The Economy

3.9%

-0.4%

-2.2%

3.1%

2.5%

1.3%

4.0%

3.1% 3.0%

1.8%

-0.3%

-2.8%

2.5%

1.6%

2.3% 2.2% 2.4%

3.2%

-3%

-2%

-1%

0%

1%

2%

3%

4%

5%

2007 2008 2009 2010 2011 2012 2013 2014 2015 Est.

New York City and U.S. Economic GrowthNYC GCP US GDP

Projected

NYC's Export Industries Performance in the Recovery(measured by change in national employment share, 4Q2014 vs 4Q2009)

NYC Industries that Gained Employment Share

• Motion Pictures & Sound Recording

• Advertising

• Colleges & Universities

• Computer Systems

• Accounting & Related Services

• Management & Technical Consulting

• Telecommunications

• Broadcasting

• Architectural and Engineering Services

• Publishing

• Finance & Insurance

NYC Industries that Lost Employment Share

• Manufacturing

• Legal Services

8.2%

-2.3%

0.8%

1.7%1.2% 1.3% 1.4%

3.9%

0.4%

1.7%2.8%

2.0% 1.7%1.3%

-4%

-2%

0%

2%

4%

6%

8%

10%

2008 2009 2010 2011 2012 2013 2014

NYC Wage Growth Compared to Metro Area Inflation RateNYC Wage Growth Metro Area Inflation Rate

Low Wage Industries24.6%

Mid Wage Industries52.7%

High Wage

Industries22.6%

Low Wage Industries59.2%

Mid Wage Industries18.3%

High Wage

Industries22.5%

Change in Composition of Job Creation in NYC

Job Distribution as of December 2009 Job Growth Since December 2009 to Present

The Budget

10.0%

2.3%

7.2% 7.7%

3.4%

4.2%

0.4%

4.7%

3.6%3.9%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14

Expenditure Growth Rate (Adjusted for Prior Year Resources)

4.7% Avg

11.3%

10.0%

11.5%

0.6%

-7.1%

3.3%

8.5%

4.4%

8.6%

5.8%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14

Local Tax Revenue Growth Rate

5.5% Avg

11.6%

2.3%

8.8%

5.4%

-2.9%

4.4%4.0%

1.5%

7.1%

2.6%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14

State and Federal Revenue Growth Rate

2.5% Avg

The Proportion of State and Federal Aid in the City’s Budget –Decline in our Fair Share of Federal and State Revenue

18.5%

17.2%

16.8%

15.5%

15.0%

12.3%11.9%

10.6%

11.9%

9.3%

8%

12%

16%

20%

2010 2011 2012 2013 2014

State Share Federal Share

$7.7 Billion

$2 Billion

Missed Opportunities – Money Left on the Table

NYCHA2006-2014

$692 million Cumulative

DOE 2012-2014

$779 million Cumulative

Operating Subsidies

$76

Section 8 Vouchers

$263

Energy Incentives

$353

E-Rate$120

Medicaid for Special Ed

$356State APPR

Penalty$303

The Administration’s FY 16 Budget Adds

• $16 Million for Rental Assistance for the Homeless

• $11 Million to EMS to Cut Response Times

• $10 Million to NYPD to Increase Police Cadet Headcount

• $4.2 Million to the Department for Updated Bulletproof Vests

Expenditures Adjusted for Pre-payments

($ in millions) FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 15- 19 AnnualGrowth

Salaries and Wages $23,898 $24,550 $24,683 $26,075 $27,504 15.1% 3.6%

Debt Service 6,242 7,031 7,414 7,736 8,051 29.0% 6.6%

Health Insurance 5,206 5,577 5,923 6,327 6,849 31.6% 7.1%

Other Fringe Benefits 3,368 3,509 3,663 3,859 4,069 20.8% 4.8%

J & C 695 710 746 782 817 17.5% 4.1%

Subtotal $39,409 $41,376 $42,429 $44,749 $47,255 20.0% 4.7%

Pensions $8,455 $8,405 $8,375 $8,360 $8,457 0.0% 0.0%

Medicaid 6,447 6,415 6,415 6,415 6,415 -0.5% -0.1%

Public Assistance 1,476 1,407 1,413 1,413 1,413 -4.3% -1.1%

Other OTPS 23,304 22,042 22,256 22,643 22,728 -2.5% -0.6%

Subtotal $39,682 $38,269 $38,495 $38,831 $39,013 -1.7% -0.4%

Total $79,091 $79,646 $80,888 $83,610 $86,304 9.1% 2.2%

$4

$5

$6

$7

$8

$9

$10

$11

$12

$19.5

$20.5

$21.5

$22.5

$23.5

$24.5

$25.5

$26.5

$27.5

FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19

Pens

ion

Con

trib

utio

ns ($

in B

illio

ns)

Wag

es a

nd S

alar

ies

($ in

Bill

ions

)

