The Citizens Budget Commission (CBC) is pleased to provide the Charter Revision Commission (CRC) with a refinement, including draft charter language, of five of our preliminary seven proposals. These proposals would:

• Strengthen legislative Fiscal Impact Statements;
• Improve accuracy of Financial Plan estimates;
• Require a statistically valid resident feedback survey;
• Create Rainy Day Fund deposit, withdrawal, and target size rules; and
• Cap Debt Service at 15% of tax revenues.

The sections below outline the proposed changes and how they would improve the City’s financial management and resident feedback. Draft Charter language is in the Appendix.

While the CRC Preliminary Report did not mention proposals to improve financial plan estimates, we include them here because they are a critically important companion to proposed improvements to legislative fiscal impact statements. Together, these reforms would substantially improve the integrity of the budget process.

We also again recommend Charter revisions to improve the Rainy Day Fund and cap debt service, since both are important to improve City finances. The Rainy Day Fund rules have long been considered and have been the subject of substantial research, while the debt service limit has been policy for decades and is relatively simple to add to the Charter.

We do not provide more detailed recommendations or draft Charter language on two of CBC’s preliminary proposals—to establish the Retiree Health Benefits Trust fund and a comprehensive performance management system. However, we stress the importance of both for the City’s fiscal and managerial success. The long-term liability for other postemployment benefits is substantial, around $100 billion, and the City needs a sustainable and affordable approach to meet that challenge.

Additionally, recent data and news reports have drawn attention to service delivery issues, and CBC’s 2023 Resident Survey found that most New Yorkers rate government services as fair or poor; a robust performance management system is critical to delivering effective, efficient, and high-quality services that New Yorkers need and deserve.

Strengthen Legislative Fiscal Impact Statements

Issue: The Charter-mandated legislative Fiscal Impact Statement (FIS) is not released until a few days prior to a local law’s enactment; the budgetary impact of proposed laws is rarely substantially considered during deliberations, and local laws with major fiscal impacts may be enacted without appropriations being budgeted.

Recommendations: These are designed to improve the timeliness and quality of the FIS, require an independent fiscal assessment for high-cost proposals, increase transparency on the budgetary status of high-cost enacted local laws, and ensure the alignment of laws and appropriation authority.

It is our considered opinion that this makes sense as good policy and is reasonable to have in the Charter. However, given the CRC's timeline, CBC was not able to explore whether there were legal issues that needed to be considered, and we hope the CRC’s staff is conducting the appropriate due diligence as it refines proposals to put on the ballot. 

For all proposed local laws receiving an initial City Council Committee hearing, revise the Charter to:

• Require publication of the City Council FIS at least 72 hours prior to the initial Committee meeting;
• Require the FIS to identify the operating and capital budget impact of the proposed law in each fiscal year of the financial plan and the annual impact when fully implemented;
• Require the FIS to identify the data, methods, and assumptions used in its preparation; and
• Require the FIS to specify whether and, if so how, the proposal can be accommodated within the current budget in each fiscal year of financial plan.

For proposed local laws that have a fiscal impact of more than $100 million in any single year—a threshold to be adjusted annually by the year-over-year change in total City funds—revise the Charter to:

• Require the Independent Budget Office to either release its own FIS, including all the components required in the City Council FIS, or certify the reasonableness of the Council estimate, within 30 days;
• Require the Office of Management and Budget to publish, with each financial plan, a list of all such local laws enacted in the past four years and to identify whether each law is funded in each year of the financial plan; and
• Allow local laws beyond this threshold to take effect once adequate appropriations have been modified into the budget or negotiated during budget adoption.

Improve Accuracy of Financial Plan Estimates

Issue: Despite the Charter requiring “accurate estimates of revenues and expenditures and provide estimates of all current programs at current service levels,” the City’s financial plan routinely understates by billions of dollars the funding needed to maintain current service levels, thereby masking the City’s true fiscal position.

