By Maurice Pinzon
At a news conference at the Marriott Hotel in Times Square, Mayor Michael Bloomberg promised not to allow Governor George Pataki to derail his efforts to get New York City out of its fiscal troubles.
Well not in so many words.
However, if Mayor Bloomberg did not name names, he did provide a bureaucratic road map for reporters and New Yorkers to follow in assessing where to look if a $170 million refinancing agreement enacted in budget legislation in Albany is derailed.
Mayor Bloomberg vowed to “take all necessary legal actions” to challenge the decision on Wednesday by the Local Government Assistance Corporation (LGAC) to stop the City’s refinancing of debt left over from the 70’s fiscal crisis. The refinancing would have New York State take over the refinanced debt payment of $170 million a year relieving the City of $500 million in debt payments a year for a total of $2.5 billion over the next five years.
Mayor Bloomberg appears to have strong backing for his argument from Felix Rohatyn, the former chair of New York’s Municipal Assistance Corporation (MAC) and the man credited with negotiating the bailout of New York City during its fiscal crisis in the 70’s.
In a telephone interview with New York News Network while he was on vacation, Mr. Rohatyn said, “The Mayor has every right to enforce the commitment he had from the State. Once that commitment has been made the Mayor has an obligation to enforce that commitment by all legal means available.”
When asked what financial alternative was available, Mr. Rohatyn said, “The only alternative would be for the State to come up with an equivalent amount of budget relief.”
Republicans and Democrats in the Senate and Assembly enacted the New York State budget over the objections and vetoes of Governor Pataki. State Senator Liz Krueger has pointed to Albany’s inability to agree on direct relief to address New York City’s fiscal problems. The Governor’s proposed budget was not even acceptable to Republican legislators. So Albany legislators were forced to scramble and cut and paste together an alternative budget that they passed over the Governor’s vetoes.
Referring to a State budget that would have avoided the bond refinancing remedy, State Senator Krueger said, “The New York State budget should have included $500 million in aid to localities, which includes education funding, less health cuts. Lots of different things.” Regardless of the constitutional merits of this bond refinancing, “I do believe the $170 million is needed by the City,” Senator Krueger said.
At the news conference Mayor Bloomberg was forceful in his defense of the State budget legislation, and he attacked the LGAC. He said that “an un-elected state board decided it would attempt to overrule the will of the Legislature, the elected representatives of the people of New York, and deprive the City of this critical aid package. This board is clearly trying to undermine the people of this State through their illegal actions.”
Mayor Bloomberg also alluded to New York City’s contribution to New York State. He said, “City taxpayers send over $3 billion annually to Albany more than we get back. The decision by the State Legislature to provide this relief uses but a small portion of this surplus.”
Still reporters at the news conference tried to draw Mayor Bloomberg out into a verbal battle with Governor Pataki. One reporter asked how criticism of the LGAC, in which two of three members are appointed by the Governor, did not logically lead to criticism of the Governor also.
Another reporter asked if the Mayor, a successful businessman who has recently received positive media attention for mending the fiscal and economic troubles of New York City, was in a strong public relations position in relation to Governor Pataki on this issue.
Mayor Bloomberg simply said that he “did not want to personalize the issue.”
A call to Governor Pataki’s office for comment was not returned.