By Nimra Noor, National News Writer
As per the executive budget for the 2018 fiscal year, New York City’s democratic mayorship under Bill de Blasio has added more than 25,000 employees and increased spending by nearly 20 percent. According to Forbes, de Blasio and the New York City Council have agreed in April to a budget for the 2018 fiscal year that includes an unprecedented $58 billion five-year capital-spending plan.
As reported by the Wall Street Journal, city spending has been offset entirely for the following fiscal year by $234 million in new savings and $123 million in pension savings in FY 2019. New savings within the budget include debt services, health care savings, and agency adjustments. The vast majority of growth in the budget, currently amounting to $85.99 billion for the 2018 fiscal year, is due to increases in federal funding for ongoing Hurricane Sandy recovery efforts and homeland security grants. Additional increases can be attributed to State Asset Forfeiture funds. As it represents a significant acceleration of public construction and improvements to public infrastructure and services, Mayor de Blasio’s plan encompasses the greatest capital spending proposals of at least the previous 35 years.
Mr. de Blasio, the first Democratic mayor of New York City in more than two decades, has emphasized an increase in fiscal spending immediately upon taking office in 2014. The Mayor has made preschool free for all children, an initiative that currently costs the city about $300 million a year. He has added nearly 1,300 police officers at an annual cost of $75 million. In addition, more than $300 million was spent to launch citywide ferry service and $4 million to create a new agency to work with veterans.
Furthermore, in the past four years, the city has seen a significant increase in spending on the maltreated groups of the society. As Mayor de Blasio approves of an escalated spending on the homeless-services, and child-welfare agencies, the Empire City has also been awarded more than $1 billion in city contracts with minority and female-owned businesses, according to the office of Mayor Bill de Blasio. That spending for fiscal 2017 amounts more than double the $400 million awarded to those businesses for 2015, and up modestly from $700 million in 2016.
“Our economy is strong and we can afford to help New Yorkers who need it most,” the mayor said in a recent emailed statement. “Making those investments is not only moral, but it will help keep our economy strong and our city the greatest in the world.”
Overall, city spending has risen by nearly 20%, to roughly $61.3 billion this year from about $51.2 billion in the fiscal year 2014, the last budget negotiated by former Mayor Michael Bloomberg. The rise is roughly four times the rate of inflation for the same period.
According to the Wall Street Journal, Mr. de Blasio has been able to spend freely because city tax revenues have risen sharply during the past four years as well, outpacing the budget increases amid a booming economy. However, it is being argued that the heavy spending could cause city finances to be pinched in the future, especially if the economy contracts. Serious risks lie behind the “no-fuss, no-drama” budget.
As Forbes magazine reported, de Blasio has pushed much of the cost of past spending into the future — making it tougher to cut spending while protecting public services in a future downturn. The mayor has added tens of thousands of employees to the city payroll without tackling the reforms needed to get their future retirement costs under control. More worryingly, de Blasio depends almost entirely on debt to finance this capital program: $88.9 billion in newly issued municipal bonds, according to the News One newsletter.
Nonetheless, there is no doubt that when many parts of the United States – particularly small towns and rural areas – are still struggling to fully recover from the previous recession in 2008-09, New York City is doing strikingly well, repeatedly breaking its own records for job creation, tourism and tax revenues. “New York, over more than 20 years, has been both smart and lucky: smart in cutting crime and improving the quality of life to attract a record number of residents, tourists and investors. It has been lucky in that the global economy, for better or worse for the rest of America, has favored the urban elite in finance, tech, and other high-paying industries,” said Nicole Gelinas, editor to the Manhattan Institute’s City Journal. “If these trends ever change, New York may wish that it had spent its boom years building for a sturdier future.”
A version of this article appeared in the Tuesday, December 12th print edition.
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