New York City Faces Potential Fiscal Crisis as $10 Billion Deficit Looms

[brooklynite]

New York Times

New York City, battered by economic headwinds and mired in a stubborn pandemic-driven downturn afflicting employment, tourism and tax revenue, is teetering on the brink of a severe budget crisis.

For the first time in six years, city officials expect that business tax revenue will decline. Personal income and related tax revenue is expected to fall by 7.7 percent, the largest drop in a dozen years.

And Wall Street’s struggles may require the city to fork over billions of dollars to its workers’ pension funds, to meet its obligation to provide guaranteed minimum returns.

The city’s commercial office market is on the precipice of a potential work-from-home abyss. The transit system’s financial situation is so grim that the state comptroller has warned that the Metropolitan Transportation Authority may seek more financial support from the city. And while the nation has regained the jobs it lost during the pandemic, New York City is still 162,000 jobs short, with the situation especially dire for Black New Yorkers, whose unemployment rate of more than 10 percent remains nearly three times the national average.

[RealityBasedNewYorkr]

1. Soft on crime policies of Alvin Bragg not helping one bit

Big chain stores have to close locations because organized crime rings and individual offenders with literally hundreds of priors ransack them to the tune of tens of thousands of dollars per day with impunity. Violent offenders out without bail, and Alvin’s “First Day Memo” (look it up) generally a carte blanche for scumbags.
I actually live with the consequences of these policies in Manhattan every day. Makes return to office for lots of folks very unappealing.

[jimfields33]

2. A lot of workers left NYC during covid to cheaper areas

Due to ability to zoom. Will they return? Who knows.

[brooklynite]

3. its not Bragg's fault...

First, keep in mind that Bragg is only AG of MANHATTAN. Most of the NYC population is in other boroughs.

Second, the primary driver is a State law eliminating cash bail. Most petty criminals know they'll be released immediately even if they're caught.

[Johnny2X2X]

4. WFH

WFH is significant and office workers in bigger cities are the ones who've most gone to work from home. Even hyubrid models have a huge effect.

You've got millions of people working in NYC, if 10% of them go to WFH, it's a massive hit to revenue. Less taxes, less revenue from parking, road fairs, and traffic fines. It's a huge deal and we're just starting to see some of this start to hit.

Even my own company going to WFH or hybrid has a noticeable effect on the local restaurants. We used to have 1,000 white collar workers here 5 days a week, now we have 400 who went WFH full time and 600 who are only here 3 days a week. That's a decline of almost 2/3s the business to local restaurants for lunches and after work happy hour.