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Independent Budget Office Releases Fiscal Outlook For City

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Candidates for mayor in 2013 may be courting union endorsements, but some will also have to consider how they will handle future contract negotiations, according to a new report from the city's independent fiscal watchdog. NY1's Courtney Gross filed the following report.

Mayor Michael Bloomberg might be a good fiscal steward to some, but to others, he has punted a serious problem to the next occupant of City Hall.

"It's as though the city put its fiscal house in order, and the challenges facing the next administration aren't that great," said Ronnie Lowenstein of the Independent Budget Office. "But if you look more closely, there are some big holes in that argument."

A new report from the city's Independent Budget Office shows that the city's budget hole next year, $811 million, is modest in comparison to years past. But there are still a lot of uncertainties.

That deficit might grow by $1 billion, say, if the city fails to sell $790 million in taxi medallions, which is currently tied up in state court, or if it fails to reach an agreement over teacher evaluations.

What could be the most unsettling, though, is that all of the city's major municipal unions are currently without a contract.

"I don't think that this mayor who is currently in office is too worried about his predecessor, because the predecessor is being left in a very difficult position," said Michael Mulgrew, the president of the United Federation of Teachers.

They also want raises, some say with retroactive pay.

"Look, what we expect is that we are going to work with the next mayor," Mulgrew said. "The teachers of New York City deserve a raise. It's been over three years."

According to the Independent Budget Office, those retroactive raises could cost the city $3.8 billion. That means many of the 2013 mayoral candidates not only have to think about balancing the budget, but also balancing politics as they seek the endorsement of many of these unions in next year's mayor's race.

City Council Speaker Christine Quinn's campaign said she doesn't negotiate contracts through the press.

But former Comptroller William Thompson fired back.

"As our city’s former comptroller, this lack of planning and preparation is bewildering to me, and to continue it would be irresponsible," Thompson said in a statement.

At least for now, negotiating wages will be left to Bloomberg. The 2013 candidates will be seeking endorsements.

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