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Mayor Eric Adams is blaming the city’s multibillion-dollar budget hole on the migrant crisis, but more than half the deficit really stems from City Hall’s massive spending on other issues, a Big Apple budget watchdog says.
“While serving the rapid influx of migrants and asylum seekers has massively strained the City’s finances, this cost is not the sole cause of the City’s fiscal problems,” said Citizens Budget Commission director Andrew Rein in an analyis released Sunday — the same day Hizzoner doubled-down on his warning the isue will “destroy” the Big Apple if it doesn’t get more federal and state help.
“Less than half of the potential fiscal year 2025 $13.8 billion budget gap is attributable to the $6.1 billion the City estimates services to migrants will cost next year,” Rein said.
Adams’ previous budget-cutting efforts also “were overmatched nearly 3 to 1 by additional spending for new and expanded programs, collective bargaining, pensions, and the failure to address the federal and City fiscal cliffs,” the budget expert said.
“Restructuring operations to significantly reduce costs would be critical now even without the migrant crisis,” he said.
Rein said other spending not connected to the migrant crisis — including hefty pay raises for the city workforce negotiated by Adams’s team — was made without the needed offsetting productivity savings.
“We are spending more than we can afford. We already had significant fiscal problems of our own making that we were not solving,” Rein told The Post on Monday.
Rein said the mayor and council added $2.6 billion in spending to the budget that is not supported by recurring revenues, given that federal COVID-19 funding and other sources of revenue are drying up.
“The fiscal cliff programs — ongoing programs funded by federal covid and non recurring City revenues –should be scrutinized to see how essential they are, since they are already unfunded in the future, “he said, although, “The City may determine they are higher impact than other programs, and ones chosen to protect.”
The added spending that should go under the microscope for potential cuts, according to the CBC.
The spending involves some city Department of Education programs: $184 million for expansion of special education pre-k; $84 million for mental support; $78 million for community schools to offer after-school and summer programs; $25 million for digital learning, gift and talented programs and wellness programs and $16 million for child-care programs.
Other programs and pricetags funded with non-recurring funds include: $558 million in rental vouchers for families with children, $41 million to cover wages for shelter security and $25 million for additional litter-basket collection.
Adams said the migrant influx could cost the city $12 billion in the next three years and that Big Apple agencies will have to immediately come up with cuts of 5% — and possibly a total of 15% by spring — although city Budget Director Jacques Jiha warned that even the more draconian figure would still “only cover two-thirds of our projected asylum costs.”
The plan includes prodding the NYPD and other uniformed agencies to slash overtime, as well as a hiring freeze — except for public health and safety and “revenue producers” — but even critical positions can only be filled to replace a vacancy, not add jobs.
Asked about the criticism regarding overspending, City Hall defended the wage hikes for city workers including police, fire and teachers as “fair and reasonable” — and overdue.
“Investing in our workforce is critical for recruiting and retaining top talent, and ensuring our city functions efficiently and effectively,” the statement said.
A mayoral spokesman said it is premature to discuss what specific programs will be part of the budget reduction to be considered in November.
The CBC did praise Adams for taking action to curb some spending and to pressure Washington and Albany to shoulder a larger share of the costs to shelter and assist migrants.
“Mayor Eric Adams is taking the right step right now, directing agencies to propose 5 percent budget savings — PEGs [Program to Eliminate the Gap] — for the November plan and to prepare for two more 5 percent rounds in January and April,” Rein’s analysis said.
“These are a substantial and challenging lift, but critical to closing the City’s massive budget gaps; the fiscal year 2025 gap alone may exceed $13 billion if the City’s asylum seeker cost estimate proves accurate,” he said.
“NYC should not bear this much of the cost of serving new migrants and asylum seekers. The federal government should provide much more fiscal aid, and the State’s recently increased commitment is welcome, but should be bigger. The migrant crisis is a shared responsibility.
“For the City’s part, the Mayor is right to direct agencies to reduce the costs of shelter and services, which appear extraordinarily high.”
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