Wednesday, December 14, 2011
The city of Detroit has begun suspending payments to some of its vendors in order to be able to cover basic services and make payroll. If the city is not able to resolve its budget crisis on its own, the state is likely to appoint an emergency manager to restructure the city and rescue it from bankruptcy. Moody's has put some of the city's municipal bonds on review for a downgrade.
Wednesday, December 07, 2011
By Jim O'Grady
(New York, NY - WNYC) The new tax deal working its way through Albany would impose a larger cut than first thought to a tax that helps fund the NY Metropolitan Transportation Authority.
The authority--along with its ability to keep the region's subways, buses and trains moving--is now facing a $370 million cut, up from an initial estimate of $250 million. That's because public schools were added to the list of those newly exempt from the tax, along with private schools and thousands of small businesses.
The tax costs $340 per $100,000 of payroll.
The state has pledged to reimburse the NY MTA for the cuts, which appear set to last the length of the three-year tax deal.
According to a State Senate press release, the cut slashes the "MTA payroll tax for about 78 percent, or more than 704,000, of the business entities that currently pay it. This includes eliminating the tax for 290,000 employers with payrollsof less than $1.25 million; 415,000 self-employed taxpayers; and all public and non-public schools."
Transit advocates, initially supportive of the arrangement because it appeared not to affect the MTA's bottom line, pointed out that the new reimbursement formula will deprive the authority in several ways: it will probably take longer for funds to reach it; millions in taxes the MTA could've taken in from an improved economy and expanded payrolls will now be lost; the state can still reduce the reimbursement at any time.
"This leaves the millions of New Yorkers who rely on public transit with little more than IOUs in the place of secure revenue," said a statement by the advocacy group Transportation Alternatives. "Public transit is this region’s lifeblood, creates construction and manufacturing jobs across the state, and requires dedicated funding. Eliminating or reducing any source of revenue means that revenue must be replaced by another secure, dedicated source of funding."
When the plan was first released, the NY MTA praised it for ensuring that it would "continue to receive the level of funding needed to keep New York and its economy moving." No new comment was forthcoming from the authority a day later, as new details emerged. The so-called Payroll Mobility Tax contributes $1.4 billion a year to the NY MTA's operating budget. When it was initially enacted, it was predicted that the tax would deliver $2.25 billion to the MTA -- legislators chose the tax (as well as a taxi surcharge and a tax on rental cars) in lieu of tolls on East River Bridges as part of a 2009 bailout package. The package also included the most severe service cuts in generations and fare hikes essentially in perpetuity.
A declining economy led to sagging tax revenues. The reimbursement plan envisioned by Governor Cuomo would only plug lost tax revenues from their lower-than-expected rates, not the higher rates that could come with a rebounding economy.
Governor Cuomo's office did not respond to a request for comment.
Tuesday, December 06, 2011
If you haven't sent out your Christmas cards yet, you might want to get on it, quick. Snail mail just got slower. The cash-strapped U.S. Postal Service announced Monday that it's going to end next-day delivery of letters, postcards and other First Class mail. The agency is looking to find $20 billion in annual savings by 2015, about $3 billion of which could come from various plans to shrink the network. But what will become of the letter?
Friday, November 25, 2011
The Joint Select Committee on Deficit Spending failed to reach an agreement in time for its Thanksgiving week deadline. The so-called "Supercommittee" of six Republicans and six Democrats was created last summer to cut the deficit by more than one trillion dollars, or else automatic cuts would be triggered. Bob speaks to New York Magazine politics writer Jonathan Chait who says the Supercommittee wasn't a failure at all, it did exactly what it was designed to do.
Wednesday, November 23, 2011
The Congressional "super committee" failed to reach a consensus about deficit reduction. But given a chance to tinker with the budget, ordinary Americans playing an online computer game called Budget Hero have made some big decisions. Users make decisions about spending in areas like defense, health care, Social Security, education and infrastructure and can see the effects.
Monday, November 21, 2011
By Frank James
Monday, November 21, 2011
After months of budget negotiations, tensions between Congressional "super committee" members have reached what seems to be a breaking point. With only three days left before their deadline to cut 1.2 trillion dollars from the federal debt, 12 super committee members made the rounds to the Sunday political news outlets and publicly aired their grievances. Republican Jeb Hensarling told "Fox News Sunday," the following: "Unfortunately, what we haven't seen in these talks from the other side is any Democrats willing to put a proposal on the table that actually solves the problems."
Friday, October 21, 2011
— John from the Bronx, a caller on The Brian Lehrer Show.
Friday, October 21, 2011
Brad Lander, Brooklyn City Councilman (D-39), and Melissa Mark-Viverito, city council member representing East Harlem and parts of the Bronx and Upper West Side, and member of the council's Progressive Caucus, discuss their new plan to involve constituents in budget allocation.
Thursday, October 13, 2011
Earlier this week, the City Council of Topeka, Kan. voted to decriminalize domestic violence. That surprising decision came as part of a budget stand-off between the city and the county: After the county cut the District Attorney’s budget, the DA stopped prosecuting misdemeanor domestic violence cases from Topeka. To send a message, the city voted to take the local law against domestic violence off the books — forcing the county to handle all domestic violence cases.
Tuesday, September 20, 2011
Faced with an uphill reelection battle and a disenfranchised base, President Obama indicated on Monday that he plans on taking a harder line against an anti-tax GOP. In a speech introducing his debt reduction plan yesterday, Obama vowed to veto any plan Congress sends him that does not raise taxes on the wealthy and corporations while cutting Medicare benefits. "I will not support any plan that puts all the burden for closing our deficit on ordinary Americans," Obama said. Obama's plan, which will reduce annual deficits up to $4 trillion over 10 years, has been assailed as "class warfare" by Republicans.
