LONG-RUN BUDGET PICTURE

The PICA report “Look Before You Leap? The Fiscal Situation that Awaits the Next Mayor” points out that the three big challenges to the city finances are pensions, benefits, and debt service that by FY09 will reach, according to the report, almost $1 billion of required expenditures—1/3 of the current budget. Two questions:

a. Are union concessions necessary to make ends meet? If so, what concessions from what unions would you seek? If you believe that union concessions are not necessary to stay on budget, how would you pay these costs?

b. The city currently spends $.16 per dollar of revenue paying off long-term obligations. What will your policy be for incurring more debt? For what purposes would you incur debt in the future?

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