Issue of the Week
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The Budget

14 May 01

by Mark Berkey-Gerard

Recently, 250 high school students gathered in midtown for a mock debate of real issues in the city budget sponsored by Citizens Commission for Children. One of the questions debated was: "Should the city spend $50 million on policing quality-of-life initiatives while cutting $20 million from youth services?" Michael Williams, a 16-year-old from Bronx Leadership Academy, made a strong case for the Mayor's position of giving more money to police, arguing that the city's economy was closely linked to the crime rate. But Williams clinched his argument by breaking into song. He did a short rendition of "We Are the World," apparently to show his compassionate side. This drew applause, cheers, and a narrow margin of victory.

When asked what he learned from the debate, Williams (who admitted that he would rather have argued the other side) said, "I learned that I could change people's minds with my presentation."

This insight is being played out right now at City Hall where the annual budget "song-and-dance" is in full swing.

In late April when Mayor Giuliani introduced his Executive Budget, he stopped short of breaking into song, but did provide a multimedia slide show and enough charts and graphs to dizzy even the most attentive observer. The Mayor's budget is a $39 billion plan that cuts spending by $150 million and calls for $525 million in tax cuts. His perennial project, new baseball stadiums, also made it into the mix at an estimated $573 million over the next three years.

Council Speaker Peter Vallone's alternative budget released earlier in March called for $155 million more than Giuliani for libraries, parks, and cultural institutions, $548 million more for education, and more moderate tax breaks targeted toward the middle and working class.

This week, the Mayor, Speaker, and City Councilmembers (or their staffs) are expected to lock themselves in a room and put together a compromise plan for 2002 that the full Council must vote on by the end of June. If the final product is similar to past years, the Council will restore an additional $120 to $160 million in services that the Mayor has cut, and some middle ground will be found on the proposed tax cuts.

But this year, two elements make the process more complex. First, it is an election year and the candidates are making promises to everyone from schoolteachers to real estate developers. Second, and perhaps more essential to the future of the city, is the threat of tough economic times ahead.


Should the city plan for new jail beds when the prisoner population is at the lowest point since the late 1980's? Should the Health and Hospitals Corporation close down 27 neighborhood clinics in order to get out of the red? How big of a tax cut is too big?

These are the specific issues -- from arts to housing to youth services -- that are being debated at City Hall. Click here for the breakdown.

And these are the issues the lobbyists, non-profit groups, and public are most concerned about. Each wants to make sure that their specific projects get into the $39 billion dollar mix.

"This is the main thing we do that really impacts the people of the city," said Harlem Councilman Bill Perkins.


In an election year, everyone adds his or her "two cents" to the budget discussion. And the mayoral hopefuls are the most outspoken.

Council Speaker Vallone wants the State Legislature and Governor to abolish the Board of Education as part of the funding equation. He also hopes he can add a substantial tax-cut to his record. City Comptroller Alan Hevesi (who is the only candidate so far to say that taxes may need to be raised to pay for improved education) called the Mayor's budget irresponsible and released a report that said it would leave the city with large deficits. Public Advocate Mark Green said this budget is "less economic-based than it is politically based." And Bronx Borough President Fernando Ferrer said he wants to raise teachers' salaries by 30 percent and promises to divert funds into neighborhoods.

Mayor Giuliani, who is leaving office in seven months and is looking to solidify his legacy, has threatened to veto any budget that does not meet his tax cut goals. He also included a host of large capital projects for cultural centers and museums in his plan.

For City Councilmembers, this year's budget presents specific challenges attached to the dollar figures. The Mayor has proposed the largest investment in housing in nearly a decade, but the increase is contingent on the City Council passing controversial rules to ease building regulations.

And the Councilmembers must pay close attention to the after-school programs, health services, and new construction projects that are the primary concern of constituents in the district.

Two of the most visible groups of city workers -- 40,000 police and 60,000 teachers -- have been working without contracts for months and are negotiating for salaries on a level with suburban pay scales. Last week, when members of the United Federation of Teachers clogged five city blocks to demand for a new contract, the candidates were there as well, saying they were the one best suited to do the job. Just where the money will come is still being debated.


Most of the talk around the budget involves the notion that New York's economic boom is coming to a quick end.

The city has ended each of the last five fiscal years with budget surpluses of $1 billion or more. Many experts, including the Independent Budget Office, the city agency that estimates revenues and expenditures independently of the Mayor and City Council, say that the days of surpluses may be coming to an end. In fact, the Independent Budget Office has estimated that gaps in the proposed budget could swell from $374 million in 2002 to $3.3 billion by 2003, and $4.9 billion by 2005.

"These gaps are too large to simply grow-out, and will pose a significant challenge to the Mayor and City Council - and their successors - as they strive to close them," said IBO Director Ronnie Lowenstein.

Each party involved - the Mayor's office, the City Council, the Independent Budget Office, and non-profit watchdog groups - often come up with different numbers. What should be cut and what should be added to the fourth largest government budget in the country (after only the federal, California and New York State budgets), then comes down to the art of selling the numbers.

In the next weeks, the Mayor and the City Council will be trying to convince the public that their numbers add up.

"We must assure the public that the process is transparent, responsible, and has the appropriate checks and balances," said Councilmember Perkins. "In the end, we will have to address budgetary problems that are not our creation and we will suffer the political consequences."

With so many numbers and so many campaign promises, even a 16-year-old knows that in some cases, the presentation as is important as the issues themselves.


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