The budget accord announced Saturday by New York City Mayor David N. Dinkins and City Council Speaker Peter F. Vallone moved quickly yesterday afternoon toward formal adoption, city officials said.
Aides to Mr. Dinkins and city council staffers said the 51-member council likely will approve the city's 1993 fiscal year budget no later than today.
The budget agreement, which nearly match item for item Mr. Dinkins's $29.5 billion executive budget, included $88 million in additional spending measures for the board of education, police, highway cleaning, and the restoration of city parks.
Many observers of the budget process said the settlement was one of the quickest in city history. Both Mr. Dinkins and Mr. Vallone praised the early resolution of the budget -- nearly a month before the start of the 1993 fiscal year as another indication that the city's finances have improved dramatically in recent months. Last Week, for example, the city announced a 1992 fiscal year surplus of $515 million, $60 million more than originally estimated.
The Dinkins administration used the surprisingly large surplus to help eliminate its planned use of transitional financing to balance the 1993 budget, a move designed to protect the city's current bond rating of A-minus by Standard & Poor's Corp. And Baal by Moody's Investors Service.
"At a time when state and local governments across this country have seen their budgetary prospects and go from bad to worse and then to terrible, this government has agreed upon a budget for the coming 1993 fiscal year which is not only balanced, but comfortably ahead of schedule," read a joint statement released Saturday by Mr. Dinkins and Mr. Vallone.
City hall and council officials attribute the quick passage of the budget to confluence of several events, including the timely resolution of the state budget and Mr. Dinkins's six-day trade mission to Europe, which created an impetus to complete the budget process, city sources said.
Peg Breen, a spokeswoman for the city council, also attributed the budget's qick resolution to a concensus over the size of the city's 1992 fiscal-year surplus.
Last week, city officials said they identified a $60 million addition to the surpus, originally estimated at $455 million. At the same time, the council said the surplus was $160 million greater than the city had originally estimated. Ms Breen said that as a part of the settlement, the city and council agreed that the budget contained $35 million in additional revenues.
As part of the accord, the city will pay for the $88 million in additional spending measures through $47 million in administrative cuts in city government, as well as the $35 million in additional tax revenues and $6 million in additional state aid.
Fiscal monitors of the city applauded the timely passage of the budget and said they found little fault with the measure designed to pay for the $88 million in additional spending.
However, the monitors warned that tougher times lie ahead for the city. For example, the city may face increased school funding under the auspices of the Stavisky-Goodman Act despite the $34 million additional funds earmarked for the board of education as a part of its accord with the council.
The board of education plans to sue the city for failure to meet its funding requirement as prescribed by state law, which fiscal monitors estimate at about $150 million for the 1993 fiscal year, according to published reports. Stanley S. Litlow, deputy chancellor for operations for the board, said the board yesterday sent a letter to Mr. Dinkins and the city council stating that budget adoption would be "outside the law" unless the city increases school aid by about $140 million.
City finance officials say the city's violation of the Stavisky-Goodman Act is a matter of debate and cite a study by the the New York State Financial Control Board, wich critizes the board of education's spending habits.
Ms Breen said the council will pass the budget regardless of the board's opinion on Stavisky-Goodman.
Apart from the prospective board of education lawsuits, both the deputy state comptroller's office and the city comptroller's office say the city faces a budget gap in the 1993 fiscal year, which begins July 1. The city comptroller recently cited a gap of $176 million, while the deputy state comptroller said the gap will be $374 million.
