Michael Bloomberg (AP)
Mayor Bloomberg dropped a bombshell in the middle of his annual budget presentation yesterday by declaring that municipal workers who’ve toiled without contracts for as long as 3 1/2 years won’t get retroactive pay raises — even after he leaves office.
“I think it’s clear down the road no administration is going to have the money to give pay [for] the past,” the mayor said as he unveiled his $68.7 billion budget plan for fiscal year 2013. “I don’t know any company that would give you retro pay.”
Back pay has been a staple of just about every past city contract settlement.
But Bloomberg argued that the economy has shifted dramatically and “it’s not likely there’s going to be extra money to do that” going forward.
The mayor will be out of office in less than 19 months and can’t speak for his successor, who’s likely to be a Democrat far friendlier to the municipal unions.
But the outstanding retroactive-pay bill will be so daunting by 2014 that the next occupant of City Hall may not have much choice but to forgo or delay retro payments.
City officials estimated that the tab just for those who missed out on the last contract settlement — 80 percent of them teachers — would reach a mind-boggling $2.7 billion by 2013 if the pattern of 8 percent raises over two years was followed.
The teachers have been working without a contract since Nov. 1, 2009. Virtually all other contracts for other city workers expired in 2010 or 2011.
Harry Nespoli, who heads the Municipal Labor Coalition covering most major unions, charged that the mayor was engaged in a self-fulfilling prophecy.
“He’s causing the problem,” said Nespoli. “He’s not even negotiating with any unions. The longer he waits, the more the retro money is going to build up. I don’t know who the next mayor is going to be, but what [Bloomberg] is doing is going to leave him or her with a problem. I think he really cares about New York City more than that, I really do.”
Nespoli added that “the unions aren’t stupid” and are well aware that the city is coming back stronger than the rest of the nation.
In fact, Bloomberg himself boasted that the number of people — 3.29 million — employed here in March was the highest on record as he provided details of his $68.7 billion budget.
But tax revenues were running below projections because new jobs were being created in lower-paying sectors such as tourism and not in the high-end financial industry, said E.J. McMahon of the Manhattan Institute.
The result: Even after a hiring freeze, a $466 million windfall from the CityTime-scandal settlement and an extra $1 billion from the expected sale of new taxi medallions, the city faces another $3 billion deficit in fiscal 2014.