De Blasio and Mark-Viverito Shake Hands on a $82.1 Billion City Budget

The city reached a budget agreement earlier than usual.

Council Speaker Melissa Mark-Viverito and Mayor Bill de Blasio announce a budget agreement.
Council Speaker Melissa Mark-Viverito and Mayor Bill de Blasio announce a budget agreement.

Mayor Bill de Blasio and City Council Speaker Melissa Mark-Viverito shook hands today on a $82.1 billion city budget.

The negotiations preceding the agreement lacked the drama of the past two years, when the City Council was pushing for the big-ticket addition of 1,000 new police officers—something they accomplished last June. This year, the sticking points were considerably lower-profile, like a boost for summer youth employment the City Council had requested and was included in the deal announced today. The city will spend $39 million to provide 60,000 job slots this summer, up from 50,000 last year, and baseline the funding going forward.

The agreement comes weeks before the city’s legal deadline of June 30, the end of the fiscal year, and just a few hours before Mr. de Blasio leaves town for the weekend to attend his daughter’s college graduation. It was reached during daylight hours, which is unusual—the handshake, like the final vote on the budget, most often happens at night.

“How early is it?” Mr. de Blasio asked as he strolled down the steps of the City Hall rotunda with Ms. Mark-Viverito. Later, he answered his own question. “This is the earliest handshake since 2001, June 2001.”

The budget is not yet final: the Council will vote on it next week, but given today’s stamp of approval from Ms. Mark-Viverito and a horde of smiling council members who stood behind her and the mayor, it is just about guaranteed to pass.

In addition to the summer youth jobs, there are several other changes from Mr. de Blasio’s proposed executive budget—including an extra $250 million for the city’s Retiree Benefit Trust Fund for 2017, an effort to protect the city in the case of a fiscal downturn. Mr. de Blasio said the extra money for the trust fund was something that the Council had pushed for in the budget negotiations.

“This budget reflects months of hard-fought negotiations between the City Council and the mayor, and is a budget that New York City should be proud of,” Ms. Mark-Viverito said.

Even with additional programs added, this budget’s total is actually less than what Mr. de Blasio proposed earlier this year—thanks to what he said was $440 million in savings identified by city agencies, many of them coming from healthcare savings agreed to when city labor unions inked new contracts.

While Mr. de Blasio has often touted his savings and the fiscal responsibility of his budgets, they have vastly increased city spending—and earlier this year Council members pushed him to require more savings from city agencies to protect against an economic downturn.

While Mr. de Blasio’s administration did ask agencies, in letters, to find savings, he hasn’t instituted a Program to Eliminate the Gap, or a PEG, as prior mayors have done. Those often called for mandated cuts of a certain percentage for city agencies, and had their own budget category—making it easier to ensure the savings actually happened, and making it possible for Council members to track them. To that end, Finance Chairwoman Julissa Ferreras-Copeland has repeatedly pushed the administration to use the PEG model.

“At the end of the day, we want to see savings that we can follow, that we can look at the November plan, that we can look again at [the preliminary budget] and say these were savings that were proposed and these were ones that failed,” Ms. Ferreras-Copeland told the Observer after the handshake. As of now, she said the savings were very “internal,” but that she hoped they could be handled more publicly. “These are things that are still very much on the table. We have to do it in a transparent way.”

For his part, Mr. de Blasio expressed reluctance to go back to the days of the PEG.

“When we need savings, we go case by case, agency by agency, program by program,” Mr. de Blasio said, saying he was more focused on changing the city’s spending on ballooning healthcare costs. “The real action here is, for years the city didn’t make progress on health care costs.”

The budget agreement also increases funding for the city’s district attorneys by $22 million, and emergency food assistance—another negotiating point—by $5 million.

Among the other priorities in the budget is a plan to bail out the city’s public hospital network, recently re-named NYC Health + Hospitals, as it struggles to stay afloat amid decreased federal reimbursements for the uninsured patients who flock to its emergency rooms.

Twice during the current fiscal year, which ends June 30, Mr. de Blasio had to add to the agency’s budget to keep the doors open—with a $160 million injection of cash in April and $337 million in January.

In the budget announced today, which will begin on July 1, Mr. de Blasio is boosting the hospital network’s budget by $180 million, by forgiving that amount of debt service. He has also outlined a plan to try to turn around the finances of Health + Hospitals—similar to his effort to do so for public housing, dubbed “Next Generation NYCHA”—to avoid a financial shortfall that his office said would reach $600 million by next year and could grow to $1.8 billion by 2020.

There’s also funding for a slew of the mayor’s priorities like new ambulance tours in Queens and the Bronx and opioid addiction treatment. There’s also $66 million to combat homelessness—a problem that dogged the mayor for months before losing the spotlight to multiple investigations into City Hall and the mayor’s campaign—which will be partly offset by  $38 million in savings. The plan also includes money to continue reforms at Rikers Island, including $8.7 million to triple the number of units for the severely mentally ill on Rikers Island, as the Observer previously reported.

The budget does not call for raising taxes or for laying off any city employees.

De Blasio and Mark-Viverito Shake Hands on a $82.1 Billion City Budget