All right. All right. >> Okay. >> go. The green light's on. Technology. Okay. Okay, can you hear me now? >> Yes. Ah, wonderful. Well, good morning, everyone. Thank you all for being here. So, today the Council released our official response to the mayor's preliminary budget, and I want to just be clear with where we're at, and I'm thrilled to be joined by our finance chair, Council Member Linda Lee, and our new finance director, Nathan Toth, who worked at the Council for many, many years. So, we're thrilled to have him back. New York City is facing real fiscal challenges. The Council's identified a roughly $6 billion funding shortfall, which includes $1.1 billion in Council priorities that were funded last year, but excluded from the administration's preliminary budget. And that shortfall is why we're taking a disciplined, responsible approach. Our plan outlines a viable path forward, one that closes the shortfall without raising property taxes, without cutting critical services, and without drawing down the rainy day fund. Through a combination of savings, efficiencies, and more accurate revenue and cost assumptions, we've identified approximately $6 billion in additional resources across two fiscal years. Um at the same time, we want to make very targeted investments in New Yorkers. While not reflected in our budget asked today, we also want to highlight three example initiatives that we want to prioritize as a negotiation process begins. We are specifically calling for the expansion of programs like Fair Fares to make buses and subways free for those earning up to at least 150% of the federal poverty level. We are calling for growing the universal college savings program, NYC Kids Rise, to give every uh public school kindergartner in our city a stronger financial foundation from day one. And we um and I do want to say that that is one of the best ways to fight income inequality because ongoing education is so critically important, whether it's vocational school, a two-year community college, a four-year college, but studies show that those who do ongoing education earn double the wages through the course of their lifetime. And we're also calling for achieving increased wages for our paraprofessionals. Investment in higher education and uh post-high school trade schools, um as I mentioned, is one of the things that we are singularly focused on to make sure that we really are addressing the issue around the affordability crisis and income inequality. But let me be clear, that is just the beginning. The Council has a very robust list of additional priorities from members um that we are going to be strenuously fighting for and pushing for as we head into these negotiations. Our proposal reflects what we can responsibly do right now based on the information we have today. And certainly, as the state budget is finalized, we believe Albany should be looking at all options to deliver additional resources to the five boroughs. Uh while this plan, our plan, keeps the city on stable footing, we need to do more to create a New York that is truly affordable and livable for everyone. We look forward to working with the administration in the months ahead to get that done. And with that, we are happy to take um a few questions. We're going to begin with on-topic questions and for Hi, Speaker. How are you? Um so, I wanted to get possible for you to just go through some of those big, when it comes to savings, where you see the opportunities to save the biggest across the two fiscal years. And how does that work if you have $1 billion in priorities that the Council has? So, we released a whole list of these savings, and it's everything from um saving accruals where there are employees that were budgeted uh for, but then just simply were not hired, and so we have that as a significant savings. We have other areas of savings that include everything um uh would you want to maybe uh >> Yeah. If you may. Yeah, go to the I'm sorry. Yeah, just just to speak at a global level, the the the document is is coming out soon if it's not already posted, and I will then just move this over. Um yeah, uh basically, what we did was went through the budget very carefully, looked at re-estimates uh for in the budget, things that are were out there, we think that, hey, maybe this could be budgeted a little differently, some of these things. And I just want to emphasize, nothing that we suggested uh is going to have an impact on employees or services to the the people of the City of New York. We're just going to more accurately We are suggesting a more accurate budgeting of certain things, which will account for some of the savings we got in there. We have many re-estimates that way. Uh and then we have also some, you know, just suggested savings. We think there's underspend in some places, just like and we, you know, applaud the mayor for identifying over uh you know, underestimating in some of these areas. And we also think that maybe we're he's underestimating some of his revenues. So, we want to make sure that just like small things and small budgetary things like there's already revenue above where his uh budget is right now. So, bring it up to that and let's recognize that. Things like that. That's what's going on as the document says all. Yeah, and so the the list is in there. I mean, it's everything from the city should recognize an additional 80 million in Department of Building construction permits and late fee re-estimates. Um it's everything from total wages and salaries budgeted across agencies uh for what was actually hired. Uh so, there's an 860 million in savings that have been accrued through the year as certain positions that were budgeted for in the financial plan have not been filled, so those expenditures have not been made. Want to be clear, we're not calling for the elimination of any of the vacancies, uh just to recognize the unspent the unspent money