Recommendations: The intent is to increase the accuracy and transparency of the budget’s estimates by requiring the financial plan to include a detailed explanation for significant year-over-year variation in projected tax revenues or program expenditures, or where they vary substantially from estimates made by the City or State Comptrollers.

Specifically, the Charter should be revised to require that each financial plan include:

• An explanation of any tax revenue change greater than 10 percent from the prior fiscal year, detailing the underlying factors including economic conditions, and changes in state, federal or local laws; and
• An explanation of any expenditure change in any major program or unit or appropriation greater than 10 percent or $10 million from the prior fiscal year, detailing the underlying factors including service or caseload volume, costs of each unit of service, and the factors that led to these changes.

Additionally, the Executive Budget Message should include:

• An explanation of any major program or unit of appropriation expenditure for the ensuing fiscal year where the estimate by the Office of the City Comptroller or the Office of the New York State Comptroller varies 20 percent or more, detailing the reasons for variance including a) service or caseload volume, b) costs of each unit of service, and c) factors that lead to these differences.

Require a Statistically Valid Resident Feedback Survey

Issue: The City is currently not required to collect statistically valid ratings from residents about City services and programs and does not have the opportunity to improve programs and policy based on feedback about the quality of City services directly from those services’ “customers,” as well as insight into how residents feel about the quality of life in the city and their neighborhood.

Recommendation: The intent is to routinely collect statistically valid and representative resident ratings of services and programs to inform management and improve service quality.

The City Charter should be revised to:

• Require the City to conduct resident survey at least once every five years, starting in calendar year 2025, with statistically valid and representative results published at the Community Board level, and by key demographics such as race, ethnicity, and household income.

Create Rainy Day Fund Deposit, Withdrawal, and Target Size Rules

Issue: Current laws governing the use of the Revenue Stabilization Fund (RSF, also referred to as the Rainy Day Fund) are inadequate because they do not a) mandate deposits to help ensure the fund’s balance is substantial enough to provide relief during a recession or emergency, b) restrict withdrawals to ensure funds are only used in a recession or emergency, and c) provide for the target size needed to adequately protect the City’s long-run finances.

Recommendations: The goal is a sufficiently robust and well-protected Rainy Day Fund (RDF) with sufficient resources to cushion the City through the typical two-year revenue loss during a recession.

Specifically, the Charter should be revised to:

• Require the Mayor and City Council to enact a local law that details the City’s RDF deposit, withdrawal, and target size policy, with withdrawals from the RSF prohibited until such a law is in effect;
• Require the local law:
  • Identify the minimum target size that is 16 percent or more of tax revenue;
  • Require deposits when tax revenue growth is at least 3 percent, year-over-year, on a common rate and base, and define the formula to be used to calculate the minimum deposit;
  • Limit withdrawals to a recession or severe emergency;
  • Define a recession based on economic factors;
  • Define a severe emergency as one that is temporary and causes an increase in expenditures or decrease in revenues equal to or greater than 2 percent of total City funds; and
  • Limit the first withdrawal following the occurrence of a recession or severe emergency to two-thirds of the balance of the fund; and
• Require the City Comptroller to issue, prior to vote, an opinion on the proposed law as to the reasonableness and appropriateness of the target size, mandatory deposit, permitted withdrawal, and definitions of a recession and a severe emergency.

Cap Debt Service at 15 Percent of Tax Revenues

Issue: The New York State Constitution and State law limit the amount of long-term debt the City can have outstanding, but not debt service. The City has a policy of keeping debt service below 15 percent of tax revenues, but it is not binding and could be changed.

Recommendation: The intent is to codify the current policy of keeping debt service below 15 percent of tax revenue to ensure debt service is affordable and does not crowd out other expenditure priorities.

The Charter should be revised to:

• Set the maximum debt level in the Executive Budget certificate of indebtedness to a level that ensures debt service remains below 15 percent of the tax revenue forecast in each year of the financial plan; and
• Add to the budget and financial plan standards a provision that debt service payments may not exceed 15 percent of projected tax revenue in any year of the financial plan.

