NEW YORK CITY-The New York Building Congress has seen the future of infrastructure investment here and doesn’t much like what it sees. An analysis of the Bloomberg administration’s capital budget plans, which were released last month, shows a commitment in the short term to spending on capital projects but a considerably weaker long-term outlook. 

The administration’s preliminary budget for fiscal year 2012 proposes spending about $8.8 billion in FY ‘12 and $8.1 billion in 2013 on capital projects. That compares with $9.8 billion budgeted for FY 2011 and a record $10.5 billion in FY 2010, yet the Building Congress notes that this level of spending “remains well above historic standards.”

Longer term, though, the city’s "2012-2021 Capital Strategy" would invest a total of $47 billion over 10 years on infrastructure, mainly on water and sewer services, education, roads and bridges. In ’09, Mayor Michael Bloomberg proposed spending $61.7 billion over the coming decade, about 25% more than he called for this year.

“While the capital plan will inevitably change over time, the overall picture is one of less, rather than more, investment,” Building Congress president Richard T. Anderson says in the report. He adds that this drop reflects "pressures on government revenues and the absence of political support for new revenue streams devoted to capital programs.”

One reason Bloomberg is maintaining, at least in the short term, what Anderson calls the administration’s “commitment to sustaining and improving the city’s vital infrastructure” is an improved revenue picture locally. While observing that revenues are still below pre-recession levels, the city has revised upward its projections on tax revenues, going from an earlier prediction of $39 billion for FY ’11 to $40 billion for the current fiscal year, and from $40.8 billion to $41.9 billion for FY ’12. That's another $2.1 billion in projected revenues over two years.

A more active commercial real estate environment, with investment sales transaction up substantially, is among the factors cited by the administration. The Bloomberg administration also cites record-breaking tourism numbers and the fact that New York City is outperforming the nation generally in job creation. Figures released Wednesday by the New York State Department of Labor showed that the city’s private sector increased employment by 0.8% between December ’09 and December of ’10, compared to a decline of 0.8% nationally in private-sector jobs during the same period.

At the same time, though, the Bloomberg administration expects a decrease in financial support from the state and federal governments. While the 10-year forecast released in ’09 projected that 24% of the financing would come from outside the city, the revised forecast chops that down to 18%, and for a smaller overall program. Specifically, the current 10-year forecast assumes that New York State will cut its capital contributions by more than half to $5.5 billion over a decade.

On the federal side, the money that came New York City’s way from the American Recovery and Reinvestment Act has dried up. “The city made significant use of Build America Bonds and Recovery Zone Economic Development Bonds, which have been lost this year,” according to the Building Congress report.

The report notes that the city’s population is expected to add another 700,000 by 2030, intensifying “the need for continued investment in the systems that support businesses and residents.” It calls upon the design, construction and real estate industries to argue for continued strategic investment and renewed support from Albany and Washington, DC.