to date, and we strongly believe those positions should be filled, so want to mention that. Uh we have in here everything from 42 million in fiscal year 2026 and 2027 in rental revenue from the Port Authority. Um we believe the city could save 175 million in fiscal year 2026 and 2027 by competitively bidding all DOE contracts. Um auditing all the agencies in non-essential contracts. For those of you that came to the education hearing, you heard me ask about this. DOE right now, um in terms of contracts, is spending about $12 billion of their budget. Uh we had a whole line of questioning around consulting contracts. Uh DOE indicated they have not even audited those consulting contracts. Again, we believe that you've got to audit the agencies' non-essential contracts. We need to right-size some of those contracts, uh and we need to competitively bid them. So, those are a few. Again, we have a very long laundry list in the document. Just one question, sir. Um two questions. I was wondering as far as the mayor has generally said what he sought to do in this budget is to more accurately reflect the city. I think a lot of people will perhaps hear what you're saying and say, "Well, we're back to the games of last year." So, if you could respond to that potential concern, and then also, I'll just give both of my questions and I'll let you off and run with it. Um you very delicately said Albany should consider more resources to the [clears throat] city. Does New York need to raise raise taxes to give those additional resources? So, I believe in progressive taxation. I want to be crystal clear of that. I absolutely believe in progressive taxation. I think you don't want a situation where you're pitting states against each other, which is basically what that would do. We believe though that Albany needs to look at every single option as they're um going forward. I think the good news is we've identified numerous savings here, which we think puts New York City on a very responsible path. And then to answer your first question about sort of the budget dance, I mean, look, I think I've been very public about this. I don't think there really should be a budget dance. I think, you know, when we look at funding around cultural organizations or libraries, and our to be clear, our response uh puts in uh for the restoration of the funding for both of those those should be non-negotiable. I don't see why we need to have a budget dance. I think we can all agree that our libraries, our cultural organizations, and so many of the other priorities should be obviously funded, and you shouldn't have any budget dance around this. I think what we've really done here is identify a number of areas of responsible savings. So, Uh two questions. One for you, Speaker, and then a technical question. So, given how large the budget deficit was this year when the mayor came into office and when you came into office, and certainly the economy Yeah. what's going on. And the certainty that a lot of these costs are going to keep coming up, and the unfunded responsibility the city has for retired health care, why didn't you find cuts? Like, do you think there's nothing to cut in the city budget? Um if You found savings, but like, do you think there's nothing to permanently cut? It's not that First of all, we want to be responsible, and we believe that we can find the savings without making cuts. We believe, and I think when you look at the full list, there are so many different items in this list where we are able to responsibly reach savings without doing cuts on services whatsoever. We're not at the point where we need to do cuts. We can find the savings in the way that we did without cutting services. So, our position has been clear. We have been a hard no on the property tax. We also are hard no on reading the rainy day fund and we released a report that showed that if you read the rainy day fund, all that does is increase our borrowing costs and actually costs the city of New York a tremendous amount of money in the future. We can get to these savings without cutting any kind of critical services or staff. But we don't we just don't need to get there. So, we were able to get there without having to look at that. So, I think the answer to the question Sally is that the good news is we were able to get there without having to do that. We don't think we need to cut services at all. And so, this is a very responsible plan that in no way cut services. And New Yorkers, uh you know, we we shouldn't be cutting services at this time. That I that also I don't think is the right approach. I think that that we were able to reach this middle approach where we do not need to cut services at all. We are not cutting staff at all and we were able to find responsible savings. I think like the example, I mean we have so many examples, but the example around the Department of Education consulting contracts is like a ripe one. I mean, the fact that DOE spends $12 billion a year on these outside contracts. The fact that in our education budget hearings, DOE admitted that they aren't even doing an audit of the outside consulting contracts. They hired Ernst & Young uh for an auditing fee of $17 million a year. When I asked, "Well, wait a minute, did Ernst & Young actually audit the consulting contracts?" The answer was no. And then I followed it up with, "Well, has there been any auditing of the outside consulting contracts?" The answer also was no. So, I mean, these are areas where every New Yorker should agree that we can make responsible savings on. Hi. Sure. Sorry, I can't hear you again. Sorry. Do you want to take that? Did you hear the question? I'm sorry. Yeah, can I get the full list? >> [snorts] >> Sorry, the last question? Rainy day? Yeah, yeah. So, I mean, with the list, we will give you the full list, but the full list absolutely adds up to that. So, we're happy to after this, our team