Five things to know about the NYC budget deal

New York City Mayor Bill de Blasio and the City Council reached an agreement on the fiscal year 2019 budget Monday evening, sealing the $89.2 billion in spending with the customary “budget handshake” in the City Hall rotunda.

“This budget is balanced. It is progressive and it is early,” de Blasio said to cheers, well ahead of the end of the fiscal year on June 30.

Here are five things to know about the city budget agreement.

Finally, Fair Fares

After de Blasio’s executive budget neglected to fund half-priced MetroCards for low-income New Yorkers, the City Council and Speaker Corey Johnson launched a citywide campaign to get the program known as Fair Fares into the final budget. The mayor relented, and the budget devotes $106 million to fund approximately six months of the program, which is set to begin in early 2019.

At the Monday press conference, de Blasio credited the Community Service Society, which led the initial push for Fair Fares, as well as Johnson’s advocacy.

“I believe that Speaker Johnson said ‘Fair Fares’ to me an unfair number of times,” de Blasio quipped.

The funding is a big win for Johnson in his first year as speaker, proving that he could disagree with the mayor and come out on top.

Good times …

New York City’s budget has risen $14 billion since de Blasio’s first budget, in 2014. Now at $89.15 billion, it’s also approximately $90 million more than de Blasio’s executive budget unveiled in April. The city budget is required by law to be balanced, and all increases are offset by City Hall’s expected revenues.

… never last

While New York City’s economy is humming, one of the City Council’s main complaints about de Blasio’s executive budget was that the good times can’t last forever and the city isn’t saving enough money. As the mayor often says, the city’s budget reserves are at their highest point in history, and the final budget will add another $125 million to the general reserve fund, raising it to a total of $1.125 billion. The final budget will also add an additional $100 million to the Retiree Health Benefit Trust Fund, increasing that to a total of $4.35 billion.

“That is a prudent and responsible thing to do,” Johnson said Monday. “This is a huge step in making sure the social services that we offer now are not cut in an economic downturn.”

Fixing the subways

Over the mayor’s initial resistance, the state budget required New York City to devote some $418 million more towards the Metropolitan Transportation Authority’s Subway Action Plan, a quick-fix effort to expedite signal repairs, among other issues plaguing the city’s subways. While the city will be coughing up more than $400 million this year, Johnson said the City Council would be working with the mayor and state leaders in Albany to find a different source of transit funding – possibly alluding to de Blasio’s preferred millionaire’s tax to fund transit. “We are making it clear today, this is a one-time expenditure,” Johnson said of the Subway Action Plan funding.

Gov. Andrew Cuomo may disagree. In an April speech he pointed towards the city’s reserves as a way to further fund the MTA.

Property tax relief delayed – or denied

Beset by complaints of New York’s expensive – and some say, unfair – property taxes, the City Council pushed for a $400 rebate for all homeowners to be included in the budget.

But de Blasio said on Monday it wouldn’t happen. “We have a huge number of properties we have to address,” he said. “I think the more fundamental need for homeowners like myself is not a one-shot answer, it is a structural answer.”

The structural answer is a joint property tax reform commission, convened by the Council and the mayor, and already announced in May. The mayor said the commission would be just a “modest cost” and would hold at least ten public hearing starting “quickly.” The last government review of New York City’s tax code – deemed “inconsistent, indecipherable and intractable” by City & State – was in 1993.