New York City’s government workforce is expected to increase year-over-year for the first time since the pandemic, signaling progress in the city’s efforts to fill vacancies and slow attrition even as some agencies remain short-staffed, according to a new report by the state comptroller.
The city’s full-time workforce stood at around 284,000 as of January, an increase from 281,000 the year before. If that level holds through the end of the 2024 fiscal year in June, it will be the first annual increase since 2020 — although staffing levels remain below that year’s total of 300,000.
The recovery could have implications for city services, which have suffered in the wake of widespread vacancies caused in part by a tight labor market and competition from the private sector. Tuberculosis control efforts and pest-control inspections have declined due to short-staffing at the Department of Health and Mental Hygiene, and the city has gotten worse at processing public benefits and delivering meals to senior citizens due to similar shortages, prior analyses found.
But the new report, by State Comptroller Thomas DiNapoli, shows signs of progress. The city’s proportion of open positions has fallen to about 5%, down from a peak of 8% in December 2022. Some of that is due to Mayor Eric Adams’ efforts to cut costs by eliminating vacant positions entirely, but the comptroller also credits the city for holding more civil service exams and increasing outreach through public hiring halls.
The Adams administration also reached new deals with city workers’ unions allowing for higher pay and some remote work — potentially reducing incentives to depart for the private sector. And a hiring freeze that Adams imposed in October was relaxed in February, meaning job numbers could recover further.
Still, staffing is “uneven” between different agencies, DiNapoli’s office found. The Department of Environmental Protection has the highest vacancy rate, at 12%, followed by the Department of Transportation at 10% and Health at 9%. A handful of agencies still face high turnover rates even as attrition has stabilized overall, with the Probation, Buildings and Fire departments all experiencing some of the highest turnover in the past year.
The short-staffing has presented its own budgetary problem, though, by forcing more agencies to rely on costly overtime shifts. The report found that overtime spending has grown to $1.8 billion through March of the current fiscal year compared to $1.1 billion through the same period in 2021 — a growth driven mostly by uniformed divisions like fire investigators and school safety agents.
“The COVID-19 pandemic upended New York city’s public workforce,” DiNapoli said in a statement. “The city has worked to stabilize its labor force and fill critical vacancies, while holding down costs. Staffing remains below pre-pandemic levels, but the city should end the fiscal year with its first increase in headcount since the beginning of the pandemic.”
A dozen years after it debuted, promising to transform the health insurance sector, Oscar Health has recorded its first profitable quarter.
The health insurance company, which accumulated losses throughout its existence, collected $177.5 million in net income during the first quarter after losing $39.6 million a year before, Oscar Health announced Tuesday. Revenue surged 46% to $2.1 billion, which the company attributed to premium increases, membership growth and lower risk-adjustment payments associated with its exchange business.
“Oscar achieved an important milestone in the quarter,” CEO Mark Bertolini said during a call with investor analysts Tuesday.
Membership in Oscar Health's individual and small group plans grew 42% to 1.4 million during the first quarter of 2024. The company reaffirmed its full-year guidance that revenue will reach $8.3 billion-$8.4 billion.
The insurer improved its medical loss ratio — which measures the share of premiums spent on claims — from 76.3% to 74.2% during the first quarter. The company projects a full-year medical loss ratio in the range of 80.2%-81.2%, which would be above the 80% threshold that would require it to issue refunds to customers under federal law.
The company announced it will phase out its Cigna+Oscar small business product next year, which had 61,400 policyholders in the first quarter. Oscar Health expects to save $250 million-$260 million by sunsetting the Cigna partnership.
“Partnering with small and midsize employers to meet their unique needs and serve their employees will continue to be one of our top priorities, and we are evaluating our options to continue serving the small group market in the future,” a Cigna spokesperson wrote in an email.
Oscar Health instead will focus on individual coverage health reimbursement arrangements, also known as ICHRAs. “We believe ICHRA is the solution for small group and middle market, and we believe that that will be a much bigger opportunity,” Bertolini said.
The insurer has fully exited the Medicare Advantage market, ending a process it began in 2022. Bertolini said Oscar Health aims to resume offering Medicare Advantage plans in a “different way” that the company will reveal at its investor conference in June.
“We can't dismiss that this is a different company than it was three years ago when they [went] public,” said Ari Gottlieb, an independent healthcare consultant at A2 Strategy. Gottlieb credited Bertolini, former chair and CEO of Aetna, with overseeing positive change since taking over the company 13 months ago.