can give the full list of all where all the savings are identified. And then in terms of the rainy day fund, if I heard your question correctly, sorry, there's a little outside noise. Uh your question was about why he the mayor is focused on Right. I mean, I don't know. I think that's a question that you would have to ask them. I mean, we look forward to engaging in very productive deliberations around the budget. I think the good news is we found these savings and that's a really positive uh step forward. We've been really unequivocal that rating the rainy day fund cannot happen. It's never been rated before. It wasn't rated during COVID. It wasn't rated during the asylum seeker crisis. So, we really can't have that. And so, we've been pretty unequivocal that we cannot do the property tax uh because that would really worsen the affordability crisis. Rating the rainy day fund would increase our borrowing costs significantly literally by billions of dollars over the course of the life of the some of these bonds. We can't do that. Um and so, that's why we have tried to chart this path forward that really identifies responsible savings. And so, our team will get the full list to you. >> [snorts] >> Hi. Sure. Sure. No, it's a great question. So, we've been really clear about FAPS. We are absolutely willing to settle FAPS and we have been in active conversations to settle FAPS that basically protects vulnerable New Yorkers, but at the same time charts forward a responsible fiscal path. Uh so, those we've been ready to settle this uh from day one. We've urged the administration to drop the appeal. There's no point in endless and constant litigation on the subject, which only serves to delay a settlement and chart a path forward. So, we >> [snorts] >> Yeah, and we've got we have a responsible settlement that we've been talking uh directly to the administration about. We've outlined with them. We're in constant conversations about that about ways that can make sure that we're protecting vulnerable New Yorkers and at the same time chart a fiscally responsible path forward. So, we have we've put options on the table for the administration. I'm not going to outline what those are cuz those are part of settlement conversations, but we've been very, very clear that we are ready, willing, and able to settle the issue around FAPS both for the current court case as well as for future expansion. Uh oh, sorry. Yes, yes, yes. Yeah, it's not a direct one one-for-one with vacancies and you know, each one tick, tick, tick. It's basically what when we came up with it, it's this you're talking about the 860 million. Um yes. So, that's a big piece of it, for sure. Uh essentially, we think this is not budgeted correctly at this point. So, we're we're looking at timing and things like that of of hiring and and uh and going forward the way it's in the budget right now or at least in the preliminary budget before we actually hit exact, we just think that it's not estimated correctly and we think the actual savings are going to be a little bit more more like 860 and this is going to be over 2 years just because the time it takes to actually hire people and things like that where they start incurring these costs for real, uh it's it's a different that's a different level. So, yeah. And those would be ongoing conversations. Exactly. And we're not saying these positions shouldn't be hired. We're just saying they haven't been. And it does take time to do the hiring. Okay. Hi, Nick. Yeah. Yeah. Right. And then we would have that discussion. I mean, to be clear, I'm not opposed to looking at any of the options that Albany has. I again, it Albany, as I said, should look at all options. So, I'm not opposed to any of the options. Right now, we don't know where they're going to land. So, what is our responsibility? Our responsibility is to try to identify areas of savings. But again, I'm not opposed to them looking at all options and we've said from the beginning they should be looking at all options. No, we're in constant conversations with Albany about it. It's not clear where they're going to end up on it. Um and those conversations are ongoing and sort of out of our purview. So, again, we've had really productive conversations with the leadership both of the Senate and the Assembly and with the governor's office. And you know, we hope that a resolution is reached soon because the longer that the state budget drags on, it it just creates more uncertainty for us. So, we want to get that resolution done quickly. And as I've said, I think all options should and need to be on the table. Hi. Mhm. >> [snorts] >> Well, we uh learned about this matter the same time I think that everyone else did on um Monday evening due to press reports. Um no indictment has been brought against Council Member Lewis. We need more information, you know, obviously about what is happening and we're closely monitoring that situation. I I can't comment on that yet because again, there's been no additional information provided about Council Member Lewis. So, we are closely monitoring the situation and based on the information we find out, we'll take appropriate course of action at that time. We have not received assurances on that. And so, again, it's an unfunded mandate. I think that, you know, it is imperative that when Albany pass laws that they not do so, you know, via an unfunded mandate, which then puts the onus on the city of New York. It's talked about how it's being included as a $600 million savings but it's not sorry, could you speak up a little bit? >> It was placed as $600 million savings but it's out of the city's hands. It Well, look, we've been advocating that it get funded. We, you know, we Council Member Lee and I went up to Albany on Tin Cup Day and said, you know, we can't continue have these unfunded mandates. Like Albany should fund this. I I I can answer that with a It's not counting