APPENDIX

For each proposed change detailed in this memo the following sections of the New York City Charter should either be amended or added.

Strengthen Legislative Fiscal Impact Statements

Chapter 2: Council

Section 33. Local laws and budget modifications; fiscal impact statements. 

a.   No proposed local law or budget modification shall be votedplaced on an agenda by a council committee, or voted on by a council committee or the council unless it is accompanied by a fiscal impact statement published and available publicly at least seventy-two hours prior to the meeting and containing the information set forth in subdivision b of this section, and the additional documents described in subdivision c of this section, if required.

b.   A fiscal impact statement shall indicate the fiscal year in which the proposed law or modification would first become effective and the first fiscal year in which the full fiscal impact of the law or modification is expected to occur; and contain an estimate of the fiscal impact of the law or modification on the revenues and capital and operating expenditures of the city, during the fiscal year in which the law or modification is to first become effective, during the succeeding three fiscal years, and during the first fiscal year in which the full fiscal impact of the law or modification is expected to occur; and identify whether and how the proposed law or modification can be supported by the current appropriation or budget.

c.   For any proposed local law whose fiscal impact estimate is greater than one hundred million dollars of city funds, indexed in accordance with subdivision g of this section, in any year of the financial plan the independent budget office, created in chapter 11,  shall either (a) publish its own fiscal impact statement including all of the components required in subdivisions b and e of this section within 30 days of the initial fiscal impact statement being publicly posted, or (b) publish a statement affirming the reasonableness of the council’s fiscal impact statement.

cd.   All agency heads shall promptly provide to any council committee any information that it requests to assist it in preparing a fiscal impact statement.

de.   Each fiscal impact statement shall identify the sources of information, data, methods, and assumptions used in its preparation.

ef.   If the estimate or estimates contained in the fiscal impact statement are inaccurate, such inaccuracies shall not affect, impair, or invalidate the local law or budget modification.

g. The fiscal impact threshold of one-hundred million dollars established in subdivision c of this section shall be updated annually by the year-over-year growth in total city funds.

Chapter 2: Council

Section 50. Local laws; funding.

A local law deemed to have a fiscal impact greater than the dollar amount established in subdivision c of section 33 of this chapter in any single fiscal year of the financial plan shall be implemented once when funds are appropriated in the amount (a) deemed required by the office of management and budget, or (b) of the funding level identified in the fiscal impact statement, whichever is lower, either through a budget modification or in the adoption of the budget.

Chapter 10: Budget Process

Section 259. Annual listing of cost of adopted laws. 

Not later than thirty days after the budget is adopted, the mayor shall publish a list of laws that (a) were passed, in accordance with Chapter 2, in the past four years; and (b) have a fiscal impact greater than the dollar amount established in subdivision c of section 33 of this chapter within the fiscal years of the financial plan. This list shall identify if funding required to implement each law is included for each fiscal year in the adopted budget financial plan.

Chapter 11: Independent Budget Office

Section 260. Powers and duties. 

a.   It shall be the duty of the office to provide to the comptroller, the president of the council, the members and committees of the council, the borough presidents, and the community boards information which will assist such officials and bodies in the discharge of their responsibilities which are related to the budgetary process, including: 

(1)   information with respect to the budget, appropriations bills and proposed local laws with fiscal implications; 

(2)   information with respect to estimated revenues and receipts and changing revenue conditions; and

(3)   to the extent practicable, such other information or analyses as may be requested by such officials and bodies. 

b.   The director, upon the request of a borough president or the president of the council for a proposed local law introduced by such official, or the chair or ranking minority member of a committee of the council for a proposed local law being considered by such committee, or as required by section thirty-three, subdivision c, shall complete a fiscal impact statement of such proposed local law consistent with the requirements of section thirty-three.

c.   The director shall from time to time publish such reports as may be appropriate to enhance official and public understanding of the budgetary process and of the budget documents published in accordance with the provisions of chapters six, nine and ten. The director shall from time to time publish such reports as may be necessary or appropriate to provide such information, data, and analysis as will enhance official and public understanding of matters relating to city revenues, expenditures, financial management practices and related matters. 

