May 3, 2013
By Marc Bussanich
New York, NY—Mayor Michael Bloomberg presented the last executive budget as Mayor for fiscal year 2014. He credited the City’s continued economic growth and fiscal discipline for a budget valued at almost $70 billion. But he warned the City faces long-term challenges unless public sector labor contracts are resolved without retroactive pay increases and City employees pay a bigger share for their health care premiums. Watch Video
“Until we make meaningful reforms to our healthcare and fringe benefit programs, the services that have dramatically improved New Yorkers’ quality of life will be left to either compete for a smaller share of the City’s budget or rely on significant tax increases that will impede our economic growth,” said Bloomberg.
He noted that public employee costs are rising; costs have increased from $22.8 billion to $39.2 billion, or 71 percent, since he first took office in 2002.
He blamed pensions and fringe benefits as the culprits, which represent $11.4 billion of the increase.
He also blamed healthcare expenses growing the most, which are forecast to rise 38 percent in the next four years, from $6.5 billion in FY 2013 to $9 billion in FY 2017, according to the Mayor.
Last month, Deputy Mayor Cass Holloway spoke at the Citizens Budget Commission proposing the city was willing to settle outstanding labor contracts if organized labor would agree to some health care contributions to their insurance premiums and accept no retroactive pay increases.
Some of the city’s public sector labor leaders said Holloway’s proposal was a non-starter, but the Mayor proposed the same in the executive budget.
“Future contracts between the City and its employees must include a minimum health care premium contribution to offset [the City’s] obligations,” said Mayor Bloomberg.
He also noted that if the City were to agree to 4% raises for public employees approved during the last round of collective bargaining it would cost $7.8 billion in FY 2014, and over $3 billion annually thereafter.
“The City cannot afford to give retroactive pay increases as such an agreement would open an immediate, current year budget gap and extended massive out-year deficits,” Mayor Bloomberg said.
Robert Croghan, Chairperson of the Organization of Staff Analysts, said the Mayor is being insincere by proposing no retroactive pay increases at a time when the city is enjoying higher tax revenue collections than previously forecast.
Mayor Bloomberg said during his presentation that public sector workers, contrary to public perception, are working with contracts because the state’s Taylor Law mandates that City employees receive a bump up in pay annually until a new contract is signed.
But Croghan hotly tested the claim that city workers have contracts.
“This is a rather amusing version of playing a game verbally. That’s true we have contracts, but my members haven’t had a raise for more than two years,” said Croghan. Watch Video
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