Average Growth ($ in millions) Salaries Pensions Salaries Pensions Change in Avg. Salary Growth

Change in Avg. Pension GrowthFY 2009 – FY 2013 $120 $447 0.5% 6.5%

FY 2013 – FY 2019 $867 $67 3.6% 0.8% $747 ($380)

Wages and Salary Growth Up As Pension Contribution Growth is DownWages and Salaries Pension Contribution

Citywide Efficiency Savings Program

• Following the fiscal crisis of the 1970s, the City regularly implemented gap closing programs - PEGs

• The City saved more than $6.5 billion in FY14 from PEGs implemented between 2008 and 2013

• If the City implemented an agency efficiency program equivalent in scale to those of the past, we would save $1 billion in FY16 alone

• If that program were continued, together with new savings initiatives each year, the cumulative impact over those years could be $10 billion by FY19

$30.6 $28.6 $28.2 $26.6 $27.9

$34.7 $33.7

$61.7

$54.1 $53.7

$67.7

$0

$10

$20

$30

$40

$50

$60

$70

$80

May-09 May-10 May-11 May-12 May-13 May-14 Feb-15

Four-Year Commitment Plan Ten-Year Strategy

Four-Year Commitment Plan and Ten Year Capital Strategy$

in b

illion

s

The Administration’s Capital Strategy Additions

• $5.3 Billion more for Education

• $851 million more for Economic Development and Business Services.

• $4.5 billion more for HPD

• NYCHA’s City-funded capital budget, more than doubled –from $63.5 million to $145.7 million.

FY 2014 Actual to Planned Capital Commitments

• The Report examined over $14 billion of Planned Capital Commitments, 25 Agencies and over 1,600 budget lines

• Sanitation achieved 89 percent of its commitments

• Since FY 2005, the City had, on average, achieved 60 percent of its planned commitments

• Only 52 percent of Planned Capital Commitments were Achieved, the Second Lowest percentage over the Past Ten Years

• The Parks Department achieved 24 percent of its commitments, the lowest of all major City agencies

Percent of Actual Commitments vs. Plan - All Funds

67%

61%

67% 66%

58%

66%

54% 55%

48%52%

60%

30%

40%

50%

60%

70%

80%

90%

100%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Avg.2005-2013

Note: The City existing measure of actual commitments is relative to total commitments after the reserve for unattained commitments. Using this measure, the FY 2014 percent achieved would be 68% compared to 52% as shown above.

Agency Actual FY 2014 Commitments

FY 2015 Executive Plan Commitments

Difference % Achieved

Sanitation (DSNY) 277 310 (34) 89.4%

Education (DOE) 2,060 2,513 (453) 82.0%

Environmental Protection (DEP) 1,160 1,663 (503) 69.8%

Transportation (DOT) 837 1,351 (514) 62.0%

Housing Preservation & Development (HPD)* 439 747 (308) 58.8%

*Includes commitment for New York City Housing Authority

Five Best Performing Agencies in Achieving Capital Commitments

$ in millions(With Planned Capital Commitments Greater Than $100 Million)

Agency Actual FY 2014 Commitments

FY 2015 Executive Plan Commitments Difference % Achieved

Parks and Recreation (DPR) 365 1,516 (1,151) 24.1%

Cultural Affairs (DCLA) 215 713 (498) 30.1%

Small Business Services (SBS) 278 892 (614) 31.2%

Health and Hospitals Corporation (HHC) 242 718 (476) 33.7%

Corrections (DOC) 125 282 (158) 44.3%

Five Worst Performing Agencies in Achieving Capital Commitments

$ in millions(With Planned Capital Commitments Greater Than $100 Million)

Risks and Offsets ($ in millions) FY 2015 FY 2016 FY 2017 FY 2018 FY 2019City Stated Gap $0 $0 ($1,048) ($1,370) ($2,074)

Tax Revenues Property Tax $0 $113 $320 $210 $1,050 Personal Income Tax 232 424 542 559 517 Business Taxes (50) (53) (25) 60 50 Sales Tax 0 21 33 30 20 Real-Estate-Related Taxes 117 228 219 36 (137)Subtotal $299 $733 $1,089 $895 $1,500

Speed Camera Revenues $5 $20 $6 $0 $0

Expenditures Overtime ($76) ($174) ($100) ($100) ($100)DOE Medicaid Reimbursement (60) (80) (80) (80) (80)DOE Full Day UPK State Support 0 (40) (40) (42) (42)Variable Interest Rate Savings 100 50 0 0 0 General Reserve 300 0 0 0 0 Prior-Year Estimates Adjustment 500 0 0 0 0 Subtotal $764 ($244) ($220) ($222) ($222)

Total (Risks)/Offsets $1,068 $509 $875 $673 $1,278

Restated (Gap)/Surplus $1,068 $509 ($173) ($697) ($796)