d.   The director may procure, for the office, up-to-date computer equipment, obtain the services of experts and consultants in computer technology, and develop techniques for the evaluation of revenue projections and budgetary requirements.

e.   The director shall make all information, data, estimates, and statistics obtained under subdivision c of section ninety-eight, and all studies and reports prepared by the office, available for public inspection and copying during normal business hours and shall, to the extent practicable, furnish a copy of any such information or report to any person upon request at a reasonable cost.

Improve Accuracy of Financial Plan Estimates

Chapter 10: Budget Process

Section 250. The budget message.

The budget message, which shall not be deemed a part of the budget, shall include:

1.   An explanation, in summary terms, of the major programs, projects, emphases and objectives of the budget, the general fiscal and economic condition of the city, the tax and fiscal base of the city, and intergovernmental fiscal relations.

2.   Itemized information and supporting schedules of positions, salaries and other than personal service expenses, anticipated for the ensuing fiscal year.

3.   Recommendations for any changes in the revenue sources and fiscal operations of the city, including intergovernmental revenue and fiscal arrangements.

4.   An itemized statement of the actual revenues and receipts and accruals of the general fund and of all other revenue sources, including state and federal aid and revenues for specified purposes, for each of the four preceding fiscal years, and for the first eight months of the current fiscal year, and the estimated amount of such items for the balance of the current fiscal year, and for the ensuing fiscal year. In preparing such information the mayor shall consult with the comptroller.

5.   An estimate of the probable amount of (1) receipts into the city treasury during the ensuing fiscal year from all the sources of revenue of the general fund and (2) all receipts other than those of the general fund and taxes on real property.

6.   A listing of the sources and amounts of all revenues and other monies of a nonrecurring nature that are being proposed to be utilized during the ensuing fiscal year and that are not expected to be available or used in subsequent fiscal years.

7.   An update of the four-year financial plan, as set forth in section two hundred fifty-eight of this chapter, containing, (a) for each agency, for all existing programs, forecasts of expenditures for the ensuing fiscal year and the succeeding three fiscal years at existing levels of service; (b) forecasts of revenue by source from existing sources of revenue for the ensuing fiscal year and the succeeding three fiscal years; (c) for each tax revenue source, an explanation of the forecast, as set forth in paragraph 8 of this section, shall be required when revenue projected for the ensuing fiscal year varies from the prior year by more than ten percent, with each explanation detailing the underlying factors including, but not limited to: economic conditions, changes in state, federal or local laws; and (cd) for each new or expanded program, an indication of when such program is projected to be fully implemented and a forecast of the annual recurring costs for such program or program expansion after it is fully implemented.

8.   For each agency, a comparison of the proposed appropriations for the ensuing fiscal year with (i) the amounts appropriated in the current expense budget as originally adopted and as modified through the first eight months of the current fiscal year, (ii) the amounts actually expended in the previous fiscal year and (iii) the amounts actually expended through the first eight months of the current fiscal year and the estimated expenditures for the balance of the current fiscal year.

9.   For each major program or unit of appropriation, an explanation of proposed appropriations or planned spending when the ensuing fiscal year’s appropriation or planned spending varies by more than ten percent from the previous fiscal year and is greater than ten million dollars. Each explanation shall detail the cause of variation including changes in (a) service or caseload volume, (b) costs of each unit of service, and (c) underlying factors that lead to these changes.

10.   For each major program or unit of appropriation, an explanation of proposed appropriations for the ensuing fiscal year where projected expenditures as reported by the comptroller or the Office of the New York State Deputy Comptroller vary by more than twenty percent. Each explanation shall detail the cause of variation including changes in (a) service or caseload volume, (b) unit costs, and (c) underlying factors that lead to these changes.

 911.   For each agency that has local service districts within community districts and boroughs, a statement of proposed direct expenditures in each service district for each unit of appropriation and a statement of the basis for the allocation of direct expenditures to local service districts of each such agency.

