Mayor Michael Bloomberg will unveil his Fiscal Year 2013 Executive Budget tomorrow at noon that will show the city’s economy and tax revenues continuing to grow relative to last year, but with significantly less money than was predicted last February.
Combined with increased costs, there is now a $495 million hole in what was Mr. Bloomberg’s preliminary budget plan for 2012 and 2013, a fact that mean for some difficult negotiations with the City Council over the coming days and weeks.
However, the financial pain won’t be as bad as it appears, as most of the hole will be filled by CityTime’s settlement with Science Applications International Corporation.
“The Mayor has spent the last decade diversifying the city’s economy because the financial markets will always have ups and downs. Our efforts have paid off, with growth and job creation in non-finance sectors like tourism, tech and TV production, which softens the blow from the drastic drop in Wall Street profits,” Mr. Bloomberg’s spokesman, Stu Loeser, said in a statement. “New York City has the strongest social safety net in country and those costs continue to rise as many families need help, and we’re going to make sure that New York remains first in the nation with a helping hand.”
The bulk of the $459 million $352 million in tax revenue, which Mr. Bloomberg’s administration attributed to volatility in global credit markets. Additionally, there was a $143 net increase in projected costs running city agencies.
Now onto the negotiation fight!