What to Expect as New York Faces a Potential Fiscal Crisis

Good morning. It’s Friday. We’ll look at why New York City may be facing a fiscal crisis. We’ll also look back to the opening of Lincoln Center and the inaugural concert at what was then called Philharmonic Hall, 60 years ago tonight.

The persistent, pandemic-driven downturn has raised the possibility of a fiscal crisis for New York City. The state comptroller, Thomas DiNapoli, recently said the city faced a potential budget gap of nearly $10 billion in 2026. I asked my colleague Dana Rubinstein, who covers politics in New York, to talk about what to expect.

How serious is the situation, really? Will 2026 be like 1975 all over again? Or 2002, when the economy sank after the Sept. 11 attacks?

It is very hard to say. All of the budget experts I spoke with for this story stressed that the trajectory of the city’s economy, and the nation’s, is impossible to predict. They are left to make what are essentially educated guesses, based on worrisome trends.

New York City is still 162,000 jobs short of its peak before the pandemic. Thanks to the long duration of office leases — many last 10 years or more — the reverberations of the work-from-home trend have yet to be fully felt. But as building valuations fall, so, too, will real estate tax revenues tied to them. Wall Street, another key tax generator for the city, is also struggling.

Those tax revenues pay for city services that we all rely on, like garbage pickups, policing, parks maintenance, you name it.

Mayor Eric Adams has just ordered city agencies to cut expenses — 3 percent this year, even more next year. Not even the Police Department is exempt from economizing. Is he concerned about a shortfall or about having to shift priorities?

Based on what he and his budget chief have said publicly, it’s fair to say he is concerned about the drying up of both tax revenue and federal aid — which really kept the city and state afloat during the worst of the pandemic — and what that will mean for funding city operations moving forward.

All of which has a whiplash quality to it, since only three months ago, he approved a $101 billion budget of record size.

He is also facing some growing expenses, including a state mandate on class sizes in public schools that he says will cost the city at least $500 million a year, and a growing population of homeless New Yorkers and asylum seekers.

Will there be layoffs this year or next? Won’t agencies slim down simply by letting jobs that are vacant now remain vacant? But isn’t the municipal work force already under strain because employees quit during the pandemic?

The mayor is promising no layoffs as part of the current budget-cutting exercise. Yes, many agencies will slim down by cutting vacant, funded positions. But many of those positions are vacant because the city has been hemorrhaging workers.

Hiring new workers to fill those vacant positions has been slow going, partly because the city’s hiring process is incredibly balky, and partly because many white-collar office workers would prefer jobs that do not require them to report to the office five days a week, as the city does.

What will the cutbacks mean — the police or the Fire Department might not come as fast when you call 911? Or the garbage won’t be picked up as often?

The city insists that the cutbacks must not affect service quality, but the budget experts I spoke with said service will almost certainly be affected.

They say some of the vacant jobs the agencies will cut will invariably include necessary jobs that the agencies would fill, were they able to find suitable candidates and hire them in a timely fashion.

In fact, the city already appears to be seeing an impact on operations from its rapid worker attrition, much as the administration would like to deny it. The city is building fewer units of affordable housing than in years past, emergency response times are up and serious injuries resulting from jail violence have increased.

Weather

Expect a sunny day with temperatures in the mid-60s. For tonight, a clear sky and lows in the low 50s.

ALTERNATE-SIDE PARKING

In effect until Monday (Rosh Hashana).

UNITED NATIONS GENERAL ASSEMBLY

It’s not only the last gridlock alert day of the week, it’s the last one until November.

• Shelter crisis: A wave of migrants is overwhelming the city’s homeless shelter system. It used to house thousands more people, until a shift in policy closed some shelters.

• Patted, not slapped: Assault charges against a grocery store worker accused of assaulting former Mayor Rudolph Giuliani in June will be dropped in six months if he has no other infractions.

• Charge dismissed: A federal judge dismissed a civil rights charge against a police officer from Ewing, N.J., who was accused of using excessive force against a Black teenager during a 2018 arrest.