in my number. That we have the savings week. >> Yeah. Yeah, yeah. Yeah, right. Hi, Beth Binder. How are you? Um I'm wondering what your take is on the mayor's decision to create an office of community safety as opposed to the Department of Criminal Justice. Oh, sure. I know you already addressed this but I still want to know. Yeah. To the extent that it's been reported that he may not have tried to create the agency because he didn't really think that he could get approval from the Council. Is that accurate? Might he not have tried to ask you? I I I I don't I don't think that's an accurate portrayal. Again, we have a Council Member who introduced the bill. The bill was just in the beginning of the legislative process and so like any legislation, we generally that winds its way through the legislative process, we usually don't comment on views on it but No, I don't think that that's accurate. I think that the mayor always had and they told us from the beginning in January that they were always looking at a number of different paths for this. It you know, doing it through executive order was a path that they had indicated to us that they were considering way back in January. And do you think that the office that he has proposed with a sort of more limited scope is worth the cost that it is? We haven't been briefed on it so I know Council Member Lee and I and she's a former chair of the Mental Health Committee. We look forward to briefing. We we have not been briefed on it so it's very hard to comment on the cost without the briefing. Hi, Speaker Johnson. How are you? Hello. Um I have a one budget question on the office of community safety. Oh, sure. I'm wondering if >> [snorts] >> considering in this response it seems that a lot of the money the city needs is actually in the city's pockets as you're saying. So, do you disagree with the mayor that we're in a fiscal crisis right now if you already have those funds on hand essentially? I Look, I think obviously we never want to be in a situation where there's a shortfall. We also never want to be in a situation where the rating agencies are doing a negative outlook. That is potentially catastrophic for our city. Our finance team did a whole analysis on the increased borrowing costs that that would mean to the city of New York cuz it's very, very problematic. Um I have run several city agencies as commissioner so I'm very used to to having to deal with some of these budgetary issues. We are obviously in a different situation this year than we've been in past years but overall the metrics for the city's economy in terms of Wall Street revenues are robust and strong. The thing honestly that concerns me as I look at the economic forecast is the fact that only 27,000 jobs were created in the city last year. And if you compare that to the on average 190,000 jobs that were created on average each of the prior [snorts] four years, that is a very concerning metrics, which is why my opinion like we really do need to focus on job creation, economic development. That is really important for the future of the city. We need to attract new businesses to our city. We need to keep businesses here so that we're keeping that job creation robust because that is obviously what is going to be needed to fund all of our important priorities around affordable housing and child care and parks and all of the things that are mission critical. My second question, I know you were asked about Council Member Rodriguez. Mhm. Uh more generally speaking, if a city council member was indicted or criminally charged, would you remove them from their committee assignments? Like where's that like red line for you? Sure. I mean, that is a hypothetical. Obviously, if there's an indictment, well, we will then cross that road and and take the appropriate action. That is a would be very serious and we would clearly take appropriate action if that were to occur. You were just discussing the census outside and citizenship applications. Uh but you didn't address, I know it wasn't quite on topic, the SCOTUS hearing that's happening today on birthright citizenship. What is your concern if SCOTUS strikes down birthright >> Sure. So, that's a very It's a very good question. I mean, so earlier today we held our press conference for Census Day and I as a former Census Director I have very strong um opinions on this. The Census is a snapshot in time. The best way to describe the Census is as if someone took a photograph of New York and every single person who was in New York City at the time. So, the the the court case that you mentioned that's being discussed today is of grave um consequence to the city of New York. We are a proud city of immigrants and my concern around the Census and around attempts that uh Republicans are doing to try to take the citizenship question off the Census and that's the case that we won. I served in a senior role at the Law Department and worked on that case. I'm very concerned about this because it will have disastrous implications for the future of the city of New York. Over 300 vital programs depend on how we do on the Census. Everything from SNAP to Head Start to funding for public safety, funding for our roads, bridges, tunnels, transportation infrastructure, funding for all all of our schools. It all depends on how we do on the Census. So, any kind of attempts to say um that those are undocumented shouldn't be counted is is you know, just disastrous for the financial implications for our city um because the Census again is supposed to be a snapshot in time of every single person that is utilizing New York City services, that is using our schools, that are using our roads, that are using social service programs. So, any attempt to try to discount um those that are undocumented would have a real dire consequence on our city. Thank you. >> Oh, okay. Thank you all so much. Thank you very much. Thank you. Is there