The opening balance for the first quarter of FY 2010 was $5.839 billion, $851 million more than the opening balance for the first quarter of FY 2009. However, the gain in cash was short-lived. During the first quarter of FY 2010, cash expenditures exceeded cash receipts by $1.243 billion compared with an excess of cash receipts of $1.382 billion over cash expenditures during the first quarter of FY 2009. The trend of lower daily cash balances is expected to continue.
The average daily cash balance for the first quarter of FY 2010 was $6.348 billion, down $78 million from the $6.426 billion average daily cash balance for the first quarter of FY 2009. The level of daily cash balances during July and August in FY 2010 was very similar to the level of daily cash balances in July and August in FY 2009. In September of FY 2010, daily cash balances fell below daily cash balances during September of FY 2009. This was reflected by higher average daily cash balances for July and August in FY 2010 compared with July and August in FY 2009 and a lower average daily cash balance in September FY 2010 than in September FY 2009.
At the close of the first quarter of FY 2010, the daily cash balance was $4.596 billion, $1.774 billion less than the closing balance for the first quarter of FY 2009.
Cash Receipts
Cash receipts totaled $17.332 billion and averaged $271 million daily during the first quarter of FY 2010. In a reversal from the first quarter of FY 2009, only August had greater cash receipts, $572 million more than in the same month of the previous fiscal year. July 2009 had $833 million less in receipts than July 2008. September 2009 had $2.157 billion less in receipts than September 2008 mainly due to a $762 million decline in tax collections. Cash receipts during the first quarter of FY 2010 increased 5 percent over the first quarter of FY 2006 and declined 12 percent from the first quarter of FY 2009. Net of reimbursements for capital expenditures, cash receipts were lower in each month of FY 2010 than in FY 2009.
During the first quarter of FY 2010, cash receipts declined $2.418 billion from the first quarter of FY 2009. Real property tax cash receipts fell $1.228 billion, other taxes fell $1.050 billion, miscellaneous fell $5 million, and other fell $702 million, offset by a $567 million increase in federal and state aid. The decrease in real property tax collections was primarily the result of timing in receipts between the months of June and July. From June 2009 through September 2009, real property tax collections of $8.180 billion were $335 million more than the $7.845 billion collected from June 2008 through September 2008. This increase in collections reflects a real property tax rate increase, which began in mid-year FY 2009. The decline in total other taxes to the lowest first quarter level recorded since the first quarter of FY 2005 reflected the current economic and fiscal conditions facing the City. Personal income tax fell 12 percent, general corporation tax fell 11 percent, unincorporated business tax fell 11 percent, banking corporation tax fell 55 percent, and mortgage and real property transfer taxes declined 60 percent during the first quarter of FY 2010 compared with the first quarter of FY 2009. Sales tax increased 4 percent, inclusive of a local rate increase to 4.5 percent and repeal of the exemption on clothing and footwear costing more than $110.
Federal and state aid in the first quarter of FY 2010 was the only major category of receipts to increase over the first quarter of FY 2009. Federal aid totaled $1.446 billion and state aid totaled $2.833 billion during the first quarter of FY 2010 compared with $1.355 billion in federal aid and $2.357 billion received in state aid during the first quarter of FY 2009.
Miscellaneous cash receipts decreased $5 million between the first quarter of FY 2009 and the first quarter of FY 2010. During the first quarter of FY 2010 miscellaneous receipts included: senior college fees totaling $167 million, community college fees of $74 million, settlements with health plan carriers totaling $91 million, and transfers in accordance with the 2009 Health Benefits Agreement from the Health Insurance Stabilization Fund to the City of $255 million. Intergovernmental aid was comprised of state revenue sharing of $63 million in both the first quarters of FY 2010 and FY 2009.
During the first quarter of FY 2010, cash receipts totaling $23 million were classified as federal stimulus funding.
Cash Expenditures
Cash expenditures, including capital expenditures, totaled $18.575 billion and averaged $290 million daily during the first quarter of FY 2010. Total cash expenditures during the first quarter of FY 2010 increased 16 percent over the first quarter of FY 2006 and only 1 percent over the first quarter of FY 2009. Net of capital expenditures, cash expenditures declined $13 million between the first quarter of FY 2009 and the first quarter of FY 2010. Daily cash expenditures as a percent of daily cash balances remained at 5 percent, the same level as the first quarter of FY 2009.