Require A Statistically Valid Resident Feedback Survey

Chapter 1: Mayor

Section 21. Resident feedback survey.

The mayor shall at least every five years, starting with the calendar year 2025, produce and publish the results of a representative survey of New York City residents that rates quality of life and city services, with statistically valid results presented on a community board level and by key demographics, including but not limited to race, ethnicity, and household income.

Create Rainy Day Fund Deposit, Withdrawal, And Target Size Rules

Chapter 58: Department of Finance

Section 1528. Revenue stabilization fund.

1.  The city may shall maintain a revenue stabilization fund to serve as a year-to-year reserve account, subject to the New York state financial emergency act for the city of New York as amended from time to time or any successor statute.

2.   Such fund shall be created and operated in accordance with any applicable state law.

3.   The mayor and council shall enact a local law to set the fund’s target size, the timing and amount of required deposits, and permitted withdrawals. Funds shall not be withdrawn from the fund until such local law is enacted.

4.   The local law shall conform to the following standards:

a.   The fund’s target size shall be at least sixteen percent of the prior fiscal year’s tax revenue.

b.    Deposits to the fund shall be mandatory when tax revenue growth, compared to the prior fiscal year, as measured on a common rate and base by the office of management and budget, exceeds three percent annually. The local law shall specify the mandatory deposit amount as a share of the tax revenue that exceeds three percent annual growth.

c.    Mandatory deposit amounts in excess of what is needed to meet the target size shall be used to fund capital projects on a pay-as-you-go basis, defease debt, or be deposited into the retiree health benefits trust.

d.   Withdrawals shall be limited to a recession, defined by economic indicators in the local law, or a severe emergency, as defined in the local law, which shall be limited to a temporary emergency that causes a significant revenue loss or expenditure increase in excess of two percent of city funds.

e.   The first-year withdrawal, once a recession or emergency has occurred, as defined in this section, shall not exceed two-thirds of the fund’s balance.

f.   The comptroller shall issue an opinion, at a minimum, as to the reasonableness of definition and appropriateness as to the levels of the target size, timing and amount of mandatory deposits and allowed withdrawals, the definition of a recession, and the definition of a severe emergency, in the proposed local law, and any future amendments, prior to a vote by council.

Cap Debt Service At 15 Percent Of Tax Revenues

Chapter 10: Budget Process

Section 250. The budget message.

The budget message, which shall not be deemed a part of the budget, shall include:

1.   An explanation, in summary terms, of the major programs, projects, emphases and objectives of the budget, the general fiscal and economic condition of the city, the tax and fiscal base of the city, and intergovernmental fiscal relations.

2.   Itemized information and supporting schedules of positions, salaries and other than personal service expenses, anticipated for the ensuing fiscal year.

3.   Recommendations for any changes in the revenue sources and fiscal operations of the city, including intergovernmental revenue and fiscal arrangements.

4.   An itemized statement of the actual revenues and receipts and accruals of the general fund and of all other revenue sources, including state and federal aid and revenues for specified purposes, for each of the four preceding fiscal years, and for the first eight months of the current fiscal year, and the estimated amount of such items for the balance of the current fiscal year, and for the ensuing fiscal year. In preparing such information the mayor shall consult with the comptroller.

5.   An estimate of the probable amount of (1) receipts into the city treasury during the ensuing fiscal year from all the sources of revenue of the general fund and (2) all receipts other than those of the general fund and taxes on real property.

6.   A listing of the sources and amounts of all revenues and other monies of a nonrecurring nature that are being proposed to be utilized during the ensuing fiscal year and that are not expected to be available or used in subsequent fiscal years.

7.   An update of the four-year financial plan, as set forth in section two hundred fifty-eight of this chapter, containing, (a) for each agency, for all existing programs, forecasts of expenditures for the ensuing fiscal year and the succeeding three fiscal years at existing levels of service; (b) forecasts of revenue by source from existing sources of revenue for the ensuing fiscal year and the succeeding three fiscal years; and (c) for each new or expanded program, an indication of when such program is projected to be fully implemented and a forecast of the annual recurring costs for such program or program expansion after it is fully implemented.

