New York

Adams touts restraint in first preliminary budget address

The budget marks a $6 billion increase over last year’s $92.3 billion preliminary budget.

New York City Mayor-elect Eric Adams speaks.

Mayor Eric Adams unveiled a $98.5 billion budget Wednesday that boosts spending on city services while reducing the size of the municipal workforce as the city’s new executive seeks to tackle persistent shootings, increase summer job opportunities for teens and maintain significant reserves.

The Fiscal Year 2023 budget, which takes effect July 1, relies on better-than-expected tax revenues, unspent federal stimulus funds and agency budget cuts. At the same time, Adams proposed a $6 billion increase over the $92.3 billion preliminary budget his predecessor unveiled last January — a plan that has grown to $106.5 billion with infusions of cash from Washington, D.C.

In a presentation Wednesday, Adams went out of his way to stress the importance of fiscal restraint — priding himself on squirreling away $6 billion in reserves, while acknowledging he has yet to account for raises for the city’s unionized workforce. Adams must negotiate contracts with some of the largest public-sector unions, whose deals have expired or are about to.

“My administration is laser-focused on fiscal discipline. We’re not spending our money; we’re spending your money,” Adams said during his live-streamed address from City Hall’s Blue Room.

Throughout his speech, the former police captain emphasized gun violence — a nod to his campaign promise to make the city safer — and promised programs designed to reduce shootings.

“New Yorkers are rightfully concerned about rising crime in our city. My administration is already taking action, with more street patrols, greater enforcement, and expanded community involvement,” Adams said. “As always, we will have public safety and justice, and invest in preventative programs and effective policing. But the initial focus must remain on reducing crime and confronting gun violence.”

His budget summary even included a bar chart showcasing a spike in the seven major felony offenses counted by the NYPD from 95,593 incidents in 2020 to 102,741 last year.

To that end, Adams announced he would shift NYPD resources to neighborhood safety teams focused on getting guns off the streets — his signature campaign proposal — and a summer employment program that will offer 100,000 jobs to teens.

Nevertheless, the mayor kept NYPD’s budget flat at $5.1 billion while leaving open the possibility of an increase later this year.

“We’re going to redeploy our manpower; we’re going to make sure that everyone who is supposed to be on the streets doing their job, they’re doing their job,” Adams told reporters after his presentation. “Then we will make the analysis if we have to put more money in.”

The administration similarly kept funding and staffing levels at the Department of Correction unchanged as crises continue to engulf Rikers Island despite calls from correction unions to beef up their ranks.

His 4-year capital budget also left roughly $8 billion intact to pay for four jails that would replace the notoriously dangerous complex on Rikers Island.

While pledging restraint and forcing agencies to trim their budgets, Adams also added spending for the summer jobs, an expansion of a reduced-cost Metrocard initiative and other new programs.

When compared to the current iteration of the budget — which grew throughout the year — city spending only went up “modestly, by 2.3 percent,” Citizens Budget Commission President Andrew Rein said.

“Mayor Eric Adams’ preliminary budget proposes important, welcome, and refreshing initial steps in the right direction, especially reducing unneeded vacant positions to realize recurring savings and removing the $500 million in specious labor savings — a victory for fiscal integrity,” Rein said in a prepared statement. “Still, to bolster New York’s competitiveness and ability to serve New Yorkers in the future, the city should take significant additional actions … to make government more efficient, stave off the looming fiscal cliffs and save for the inevitable next downturn.”

Rein applauded Adams for a $2 billion citywide budget cut over an 18-month period. The administration will save $18.2 million next year by suspending the expansion of a curbside organics program from the Department of Sanitation, for example, and $49 million by closing hotels used as homeless shelters for families. The administration eliminated 3,200 vacant municipal government positions in the current fiscal year and 7,000 positions for the upcoming fiscal year, which begins July 1, as part of a $2 billion PEG.

But, Rein warned of the unfunded raises for city employees set to bargain for new contracts.

Adams did not allocate any money for salary increases for the next two years and just enough for 1 percent bumps the following year — a common negotiating tactic.

Still, he pledged he would give workers better pay.

“I want my city employees, who are predominantly Black and brown women that are civil servants, to be paid a fair salary, but at the same time we must be conscious of taxpayers’ dollars,” Adams said.

Rein tagged it as “one of the significant risks in this budget.” Annual raises of 2 percent, for example, would add $1 billion to the upcoming budget and $2.5 billion in FY2025, Rein said.

“If you’re going to deal with the fiscal cliffs, the rocky economy and the raises, you’ve got more work to do” to cut spending, he added.

Adams used his address to highlight obstacles to the city’s pandemic recovery.

Workers are returning to offices slower here than elsewhere in the country, for instance. And unemployment across the five boroughs remains at 8.8 percent, lagging behind both state and national levels.

“Unfortunately we do not expect to regain our pre-pandemic level of jobs until 2025,” he said, noting that the biggest losses were registered in the service sector.

The budget also failed to address de Blasio’s use of one-time city money, to the tune of nearly $700 million, to pay for a suite of recurring programs including increased salaries for homeless shelter workers. Adams will either need to pony up for the initiatives going forward or cut them.

The budget was largely well received, but drew recrimination from housing advocates who accused the mayor of going back on a promise to double the annual capital budget for affordable housing to $4 billion. Wednesday’s plan shows no change to the program, nor to money earmarked for upgrades to dilapidated public housing.

“We are extremely disappointed that Mayor Eric Adams did not even mention housing in his remarks nor prioritize it in his budget plans, instead choosing to maintain the status quo and abandon his campaign promise,” Rachel Fee, head of the New York Housing Conference, said in a statement.

Still, there were several bright spots. Total tax revenue is up $1.6 billion from projections from November, spurred by a banner year for Wall Street and better-than-projected residential real estate sales.

The latter helped drive an $800 million increase in property tax collections compared to the latest projections from November. While shoring up the city’s finances, that increase could spell trouble for Adams’ desire to dramatically increase borrowing capacity by $19 billion, a gambit that has been panned by budget watchdogs.

The budget also dispensed with a brazen gimmick from the de Blasio administration. The former mayor had penciled in $1 billion in labor savings into Covid-era spending plans to artificially balance the books, and even planned for $500 million in fake labor savings in Adams’ budget. The sleight of hand was taken out of Wednesday’s plan.

It received a warm response from leaders of the City Council, who praised the mayor’s decision to baseline a transit program for low-income New Yorkers, which was their sole request to date. The Council will now release its own set of budget priorities ahead of a monthslong negotiation before it votes on the budget in June.

“We also appreciate the Mayor’s proposals for new family health services, expansion of the Earned Income Tax Credit, and support for the Fair Futures program that assists young people in successfully transitioning out of foster care,” Council Speaker Adrienne Adams and Council Member Justin Brannan, chair of the Committee on Finance, said in a joint statement.

Adams nodded to his national profile toward the end of his remarks Wednesday, saying: “Together we will embark on an urban renaissance unlike anything we have seen in our lifetimes.”