Mar 11th - 12:56 pm
State Comptroller Tom DiNapoli gave NYC Mayor Bill de Blasio’s budget proposal a thumbs up for the short term, saying he made appropriate use of higher than expected tax revenues to reduce out-year budget gaps and to
But the comptroller also warned that the potential cost of labor negotiations on some 150 outstanding municipal contracts “casts a shadow of uncertainty on the city’s finances.
“While strong economic growth has boosted city revenues, Mayor de Blasio continues to grapple with ongoing structural deficits and labor contracts that have remained unsettled for far too long,” DiNapoli said.
“The final cost and structure of these agreements may not be known for some time. This plan is a strong starting point for the mayor and I urge him to remain cautious and look at the long-term picture.”
That concern echoes the assessment of DiNapoli’s New York City counterpart, Comptroller Scott Stringer, who recently called the contracts the “Achilles heel” of the de Blasio administration, and said budget chaos will ensue if the mayor doesn’t reach agreements with the city’s labor unions by the end of June.
DiNapoli’s analysis suggests that revenues could be higher than what the de Blasio administration has forecast, but found it still faces a number of large budget risks.
Besides the outcome of collective bargaining, other risks include the anticipated receipt of $1.2 billion from the planned sale of taxi medallions during fiscal years 2015 through 2017 and whether the Health and Hospitals Corporation will require additional financial assistance from the city. It is also unclear if federal aid for Sandy recovery will fall short of the city’s expectations.
DiNapoli left a blank when it comes to the question of funding for universal pre-K. De Blasio says his tax-the-rich plan would generate about $340 million to $350 million a year to enroll all the city’s four year olds, which is considerably more than the $100 million Cuomo has allocated in his 2014-15 budget proposal for pre-K statewide.
Another concern flagged by the state comptroller is the city’s projected growth in debt service and health insurance costs. Together they are expected to grow by $4.6 billion – or 47 percent – between FY 2013 through FY 2018, and to consume 24 percent of city fund revenue by FY 2018.
In recent years, DiNapoli notes the city has relied heavily on nonrecurring resources to balance the budget. The budgets for fiscal years 2014 and 2015 each count on about $2.5 billion in nonrecurring resources.
You can read DiNapoli’s entire report on the NYC budget here.
Mar 3rd - 12:21 pm
ICYMI, here’s the lead item today’s Morning Memo:
The New York City-based war over charter schools will reach a head in Albany tomorrow, as hundreds from either side descend on the state Capitol for dueling rallies.
On one side: Former NYC Councilwoman and charter school operator Eva Moskowitz, who is furious with NYC Mayor Bill de Blasio for reversing co-location decisions by his predecessor, former Mayor Bloomberg, that would have allowed for the expansion of three schools operated by her Success Academy network.
Moskowitz has cancelled school tomorrow at all 22 of her charters, and plans to bus angry parents, students and teachers to Albany to protest de Blasio’s decision.
On the other side: De Blasio and his allies, who had already planned to be in Albany Tuesday to rally for his ever-more-out-of-reach plan to let the city tax wealthy residents to expand pre-K and after school programs in the five boroughs. De Blasio last week fanned the flames still further by calling Moskowitz’s rally a “sideshow,” insisting he would not be deterred by her plans.
There is a belief among de Blasio backers that that Moskowitz has launched her competing rally with the tacit approval – if not outright encouragement – of the pro-charter Cuomo administration, which is at odds with the mayor over pre-K funding.
Just last week, Cuomo was praising the charter school movement and its departed “champion” (Bloomberg), while refusing to weigh in directly on the co-location argument.
A Cuomo spokesman did not return an email seeking comment Sunday night.
Meanwhile, Senate GOP Leader Dean Skelos told the NY Post he’s prepared to fight on behalf of charter schools during the ongoing budget negotiations with Cuomo, Assembly Speaker Sheldon Silver and IDC Leader Jeff Klein.
Skelos called de Blasio’s co-location decision “unconscionable.” He also expressed concern about the administration’s effort to redirect a $210 million construction fund used to build space for charter schools toward pre-K, and its plans to charge better-financed charter schools rent.
