From a recently released budget report by the New York City Independent Budget Office we have the following opening volley:

As Economy Weakens, City’s Budget Gaps Swell

After several years of amassing large budget surpluses, New York City now faces swelling budget gaps as a long and deep recession erodes jobs and tax revenues. IBO projects that the city will lose 243,000 jobs from the peak during the first quarter of 2008 and tax revenues will fall by $2.8 billion in fiscal year 2009 to $34.7 billion and then decline by $380 million more in 2010.

Recognizing that the city will not be generating large surpluses to cover the shortfall between recurring revenues and expenses, the Bloomberg Administration and the City Council have ended the property tax rate cut six months ahead of schedule, taken steps to generate additional revenues, and cut spending. Despite these efforts, the city faces daunting budget gaps beginning in 2010—the upcoming fiscal year.

Based on IBO’s estimates of revenue and expenses under the November 2008 financial plan, adjusted for the tax measures adopted last month, we project that the budget gap for fiscal year 2010 has grown to $4.3 billion (10.4 percent of city-funded revenues). With little recovery of the local economy anticipated before the end of calendar 2010, we expect the fiscal year 2011 gap to reach nearly $7.0 billion (15.9 percent of city-funded revenues).

Full Report HERE

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