Slow Growth And Trump Present Challenges To NYC, DiNapoli Says
Aug 2, 2017
New York City has an estimated surplus of more than $4 billion, but even with its coffers full still faces challenges from federal cuts in Washington, slow growth in tax revenue as well as job creation, according to Comptroller Tom DiNapoli.
“Changes in federal fiscal policies present the greatest and most imminent risk to New York City’s financial outlook. The city faces the possible loss of hundreds of millions of dollars in federal funding and cuts to Medicaid,” DiNapoli said. “With these risks in mind, Mayor de Blasio and the city have prudently increased reserves to record levels. The city should continue to identify opportunities for agency savings, which will provide added budgetary flexibility.”
The surplus is the largest the city has had since 2008, just before the onset of the recession.
However, budget gaps for the 2019, 2020 and 2021 fiscal years are projected, starting at $3.5 billion.
Tax collections have dropped starting in 2016, with non-property taxes declining for the first time since 2010.
Meanwhile, the labor market has constricted. Unemployment is down to 4 percent, its lowest level in 41 years. But given the economy can be cyclical, its possible each year will bring a new setback.