our website) 


Devin Balkind is a candidate for New York City Public Advocate. He is also the President of the Sahana Software Foundation, a nonprofit organization that produces the world’s most popular open source software platform for disaster management. On Twitter @DevinBalkind.

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Have an op-ed idea or submission for Gotham Gazette? Email opinion@gothamgazette.com

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A More Transparent City, with A Page for Every Capital Project Wed, 01 Nov 2017 04:00:00 +0000
What's The [DATA] Point? $95 billion http://www.gothamgazette.com/?id=7272:what-s-the-data-point-95-billion-opeb-debt http://www.gothamgazette.com/?id=7272:what-s-the-data-point-95-billion-opeb-debt whats the data point


What's The Data Point? Episode 17 -- $95 billion [You can download What's The [Data] Point? wherever you get your podcasts, including on iTunes]

thad calabrese

This week's data point is $95 billion, the current value of all of the future retiree benefits, except pensions, already earned by current retirees and current workers of New York City. This amount, referred to as OPEB, or "other public employee benefits," is primarily the cost of health insurance for New York City employees, their spouses and families. Thad Calabrese of the Wagner School at NYU joined Ben Max and Carol Kellermann to discuss the report he authored for CBC on OPEB debt and what to do about it, "The Price of Promises Made: What New York City Should Do About Its $95 Billion OPEB Debt."

Listen to the conversation and let us know what you think: Ben Max of GG (@TweetBenMax), Carol Kellerman of CBC (@cbcny), and special guest Thad Calabrese of the Wagner School at NYU. Listen below or download wherever you get your podcasts!

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by Ben Max, Gotham Gazette
     

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What's The [DATA] Point? $95 billion Wed, 25 Oct 2017 04:00:00 +0000
What’s The [DATA] Point? 95, with City Council Member Julissa Ferreras-Copeland http://www.gothamgazette.com/?id=7218:whats-the-data-point-95-with-city-council-member-julissa-ferreras-copeland http://www.gothamgazette.com/?id=7218:whats-the-data-point-95-with-city-council-member-julissa-ferreras-copeland whats the data point


What's The Data Point? Episode 13 - 95 with City Council Member Julissa Ferreras-Copeland [You can download What's The [Data] Point? wherever you get your podcasts, including on iTunes]

For this episode of the podcast, we were joined by City Council Member Julissa Ferreras-Copeland, who has chaired the powerful finance committee and is leaving the City Council at the end of the year. Ferreras-Copeland could have run for one more term, and was seen as a leading contender to become the next City Council Speaker, but decided not to seek reelection this year. She explains why on the podcast, part of a wide-ranging discussion about politics, the city budget process, and much more.

Listen to the conversation and let us know what you think: Ben Max of GG (@TweetBenMax) & CBC (@cbcny) & guest Julissa Ferreras-Copeland (@JulissaFerreras). Listen below or download wherever you get your podcasts!

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by Ben Max, Gotham Gazette
     

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What’s The [DATA] Point? 95, with City Council Member Julissa Ferreras-Copeland Thu, 28 Sep 2017 04:00:00 +0000