June 3, 2013
By Neal Tepel
New York, N.Y. – Mayor Michael Bloomberg's final Executive Budget offers a capital spending plan for Fiscal Years 2014 through 2017 that maintains the administration's commitment to near-historic levels of capital spending. Thanks in part to significant emergency federal aid related to Superstorm Sandy, spending is forecast to increase in each year compared to the budget presented one year ago.
The City proposes to spend $10.2 billion in 2014, the second-highest level of capital spending of the last thirty years in absolute terms. The City's five-year spending plan is $45 billion, near record highs.
However, the future is not as bright for infrastructure spending due to the City's increasing debt burden, which is expected to grow from $68 billion this year to $75.5 billion in 2017. Debt service will also take up a larger share of tax revenues, rising from 13.2% to nearly 15% of tax revenues in 2015-17.
With the level of deft rising, it will not be possible for New York City to sustain the present levels of investment in critical infrastructure for the future. A recent Citizens Budget Commission report also warned of the growing debt burden and its impact on the City's overall budget.
A Building Congress review of City budget documents showed that total capital spending under Mayor Bloomberg was greater than at any point in the previous three decades. This was accomplished even as the Administration kept debt service at generally accepted levels. However, as candidates jockey to take the reins of City Hall next year, a critical issue will be how to maintain a robust program as debt levels threaten to shrink the City's ability to invest in the future.
Based on Current Information from the Building Congress.