Tax Increases Avoided as City Budget Deal Is Reached

$129 Million in Cuts to Schools Proposed by Mayor Are Restored

(NY Sun) -- Sounding a somber note, Mayor Bloomberg and the City Council announced a budget deal that provides new funding for schools, avoids tax hikes, and would increase overall spending only slightly.

The centerpiece of the $59.1 billion budget agreement, reached last night at City Hall, is the restoration of $129 million in cuts to schools that had been proposed by the mayor. Speaker Christine Quinn said the funding boost would protect classrooms from budget cuts.

Rather than sustain cuts that the Department of Education had said could have reached as much as $1 million for some schools, public schools will maintain their budgets as they were written this year for next year.

A proposal by council members to raise the city's hotel tax was not included in the budget. Neither was an increase to the city's property taxes. The budget does include a $400 property tax rebate for homeowners. It calls for cuts to all city agencies and raises spending by 1.6%, which is less than the projected annual rate of inflation, 2.7%.

Mr. Bloomberg cautioned that the city might have to revise its budget in the coming months if its financial picture takes a turn for the worse.