That was fast. Last Thursday, Mayor Bill de Blasio informed the United Federation of Teachers that the city couldn’t afford a $900 million bonus for union members. It took 24 hours for the union to knock this threat down — and wring a better deal from out-of-work taxpayers.
The state must step in.
How did New York City end up on the hook for a near-billion-dollar payment during the worst fiscal crisis ever?
You can thank de Blasio. In Mayor Mike Bloomberg’s final term, the global economy melted down — and Bloomberg told teachers that if they wanted raises, they would have to pay for them through work-rule or benefits changes.
The teachers waited Bloomberg out, and de Blasio delivered in his first six months. He offered a contract that included $3.6 billion in back pay.
Only problem: The city didn’t have $3.6 billion. The “thinking”: The city would surely have the money by, oh, say, October 2020. The city stretched out the payments over the six years, with payments getting bigger the further into the future they got.
Only other problem: State law forbids New York City from borrowing for day-to-day operating expenses, let alone borrowing for past operating expenses. And this is what this was. Consider: If you ask your neighbor to paint your house but tell him you can’t pay him for 12 years, don’t you owe him money? That’s debt.
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