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The dramatic growth in the size and cost of city government since Mayor de Blasio took office has been of concern to budget watchdogs: the number of city employees has grown by 35,000 and total annual spending by more than $20 billion since 2014.
The mayor’s latest budget presentation, delivered last week, came with talk of fiscal prudence, but assuaged few fears, including those of an unexpected new source adding his voice to those warning about the city’s long-term health.
The $92.5 billion proposed operating budget for the fiscal year that will begin on July 1 includes over $1 billion more in city-funded expenditures than was anticipated by the mayor’s Preliminary Budget released only a few months ago, offset by increases in revenue and “savings” through a variety of expenditure adjustments, netting out to an increase of about $350 million in planned spending since the mayor’s prior plan.
The budget for the coming fiscal year is balanced but the projected deficit for the 2020-2021 fiscal year is estimated to be $3.5 billion. The revised 10-year Capital Strategy is increasing a whopping $13 billion — to nearly $117 billion.
The mayor stressed that his plan is fiscally prudent and that new initiatives have been kept to a minimum out of an abundance of caution about possible threats to the city’s economic picture. But Citizens Budget Commission President Andrew Rein succinctly summarized the general reaction from watchdogs and other commenters:
“Mayor de Blasio’s stay-the-course budget does not take the steps needed to preserve services or forestall tax increases in the eventual hard times.”
Will our city’s elected leaders heed the warnings and restrain their impulse to find more “savings” and add more spending to the budget that is finally adopted by the end of June? Not if past behavior is any guide.
But perhaps they will listen to someone who should command respect from the mayor and City Council alike: Stanley Brezenoff.
Last Friday, the day after the mayor presented his updated budget plans, Stan received the Civic Fame Award from the Center for New York City Law at New York Law School. his remarks were reflections about his years in government and the nature of the three mayoral administrations he has served. They were thoughtful, nuanced, and unexpected.
Stan started out as a young activist in the civil rights movement working for the Reverend Milton Galamison, who led the fight for community control of city schools in the 1960s. Indeed, it was noted at the award ceremony that Stan had some trouble getting a full-time job in New York because he had so many arrests from protests on his record.
Stan entered city government in the administration of Mayor John Lindsay, went on to various positions including as the first commissioner of the newly formed Human Resources Administration, was Executive Director of the Port Authority, and eventually became First Deputy Mayor under Ed Koch, which is when I first met and worked for/with him.
I was fortunate to work with Stan again when he was the Vice Chair and I was President of the September 11th Fund, and since then we have been friends and colleagues on various projects.
Given Stan’s extensive background and his long relationship with then-First Deputy Mayor Tony Shorris (who was his deputy and successor at the Port Authority), it is not surprising that Mayor de Blasio has relied on Stan to help deal with some of the weightiest challenges of his administration – first as an advisor on labor relations, then as Acting CEO of the city’s financially-strapped Health + Hospital system (which he ran 1981-1984), and most recently as Acting Chair of the beleaguered public housing authority, NYCHA.
So, suffice it to say, this is not someone who can be dismissed as a conservative, anti-government pundit who doesn’t care about the city’s social safety net or believe in unionized public employment. That is why his comments, while diplomatic, were especially noteworthy and startling.
His main points were:
-Mayor Lindsay came into office in 1966 at an important inflection point. He had an expansionist, activist agenda driven by social goals, i.e. equality and attention to the needs of the poor.
-Lindsay attracted a young, energetic staff that shared his agenda and they accomplished a great deal.
-But they were not prepared or oriented towards the tasks needed to manage the large business enterprise that is city government; hence the seeds of the fiscal crisis were sown.
-Mayor Abe Beame (1974-1977) and his administration lacked the understanding and tools to address the magnitude of the financial challenges that became apparent. Capital funding had been borrowed and used to support operating expenses and now the banks were refusing to loan the city government any more money.
-Mayor Ed Koch (1978-1989) brought a management perspective to the job. Because of the fiscal crisis the public psyche had changed and it became “easier to say no” to advocates and new social policies because there simply wasn’t enough money to do everything. Koch and his administration, subject to the constraints imposed by the Emergency Financial Control Act, engineered a financial turnaround that put the city on a stable footing.
-Moving forward to the present, the current administration is experiencing an extraordinary period of affluence that has enabled Mayor de Blasio, as did Lindsay, to focus on an expansionist social agenda. While his achievements –- e.g. universal pre-kindergarten, an aggressive affordable housing program – are laudable and important, there has been less attention to enterprise management functions and there are warning signs that good times will not last much longer.
-There has been little emphasis on efficient service delivery and achieving savings. The annual PEG (Program to Eliminate the Gap) that has been required by all mayors since Koch to exert savings discipline upon agency spending has been absent 2014-2018.
-This is the first budget of the de Blasio administration in which a PEG has been imposed, but it was “not very vigorous.”
-Good stewardship requires remembering and learning from history. Expansionist policies cannot be implemented without good fiscal management to sustain them.
Thus, in a very nuanced, diplomatic way, 40-year veteran of government Stan Brezenoff offered the same message as Andrew Rein from CBC: we are taking the good times for granted and are not prepared for a recession or some terrible crisis that rapidly decreases revenue and catches the city unprepared to fund all its current expenses and significant long-term liabilities.
City Council and mayor: listen up! Stan Brezenoff has committed his life to social justice. He is not anti-union or a believer in small government. If he is worried, you should be too!
Don’t make the situation worse by adding pet projects to what the Executive Budget already includes. Any more revenue that turns up should be put into reserves for that rainy day. We are far short of the $12-15 billion that would be needed to weather a recession.
The public and Stan B will be watching.
[Watch Stan Brezenoff’s comments in full here.]
Carol Kellermann was president of Citizens Budget Commission from 2008 through 2018.
This story was originally published on May 1, 2019 by Gotham Gazette.