Feb. 19 (Bloomberg) -- New York Mayor Bill de Blasio’s $74 billion preliminary budget for the 2015 fiscal year underestimates labor costs and relies on $530 million from a tax levy on the rich the state may not approve, the city’s comptroller said.
Scott Stringer, 54, elected as the city’s chief financial officer in November on the same Democratic ticket as de Blasio, described the plan as a “strong presentation” that contained the “prudent decision” to reserve $1.3 billion in a retirement-benefits trust and a general fund for unforeseen expenses. The budget, which the City Council must approve, would set aside 1 percent yearly for municipal wage increases through 2018.
Yet it doesn’t account for the cost of reaching agreement on contracts with more than 150 city unions that expired years ago, which could add “multi-billions of dollars” to de Blasio’s budget, Stringer said.
“Our municipal workers have worked too long without a settlement and our taxpayers need to know the true state of our city’s fiscal situation,” Stringer said in a news briefing at his lower Manhattan office. “Neither is possible without knowing the extent of this liability and how it will be funded.”
De Blasio’s plan may assume incorrectly that the city will reap $530 million from a tax on earnings above $500,000 a year to pay for universal all-day pre-kindergarten and after-school programs for teens, Stringer said. The tax surcharge requires state legislative approval. Governor Andrew Cuomo and key senators have said they oppose the idea.
“If Albany fails to deliver the taxing authority, the state will need to find a dedicated source of revenue to pay for this important priority,” Stringer said.
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