CWA 1180 - Political Action

Final budget deal a mixed bag
June 2002

The mayor and the City Council agreed to a final budget on June 19 that includes restoration of some of the worst cuts proposed in the mayor's initial budget but also includes significant cuts and does not include any new progressive taxes. It does include several regressive tax increases: a huge increase in the cigarette tax that will bring the cost per pack to $7, a new tax on cell phones and increases in parking fines. The new budget also includes $1.5 billion in new borrowing. Overall, it is far from the kind of budget that Local 1180 and other community voices advocated for, yet it is also clear that without the multiple protests and visible advocacy for a different budgetary vision, the final budget would have been far worse.

In budget negotiations, and backed up by dozens of protests involving tens of thousands of New Yorkers, the City Council was able to get 75% of the mayor's proposed spending cuts restored. These include keeping seven senior centers open, preserving 3,000 daycare slots, keeping libraries open six days a week, saving 40,000 summer youth jobs and restoring funding for HIV prevention and infant mortality programs. The final budget also includes restoration of the bulk of the mayor's proposed $358 million education cuts.

However, the education budget is still taking a $60 million hit, one that the already strained system cannot afford. Parks, homeless shelters, ambulance shifts, cultural programs and glass and plastics recycling all were cut as well. The biggest setback was not so much the individual cuts, which will surely hurt the city, but the failure of the council and the mayor to get the city's wealthy to shoulder any of the burden of the budget gap. The City Council, under heavy pressure from the Working Families Party and labor and community constituencies, did propose progressive revenue increases, that is, taxes that fell mostly on the rich and not the poor. The tax increases that were finally enacted, by contrast, are regressive, that is, they fall disproportionately on the poor. Everyone will now pay $7 for a pack of cigarettes, but for many working people that's an hours wage, while for the rich its what they make in a matter of minute or even seconds.

Part of what contributed to the failure of budget negotiators to shift the tax burden is that almost all city tax increases require state approval, and Albany is rarely willing to genuinely help the city out. In a state election year, tax increases were treated as an impossibility by Mayor Bloomberg, whose proclaimations on the subject then became a self-fulfilling prophecy. Bloomberg's own ideolological opposition to progressive taxation was the biggest obstacle.

The budget gap for next year is already predicted to be huge, and the city will have none of the "one-shot" options available that it had this year. Bloomberg—in a significant concession to the popular call for increased revenues—has indicated that tax increases are on the table for next year. It's up to all of us to make sure that those increases are fairly distributed and that the next budget addresses the human needs of New Yorkers.

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