New York must sacrifice more

Press, Volume CXVI, Issue 34156, 18 May 1976, Page 17

New York must sacrifice more

(N.Z.P.A.-Reuter—Copyright)

WASHINGTON, May 17

New York City must make even greater financial sacrifices to avoid bankruptcy in two years time, according to a report by the Senate Banking Committee released today by its chairman (Senator William Proxmire).

“New York City will have the fight of its life to balance its budget, pay off its Federal loans, and avoid bankruptcy in 1978,” the Wisconsin Democrat said in a statement.

“The city can make it, but only with even greater sacrifices than it has made so far.”

Congress approved a three-year Federal loan programme to save New York from bankruptcy last December. Senator Proxmire said he was certain the loans would not be continued beyond 1978. The report said a threeyear pay freeze for city

workers must be maintained and their fringe benefits should be reduced. Wages and fringe benefits cost New York City SUS4OOOm a year, one-third of its total budget. New York City has already received SUSI26Om in Federal loans which must be repaid by June 30. It will then be eligible to borrow up to SUS23OOm in the next financial year.

Senator Proxmire said New York State should take action now so that it could be ready to provide loans to the city if that became necessary after the Federal 1 loans ended.