Mayor Bill de Blasio proposed a $3 billion increase in the city’s new budget Thursday — while warning that dark fiscal clouds will force some program cuts next year.
For the first time since taking office five years ago, the mayor ordered agencies to produce savings totaling $750 million as he released a $92.2 billion preliminary budget for fiscal 2020, which starts on July 1.
That was up from the $89.2 billion allocated for the current fiscal year.
Pointing to wild stock market swings, budget cuts in Albany and another possible federal government shutdown, de Blasio said the flush times appear to be over.
“We may well have to limit some of our investments or slow down some of our investments or, in fact, cut some programs or some investments outright,” he said.
“We have some tough choices up ahead under any scenario.”
The added spending was largely attributed to $1 billion in higher labor costs, $632 million in added education funding and $325 million more for debt service.
The city’s personal income tax revenues were expected to come in $935 million below last year, which is $300 million more than was anticipated.
De Blasio also cautioned that Albany could add to the pain because Gov. Andrew Cuomo’s proposed state budget includes $600 million in cuts and cost shifts that would hit the city’s budget.
To deal with the expected downturns, de Blasio expanded a partial hiring freeze and asked for the agency savings, which amount to less than 1 percent of the budget.
“If this is the beginning of a real challenge, we’re turning rapidly now. We see the iceberg up ahead and we’re turning now and there’s time to make the turn,” he said.
“I’m comfortable that right now if we need to make a lot of changes we can.”
But records show that despite the partial hiring freeze enacted in April 2017, the workforce continued to grow, adding another 1,000 full-time jobs between January and November 2018, the most recent month that figures are available.
Since becoming mayor in 2014, when the budget stood at $75 billion, de Blasio has increased spending about 23 percent.
Watchdogs called on the mayor to build up the city’s reserve funds, which stand at $5.75 billion.
“The city does not have enough in its rainy day fund to address the kind of economic storms that we see on the horizon,” said Andrew Rein, executive director of the Citizens Budget Commission.
“The mayor sounded the caution about the risks and that’s good, but the plan we saw today bolsters spending and did not build the reserves necessary.”
Comptroller Scott Stringer, a probable 2021 mayoral candidate, also urged immediate action.
“We definitely see that this economy is tightening and we have to act accordingly,” he said. “We know that when there’s a terrible tragedy in the city — whether it’s after 9/11 or a big hurricane — whatever reserves we’ve built up tend to get depleted overnight.”
The mayor will present his executive budget in April, when negotiations will begin with the City Council, which must approve the spending plan.