Comptroller Elizabeth Holtzman of New York City said in a report yesterday that Mayor David N. Dinkin's revised financial plan for fiscal years 1992 to 1996 does not present an entirely balanced budget and "raises serious problems."

Ms. Holtzman called for the continued restructuring of city government, greater cuts in the city work force, and the innovative use of new revenues.

The Dinkins administration's projection of economic recovery for the city is too optimistic, she said, adding that her office projects the citi will lose 150,000 jobs in 1991 and 100,000 jobs in 1992 because of the recession.

She also said the city underestimated the fiscal 1992 budget gap by over $200 million. Her office projects a $419 million budget gap in fiscal 1992, when began July 1.

The report says the city's proposal to pare its work force must include a broader early retirement program and a more "aggressive" job attrition program. Mayor Dinkin's had proposed to reduce the work force by 31,000 through fiscal 1996, but that plan has been shown to include only 16,400 full-time employees -- all to be removed through attrition -- with about 7,800 of them included in the fiscal 1992 plan.

The city comptroller suggested that a 50% hiring freeze, excluding criminal justice workers, could cut the work force by about 8,000 workers a year, or a total of 37,000 over five years, and produce an estimated savings ranging from $150 million in fiscal 1993 to $268 million in fiscal 1996.

In her report, Ms. Holtzman also proposed using $1 billion of funds from the Municipal Assistance Corporation for the City of New York to finance the restructuring of city government, such as creating an "efficiency bank" to pay for the hiring of professional city procurement officers to reduce contracting costs, a pet program her office has pushed for. The Dinkins administration would like to use the funds, which would be generated through a refunding of MAC bonds, to plug projected gaps in fiscal 1993 and 1994 and spare New Yorkers tax increases.

Mayor Dinkin's modified financial plan proposes to close budget gaps in fiscal years 1992 through 1996. The city estimated a $210 million gap in fiscal 1992, but plans to close it with a variety of spending reductions. The total combined budget gap projected for fiscal years 1993 through 1996 is almost $7 billion, and the Dinkins administratiion included a number of gap-closing measures in the revised plan, including two $1 billion refundings to reduce debt service, the MAC money, and property tax increases in 1995 and 1996.

But Ms. Holtzman said, "Unfortunately, the proposed modification does not present a balanced budget for fiscal years 1993 to 1996 and raises serious problems."

She noted that the city is counting on the MAC funds to avoid property tax increases in fiscal 1993 and 1994.

If the city does not "aggressively work" to reduce its payroll through attrition and other measures, the city will face the same problems after the MAC funds have been used up -- namely, how to balance the budgets over the next few fiscal years.

Meanwhile, state Comptroller Edward V. Regan yesterday released a report blasting the city for diverting to gap-closing purposes money that was earmarked for a criminal justice program.

The state comptroller said the city's fiscal 1992 budget gap, which had been projected to be about $210 million, could grow by about $20 million because of an estimated revenue shortfall in one program in the $1.8 billion "Safe Streets, Safe City" criminal justice program initiated in fiscal 1991.

The program's revenues are generated by a special city lottery, projected by the city to raise a net $38 million in fiscal 1992 on sales of $71 million, and earmarked for school children. The city has since revised its figure to $25 million, the state comptroller's report notes. Competition from other lottery games and the recession are likely to dampen the success of the new "Kids Lottery," the report says.

"It looks like everyone will lose in this gamble, because the city planned to use the projected revenue to balance the budget and not to create the children's safety programs for which the lottery was and continues to be touted," Mr. Regan said.

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