8.   For each agency, a comparison of the proposed appropriations for the ensuing fiscal year with (i) the amounts appropriated in the current expense budget as originally adopted and as modified through the first eight months of the current fiscal year, (ii) the amounts actually expended in the previous fiscal year and (iii) the amounts actually expended through the first eight months of the current fiscal year and the estimated expenditures for the balance of the current fiscal year.

9.   For each agency that has local service districts within community districts and boroughs, a statement of proposed direct expenditures in each service district for each unit of appropriation and a statement of the basis for the allocation of direct expenditures to local service districts of each such agency.

10.   An explanation of principal changes in performance goals and indicators from the date of submission of the preliminary management report to the submission of the proposed executive budget.

11.   An itemized statement, covering the city's entire capital plant, except for those portions of the capital plant which have been committed to the care and control of the board of education or officers or employees thereof, by agency and project type and, within project type, by personal services and other than personal services, of the amounts appropriated for maintenance of such capital plant in the previous and current fiscal years as originally adopted and as modified through the first eight months of the current fiscal year, and of the amounts actually expended for such maintenance in the previous fiscal year and through the first eight months of the current fiscal year and the amounts estimated to be expended for such purpose during the balance of the current fiscal year; and, for each agency, an explanation of the substantive differences, if any, between the amounts actually expended for such maintenance in the previous fiscal year or projected to be expended for such purpose in the current fiscal year and the amounts originally appropriated for such purpose for such years.

12.   A presentation of the maintenance activities proposed by the mayor to be completed during the ensuing fiscal year for all major portions of the capital plant, as such terms are defined in subdivision a of section eleven hundred ten-a, categorized by agency and project type; an explanation of the differences, if any, between such proposed activities and the activities scheduled to be undertaken during such fiscal year pursuant to subdivision c of such section; an explanation of the differences, if any, between the proposed appropriations for such activities and the estimates of the amounts submitted, pursuant to subdivision f of such section, as necessary to maintain such portions of the capital plant; and a presentation and explanation of the differences, if any, between the maintenance activities for all major portions of the capital plant proposed by the mayor, in the budget message for the previous fiscal year, to be completed during such fiscal year and the activities actually completed during such fiscal year.

13.   A statement of the extent to which the executive budget incorporates the revisions to the preliminary budget suggested by the borough presidents, in accordance with subdivision a of section two hundred forty-five and the reasons why any other suggested revisions were not incorporated in the executive budget.

14.   A statement of the modifications, if any, which the mayor recommends that the council make in the appropriations submitted by the borough presidents pursuant to sections one hundred two and two hundred eleven.

15.   A statement of any substantive changes in the methodology and assumptions used to determine the revenue estimates presented pursuant to subdivisions four, five and six of this section from the methodology and assumptions presented in the preliminary budget.

16.   A statement of the implications for the orderly development of the city, its community districts and boroughs of the capital projects included in or contemplated by the capital budget and program.

17.    A certificate setting forth the maximum amount of debt and reserves which, in the mayor's opinion, the city may soundly incur for capital projects during the ensuing fiscal year and during each of the following three fiscal years, and the maximum amount of appropriations and expenditures for capital projects which the city, given such maximum amount of debt and reserves, may soundly make during each such fiscal year. This maximum shall be set to ensure that debt service is less than fifteen percent of the tax revenue forecast in each year of the financial plan.