Personal service expenditures totaling $8.799 billion were 47 percent of total expenditures in the first quarter of FY 2010 and fell 2 percent from the first quarter of FY 2009. Gross payroll was $402 million lower during the first quarter of FY 2010 than in the first quarter of FY 2009, when the Patrolmen’s Benevolent Association members received approximately $485 million in back pay for their 2004-2006 contract and other uniformed collective bargaining agreements were implemented. Headcount was only 35 less in the first quarter of FY 2010 compared with the first quarter of FY 2009. Other personal services increased $248 million during the first quarter of FY 2010 over the first quarter of FY 2009 including a $130 million increase in payments to the pension funds and $110 million more in health plan costs.
During the first quarter of FY 2010, other-than-personal-service expenditures were 35 percent of total expenditures and increased 4 percent over the first quarter of FY 2009. From the first quarter of FY 2009 to the first quarter of FY 2010, public assistance was $201 million greater. The number of public assistance cash recipients in the first quarter of FY 2010 increased from the first quarter of the previous year for the first time since the first quarter of FY 2005. From the first quarter of FY 2009 to the first quarter of FY 2010, medical assistance was $158 greater; federal stimulus funding reduced Medicaid payments offset by $411 million in intergovernmental transfers. Other social services were $44 million less and vendor and other fell $74 million in the first quarter of FY 2010 compared with the first quarter of FY 2009.
During the first quarter of FY 2010, $118 million of expenditures were classified as eligible for funding under the federal stimulus program.
Capital Expenditures and Reimbursements
During the first quarter of FY 2010, capital expenditures totaling $2.528 billion were 13.6 percent of total cash expenditures compared with 12.6 percent in the first quarter of FY 2009, 10.8 percent in the first quarter of FY 2006, and 8.3 percent in the first quarter of FY 2001. Capital expenditures were $220 million more during the first quarter of FY 2010 than during the first quarter of FY 2009, $798 million greater than in the first quarter of FY 2006, and $1.531 billion greater than during the first quarter of FY 2001. The City-funded component of capital expenditures was $800 million higher during the first quarter of FY 2010 than during the first quarter of FY 2009, $600 million greater than in the first quarter of FY 2006, and $1.340 billion greater than during the first quarter of FY 2001. Payments to the School Construction Authority totaled $800 million during the first quarter of FY 2010 compared with $151 million, $600 million, and $800 million in the first quarters of FY 2001, FY 2006, and FY 2009, respectively. Beginning in FY 2007, capital expenditures for payments to the School Construction Authority were classified mainly as non City-funded state capital expenditures. School Construction Authority payments reverted to mostly City-funding during the first quarter of FY 2010.
All capital expenditures are initially paid from the New York City Central Treasury and reimbursed mostly from the proceeds of general obligation, Transitional Finance Authority, and New York City Municipal Water Finance Authority debt, and Expanding Our Children’s Education and Learning capital grants from the Dormitory Authority of the State of New York. Reimbursements of $1.940 billion during the first quarter of FY 2010 were $442 million less than reimbursable expenditures, or 81 percent of reimbursable capital expenditures and 11 percent of total cash receipts. Over the last ten years, from the first quarter of FY 2001 to the first quarter of FY 2010, reimbursements were 86 percent of reimbursable expenditures and 8 percent of total cash receipts.
General obligation bonds financed 27 percent of reimbursements in the first quarter of FY 2010, 45 percent from the first quarter of FY 2006 to the first quarter of FY 2010, and 41 percent from the first quarter of FY 2001 to the first quarter of FY 2010. New York City Municipal Water Finance Authority proceeds financed 31 percent of reimbursements in the first quarter of FY 2010, 29 percent from the first quarter of FY 2006 to the first quarter of FY 2010, and 30 percent from the first quarter of FY 2001 to the first quarter of FY 2010. In the first quarter of FY 2010, Transitional Finance Authority proceeds financed 31 percent of reimbursements compared with less than 1 percent of reimbursements in the first quarter of FY 2009, 11 percent from the first quarter of FY 2006 to the first quarter of FY 2010, and 18 percent from the first quarter of FY 2001 to the first quarter of FY 2010. Transitional Finance Authority Building Aid bonds and Dormitory Authority of the State of New York funding financed 10 percent of reimbursements in the first quarter of FY 2010, 15 percent from the first quarter of FY 2006 to the first quarter of FY 2010, and 9 percent from the first quarter of FY 2001 to the first quarter of FY 2010.
Financing
The City did not issue general obligation debt during the first quarter of FY 2010.
During the first quarter of FY 2010, the Transitional Finance Authority issued $1.7 billion in bonds. The proceeds of $800 million in tax-exempt bonds and $100 million in taxable bonds funded capital projects. The balance of $800 million in tax-exempt debt refunded outstanding debt and yielded $66 million in budget savings over the life of the bonds.
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