NYC Mayor-elect Will Face Immediate Fiscal Crisis
Like most big-city mayors, de Blasio is uncertain to count on aid from Washington, where another government shutdown or sequestration could turn off the faucet of federal funds.
But he also faces a silent threat unique to New York, a heavily Democratic city where that party has been out of power for more than 20 years. Suddenly, liberal groups a¿¿ from social service organizations to nonprofits a¿¿ will have their hands extended, looking for their overdue share of city funds.
Beyond combating unforeseen disasters, both natural and man-made, another land mine could be the interest rates on the city's debt service. New York has more than $100 billion in long-term capital debt and would take a hit if rates were to increase.
"The mayor has relatively limited ability to affect the city economy," Muzzio said. "It is driven by forces outside of his control. He's captive."There is some good news: New York has bounced back from the last recession better than most big cities, city spending has been cut slightly and tax revenues are on the rise, thanks in part to Bloomberg's policies and rising profits on Wall Street. But de Blasio needs more than that to enact his sweeping legislative agenda, one he hopes will continue the city's reduction in crime while combatting New York's rising income inequality. His signature campaign proposal is universal pre-kindergarten, which will be funded by a tax hike on the wealthy. But he needs Albany's support to raise taxes, and if it's not forthcoming, he'll need to look elsewhere to find the money. "He has tough choices to make," Kellerman said. "There's no pot of gold to pay for everything."
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