City's Budget Ordered Cut; Hiring Halted

The Wall Street Journal - October 05, 2011


Mayor Michael Bloomberg on Tuesday ordered all New York City agencies to prepare plans to slash expenses by a total of $2 billion during the next 18 months, the administration's first major step to combat a projected $4.6 billion deficit in the fiscal year beginning July 2012.

"The outlook for the economy--as evidenced by the chaotic stock market and other indicators--has become increasingly uncertain, and the prospects for state and federal aid have worsened," the mayor's budget director, Mark Page, wrote to agency heads in a memo Tuesday.

The mayor also imposed a hiring freeze for the "foreseeable future," Mr. Page wrote. City agencies must submit their plans to the Office of Management and Budget by Oct. 18.

Mr. Bloomberg plans to cut $500 million from the current year's budget and $1.5 billion from the budget for the fiscal year beginning July 1, officials said. To achieve that goal, he's directed Mr. Page to order every city agency head to submit plans to reduce spending by 2% for the remainder of this fiscal year, and another 6% for the following year.

For agency heads, the memo from Mr. Page may look familiar, as they have received a series of such requests for major spending reductions over the years. Last November, when the mayor released an update to the budget, he unveiled plans to slash spending by $1.6 billion.

The prospect of yet another round of severe budget cuts has already prompted an outcry from municipal union leaders, who say there is little left to shave from the budget.

"The last thing this city should plan to do for the future is to reduce the staffing of the NYPD which has already been stripped to the bone in our local neighborhood precincts," said Patrick Lynch, president of the Patrolmen's Benevolent Association, in a statement. "Government's first and most important responsibility is to keep its citizens safe and given the increase in violent felonies and homicides, it is clear that it is failing to meet that responsibility."

Michael Mulgrew, president of the United Federation of Teachers, said the nation's largest municipal school system has suffered from three years of budget cuts.

"Class sizes are skyrocketing all over the system while afterschool programs are disappearing," he said. "The schools just can't be cut anymore."

City Council Speaker Christine Quinn said the cuts sought by the mayor are "sizeable" and she said "we share New Yorkers' concerns" about the impact of these cuts on vital city services.

"As always the council will work to ensure that all possible alternatives are considered before core programs are targeted for cuts," she said.

The administration's plans have reignited fears that the mayor will try to impose some of the controversial spending-reduction initiatives he's previously proposed, such as his call to close 20 fire companies and lay off thousands of teachers.

In recent years, services for senior citizens and funding for cultural groups have taken a hit; and the mayor has attempted, with varied amounts of success over the years, to cut the budgets of the public advocate and the borough presidents.