N.Y. Mayor Dinkins Announces $288 Million in Budget Cutbacks

Mayor David N. Dinkins Thursday announced $288 million in cutbacks, including a reduction of 5,500 city jobs this fiscal year--and perhaps 20,000 next year--through layoffs and attrition.

“Today, I have some bad news and some worse news,” Dinkins told reporters.

The bad news, he said, “requires painful sacrifices from every part of our Administration,” including a 10% cut in the mayoral staff.

The worse news was that on Jan. 15, he will be back with another proposal for the fiscal year beginning next July to close a budget gap that has grown to $1.6 billion.

Dinkins had acted earlier to close the budget gap for this fiscal year when he ordered a hiring freeze and cut the pay of top management by 5%, including lopping $6,500 off his own salary of $130,000.

The city faces the cuts because of falling tax revenues. “The root of all these problems is the economy,” Budget Director Philip Michael said.

Last month, Standard and Poor’s, a bond rating service, put the city on “credit watch.”

Under the proposal for this fiscal year, New York City’s Board of Education would be forced to cut $90 million. Health and human services agencies would be cut $51.9 million. The uniformed services--police and firefighters--would be reduced by $60.6 million and all others by $85.5 million.

An additional $100 million in savings would come in a one-shot sale of a city parking lot.

The city also increased its reserve fund for emergencies by $50 million, to $150 million. This was done because of the possibility of a worsening economy, officials said.

The mayor said other cuts include eliminating wading pools in parks, delaying recycling, postponing hiring additional teachers and eliminating three fire companies and two fire salvage units. Hundreds of employees also will be dropped from the city’s housing rehabilitation program.

Leaders of municipal unions have broken off contract talks with the city because the city has been unwilling to match a 5.5% pay raise teachers received Oct. 1.

The city budgeted 1.5% increases for all unions and says that is all that it is giving the teachers--the rest comes from state aid and a rearrangement of the pension funding system.