Not everyone in the charter community is at war with de Blasio. Twenty-three charter organizations have signed onto a Feb. 27 statement calling Moskowitz’s competing rally “not the right approach at this time,” and refusing to participate.
“Tuesday is not a day to be divided,” the letter reads. “Those rallying in Albany next week should stand together with the city and advocate – side by side – for our children, particularly the most underserved, and all of whom are public school students.”
Feb 28th - 10:32 am
Kerry Kennedy was acquitted on Friday morning of drugged driving charges.
The daughter of the late Sen. Robert Kennedy and ex-wife of Gov. Andrew Cuomo had maintained during a trial that she had accidentally taken sleeping medication.
Feb 26th - 3:26 pm
Sen. Tony Avella caught the “regular” Democrats by surprise with his decision to defect to the IDC. Apparently, there was no warning – not for his (now former) conference members or his longtime consultants at The Parkside Group - which has left some pretty bruised feelings on the part of the people he left behind.
It might not be so bad if the conference – and especially Avella’s fellow Queens Democrat, DSCC Chairman Mike Gianaris – hadn’t worked hard to get Avella elected in a tough race against former GOP Sen. Frank Padavan back in 2010. The fact that Avella has given a win to Gianaris’ political rival, IDC Leader Jeff Klein, has got to sting, too.
What’s particularly surprising about this move is that Avella has never been much of a joiner. He’s neither a party guy, nor an institutional guy. And while the political world has been willing to chalk up his behavior to “Tony being Tony,” his maverick streak has not served him well in terms of making friends – not during his days on the NYC Council, and not in Albany, either.
According to Queens and Albany sources, the Senate Democrats had been working on Avella’s behalf to smooth feathers he ruffled with local Democrats thanks to his handling last year of a local NYC Council race and his short-lived run for borough president.
Avella refused to endorse the party’s nominee for the Conucil seat he once held, Paul Vallone, even after Vallone eked out a victory in the Democratic primary. Avella and the Vallones (a NYC political dynasty family) have never gotten along terribly well. Avella tangeled with his former Council colleague, Peter Vallone Jr., during the borough president race before dropping out of the running entirely.
According to several sources, the unhappiness with Avella on the party of some local Democrats was so high that there had been talk of a primary challenge. Now that he has thrown in his lot with the IDC, he may very well have increased his chances of getting challenged by a member of his own party this fall. A number of names have already been floated, including (but not limited to) Assemblyman Ed Braunstein and WFP legislative director Austin Shafran, a former Cuomo administration aide and Senate Democratic spokesman who lost a close Council primary to Paul Vallone last fall.
There’s also always the threat of a primary challenge from Sen. Toby Stavisky, whose home was redrawn into Avella’s district during the last round of redistricting. She ultimately chose to run in the 16th SD instead of the 11th, but could always change her mind, especially if she faces a third primary challenge challenge from John Messer.
“Everyone is talking now about primarying the guy,” a Queens Democratic source told me this afternoon. “He has a lot of enemies…Everyone hates Tony Avella; he fights with everyone.”
Everyone hates him, that is, except the people who matter: The voters. Avella remains very popular with his constituents, and, as Jimmy Vielkind noted, has maintained a hyper-local focus during his time in Albany, which certainly has helped to maintain his close connection with his constituents.
Despite his local strengths, it’s worth noting that Avella defeated Padavan with a campaign that focused largely on two key issues: Immigrants rights (the district has a lot of first and second generation immigrants), and women’s rights – specifically, abortion. The fact that Avella has now joined up with the IDC, which women’s rights groups blame for the failure of Gov. Andrew Cuomo’s 10-point Women’s Equality Act to come to the floor, will no doubt come up if someone does opt to challenge the senator.
Avella has never been one for raising campaign cash. As of mid-January, he had just $2,775 in his campaign account. Of course, now that he’s joined forces with the IDC, Avella will come under Klein’s protection. IDC spokesman Eric Soufer told me the conference is “fully behind” its newest member, politically speaking.
