MAYOR MICHAEL R. BLOOMBERG PRESENTS
$44.5 BILLION FISCAL YEAR ‘04 EXECUTIVE BUDGET

Agency Program Increases to $3.2 Billion
Mayor Calls on Albany Leadership to Help City in Time of Need

Mayor Michael R. Bloomberg today presented his Executive Fiscal Year (FY) 2004 New York City Budget. The ongoing national economic downturn, compounded by the war against terrorism, and, most recently, by reduced international travel continues to wreak havoc on New York’s economy.  In 2002, with hotel occupancy falling to levels seen in the aftermath of September 11th, the City lost 117,000 jobs, and the unemployment rate in the City is currently 8.8% - the highest level in four years. Securities firms are still shedding jobs, down almost 40,000 since 2000.

Despite the City’s fiscal woes crime rates continues to fall, welfare rolls continue to decline, streets and parks are clean and the standards of accountability and achievement are being introduced to the public schools system.  In the last 16 months, $3.2 billion in city funds has been reduced from the City’s budget, 14,000 City workers have left the payroll and the City Council passed a much-needed increase in the City’s property tax.

“The challenges we face today, and the solutions we find, will define our City for generations to come,” said Mayor Bloomberg.  “We must not pass the burden of spending today on to our children, and we cannot surrender our destiny to the Financial Control Board. Times are tough, and we will find ways to stretch what resources we have. We must remember the lessons of the past – New York City must not be permitted to deteriorate as it did in the late 1970s.  Seeking our fair share of State and Federal resources to preserve New York City’s status as the greatest city in the world is not only the necessary thing to do, it is the right thing to do since the entire state and country benefits from a strong New York City.”
 
The January 2003 Preliminary Budget projected a $2.9 billion gap between forecast revenues and expenditures for FY 2004.  Primarily, as a result of the continued decline in the tax revenue forecast and added costs arising from the State’s Executive Budget, the budget gap is now of greater magnitude. Despite reductions in spending, additional gap-closing actions, the City faces a gap of approximately $3.8 billion for FY 2004.

$600 Million Agency Program

This Executive Budget details City gap-closing actions currently being implemented, totaling over $600 million for FY 2004. Since the City’s labor representatives have made no concrete productivity commitments to mitigate these necessary reductions, regrettably, substantial layoffs are unavoidable. It is now too late for any labor productivity to forestall some part of the current $600 million gap-closing program. Instead, future productivity savings, if realized, will be necessary to avoid additional and even more damaging contingency cuts to the City’s workforce.  The $600 million in failed labor productivity will now result in:

• In the Fire Department, layoffs of 75 full-time and 119 part-time civilian positions will occur. The Fire Marshal Program will be reduced by 25% to 100 Marshals.
  
  
• The Department of Education will eliminate 864 paraprofessional positions and 767 school aides.
  
  
• The Department of Transportation will reduce service on the Staten Island Ferry from 4 to 3 boats per hour during rush hour.
  
  
• The Department of Parks and Recreation will eliminate subsidies to the Wildlife Conservation Society for Prospect Park Zoo, and the Queens Wildlife Center, and will not hire approximately 1,155 part-time seasonal parks and playground workers.
  
  
• The Administration for Children’s Services will close 4 congregate care facilities and eliminate 528 positions agency-wide.
  
  
• The Department of Health and Mental Hygiene will close 12 of 30 Child Health Clinics, and will terminate 165 employees in the School Health Program, ending the Hepatitis B Immunization Initiative. 
  
  
• The Department for the Aging will end take-home weekend meals for 7,500 senior citizens. 

In addition to the $600 million gap-closing program detailed above, the delivery of social services will be streamlined through structural reorganization, generating $75 million in savings.  The Department of Employment will be consolidated and its responsibilities assumed by the Department of Youth and Community Development, and The Human Resources Administration. 

Personal Income Tax Reform

To avoid further cuts New York City is requesting that the State reform the personal income tax to increase City revenue by $1.4 billion. This will not only bring in much needed revenue, but will enable the City to spread the tax burden equitably to residents and non-residents who all share the benefits of the services that the City provides.  New York needs $252 million in gap-closing actions by the State, and the City has provided a list of over $800 million in actions, which would cost the State nothing. The Governor’s proposed budget reduces the City’s baseline education aid by almost $478 million and does not fund the continuing annual cost of $275 million for the extended school day, a program instituted last year with the help of State funds. In this Executive Budget, the City has allocated its share of local funding to maintain its support of education, a requirement rightly established by the State when it granted the Mayor the power and responsibility to improve education in this City last year. If City schools are to be given a chance to meet the ambitious goals of their new management, continued baseline education aid from the State is vital.  These funding cuts must be restored.

$1 Billion Contingency Plan

Released with the Executive Budget is a $1 billion contingency plan.  The plan includes additional cuts to agencies and requires 10,000 layoffs that will be implemented if the City does not receive the necessary assistance from the State Government in Albany:

• In the Police Department, the July 2003 cadet class will be eliminated, reducing peak uniformed headcount to its lowest levels since Fiscal Year 1993.  There will also be a 35% reduction in trade titles, administrative and clerical positions, resulting in over 1,700 layoffs.
  
  
• The Fire Department will reduce overtime by $47 million.
  
  
• The Department of Correction will lay off 1,300 uniform positions and 110 civilians. 
  
  
• The Department of Sanitation will lay off 846 uniform employees and 211 civilian employees, severely impacting core collection, recycling, snow removal and street cleanliness functions.
  
  
• The Department of Education will eliminate all after school educational programs and summer school for all remaining students who are designated as needing improvement.
  
  
• The Department of Parks & Recreation will lay off 194 workers and close all 31 outdoor pools and all 21 City-funded recreation centers, which together have approximately 3 million visitors annually. The Department will also lay off 538 full-time employees – 20% of the remaining workforce – resulting in a significant decline in park cleanliness.
  
  
• The Human Resources Administration will eliminate City-funded HIV/AIDS case management and the Emergency Food Assistance Program.
  
  
• The Department of Homeless Services will lay off an additional 109 employees who currently provide cleaning services in City-operated shelters. Also, outreach to the homeless on City streets would virtually end.

“Implementation of the contingency plan would require abrupt cuts in City services.  Regrettably, this would require massive lay-offs.  The contingency plan can be avoided if we get the necessary assistance from the State Government, and I am optimistic we will get the help we need.  Everyone whose livelihood depends on the City should do their part to help the City through these challenging times.

“No problem is intractable if we focus on our common goals. To that end,  I pledge to work with all levels of government to find a resolution. Time after time,  New Yorkers have shown that, by working together, we can overcome any obstacle. Now, we will have to prove our strength once more,” Mayor Bloomberg concluded.