DEP Press Advisory on Deer Hunting Cancellation, October 2, 2001

NYC 9/11 Public Portal Document

THE ECONOMY

City Puts Attack’s Costs at Up to $ IOS Billion By LESLIE EATON for unemployment benefits in the budget, as required by law, Mr. Hev­ City Comptroller Alan G. Hevesi last week said it was because of the esi said. But the next fiscal year may issued the first official estimate yes­ trade center disaster, bringing the be more of a problem. The comptrol­ terday of how much the World Trade total of disaster-related job losses so ler’s office had been predicting a Center disaster will cost New York­ far to 16,747, according to the New deficit of at least $3.6 billion, and that ers, and the number is a shocker: as York State Department of Labor. will grow if tax collections fall by an much as $105 billion over the next The Hevesi report estimates that estimated $567 million. two years. the city will lose 115,274 jobs in its The report calculates that replac­ The estimate includes $34 billion in current fiscal year, which ends June ing the entire trade center complex property damage and up to $60 bil­ 30. The largest losses — 28,717 — will and repairing damaged buildings lion in economic costs, including lost come in services, including at least nearby will cost $12 billion. The Port jobs and lost rents. 6,000 airline jobs. Sales, retail or Authority of New York and New Jer­ The encyclopedic study calculates wholesale, will also be hard hit, with sey’s losses in addition to the trade everything from the cost of rebuild­ job losses of more than 17,000. center (it owned the buildings and ing the twin towers ($6.7 billion) to But the biggest chunk of lost wages leased them to a private developer) revenue lost because fewer traffic — which will total almost $9.6 billion are $2.4 billion. tickets will be issued ($82 million). — will come from a loss of Wall Fixing the subways will cost about While the comptroller’s office is Street paychecks totaling $3.4 billion. $3 billion, while repairing phone and widely respected for its economic One of the report’s most contro­ electrical systems will cost $2 billion. forecasts, it is clearly in the city’s versial figures may be its estimate of Replacing what was lost in the trade interest to make the total as big as the loss of “human capital,” $11 bil­ center’s stores adds another $2 bil­ possible so that officials can ask for lion. “It is impossible to put a real lion to the tab. The report estimates increased federal aid. Mr. Hevesi value on a human life and the pain of the value of property in and around urged them to do so, saying, “We losing a loved one,” Mr. Hevesi said. the towers, from cars in the garages took the hit for America.” But Mr. Hevesi noted that econo­ to computers, was $12 billion. The report was issued as Gov. mists “ascribe value to human life” There will be some money coming George E. Pataki’s budget director by calculating how much people into the city that will help offset New estimated that the state would lose might earn in their working years. Yorkers’ losses, the report notes. $1 billion to $3 billion in revenues in Economists in his office assumed Families of the victims are likely to the fiscal year that ends in April, and that about 5,600 people were killed in receive about $4 billion from life $2 billion to $6 billion in the next the disaster, that they had about 20 insurance payments, while property fiscal year, as a result of the attack working years left apiece, and that insurance should contribute $17 bil­ on the trade center. The budget di­ their average income was $100,000. lion. Other kinds of insurance, cover­ rector, Carole E. Stone, acknowl­ The damage to the city’s budget, ing disabled workers and interrupted edged that those were rough esti­ while serious, is not as severe as the business, could pay as much as $18 mates based mostly on anecdotal overall injury to the economy, Mr. billion, while workers’ compensation information. Hevesi said. would amount to about $3 billion. The governor has promised to bal­ Tax collections are likely to drop Finally, there is federal and state ance this year’s budget without re­ by $738 million this fiscal year, the aid. Congress has appropriated $20 sorting to layoffs or tax increases. report said. The biggest decline will billion for recovery, but the money Ms. Stone ordered state agencies in a be in hotel and sales taxes, which are must be shared with Pennsylvania letter yesterday to hold spending in forecast to fall by $338 million. ’and Washington, where hijacked ! their budgets for next year at this Because the city has been running planes also caused damage. “Clear­ year’s levels. a small surplus, it will be able to take ly, given the costs,” Mr. Hevesi said, I Almost 6,000 people who applied “manageable” steps to balance its “this will not be enough.”

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