A panel of budget experts yesterday called on New York City officials to enact a combination of tax increases and deep budget cuts, including a reduction in its capital program, to eliminate the city's structural budget deficit.
The panel, appointed by the administration of Mayor David N. Dinkins last May, issued a report yesterday recommending prompt action by city officials to reduce spending and raise revenues.
The Dinkins Administration appointed the three-member group amid growing concern voiced by the city's fiscal monitors and rating agencies that the city's budget problems had escalated. The city is rated A-minus by Fitch Investors Service, Baa1 by Moody's Investors Service, and A-minus by Standard & Poor's Corp.
The Standard & Poor's rating includes a negative outlook, and officials there say the city must address its structural budget imbalance to maintain the A-minus rating.
The report, prepared by Donald Kummerfeld, president of the Magazine Publishers Association; Dall Forsythe, former state budget director; and former Congressman Bill Gray, now president of the United Negro College Fund, said city expenditures "regularly exceed recurring revenues and there is no realistic expectation that economic growth will erase this growing deficit." The report says the city faces multibillion budget gaps between fiscal years 1995 and 1998. The city's fiscal year ends June 30.
To remedy the fiscal shortcomings, the panel called for:
* Deep reductions in city personnel through attrition and layoffs.
* The elimination and modification of work rules, staffing, and service delivery with municipal labor unions.
* The possible elimination of the Public Advocate's office and the Borough President's office.
* A reduction in capital spending. The report calls for an emphasis on "basic infrastructure needs" and says the city should reexamine its current plans to comply with a state mandate for courthouse construction and "cut back sharply on its capital spending for housing."
* An increase in some property taxes and sales taxes.
* Tolls on the East River bridges and the Harlem River crossings.
Press officials representing Mayor-elect Rudolp Giuliani did not return telephone calls on the report.