NEW YORK, NY – New York City’s latest financial plan projects a surplus of nearly $3.7 billion for the fiscal year ending June 30, 2018, This is resulting from reductions in unneeded reserves in the current year, higher than expected tax collections and benefits from the citywide savings program. The surplus money will be used to balance the FY 2019 budget.
“The city’s economy is strong and the out-year budget gaps appear manageable under current conditions. However, the city should increase its reserves during the financial plan period given the budget risks on the horizon, particularly the threat of federal budget cuts,” said State Comptroller Thomas P. DiNapoli.
Tax collections outpaced the city’s initial forecast by nearly $1.5 billion in FY 2018. This was driven by higher-than-planned personal income tax collections and lower than expected property tax refunds, delinquencies and tax abatements. Business tax collections continued to fall short of expectations.In addition, personal income tax collections are projected to grow by 9.4 percent in FY 2018, the fastest in three years.
The citywide savings program is expected to generate $1 billion in each of fiscal years 2018 and 2019 (a cumulative total of nearly $4.7 billion through FY 2022). However, only a small share of the savings are projected to come from efficiencies that improve agency operations. Most will come from funding shifts, debt service savings and cost reestimates.