Cut

Fewer NYC parking tickets to cut revenue 4 pct: group

Reuters News
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Posted: Mar 24, 2011 6:27 PM
Fewer NYC parking tickets to cut revenue 4 pct: group

By Joan Gralla

NEW YORK (Reuters) - New York City has issued fewer parking tickets each year since fiscal 2003, and this year likely will continue the "long-term downward trend," a fiscal watchdog said in a report released on Thursday.

Revenue from this unpopular fine is expected to slide nearly 4 percent to $580 million, according to the report by the New York State Financial Control Board.

About 9 million tickets have been written each year since fiscal 2004, down sharply from the highs of 13 million tickets hit in 1991 and 1992.

The drop this year, for the budget that ends on June 30, is partly explained by an exceptional series of local snowstorms, which cost the city about $53.5 million in lost parking fines.

But the Financial Control Board, set up in 1975 to rescue the city from a fiscal crisis, says it is waiting for a more complete explanation from the Mayor's Office.

A mayoral spokesman said: "We've heard a lot of talk that there is extra money and the tough choices the Mayor is making are not necessary, but this is the third report from an outside fiscal monitor that shows there is no extra money, and that the Mayor is making the difficult decisions that need to be made."

The two other budget reports came from the Independent Budget Office and the City Comptroller.

The New York Financial Control Board's report echoed some of the mayor's own warnings about the fiscal risks facing the city.

Citing dwindling state and federal aid, he recently told reporters: "Keep in mind, we are going to have to do more with less,. and in some cases, do less."

SACRIFICE NOW OR SUFFER LATER

Bloomberg has proposed various ways of cutting how much it costs to pay the city's 300,000 workers, and fund their pension and health benefits -- and those of its retirees.

So far, the state Legislature and the unions have resisted some of his plans, which include raising retirement ages and laying off teachers based on performance instead of seniority.

Yet the city's future budget gaps could range from almost $5.7 billion in fiscal 2013 to over $6 billion in fiscal 2016, the report said, citing the high growth in debt service, and pension and healthcare costs for current and retired workers.

"It is time for all of the stakeholders -- the city, state, labor and management -- to come together and develop plans to reduce the growth in both pension and healthcare costs," the state Financial Control Board's report said.

"If this is not successful, the city will be faced with having to develop deeper and deeper agency reduction programs year after year," the report warned.

Bloomberg has ordered 10 rounds of budget cuts since 2007. His new $65 billion budget plan reduces capital spending by 10 percent, lays off nearly 5,000 teachers, and reduces the fire and police forces to their lowest levels in decades.

However, the report found some bright spots in the city's economy, including the start of a recovery in the real estate market. The market value of all taxable property in New York City is expected to rise 3.75 percent to $823 billion in the new fiscal year that starts on July 1.

Noting property values had stagnated at around $800 billion since fiscal 2008, the report said: "As welcome as is any sign of recovery, this 3.75 percent growth is modest compared with the 13 percent average annual market value growth achieved from fiscal 2003 to fiscal 2008."

Wall Street, the linchpin of the city's economy, staged quite a recovery after the credit crunch, earning $61.4 billion in 2009 and $27.6 billion in 2010, the report said.

But the city this year has not captured a bonanza in personal income tax revenue, partly because banks and brokerages now pay more of their bonuses in restricted stock, to soothe public ire and tie performance more closely to a company's long-term health.

When bankers and brokers sell these stock awards and pay taxes in the future, however, the city should get "an upside in future personal income tax revenues," the report said.

(Reporting by Joan Gralla; Editing by Jan Paschal)