Remarks of New York City Comptroller Scott M. Stringer at the New York State Financial Control Board Annual Meeting

I would like to begin by acknowledging Mayor de Blasio, Comptroller DiNapoli, State Budget Director Mujica, and the members of the Financial Control Board.

I am pleased to report today that our city’s economy and fiscal condition continued strong in Fiscal Year 2019. New York City has added over 900,000 jobs since the end of the Great Recession. Average wages are rising – up 4.4 percent in the last quarter. And we have now entered the longest sustained period of economic growth in modern history. This is an extraordinary accomplishment.

Among other things, the economy’s strength has allowed our City to enjoy low borrowing costs. In collaboration with the Mayor’s Office of Management and Budget, my office has achieved nearly $4.5 billion in savings from bond refinancings since 2014 – building up crucial resources at a time when every penny counts.

I am also happy to report today, that despite a year in which the markets were characterized by volatility, trade conflicts, and instability in the technology sector, our pension funds finished the year up 7.24 percent – above our actuarial target of 7.0 percent. Ten years after the rock-bottom of the financial crisis, our Funds are stronger than ever. That’s due to the strong partnership between the Trustees of the City Retirement Systems, the Mayor’s office, and our own Bureau of Asset Management. It’s our most important job.

Looking at these facts, it is clear that by the numbers, we have benefitted from our solid economy.

We ended Fiscal Year 2019 with a balanced budget of $93.4 billion , an increase of $4.276 billion from when the budget was adopted. And happily, almost all of that increase was a surplus that we used to help balance the Fiscal Year 2020 budget as well.

The FY 2020 budget is also balanced, at $92.8 billion – thanks to the FY 2019 surplus. Adjusted for prepayments, the budget is $95.6 billion – up a modest 1.6 percent from FY 2019.

The 2020 budget also took forward-looking steps on several important priorities that I have long advocated for.

Providing pay parity for certified contract child care workers and attorneys with their City counterparts will bring more fairness to our economy – and pay off in the long-run for our children. In addition, the Administration and City Council agreed to reimburse human services contractors for their true indirect costs. This is a reform we’ve long called for that delivers an overdue investment in the long-run viability of our critical human services providers.

We applaud these investments in a more equitable New York. But as we all know, we do not have unlimited resources. We must manage our budget with care today for the long-run benefit of our City.

Spending in the FY 2020 budget increased by just over one billion dollars between the Executive proposal and the Adopted plan, including $454 million in City Council initiatives – an increase of over 17 percent from last year. It also includes $258 million in spending by the Administration on other priorities identified by the Council, plus other new spending needs that total $228 million in FY 2020 and roughly $160 million annually in the outyears.

For the first time since FY 2014, however, the FY 2019 surplus roll declined compared to the FY 2018 surplus, by $355 million, from $4.576 billion, to $4.221 billion.

In other words, despite the $150 million added to the FY 2020 general reserve, and the $100 million addition to the Retiree Health Benefits Trust (RHBT) – we not only didn’t add to our budget cushion – we actually reduced it. The budget cushion – the sum of budgeted reserves, prepayments, and RHBT balances – fell, from 11.3 percent of budgeted spending at the beginning of FY 2019, to 10.7 percent at the beginning of FY 2020. That’s $1.2 billion short of the minimum level of 12 percent that we should be working towards.

If we’re going to build the savings we need to safeguard our fiscal condition, we have to acknowledge that our resources are not endless. We have to take the long view for our city’s long-term fiscal health. So while our fiscal position remains strong today, finding the necessary savings to ensure the sustainability of these initiatives in the future is imperative.

A greater share of those savings should come from City agencies. From the total of $5.97 billion in the Citywide Savings Plan for fiscal years 2019 through 2023, only $839 million – or 14 percent – can genuinely be attributed to agency efficiencies.

We must continue to work together to ensure the Citywide Savings Plan relies less on refinancings, re-estimates of spending, and funding swaps with State or Federal funds, while asking more from our agencies.

Today our City budget is balanced, our credit rating is strong, and we have built a strong foundation for future generations of New Yorkers. Taking these additional steps is central to our ability to ensure that today’s investments in the future are sustainable, whether we face a recession or some other unforeseen event in the future.

I look forward to working with the Mayor and our partners here today to build on the foundation we’ve laid, and continue to move our city forward for generations to come. Thank you.

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