Upon learning the news about Avella’s switch, several observers wondered how long this new relationship might last, given the senator’s independent streak and his propensity for pissing people off.
“He’s whole brand is that he’s not that guy,” my Queens source said. “He’s the guy who rips up his parking placard every year and tells everyone to drop dead. He’s not the political guy who’s in bed with the other side and doing deals. And all of a sudden, he’s with the Republicans? I don’t see this thing lasting.”
Only time will tell.
Feb 11th - 12:04 pm
Former Bronx Councilman Oliver Koppell, who is reportedly mulling a primary challenge to IDC Leader Jeff Klein this fall, issued a statement this morning blaming Klein for the refusal of his power-sharing partner, Senate GOP Leader Dean Skelos, to allow a bill establishing NYC Mayor Bill de Blasio’s tax-the-rich-for-pre-K plan to the floor for a vote.
Koppell called Skelos’ decision to block the measure “outrageous,” said said the “only reason” the GOP leader is allowed to block this and other progressive legislation “is because of his backroom deal with Senator Jeff Klein.”
“As a former Councilmember who represented much of Senator Klein’s Senate District and a current resident of this district, I call upon Senator Klein to immediately renounce his self-serving agreement with Senator Skelos and rejoin the Democratic Conference.”
This is the first time I can recall that Koppell issued a formal statement on anything to do with the goings on in Albany.
The former councilman, who also served a brief stint in the state attorney general’s office, has not officially announced a challenge to Klein, but he has discussed a possible run with the IDC leader’s political nemesis, DSCC Chairman Mike Gianaris. If nothing else, this statement serves to put Klein on notice (assuming he wasn’t already) that Koppell is waiting in the wings.
But Klein has doubled down on his support for de Blasio’s plan to tax wealthy New York City residents to fund universal pre-K and after school programs.
Yesterday, the senator upped the ante – and further drove a wedge between himself and Skelos – by saying he would not support a budget plan that does not “realize the vision Mayor de Blasio and I share of providing high-quality, universal pre-k to the 50,000 four year olds who need it,” adding: “Mayor de Blasio’s plan is the only one that provides New York City with the funding it needs to achieve that goal.”
The left has been agitating for some time against Klein and his fellow IDC members for failing to live up to their promise that their power-sharing deal with the Republicans would result in the passage of more “progressive” legislation, though the IDC has pointed to things like the minimum wage hike as proof that the conference is indeed delivering.
The left has been making noises about supporting primary challengers to IDC members, though they so far have failed to locate any willing candidates. They appear to be keeping their powder dry until at least the end of the budget battle – and perhaps the entire legislative session – to see what kind of progress the conference is able to make.
UPDATE: The Daily News’ Glenn Blain reports that Klein today is walking back his Shermanesque no budget/no pre-K statement from yesterday, reiterating that he’s not in favor of “taxing for the sake of taxing,” and adding: “But again, if we move forward and we find that we can’t fund the universal program in the city or the state, every alternative has to still be on the table.”
Klein said it’s “too early” to say for certain whether de Blasio’s pre-K plan is “right” compared to the one the governor is proposing, which calls for using $1.5 billion over five yreas to fund pre-K statewide ($100 million total in the first year, $25 million of which is renewing the existing competitive pre-K grants). That’s considerably less than $350 million a year de Blasio says it would cost just to cover re-K in the five boroughs.
Also, after tweaking the Senate Republicans yesterday for being “in the minority,” Klein today rejected the idea that there’s any rift between him and Skelos.
Jan 17th - 2:08 pm
The post-Sandy rebuilding of a Nassau County sewage plant with the help of $730 million from the Federal Emergency Management Agency is a credit positive for the county government and avoids a potentially expensive borrowing scheme, a Moody’s analysis found.
Debt-laden Nassau County had planned to pay for the rebuilding of the facility with a combination of state-backed loans and long-term financing.
Nassau’s debt service accounts for 13.5 percent of its expenses.