Section 258. Standards for budget and financial plan.

a.   The operations of the city shall be such that, at the end of the fiscal year, the results thereof shall not show a deficit when reported in accordance with generally accepted accounting principles unless such deficit is offset by funds withdrawn for such purpose from the revenue stabilization fund established pursuant to section one thousand five hundred twenty-eight. The mayor shall take all actions necessary in accordance with the provisions of the charter, including but not limited to section one hundred six, or other applicable law to ensure that the city is in compliance with this subdivision.

b.   Pursuant to the procedures contained in subdivision c of this section, each year the mayor shall develop, and from time to time modify, a four-year financial plan. Each such financial plan and financial plan modification shall comply with the requirements of subdivision d of this section and shall conform to the following standards:

1)    For each fiscal year, the city's budget covering all expenditures other than capital items shall be prepared and balanced so that the results thereof would not show a deficit when reported in accordance with generally accepted accounting principles, unless such deficit is offset by funds withdrawn for such purpose from the revenue stabilization fund established pursuant to section one thousand five hundred twenty-eight, and would permit comparison of the budget with the report of actual financial results prepared in accordance with generally accepted accounting principles.

(2)   The city shall issue no obligations which shall be inconsistent with the financial plan prepared in accordance with this section.

(3)   Provision shall be made for the payment in full of the debt service on all bonds and notes of the city and for the adequate funding of programs of the city which are mandated by state or federal law and for which obligations are going to be incurred during the fiscal year.

(4)   Debt service payments in the four-year financial plan may not exceed 15 percent of projected tax revenues.

(45)   All projections of revenues and expenditures contained in the financial plan shall be based on reasonable and appropriate assumptions and methods of estimation. All cash flow projections shall be based upon reasonable and appropriate assumptions as to sources and uses of cash (including but not limited to the timing thereof),and shall provide for operations of the city to be conducted within the cash resources so projected.

(56)   A general reserve shall be provided for each fiscal year to cover potential reductions in projected revenues or increases in projected expenditures during each such fiscal year. The amount provided for such general reserve shall be estimated in accordance with paragraph four of this subdivision, but in no event shall it be less than one hundred million dollars at the beginning of any fiscal year.

(67)   In the event that the results of the city's operations during the preceding fiscal year have not comported with subdivision a of this section, the first fiscal year included in any financial plan shall make provision for the repayment of any deficit incurred by the city during the preceding fiscal year.

c.   The financial plan shall be developed and may from time to time be modified, in accordance with the following procedures:

      (1)   The mayor shall, in conjunction with the preliminary budget prepared pursuant to section one hundred one, prepare a financial plan covering the four ensuing fiscal years (the first year of which is the year for which such preliminary budget is being prepared) as well as updating the current fiscal year.

      (2)   After the preparation by the mayor of a financial plan in accordance with the preceding paragraph, the mayor shall reexamine, at least on a quarterly basis, the projections of revenues and expenditures and other estimates contained in the financial plan, and shall prepare modifications in accordance with the following procedures:

         (a)   The budget message, issued pursuant to section two hundred fifty of this chapter, shall include an update of the financial plan covering the four ensuing fiscal years (the first year of which is the year for which such budget message is being prepared) as well as an update for the current fiscal year.

         (b)   Not later than thirty days after the budget is finally adopted, the mayor shall issue an update of the financial plan covering the four ensuing fiscal years (the first year of which shall be the year for which such budget has been adopted) as well as an update for the fiscal year that is ending or has just ended. Such update shall reflect changes which were made in the budget in accordance with sections two hundred fifty-four and two hundred fifty-five; provided, however, that the budget adopted in accordance with such sections shall be consistent with the standards applicable to the financial plan set forth in this section.

         (c)   During the second quarter of the fiscal year, the mayor shall issue an update of the financial plan covering the fiscal year in which such quarter occurs and the three ensuing fiscal years.