• Memorial service for Joan Didion: The writer, who died in December at 87, was remembered by the actress Vanessa Redgrave; the writers Hilton Als, Jia Tolentino and Calvin Trillin; and former Supreme Court Justice Anthony Kennedy, who grew up with her.

LOOK BACK

Sept. 23, 1962: Opening night at Lincoln Center

Sixty years ago tonight, Lincoln Center opened with the first concert at what was then called Philharmonic Hall. The musicians played their instruments. The children of the conductor soon played, too — in the corridors, in the balconies, in their father’s office.

Leonard Bernstein’s daughter Jamie recalled romping in the new building as her father prepared for his “Young People’s Concerts,” which, like the New York Philharmonic’s opening-night performance, were televised. She was 10 years old then. Her brother Alexander was 7.

“My brother and I would accompany our dad” on the day of a telecast, arriving at 7 a.m. for her father’s camera rehearsal, she told me. “Then, by 9 a.m., the orchestra would have drifted in to have their rehearsal,” she said, “and they would set up a big table with coffee and doughnuts. We were so thrilled about the doughnuts. We would steal the doughnuts.”

“While the rehearsal was going on, Alexander and I would run around the hall,” she said. “Nobody supervised us. Nobody told us there was a place we couldn’t go. We knew every nook and cranny, every staff room. We would have races in the corridors.” They called the third balcony “the tippity top.”

Later there would be a dress rehearsal, which she said inevitably ran long — a problem in the every-second-counts world of network television — and was inevitably followed by “an emergency meeting in my father’s office with the production team.”

The grown-ups focused on “poss cuts,” possible cuts in the script. The children focused on cold cuts. “There would be sandwiches,” Jamie Bernstein recalled. “Alexander and I were starving by then. We’d been going hard.”

On the morning after the inaugural concert, The New York Times said it had been a milestone “in its excitement, social prestige and spirit of community welcome.” But what about the sound? Philharmonic Hall had literally been tuned with a bang — the acoustical engineers had fired cannon shots from the stage several months earlier. And on the morning of opening night, The Times’s music critic, Harold C. Schonberg wrote an article that wondered if Philharmonic Hall would be among “the great ones.”

The acoustics were “unsatisfactory and fiercely criticized,” the Bernstein biographer Humphrey Burton later wrote. Or, to quote an amusing and acerbic line from an essay by the critic Alan Rich: “I never saw anything like it,’ burbled Jacqueline Kennedy on opening night, when asked about the sound.”

Burton wrote that “Bernstein had the difficult task of privately calling for urgent remedial action but publicly expressing confidence in the Philharmonic’s new home.” Eventually Philharmonic Hall was remodeled and renamed Avery Fisher Hall. It was re-renamed in 2015, becoming David Geffen Hall after a $100 million gift from the entertainment mogul. Now it is about to reopen with a new look, fewer seats and what the lead acoustician called “a much better relationship between cubic volume and sound absorption.” As our writer James S. Russell put it: “The New York Philharmonic and Lincoln Center are betting $550 million that he got the sound right.”

Metropolitan diary

Black lace dress

Dear Diary:

I was planning to attend a memorial service for my boss, Oribe Canales. Knowing that I would see a lot of my former co-workers, I decided to buy myself a new dress. I found a gorgeous Anna Sui black lace dress that seemed perfect for the occasion.

On the day of the service, I was standing outside Lincoln Center catching up with friends I had not seen in some time. A man and a woman approached our circle.

They stopped to chat with us, and I realized to my delight that the woman was Anna Sui.

“I’m wearing your dress!” I said.

“I know,” she said.

— Jane Witkowski

Illustrated by Agnes Lee. Send submissions here and read more Metropolitan Diary here.

Glad we could get together here. See you Monday. — J.B.

P.S. Here’s today’s Mini Crossword and Spelling Bee. You can find all our puzzles here.

Melissa Guerrero, Jeffrey Furticella, Rick Martinez and Olivia Parker contributed to New York Today. You can reach the team at [email protected].

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