Under Bertolini, Oscar Health has grown its membership, improved its operations, saved on technology and negotiated better deals with pharmacy benefit managers, Gottlieb said. Yet the company continues to face significant challenges to gaining scale in the individual market, he said. “My contention still is that Oscar is a subscale play,” he said.
Bertolini was the highest-paid for-profit health insurance chief executive last year, according to a Modern Healthcare analysis. The CEO received $44.5 million, nearly all in the form of stock awards linked to company performance.
Oscar Health shares opened at $20.60 on the New York Stock Exchange on Tuesday, up 8.6% from the previous day's closing price.
This article originally appeared in Modern Healthcare.
One of the most iconic buildings in the Bronx is for sale again. The Bronx General Post Office at 558 Grand Concourse is looking for a buyer five years after a deal to buy the landmark fell through. Developer Young Woo & Associates purchased the property from the United States Postal Service in 2014 with [...]
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New York City officials this week broke ground on an ambitious project to defend Lower Manhattan from climate change. Mayor Eric Adams on Monday announced the start of work on the city-funded Battery Coastal Resilience Project, a $200 million plan to rebuild and raise the wharf promenade in The Battery, part of a larger effort [...]
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Mayor Eric Adams’ administration is moving to take advantage of its newfound ability to inspect and then padlock illicit cannabis shops, thanks to the authority the city was granted in last month’s state budget.
The city on Tuesday published a new set of emergency rules that would give the City Sheriff the ability to inspect businesses selling cannabis and seal the shops entirely when they pose an “imminent threat” to public health and safety. Authorities planned to inspect 20 different shops on Tuesday, Sheriff Anthony Miranda told reporters during a press conference, where he called in live from a Lower Manhattan smoke shop that deputies had just raided.
Adams had long begged the state for permission to more quickly shutter the unlicensed retailers, which now number around 2,800 across the city, according to his administration. Although Adams had promised to close down all illegal shops within 30 days of being granted the authority to do so, it took City Hall more than two weeks to draft the new policies following the state budget’s passage.
The city’s rules mainly formalize what the state budget already authorized, such as the ability to inspect shops suspected of selling marijuana without licenses. But the rules shed more light on how the city plans to carry out those inspections: The Sheriff’s Office will create a “roster” of shops due for inspections, compiled through a mix of law enforcement observations, civilian complaints and signage or advertisements from the shops themselves.
To padlock a shop, the sheriff can point to any of the “imminent threats” already listed in the state’s cannabis law, such as evidence that the store sold cannabis to minors or carried unlicensed products. But the city is also adding its own new restrictions: a cannabis shop can be considered an “imminent threat” if it is within 1,000 feet of a school or house of worship, according to the new rules — a bigger range than the 200-foot limit that the state imposes on legal cannabis retailers.
“The greater distances included in this rule reflect the more serious risks that illegal businesses pose,” reads the city’s new rule. The regulations are being put forward by the Department of Finance, which oversees the city’s Sheriff’s Office.
When sheriff’s deputies seize illicit cannabis, they will be required to store the products in a secure location based on a not-yet-specified “cataloguing system” and give each business a list of the items seized. Storeowners whose products are taken can challenge the seizure and petition for the items’ return within 20 days.
“If you’re out there, we have a lock with your name on it,” Adams said during a press conference Tuesday morning.
The Finance department is adopting the new rules on an emergency basis, allowing them to take effect quickly and skip the usual weekslong public comment period for agency regulations.
The proliferation of unlicensed weed shops has become visible in virtually every corner of the city and embarrassed the state as it tries to jumpstart its slow-rolling legal cannabis program. About 40 legal cannabis stores have opened within New York City since last year.
The Adams administration has made other efforts to shutter the shops, including by filing lawsuits against them under the city’s public nuisance law and threatening legal action against more than 600 landlords who lease space to the stores. City Hall says it has closed 128 unlicensed stores and issued more than 20,000 summonses, but the efforts have plainly failed to put a major dent in the problem.
Other provisions in the new state budget will subject landlords to a $50,000 fine if they fail to start eviction proceedings after being warned they are renting to an illicit shop. The budget also empowers the state’s Office of Cannabis Management to padlock businesses immediately after an inspection if they are found to be selling illicit products or peddling to minors.
The mayor’s office said the inspections on Tuesday were part of a citywide crackdown that “will accelerate in the coming weeks.” But the administration has made no recent promises about when it expects to close down a bigger chunk of the shops.
This keg has run dry.
