The Empire Page

Background: Assumptions about financial data is a crucial aspect of running New York State -- at all levels of government.  But how do we know the numbers offered by the governor, mayor or other officials are reliable?  In 1974, Congress created an independent budget office to help it evaluate the president's data.  In 1996, the NYC Independent Budget Office (IBO) opened its doors seven years after voters approved the concept.  Should New York State have an IBO?  To help Empire Page readers make up their minds about that option, we interviewed Doug Turetsky, chief of staff and communications director of the Independent Budget Office for New York City.

Q: Please explain the orgins of the NYC Independent Budget Office.

A: New York City voters approved the creation of the Independent Budget Office in 1989 as part of a far-reaching change in the city’s governmental structure. The change, necessitated by a US Supreme Court ruling that found the city in violation of the Voting Rights Act, resulted in making a strong-mayor system even stronger.

IBO’s role as an “honest broker” of economic and budgetary information and analysis provided some counterbalance to the mayor’s increased strength.

Apparently chafing at the role IBO would play in providing other elected officials and the public with independent and unbiased information, a succession of mayors sought to block its opening. But a number of civic organizations and elected officials went to court and won. IBO finally opened its doors in 1996 and has since become an established and respected part of city government.

Q:   What is the role of the Independent Budget Office?

A:   IBO’s job is to provide information about the local economy and city revenue and spending. We fulfill this role in a variety of ways.

The City Charter requires us to produce three reports a year: a fiscal outlook report and reports on the mayor’s preliminary and executive budgets. The fiscal outlook report projects spending and revenue for the coming years based on the city tax and spending policies at that time. Our reviews of the mayor’s preliminary and executive budgets include IBO’s estimates of revenue and spending based on the mayor’s budget plans. In addition, IBO releases a volume each year that outlines the pros and cons of various options the city could take to cut spending or raise revenue.

We also produce many other reports and publications--more than two dozen last year alone. These publications focus on a wide range of budgetary topics, from school spending to the fiscal condition of the Metropolitan Transportation Authority to the revenue implications of changes in city tax policy. Responding to questions from elected officials, civic and advocacy organizations, the press, academics, and others is also an important part of our role in providing information. Sometimes our responses to these questions become publications.  IBO also testifies at the request of the City Council and at other public hearings.

All of IBO’s reports, testimony, and other publications are available for free on our Web site at www.ibo.nyc.ny.us.

Q:  How is the Independent Budget Office financed?

A:  IBO is a public agency, funded by the city’s taxpayers. To ensure IBO’s independent role, the 1989 Charter Revision Commission wisely determined that we should have a guaranteed funding line. IBO’s budget is automatically set at no less than 10 percent of the Mayor’s Office of Management and Budget. In practice, that 10 percent has been both the floor and the ceiling. And when the mayor’s budget office takes a cut, we do too.

Q:  Describe your relationship to the City Council.

IBO has a good relationship with the City Council. The City Charter lists the City Council as one of the primary entities we were created to serve and we do this formally by responding to questions from Council Members and informally through discussions and information sharing with Council staff.

There are many examples of our formal role. We recently issued a report at the request of Council Member Bill deBlasio that looked at changes in city spending on homelessness prevention programs in conjunction with the Bloomberg Administration’s plan announced four years ago to reduce the number of homeless by two-thirds. Another recent example is work we did at the request of Council Member James Oddo on the cost of eliminating the Department of Buildings’ professional certification program and requiring that all plans go through a complete review by the agency.

Council Speaker Christine Quinn pointed to our work in restating the city budget in terms of agency spending by programs to get the Bloomberg Administration to develop a similar presentation of the budget, which is now available on the Web sites of the Council and the Mayor’s budget office.

Of course Council Members are not always pleased by the findings in IBO’s work. And they are not shy about letting us know it. But it’s our responsibility to give them the best, most objective information we can.

Q:  Other than the Congressional Budget Office that serves the federal government, how many IBOs exist around the country?

A:  We were modeled on the CBO. The CBO was modeled on the Legislative Analyst’s Office in California, which was created more than 65 years ago. But there is one very significant difference between IBO and these predecessors:  While they report to their respective legislative branches we do not.

We are aware of other budget offices similar to IBO in various parts of the country, from budget review offices in Nassau and Suffolk Counties on Long Island to the Office of the Independent Budget Analyst in San Diego. Unlike IBO, these offices also directly serve their respective legislatures. In our case the legislative branch, the City Council, is just one of a number of constituencies we serve.

Q:  Under what circumstances would you recommend that New York State establish an independent budget office to focus on state finances?

A:  One decision we made early on was to stay away from making recommendations—as soon as you make a few you are labeled  “liberal” or “conservative” or with some other shorthand description that undermines the credibility of our role as an objective source of information and analysis.

But we’re unquestionably big fans of the independent budget office concept and believe one could play a valuable role in Albany. The trick is to create an organizational and funding structure that protects any IBO from political pressure, or even the appearance of pressure, to slant its findings. It means developing a ”good government” approach to picking a director and a means of funding the agency that doesn’t force it to appeal to the executive or legislative branches for annual appropriations. That way public officials and the public at large can know that an independent budget office is giving them the best, unvarnished information it can.

Q: That's important input.  However, let me try to re-phrase my previous question:  The idea of creating the IBO for New York City came as a result of a lack of confidence that the public and its representatives on the city council were getting an unbiased picture of the city's finances, correct?

A:

Back in 1989, when New York City’s governing structure was being overhauled, many of the commissioners and others participating in the process of revising the City Charter felt there was a need to offset the increased power of the mayor under the system being developed.

The addition of an independent budget office became one important counterbalance. Since the budget is the foundation upon which city policy is built and programs implemented, many of those participating in the Charter-revision process felt that a nonpartisan budget office with access to the same fiscal data as the mayor but with its own mandate to provide unbiased information and analysis could provide some check. If Council Members or other elected officials were having difficulty getting information because they wanted it to propose legislation the mayor opposed, the independent budget office could be another source of needed data. In addition, Council Members and other elected officials could turn to this independent office for a “second opinion” if they had reason to question information coming from the mayor’s office.  

And because the projection of tax and other revenues is the basis upon which the budget is formed, the commission also made its independent budget office responsible for revenue projections. So if a mayor sought to lowball their revenue estimate in order to limit spending, there’d be another, unbiased projection out there—one that had no stake in ramping its numbers up or down.

As I noted earlier, the role of the independent budget office was seen as that of an “honest broker”—a role we have sought to dependably fulfill since the city’s voters endorsed the commission’s proposals nearly two decades ago.