Tuesday, September 20, 2011
Before President Obama had even made his deficit speech, Congressman Paul Ryan spelled out his concerns over its impact. On Sunday, he accused Obama on Fox News of launching "class warfare" by introducing the so-called Buffett Rule. The president rebuffed the remarks saying "This is not class warfare. It's math."
Thursday, September 08, 2011
Six weeks after the Congressional showdown over raising the debt ceiling came to resolution, the 12 member Congressional deficit reduction committee, sometimes referred to as the "super committee" or "super Congress," will have its first meeting today. Federal spending, taxes, and deficit reduction are all on the super committee's agenda as it tries to cut nearly $1.2 trillion from the nation's debt over the next decade.
Monday, September 05, 2011
Last week, we discussed the state of the nation’s job market, and the news was not good. No new jobs were created in August, meaning unemployment is stuck at 9.1 percent. How to get the job market moving will be the subject of intense debate this week, as Congress returns from its summer recess and the President outlines his strategy. We’ll also see the first meeting of the deficit reduction committee responsible for cutting $1.5 trillion from the budget. So it’s a big week for Congressmen and women, who recently haven’t shown a fondness for compromise.
Tuesday, August 30, 2011
As students across the nation head back to school, The Takeaway presents a special report on education this week. Today, we focus on budget cuts. As states continue to take in less revenue, public schools around the country are seeing their budgets slashed. It's the principal's job to examine a budget, and distribute available funding in a way that's in the best interest for the students.
Thursday, August 04, 2011
The Newark Municipal Council has voted to introduce Mayor Cory Booker's 2011 budget by a vote of 5 to 4.
Tuesday, August 02, 2011
By Janet Babin : Economic Development Reporter, WNYC News
Newark Mayor Cory Booker is expected to reintroduce a budget to the Newark City Council Wednesday morning. Last month, his $772 million budget proposal was turned down. The sticking point for most Council members was a 7 percent increase to Newark's property tax.
Saturday, July 30, 2011
By Jim O'Grady
The MTA said the city pay should pay it half a billion dollars for building the Second Avenue Subway since, the authority claims, the city stands to gain a big boost in tax revenues as property values go up around the subway after its planned opening in 2016.
Friday, July 29, 2011
By Jim O'Grady
(New York, NY - WNYC) The NY Metropolitan Transportation Authority says the city should pay it half a billion dollars for building the Second Avenue Subway. It's only fair, the NY MTA reasons, when the city stands to gain a big boost in tax revenues as property values go up around the subway after its planned opening in 2016.
The proposal is one of nine different sources of funding the authority is counting on to plug a $9 billion gap in its $13.5 billion capital construction plan covering 2012-2015.
But Mayor Michael Bloomberg sounded unconvinced when asked on his weekly radio show about the NY MTA's idea for revenue-sharing. "Let me check," the mayor said sardonically. "I'll call our finance director and see if taxes came in yesterday."
Bloomberg said he preferred having the authority plug its budget gap with new revenue, like tolls on the East River Bridges. But that idea was most recently defeated by the New York State legislature in 2009. "We should find some ways to raise money for the MTA," the mayor added. "Something that would encourage people to take mass transit so there'd be more fare payers."
But NY MTA Chief Financial Officer Robert Foran said Albany "has no appetite for new dedicated taxes or fees."
As a result, the bulk of the NY MTA's strategy for funding the capital construction plan is to float new bonds worth $4.7 billion and obtain a low-interest federal loan for $2.2 billion. The plan has not pleased transit watchers.
The Citizens Budget Commission, a watchdog group, said it was "better than doing nothing to meet the essential infrastructure needs of mass transit. But it has a critical flaw – it proposes to borrow billions without presenting a corresponding plan for new revenues to match the increased long-run debt service burden."
Gene Russianoff of the Straphangers Campaign told WNYC that it's likely the borrowed money, plus interest, will be obtained down the road from the fare box. "I have sympathy for the MTA because it's not getting help from Albany or City Hall," he said. "But then it's turning to the riders and saying, 'Well, we'll see how this goes. There's a good chance your fares going to balloon down the road.'"
The NY MTA's capital construction plan will run out of money at the end of the year. Should the authority's funding plan not yield the billions expected of it, work on mega-projects like the Second Avenue Subway and a tunnel bringing Long Island Railroad trains into Grand Central Terminal could start to slow down by next year and, eventually, grind to a halt.
That doesn't even take into account the budgetary havoc to be wrought should some state lawmakers come through on their threat to eliminate the payroll mobility tax, which is expected to yield $1.2 billion for the NY MTA in 2012 alone. On Monday, Foran told a briefing for reporters on the budget that, "if we lose that tax, we have a big hole that we can't overcome."
And another thing. Balancing the NY MTA's budget also depends on saving $1.2 billion by convincing labor unions to agree to work three years in a row, beginning next year, without pay raises. John Samuelson, president of the 38,000 members of the Transport Workers Union, has said he’ll fight such a deal.
Foran said the NY MTA is doing its part by finding $2 billion in savings through cost-cutting measures like revamping an employee health plan, consolidating 34 data centers into three and eliminating 3,000 agency cell phones. He said funding must be found because the NY MTA's capital projects create 25 percent of all construction jobs in the metropolitan area, and are crucial to improving New York's subway and bus system.
Tuesday, July 26, 2011
By Julia Furlan : WNYC Culture Producer
On Tuesday, the New Jersey State Council on the Arts doled out $15.8 million in Fiscal Year 2011-12 funding to arts groups. The three groups that got the most funding are all based in Newark.