NYC Revenue Picture Worsens With Shortfall Rising to $9 Billion

(Bloomberg) -- New York City’s fiscal crisis has worsened, with Mayor Bill de Blasio projecting a $9 billion loss in tax revenue through mid 2021 because of the coronavirus lockdown.

The shortfall is $1.6 billion more than projected last month and may force de Blasio to order layoffs, furloughs or further cuts to city services if the city doesn’t receive additional federal aid, the mayor said. The city is also seeking state approval to borrow as much as $7 billion as a last resort to pay operating expenses.

“There is literally no way that we can solve this problem without federal help or without making very very painful choices that will affect the quality of life in this city,” de Blasio said at a news conference. “No one wants to borrow. What we want is the federal government to step up for us in the middle of this crisis.”

Last month, Bill de Blasio proposed an $89.3 billion budget for the fiscal year beginning July 1, $6 billion smaller than he had planned in January. It was balanced by $3 billion in spending cuts and debt service savings and $4 billion in reserves built up over the past six years, as well as about $2 billion in previously received federal aid. The mayor ruled out raising taxes.

“The upcoming fiscal year, a huge budget problem. The next fiscal year, I can tell you right now is also going to be a huge fiscal problem,” the mayor said. “We’re not going to see the revenue recover any time soon.”

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