New York City Needs Federal Funds to Recover Economic Footing, Mayor Says
By Katie Honan
New York City's latest economic analysis paints a less dire
picture than earlier this year, but it still needs a federal
bailout to recover from the crisis caused by the coronavirus, Mayor
Bill de Blasio said.
The first round of a federal stimulus package helped the city
avoid steeper cuts in tax revenue collections this summer,
according to the city's latest financial plan released Monday.
The city's updated budget grew from $88.19 billion in late June
to $92 billion, buoyed by $3.2 billion in federal dollars with the
majority going to pay for Covid-19 expenses, Mr. de Blasio
It added $748 million more in collections from personal income
and business taxes than originally forecast in the fiscal year's
earlier budget, the mayor said.
But it still needs more help from the federal government.
"If there is no stimulus we're going to have to make extremely
difficult choices," the mayor, a Democrat, said at a press
The city still has a $4 billion revenue gap, and projected to
continue to see less revenue. The absence of new federal stimulus
could also hurt the budget of the state, which could then slash its
own funding to the city to save money, he said.
Since the city shut down in the spring to slow the spread of the
coronavirus, the mayor has prepared the city for stark cuts,
slashing some services in the most recent budget, which was passed
June 30. Thousands of city employees were required to take a 5-day
furlough between October and March, including Mr. de Blasio, who
was docked one week of pay earlier this month although he continued
Mr. de Blasio warned of possibly laying off 22,000 city
employees if the city didn't get borrowing authority from the
state, or a federal bailout. The layoffs have so far been avoided
by deferring billions in labor costs to coming years to achieve
savings within this and next year's budget.
But there could be future layoffs if more assistance isn't given
to New York City, the mayor said.
Independent budget watchers said Mr. de Blasio doesn't do enough
to achieve necessary savings, instead deferring payments to future
budgets. There could still be more budget cuts at the agency level,
said Andrew Rein, the president of the independent Citizens Budget
"Federal aid is needed and may be significant," he said in a
statement. "Still, even if substantial, federal aid will only be a
bridge and that bridge must land on a stable shore."
Write to Katie Honan at Katie.Honan@wsj.com
(END) Dow Jones Newswires
November 23, 2020 16:08 ET (21:08 GMT)
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