Citizens Budget Commission (CBC) President Andrew S. Rein released this statement on behalf of CBC:

"The City is right to initiate a PEG—a Program to Eliminate the Gap—for the Executive Budget. This action is timely, if not overdue. Any delay increases the chance that the City barrels head first into the impending fiscal wall and has to make massive cuts in the future.

The City’s budget gaps as reported already grow to $6.5 billion by fiscal year 2027, even without including the unbudgeted labor contract costs, unreimbursed asylum seeker costs, federal fiscal cliffs, under-budgeted overtime, and proposed State mandates to pay more for the MTA and Medicaid.

Stronger revenues and non-rainy day reserves may help reduce the gaps, but they will not fund the $8.8 billion the City may need this year and next, and pale in comparison to the future gaps that which may well exceed $14.0 billion by fiscal year 2027. (See Figure.)

The 4 percent PEG will provide savings, but nobody should be under the illusion that it solves the whole problem. Additional actions will be needed. We await the Fiscal Year 2024 Executive Budget, due later this month, to see whether the City proposes other actions, re-estimates its revenue forecast, and the impact of the State budget, which hopefully will be enacted by then.

The PEG directive rightly says that savings programs should “(not) include layoffs and should avoid meaningfully impacting services where possible.” Ample vacancies exceeding 23,000 Citywide not only eliminate any need for layoffs, but should allow agencies to meet their savings targets and still hire critical positions.

Furthermore, the best approach to preserving services is to improve operational efficiency, which should be the focus now. While the City unfortunately failed to leverage collective bargaining negotiations to make work rules and job titles more flexible to increase operating efficiency and reduce ongoing costs, doing so in this PEG will serve all New Yorkers well by preserving services and increasing long-run fiscal stability."