Comptroller Mark Levine said Mayor Zohran Mamdani’s plan to draw down $1.2 billion in reserves to balance the budget could make things even worse for taxpayers when it’s time to cook up next year’s spending plan.
“You do not want to be draining the reserves when the economy is otherwise good,” Levine said Sunday on CBS New York’s 2’s “The Point with Marcia Kramer.”
Raiding $1.2 billion next year and $2.6 billion over the next two years as the Mamdani administration’s plans would leave the city flatfooted if the economy goes south.
“It’s going to leave us more vulnerable next year … This is not a year to be draining our reserves,” Levine said.
He said the unknown impact of the Iran war also has to be taken into account.
Emergency funds should be used as a last resort during a real financial crisis such as a recession, a pandemic or another catastrophe, he said.
Levine also said that the bond credit rating agencies’ issuing a “negative outlook” on the city’s finances —partly citing concerns about tapping into emergency reserves — is a warning sign that the mayor and City Council to get the budget under control.
Mamdani’s preliminary $127 billion spending plan projects a $5.4 billion deficit that must be closed. He has proposed closing most of it through tax hikes, not spending cuts.
Levine projects the deficit at $6.5 billion — and he said part of the solution should be spending less.
“We’re spending more than we’re taking in … We’re going to have to find more efficiencies throughout the agencies of city government,” he said.
As he testified during his recent budget testimony before the City Council, Levine said spending on the city’s rental assistance or housing voucher program has exploded and is expected to cost $2.6 billion next year.
“It’s growing by 4% a month,” Levine said.
City Council Speaker Julie Menin also said she opposes dipping into reserve funds to balance the budget, claiming it’s unnecessary.
Meanwhile, former Democratic Gov. David Paterson admitted Sunday that Florida’s elected officials have been more prudent in managing taxpayers’ dollars than New York’s.
“Florida, in spite of its size and population, has been far more careful with how they manage their finances than New York,” Paterson said on 77 WABC radio’s “Cats Roundtable” program.
The city budget is $127 billion, more than Florida’s $115 billion state budget, despite the Sunshine State having nearly three times the population.
New York State’s $260 billion budget is more than double Florida’s, despite having 5 million fewer residents.
Paterson said counties in New York fight for more funding from Albany and “it puts an inordinate strain on the tax base … [New York] is now starting to feel the whole thing coming apart.”