         (d)   In addition, on such schedule as the mayor deems appropriate, the mayor may issue further updates of the financial plan during the fiscal year.

d.   The financial plan shall include projections of all revenues, expenditures and cash flows (including but not limited to projected capital expenditures and debt issuances) and a schedule of projected capital commitments of the city. In addition, each financial plan and financial plan modification shall include a statement of the significant assumptions and methods of estimation used in arriving at the projections contained therein.

e.   When the mayor issues modifications to the financial plan pursuant to subdivision c of this section, and such modifications would require the mayor to make a notification or submission to the council pursuant to subdivision b or e of section 107, the mayor shall make such notification or submission within 30 days of issuance of such modifications to the financial plan.

f.   Notwithstanding any inconsistent provision of this charter, in the event of any change in generally accepted accounting principles, or change in the application of generally accepted accounting principles to the city, if the mayor determines that immediate compliance with such change will have a material effect on the city's budget over a time period insufficient to accommodate the effect without a substantial adverse impact on the delivery of essential services, the mayor may authorize and approve a method of phasing the requirements of such change into the budget over such reasonably expeditious time period as the mayor deems appropriate.

g.   The powers, duties, and obligations set forth in this section shall be subject to the powers, duties, and obligations placed upon any state or local officer or agency, including but not limited to the New York state financial control board, by or pursuant to the New York State Financial Emergency Act for the City of New York, while such act remains in effect.

RESOURCES

Akiva Blander, Setting the Right Ceiling: Rethinking the City’s Debt Limits and Capital Process (Citizens Budget Commission, April 2024), https://cbcny.org/research/setting-right-ceiling.

Ana Champeny, Real Numbers, Real Choices (Citizens Budget Commission, April 2024), https://cbcny.org/research/real-numbers-real-choices.

Ana Champeny, “Testimony on NYC November 2023 Financial Plan,” (Citizens Budget Commission, December 2023), https://cbcny.org/research/testimony-nyc-november-2023-financial-plan.

Ana Champeny and Adam Ciampaglio, Straight from New Yorkers (Citizens Budget Commission, March 2023), https://cbcny.org/research/straight-from-new-yorkers.

Andrew Rein, “Underbudgeting Still Clouds City’s Fiscal Picture, Even with Expanding Economy,” (Citizens Budget Commission, April 2024), https://cbcny.org/advocacy/underbudgeting-still-clouds-citys-fiscal-picture-even-expanding-economy.

Andrew Rein and Ana Champeny, Preliminary Recommendations to NYC Charter Revision Commission for Improving Finances, Management, and Resident Feedback, (Citizens Budget Commission, June 13, 2024), https://cbcny.org/research/preliminary-recommendations-nyc-charter-revision-commission.

Charles Brecher, Thad Calabrese, and Ana Champeny, To Weather a Storm (Citizens Budget Commission, April 18, 2019), https://cbcny.org/research/weather-storm.

Office of the New York City Comptroller, Debt Management Policy: New York City General Obligation and New York City Transitional Finance Authority (September 2023), p. 9, https://comptroller.nyc.gov/wp-content/uploads/2023/09/NYC-Debt-Policy-9.5.2023.pdf.

Office of the New York City Comptroller, Preparing for the Next Fiscal Storm: Setting Guidelines for NYC’s Rainy Day Fund (May 23, 2022), https://comptroller.nyc.gov/reports/preparing-for-the-next-fiscal-storm.

Office of the New York State Comptroller, Strengthening New York City’s Rainy-Day Fund (November 2021), https://www.osc.ny.gov/files/reports/osdc/pdf/report-13-2022.pdf.

New York City Council, Finance Division, “Fiscal Impact Statement, Proposed Intro. No: 878-A,” (May 24, 2023), https://legistar.council.nyc.gov/View.ashx?M=F&ID=12022610&GUID=258ED154-8EA9-43F1-B7D7-37D2014DDF22.

New York City Council, “ICYMI: Cost Estimates of City Council CityFHEPS Bills Dispute Mayor Adams’ Administration’s Unsubstantiated Cost Projections,” (press release, July 12, 2023), https://council.nyc.gov/press/2023/07/12/2443/.

New York City Council, “Council Overrides Mayor’s Veto on Legislation to Address Homelessness Crisis by Helping New Yorkers Move Out of Shelter and Avoid Evictions with CityFHEPS Vouchers,” (press release, July 13,2023), https://council.nyc.gov/press/2023/07/13/2444/.