New York State Comptroller Thomas P. DiNapoli issued the following statement on Mayor Adams’ preliminary budget proposal:
“Mayor Adams presented his first budget proposal as New York City continues to recover from the pandemic and faces an uneven economic recovery. The city’s outlook has improved, thanks to good fortune and more proactive planning, but it can do more to prepare for continued uncertainty and increase its reserves.
“A year after the city budgeted for its largest-ever drop in property tax collections, a remarkable turnaround in property values has emerged. The provisional property tax rolls are now above the record level of 2021, three years earlier than expected. The city is cautiously projecting an additional $848 million in property tax revenue per year, given the state of the commercial real estate market and potential tax appeals. Wall Street profits are also expected to top 2020 record highs and contribute to higher non-property taxes in fiscal 2022.
“At the same time, restarting the Program to Close the Gap (PEG) could generate nearly $2 billion in savings in fiscal years 2022 and 2023. The majority of the savings come from operational expenses and significant vacancies in major agencies, two opportunities I have highlighted in recent months Stronger-than-expected revenue and actions taken this year will see the city generate a projected surplus of $3.7 billion in fiscal year 2022 .
“While outer year budget variances will average more than $2.6 billion, close to November forecast levels, the plan begins to address more than $1.4 billion of risk my office has raised, including fair fees, charter school tuition, and school transportation expenses. The city also eliminated a $500 million annual risk from unidentified labor savings beginning in fiscal year 2023, allowing it to focus on managing its expired contracts, which now cover about half of its represented workforce. Risks from fiscal cliffs that will begin when one-time federal aid runs out remain a concern.
“I have also asked the city to strengthen its reserve levels. This budget takes a small step in that direction, increasing the general reserve by $55 million in fiscal year 2023, and still includes a planned deposit of $500 million in its rainy day fund More can be done at the end of the fiscal year and the city’s budget surplus is likely to exceed currently projected levels.
“My office will release a full analysis of the budget and financial plan in the coming weeks.”
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