Up until recently, the federal government hadn’t committed to specifying a share of the constructions.
But the $730 million in aid is the largest award to date for repairs relating to the devastating storm to any local government with the exception of New York City.
The move is also a positive development for financially troubled municipalities like Long Beach, the report found.
More from Moody’s can be found on page four of the report:
Dec 24th - 2:04 pm
They’re just one big, happy Democratic family.
All of the state’s top elected Democratic officials will unite on Jan. 5 to host a breakfast at Gracie Mansion on Jan. 5. to celebrate the inauguration of New York City’s new mayor, Bill de Blasio.
An invitation to what is officially being billed as an “inauguration committee breakfast,” lists Gov. Andrew Cuomo, Sens. Kirsten Gillibrand and Chuck Schumer, state Comptroller Tom DiNapoli, AG Eric Schneiderman, Assembly Speaker Sheldon Silver, Senate Democratic Leader Andrea Stewart-Cousins, IDC Leader Jeff Klein, NYC Comptroller-elect Scott Stringer and NYC Public Advocate-elect Tish James as the hosts of the event.
The breakfast will take place form 8:30 a.m. to 10 a.m. at Gracie on Sunday, Jan. 5 – four days after de Blasio is sworn into office at City Hall.
Nov 20th - 3:55 pm
Citing structural imbalances and limited liquidity, Moody’s Investors Service on Wednesday downgraded Westchester County’s general obligation rating from AAA to AA1 with a stable outlook.
The downgrade comes preceding a bond issue in order to finance local capital projects.
The downgrade also comes as newly re-elected Republican County Executive Rob Astorino is considering a run for governor and will likely campaign on a theme of the state ignoring the plight of local governments as well as his own budgetary competence.
In announcing the downgrade, Moody’s pointed to reduced financial flexibility due to narrow reserves and a “trend of structurally imbalanced operations” and economically volatile sales tax revenues.
Still, the county has a lot of structurally inherent positives for investors considering its large tax base that benefits from its closeness to New York City along with its many wealthy residents.
Nov 8th - 12:48 pm
Credit rating agency Moody’s downgraded state Thruway Bonds from A1 to A2 on Friday, citing ongoing questions surrounding the financing of the replacement for the Tappan Zee Bridge.
The authority is expected to issue a “significant amount” of junio lien obligations recently adopted by the Thruway Authority’s board in order to help finance the bridge.
“The downgrade considers that future financial performance will rely to a much greater extent on as yet undetermined toll increases to support the bridge construction costs and that failure to adopt sufficient rate increases within the expected time horizon would pressure financial metrics,” Moody’s reported.
Among the challenges the Thruway bonds face:
-The Thruway Authority is yet to adopt a policy for toll increases in order to finance debt repayment on the new bridge. New tolls are expected over time to meet those goals.
-The authority’s debt load is expected to “increase significantly” to fund the project alongside the rest of the Thruway’s needs. It’s estimated by Moody’s the ratio of debt to operating revenues will grow substantially.
-The challenging logistics of the construction also present challenges. The rating agency cites the shipping of a giant crane to be used in building the new bridge from the west coast through the Panama Canal. Failure to receive the crane in working order could pose a delay and added costs.
There are bright spots, however.
Moody’s notes that most of the bridge construction cost is benig held down by the fixed-price design-build contract. At the same time, the toll rates in Thruway system overall remain “relatively low” leaving a margin for future increases.
Gov. Andrew Cuomo celebrated late last month when the federal government approved a massive $1.6 billion loan package to help finance the bridge construction.
Nov 7th - 12:17 pm
ICYMI: WNYC’s Brian Lehrer did a fantastic job of taking the advice of “The Colbert Show” producers to heart and talking to the host (when he was in character) “like he was some rich drunk idiot at a bar.”
Topics of discussion included: Mayor-elect Bill de Blasio’s win and how much that can be attributed to his unusually photogenic family, Joe Lhota’s loss and how much that can be atrributed to his willingess to let adorable kittens get run over by subway trains, and New Jersey Gov. Chris Christie’s big re-election win.