including Ana Champeny, deputy research director at the Citizens Budget Commission.

Ana Champeny: Yes, Mayor Adams is exactly right to ask agencies to identify savings of 3%. Ensuring the city uses taxpayer resources efficiently and effectively, delivers high-quality services and achieves a sustainable budget is critical to maintaining the ability to provide for New Yorkers in the future. City-funded spending increased by $16 billion (30%) from fiscal year 2014 to fiscal year 2020, prior to the pandemic, with little attention to increasing efficiency and ensuring high-quality services. Now, the city faces multi-billion-dollar budget gaps, upward pressure on spending from expired labor contracts, a looming fiscal cliff when the federal money is used up, and significant economic risks. Starting to implement productivity-based savings now is necessary.
Ana Champeny: The Program to Eliminate the Gap letter from the Office of Management and Budget provided direction on how to achieve the reductions. First, agencies were asked to right-size their headcount by reviewing and eliminating vacant positions (currently, there are nearly 20,000 vacant full-time positions). Second, agencies were asked to find productivity and efficiency savings by reducing spending on underutilized services and streamlining operations, while not cutting direct services, raising fees, or resorting to layoffs. Further, agencies were instructed to identify service impacts and rank these reductions. This step is important and will allow OMB to think critically about which proposed reduction to implement.

Ana Champeny: While there certainly is some waste, the Citizens Budget Commission has long supported consistent and on-going efforts by agencies to identify efficiency savings and improve operations. Five strategies include: 1) redesigning programs or services, or shrinking or eliminating less cost-effective or duplicative services; 2) improving operations through the use of technology or process redesign; 3) identifying alternate service providers within or outside the public sector; 4) sharing resources across agencies and reducing or eliminating duplicative processes; and 5) strengthening centralized management of cross-agency operations, such as fleet, office space, and energy. Agencies should include staff at all levels – from executive to managers to front-line staff – in these efforts. Staff will have valuable insights on how programs and operations can be improved. Ongoing, the mayor should be working with labor during this round of collective bargaining to find even greater efficiencies. This is crucial both to stabilize the budget over time and to provide workers raises without driving unaffordable spending increases.

“The question is, fundamentally, what will be delivered, what we can afford and how impactful will those programs be,” said Andrew Rein, the president of the Citizens Budget Commission, a fiscal watchdog.
This year, the state’s coffers are overflowing, partly after an influx of federal funding, with state officials now projecting balanced budgets through 2025, a starting negotiating position for Ms. Hochul that Mr. Rein described as “virtually unprecedented.”

Still, filling the final gaps in coverage in New York remains a challenge, said Andrew Rein, the president of the Citizens Budget Commission.

"The last mile is really hard, which is why New York's leaders should be considering an array of strategies to increase the number of New Yorkers who have insurance," he said.

The proposals unveiled at a virtual news conference by the Citizens Budget Commission and the Community Service Society also come as Gov. Kathy Hochul next week is expected to unveil her first budget proposal.

Still, filling the final gaps in coverage in New York remains a challenge, said Andrew Rein, the president of the Citizens Budget Commission.

"The last mile is really hard, which is why New York's leaders should be considering an array of strategies to increase the number of New Yorkers who have insurance," he said.
"It will have effects on individuals and their out of pocket spending, insurance markets and how they can affect premiums, on insurance provider system, including the safety net system," Rein said.

Andrew Rein, president of the nonpartisan Citizens Budget Commission and a former city Health Department deputy commissioner, was encouraged by Adams’ announcement, but said he has his work cut out for him.

“This will be a challenge, because the muscle memory of developing PEGs has to some degree been lost as it hasn’t been a feature of the past eight years,” Rein said, referring to de Blasio’s administration. “This is going to be hard work.”

Rein suggested Adams’ 3% spending reduction target may need to increase down the road — and urged the mayor to also eventually make the Department of Correction part of the PEG effort, though he voiced sympathy with the fact that the agency remains in a staffing crisis.

“It’s a good to start, but it should not be the end,” said Rein. “DOC is in crisis and there are a variety of steps that needs to be taken to make sure that it’s managed better, but I understand this is not the time.”

“As we come out of this, as we get past the pandemic, we say we still have issues in the health system, and reducing the number of uninsured is one of those major issues,” said Andrew Rein, president of the Citizens Budget Commission. That’s why he said his organization teamed up with the Community Service Society to provide lawmakers an analytical roadmap for a variety of potential solutions.
The most expensive path the Citizens Budget Commission and Community Service Society modeled was creating state premium subsidies to supplement those that exist at the federal level for people buying individual plans on the public marketplace.
None of the five options the report would alone offer a “magic bullet” solution, as Rein put it, to insuring the remaining 1 million New Yorkers without coverage. And the report was not designed to advocate for any one plan that the state should pursue. “You’ve got your carrots, your sticks and your nudges,” Rein said. “You make it cheaper, carrots; you’ve got your sticks, you’ve got a mandate; and you got your nudges, you go out and help people enroll.”

Hochul’s plan to accelerate middle-class tax cuts and state efforts to find Medicaid changes that improve access and care, and lower costs, received high marks from Citizens Budget Commission president Andrew Rein.

“Her plans span many areas and we commend her intention to ensure New Yorkers who left return and make New York the most business-friendly state in the nation,” he said.

However, Rein cautioned that the programs presented in Hochul’s State of the State address “must be affordable or they risk the State’s future capacity to serve New Yorkers, including those most in need.”

Funding for the state’s proposed Clean Water, Clean Air and Green Jobs Environmental Bond Act — which goes before the voters in November — would also increase $1 billion to $4 billion.

Andrew Rein, president of the independent Citizens Budget Commission, commended Hochul for having “laid out an expansive recovery and policy agenda,” specifically noting her pro-business proposals.

“We also caution that the programs presented, many of which appear beneficial, must be affordable or they risk the State’s future capacity to serve New Yorkers, including those most in need,” Rein said in a prepared statement.

Hochul didn’t delineate funding sources for her $10 billion in proposed health-care spending, or the price tag for her proposed Brooklyn-Queens rail line, for example.

The governor has said often in recent months that she’s opposed to raising taxes. Indeed, she’s proposing cuts in taxes to benefit lower and middle-class taxpayers, with $2.2 billion in relief.

“The programs presented, many of which appear beneficial, must be affordable or they risk the state’s future capacity to serve New Yorkers, including those most in need,” Andrew Rein, president of the Citizens Budget Commission, warned in a statement.

“At this point we don’t have the details about what the structure and process is, but it’s good to have someone who’s managed the city and has experience with it, especially with an agency point of view,” said Andrew Rein, president of the Citizens Budget Commission, an independent fiscal watchdog.

Spending on homelessness more than doubled to $4 billion during the de Blasio Administration. de Blasio was “fortunate,” said Andrew Rein, president of the Citizens Budget Commission. “First, riding a really strong economy and second with what may have been the biggest bailout of a local government during a recession.”

Carol Kellermann, former president, Citizens Budget Commission, and columnist, Gotham Gazette