New York City faces a migrant crisis, and the city faces its biggest budget crisis since the 1970s.
But, as two of the city’s most preeminent fiscal watchdogs reminded us this week, the city’s budget crisis is not entirely due to the migrant crisis.
Yes, our failure to manage migrants is costing us billions — but so is our preexisting failure to manage regular day-to-day spending.
Monday, state comptroller Tom DiNapoli, a Democrat, and Citizens Budget Commission chief Andrew Rein teamed up to sound the alarm in Crain’s, the city’s business newspaper. “Major looming budget gaps will have serious consequences . . . unless action is taken now,” they wrote.
Yes, the migrant crisis, costing, likely, $4 billion annually for the next few years, will cost taxpayers “what it spends to run the sanitation and parks departments combined.”
But: that migrant cost is well less than half of projected budget gaps.
Next year, New York could face a budget deficit of between $9.9 and $13.8 billion. (The rest of the city’s $111.1 billion budget comes from state and federal taxpayers, who are, of course, also us.)
A $10 billion budget gap, at the low end of these estimates, would represent nearly one out of every eight city tax dollars.
What happened? City-funded spending has increased by half over the past decade, to $82.8 billion, even as inflation has risen “only” by one-third.
If it’s not all migrants, what are the culprits?
Ten years ago, salary and wage costs were $24.5 billion. Today, they’re $33 billion — growth of one-third, even as headcount is shrinking.
As DiNapoli has estimated separately, raises awarded by Mayor Adams added $3.1 billion to next year’s budget deficit.
This year, the city will spend $13.3 billion on health and other benefits for workers and retirees — up 37% from a decade ago.
Former mayor Bill de Blasio supposedly did a deal with unions in which workers were supposed to work with the city to control healthcare-cost growth — but a deal to transfer retirees to a managed-care Medicare plan is still tied up in court.
Adams could have held off on raises until the issue was resolved — but didn’t.
In 2014, city-funded education spending was $9.3 billion.
This year, it’s $14.1 billion — growth of 40%. The city still hasn’t grappled with how to cut spending even as school enrollment shrinks.
And now, city council progressives want to “solve” the migrant problem by adding more city-funded housing vouchers — which, in a city with limited housing supply, not only cost taxpayers money but push the cost of housing up.
DiNapoli and Rein suggest, perfectly reasonably, that the city collaborate with its workforce on ways to find efficiencies.
That would be a lot easier if Adams hadn’t just awarded raises with no givebacks in return.
Now, the only leverage he has over the workforce is to threaten layoffs, which directly impact public services.
If it does come to that, though, Adams should make it clear that he’ll protect uniformed staffing in the police department, which is already falling toward three-decade lows, and protect core public services like trash pickup, over meeting teachers’ union goals such as ever-smaller class sizes.
And it’s always good to lead by example: no more overseas adventures for the mayor or for top commissioners, whether to Latin America or to Europe, no more cushy “advisor” jobs for the mayor’s cronies, such as a new position for Adams’s departing corrections commissioner.
As DiNapoli and Rein note, Adams pledged to cut spending before, “but new spending that was simultaneously added” — by him! — “amounted to more than double the planned savings,” making the whole exercise a “futile task.”
So, a first step is to . . . just stop doing what we’re doing.
Nicole Gelinas is a contributing editor to the Manhattan Institute’s City Journal.