No pain for education in city budget

The city expects to increase spending on education next year by a modest but welcome $182 million, or 1 percent, according to Mayor Bloomberg’s preliminary budget for fiscal 2013, a budget notable mostly for its lack of serious controversy.

Compared with last year, when the mayor’s plan to lay off more than 5,000 teachers sparked months of demonstrations and cliff-hanger negotiations, this year’s budget, which was released on Feb. 2, includes no threatened pink slips but there will be continued attrition.

Thanks in part to a promised $224 million increase in state education funds, the city will raise education spending to $19.63 billion for the coming year, from $19.45 billion this year. The state is slated to bring in additional revenue this year from the income tax reform that was enacted in December at the urging of the UFT, the Strong Economy for All coalition and others. The small increase in city education funds comes after school budgets have absorbed cuts for three years in a row.

There are no bold new initiatives in the plan, but neither are there painful reductions. The city’s post-recession finances are stabilizing and revenues are improving.

The city Office of Management and Budget predicts Wall Street profits will rise by almost $1 billion to $14 billion in calendar year 2012. Tax revenues will also go up, as the city has already gained back two-thirds of the private-sector jobs that it had lost during the recession and should have them all back in 2013, the budget office projected.

The mayor noted that he had not raised taxes to balance the budget, including on the city’s highest income earners. But he did project a $29 million increase in revenue from fees and fines.

The plan for fiscal year 2013, which begins July 1, does include small reductions in most agency budgets except education, a total of $437 million. Many of those proposed cuts can affect the schools by affecting children, such as reductions for homeless services, libraries and after-school and health programs. But some are likely to be restored by the City Council before the final budget deadline on July 1.

The mayor announced a 10 percent across-the-board cut in the city’s ten-year capital budget. As a result, the city budget for the construction of new schools was reduced to $3.3 billion over 10 years.

The mayor used his budget announcement to stump for a new, less-generous pension plan for future government employees, one that mirrors Gov. Andrew Cuomo’s proposal in his state budget address. Bloomberg wants to hike the retirement age for new nonuniformed city workers to age 65 and increase their required pension contributions.

Such changes to the pensions of future city workers would have to be approved by the state Legislature and cannot be made as part of a budget adoption.