Just one day before the New York State Financial Control Board is expected to release its report on New York City's financial plan, two other fiscal monitors dropped bombshells about the budget, saying the city faces a gap of between $300 million and $700 million in fiscal 1992.

New York State Comptroller Edward V. Regan, in a report released yesterday that review New York City's four year financial plan, said the city's fiscal 1992 budget, which began July 1, "could easily fall apart in the months ahead" and there are elements in the budget that could throw it out of balance by at least $300 million.

The gap, Mr. Regan said, could be caused in part by increased spending for projected wage increases and overtime costs, as well as shortfalls in the estimated revenue collections forecast by the Dinkins administration.

On the more pessimistic side, City Comptroller Elizabeth Holtzman said her office forecasts the gap could go as high as $511 million, or about 2% of the $28.5 billion fiscal 1992 budget. She also said the fiscal 1992 budget problems could worsen by an additional $200 million if some of the proposed gap-closing measures do not achieve their full savings. Her office also forecasts even wider gaps over the next three fiscal years, reaching $3.3 billion in fiscal 1995.

The two comptrollers had warned of potential gaps in the waning months of fiscal year 1991, but yesterday's reports are their first official commentaries since the budget was adopted on July 2.

The reports did not dampen the bidding on the city's competitive offering of $1 billion of tax anticipation notes yesterday. The city received 45 bids -- all considered aggressive -- and awarded the notes to five firms for an overall net interest cost of 4.921758%.

The projected gaps for fiscal 1992 are not expected to trigger a takeover by the state's Financial Control Board. The control board could step in if the city had, or was likely to have, a $100 million gap in its budget at the end of its fiscal year. A takeover is unlikely because it is still too early in the city's fiscal year to ascertain whether a gap of that magnitude is likely or imminent. The city also has enough time to remedy any potential problems.

This latest round of troubling budget news from two of the city's most important fiscal Cassandras came one day after Mayor David N. Dinkins delivered a televised address to New Yorkers, outlining a major reform plan for city government that includes further downsizing, privatization of some city functions, and the possibility of creating authorities for sanitation, roads, and bridges.

The reports were also presented less than 24 hours before the Financial Control Board was scheduled to meet to discuss the city's financial plan and release its own report. As part of its recently announced stepped-up scrutiny of the city's finances, the control board, created to oversee the city's finances during the fiscal crisis in 1975, is expected to gather at Two World Trade Center in Lower Manhattan this morning. The board includes as members Mayor Dinkins, Ms. Holtzman, Mr. Regan, and Gov. Mario M. Cuomo, its chairman.

In statement released with his report, Mr. Regan said, "The report we are releasing today shows a potential for higher spending in such areas as overtime and salaries, lower revenues due to continued economic downturn, and slippage in the implementation of the city's ambitious $2.3 billion agency cost reduction program" He warned that it has been more than a decade "since we've seen potential gaps of this magnitude" so early in the city's fiscal year.

The report follows a "milestone monitoring" report released yesterday by the comptroller saying that for fiscal year 1991, which ended June 30, the city "should squeak through with a balanced budget."

Mr. Regan took aim at the transitional funding proposals the city is eyeing to help it through its rough fiscal waters. "Such proposals harbor potential for even greater problems down the road unless combined with successful efforts to reform the city's spending and revenue generating policies," he said.

The largest of those one-shot revenue gainers would be the refunding of $1 billion of outstanding first resolution bonds sold by the Municipal Assistance Corporation for the City of New York. The corporation could turn over to the city about $1 billion of revenues over the next three to five fiscal years.

Other one-shots include bonding proposals that were suggested for fiscal 1991, but not used -- such as $60 million in proceeds from the sale of a mortgage on a bond-financed housing project and capitalizing between $50 million and $100 million of interest payments with bond proceeds.

Ms. Holtzman said the city faces a budget gap of $1.87 billion in fiscal 1993; a gap of $2.77 billion in fiscal 1994; and a gap of $3.23 billion in fiscal 1995.

For fiscal 1992, the comptroller estimated tax revenues will be $215 million less than projected in the city's budget. Her office forecasts $32 million less in property tax collections, $97 million less in personal income tax collections, and $100 million less in sales tax revenues.

Another culprit, Ms. Holtzman noted, is increasing debt service costs. These costs will be taking on an ever-increasing portion of city spending, rising to 10% of spending in fiscal 1995. Debt service costs in fiscal 1995 are estimated to be about $3.26 billion.

Ms. Holtzman said the city may not be able to achieve the full $100 million in savings from refunding about $1 billion in credit-enhanced bonds, slated for this fall, because a plethora of uncertainties, such as market conditions and interest rates, make it "difficult to forecast precisely what savings will result."

For his part, Mr. Regan sees personal income tax collections $20 million higher than the city projected in fiscal 1992, but then falling $90 million below that the city forecast in fiscal 1993 and 1994, and slipping by $100 million in fiscal 1995.

Sales tax revenues could slip by $50 million below the Dinkins administration's estimates in fiscal 1992 and 1993, and by $75 million in fiscal 1994 and 1995, the state comptroller's report says.

In addition to pointing out some of the potential problems the city faces, Mr. Regan also applauded Mayor Dinkins for his speech made Wednesday evening that outlines plans for major reforms in city government.

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