Public Employee Press

Budget threatens more layoffs

By GREGORY N. HEIRES

Only three days before laying off 642 mostly low-paid school workers, Mayor Michael R. Bloomberg callously called for further economic pain.

Preparing for a November mid-fiscal-year budget modification, Bloomberg announced Oct. 4 that he would continue his hiring freeze for a second year and called for $2 billion in spending cuts over the next 18 months.

Imposed at the least sign of deteriorating economic conditions and/or revenue projections, Bloomberg's mid-year budget cuts have totaled $5 billion since 2007.

Uncollected revenue

"This continues a policy of cutting jobs and services without considering raising revenue," said DC 37 Executive Director Lillian Roberts.

"All of this would be unnecessary if the mayor would rein in wasteful contracting out and capture the revenue the city fails to collect from big business and the wealthy," Roberts said. She pointed out that the administration had failed to accept the union's proposal to beef up Finance Dept. staff and bring in more revenue.

Bloomberg ordered city agencies to cut spending 2 percent in the current fiscal year, which ends June 30, 2012, and 6 percent in fiscal year 2013. His four-year financial plan calls for a three-year wage freeze while budgeting for a 1.25 percent pay hike in fiscal year 2015. The administration ordered agency heads to recommend cuts - which could include more layoffs - by Oct. 18 for possible inclusion in the November budget change or January's preliminary fiscal plan.

Depending on economic circumstances such as the "chaotic stock market" and possible reductions in state and federal aid, "the size of cuts may need to increase," said Mark Page, director of Bloomberg's Office of Management and Budget, in an Oct. 4 memo to agency heads.

Cutting to the bone

Roberts said the budget cuts reflects Bloomberg's governing philosophy of favoring the wealthy over the city's working families and poor communities, which are sure to be hurt more by the cuts.

Any layoffs - like the recent school firings - will not result in significant savings because the city will have to pay for unemployment assistance and other help for laid-off workers, she said.

In previous mid-year budget modifications, Bloomberg has imposed smaller cuts on the New York Police Dept. and Dept. of Education than on other agencies, but this time their planned reductions are the same. Police and schools face a total of $1.25 billion in cuts over the next 18 months, more than half of the total that Bloomberg wants for the city.

Tax the rich

DC 37 Associate Director Henry Garrido noted that a significant amount of spending cuts could be avoided if Gov. Andrew Cuomo with Bloomberg's support would extend the so-called millionaire's tax. That tax brings in $5 billion in revenue each year but is scheduled to expire at the end of 2011.

DC 37 has identified $500 million in potential savings for the city through improvements in property assessment, reductions in payments to contractors and better collection of taxes and fees. The city loses millions in revenue each year, for instance, because of its failure to collect fees on cell phone towers and billboards. It would save considerably more by slashing expenditures on consultants and contracting out, which have risen nearly 75 percent since fiscal year 2001.