COVID-19 is a catastrophe for the city’s $89.3 billion budget, likely tearing 20 percent — or more than $13 billion — off the city’s tax revenues by winter. It would be a challenge for any mayor.
It’s our luck, though, not to have just any mayor, but Bill de Blasio — who took actions during the boom years that make things much worse now for almost everyone, from parents hoping to take their toddlers to the pool in late summer to at-risk teens who’ll be without summer jobs after being stuck in an apartment all spring.
When he took office in 2014, de Blasio was the first mayor since John Lindsay not to inherit a fiscal crisis from his predecessor. That’s because Mike Bloomberg — never exactly a fiscal conservative in his first two terms — did take actions in his third term to control spending.
As the financial crisis hit in 2008, Bloomberg did something quite reasonable: He told the city’s workforce, mainly teachers and other civilians, that if they couldn’t find savings to pay for raises, they, like most everyone in the private sector, would not get raises.
De Blasio, rather than being grateful that someone else had made a tough choice, was — as would become his wont — ungracious.
In May 2014 — in awarding the first of $2.9 billion in retroactive raises to teachers and civilian workers, as part of a general $15.2 billion wage hike through 2018 — de Blasio couldn’t resist a dig at his predecessor. The previous mayor’s stance was “so intractable, and so wrong, and so unnecessary,” de Blasio lectured.
Only one problem: Even in the greatest tax-revenue boom the city had ever seen, de Blasio couldn’t actually afford to pay teachers extra money for work they had done five years before.
Solution: Stretch the retro–active pay out to 2021, the fiscal year that starts this July. This fall, Gotham must splash out $1.5 billion for work teachers and other city employees did as far back as 11 years ago. (It’s supposedly offset by illusory health-care savings; the city’s bill for health insurance and other non-cash benefits for its workers is now $11.6 billion annually.)
To close the $6.6 billion budget gap the mayor foresees for next year — and the gap will probably be twice that — he is mostly drawing down reserves, like a long-term account meant to pay for public workers’ health care once they retire.
The city has only managed to come up with $2.7 billion in real spending cuts so far — and at a high price.
No summer jobs for teens who’ll have missed three months of school and will be in need of professional-adult mentorship: $116 million; $12 million to close city pools for the summer — even though, as with summer jobs, it’s way too early to decide that kids cooped up all spring can’t maybe go to the pool in August; $3 million in not building new bike lanes, when people won’t want to ride the subway for a while.
De Blasio has barely started cutting, and he has started by scraping the bottom of the barrel, signaling the public that the city won’t be the place to be for the indefinite future.
Meanwhile, come October, the city’s teachers and other civilian workers can still expect their final lump-sum payment for work that they did last decade.
In a historic crisis, this is the first thing to cut — and a hard-headed mayor would use the threat of furloughs to get the workforce to do it “voluntarily.” Or why not just delay it another 10 years?
It was never a good sign that back in 2014, de Blasio felt the need to resort to what is effectively borrowing from the future to pay past operating expenses. Now, the future is here, and it needs its money back.
But don’t just blame the mayor: the city comptroller, Scott Stringer, and the state-appointed Financial Control Board, too, signed off on this nutty deal, even though reforms put in place after the 1970s fiscal crisis supposedly forbid it.
None of this means Washington shouldn’t approve billions of dollars in new aid for New York. Bailouts are never fair, and the nation doesn’t benefit if its largest city can’t pick up the trash. But we need a bailout not only from COVID-19 but from our regressive mayor’s past bad decisions.
Twitter: @NicoleGelinas