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New York City Needs to Slash Its Spending — or Face Receivership

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New York City Needs to Slash Its Spending — or Face Receivership

New York Post April 28, 2020
Urban PolicyTax & BudgetNYC

Mayor Bill de Blasio and the City Council aren’t in charge of the city’s proposed $93.5 billion budget. Gov. Andrew Cuomo and the Legislature are. The mayor’s first attempt at post-corona budgeting, two weeks ago, was a dud — so the City Council has two months to prove that it can be fiscally responsible. If City Hall can’t come up with a balanced budget by July 1, the state will have to step in — to avoid a repeat of the 1970s.

In the seven weeks since New York City went on lockdown, Hizzoner has shown no indication that he understands the fiscal ­severity. In January, he proposed a pre-corona budget calling for $73.9 billion in city-funded spending, 31 percent higher than the final Bloomberg budget, three times the inflation rate. (The rest of Gotham’s spending comes from federal and state grants.)

Post corona, the mayor proposed more than $3 billion in cuts, but spending will still be 26 percent higher than in 2014.

The mayor’s proposed budget for the fiscal year that starts July 1 is far from balanced, as required by state law.

The mayor “balances” the budget first by low-balling the revenue loss from the lockdown. The city estimates the loss at $7.4 billion over two years. But with more than 625,000 job losses — 15 percent of the private-economy total — the city is likely to see tax revenues fall by 20 percent, or $13 billion.

Continue reading the entire piece here at the New York Post

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Nicole Gelinas is a senior fellow at the Manhattan Institute and contributing editor at City Journal. Follow her on Twitter here.

Photo by William Farrington-Pool/Getty Images

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