A decade-old brewery in the Bronx is closing its doors for good next week — becoming one of almost half a dozen in the city that have shuttered in the past six months.
The brew masters at Gun Hill Brewing Co., which opened in 2014 at 3227 Laconia Ave., will serve their last pint in the borough May 18 in what's become a competitive industry.
"There's been an explosion of breweries in the last 10 years," said Dave Lopez, one of the partners behind the tap room. "We've had a hard time justifying all the price increases since Covid."
Then-Bronx Borough President Rubén Díaz Jr. celebrated the opening of the Williamsbridge neighborhood brewery during the kickoff to Bronx Week in 2014, the Daily News reported at the time. Rapper Swizz Beatz, a native of the borough, was on hand as an honoree.
Lopez says the company is not tapping out of the business for good and will continue to make its hops upstate as well as operate a smaller offshoot of the brewery, the Gun Hill Publick House, in Sunset Park's Industry City. But the firm's decision to close the 5,000-square-foot taproom, between Boston Road and Duncan Street, was not made lightly, said Lopez, who cited the increased costs of raw materials and utilities.
Gun Hill is now joining the fate of four other breweries across the city that have also recently closed: Coney Island Brewery, Interboro Spirits & Ales in East Williamsburg, and LIC Beer Project and Big aLICe Brewing in Long Island City.
Coney Island Brewery, on Surf Avenue near Luna Park in what's known colloquially as the people's playground, similarly attributed its closure to financial struggles and the "seasonality of the area," which is usually packed during the summer months but empties out as it gets cooler, according to Brooklyn Magazine.
"It's definitely part of a larger trend," said Lopez.
Meanwhile, even more have opened in just the past few years: Torch & Crown Brewing Co. opened in SoHo in 2021; Talea Beer Co. has opened three new taprooms since 2022, two in Manhattan and a third in Cobble Hill; and Finback Brewery also opened up two taprooms, one in Long Island City and the other in Gowanus, in 2023 and 2022, respectively.
The longtime owner of the former Gun Hill Brewing Co. property, Charles Monaco, told Crain's Tuesday that the lease goes for $10,000 per month, and he hopes to rent it out to something other than an auto body shop.
In return for keeping its global headquarters at 731 Lexington Ave., Bloomberg LP struck an unusual deal that could lower its rent by as much as 10%.
The exact amount won’t be determined until the new lease takes effect in 2029. Depending on market rates, there’s a chance former Mayor Michael Bloomberg’s company could pay higher rent for its 900,000 square feet of space in the tower at the corner of East 59th Street. But at least for now, investors reckon the new rent will come in at the lower end after Vornado Realty Trust reported last night the Midtown office market continues to hobble.
Occupancy in the landlord’s Midtown office towers continued to erode last quarter and rental income fell by a surprising 5% while new tenants remain tough to find. Vornado’s share price fell by 7% in midday trading Tuesday.
Against this tough backdrop, Bloomberg’s decision yesterday to extend its lease until 2040 was a big win for Steven Roth, who is CEO of both Vornado and the real estate investment trust that owns 731 Lexington Ave., Alexander’s Inc. Vornado owns about a third of Alexander’s.
On an earnings call, Roth said that Alexander’s would be collecting $98 per square foot in net rent, after taxes and other expenses, when Bloomberg’s lease expires in five years. Under the terms of the extension, Bloomberg would pay a minimum net rent of $88.72 per square foot and a maximum of $108.44. The amount would depend on market rates in 2029 for Class A office space.
“We have certainty on the bottom as to what the rent would be,” Roth said. “Both tenant and landlord think this is a fair deal and a clever way of handling the future.”
Roth committed to spending up to $124 million, or $135 per square foot, on improving 731 Lexington, which has been occupied by Bloomberg since it opened 20 years ago. Bloomberg also secured a year of free rent, which analysts say is typical for a deal of such magnitude.
Locking in a key tenant for another 16 years was perhaps the best news Roth could offer after Vornado delivered a disappointing quarter.
The occupancy rate in its 20 million square-foot New York office portfolio declined to 88.2% from 89.9% in the prior-year period, due mainly to tenants moving out of premiere buildings at 280 Park Ave. and 1290 Sixth Ave. Rental income in the New York portfolio fell by 5.1%, weaker than expected.
Next month Meta Platforms will move out of a third of its 775,000 square feet of space at 770 Broadway.
Filling vacant space remains a challenge, with leasing volume coming in at 291,000 square feet last quarter, down from 777,000 in the prior-year period. Concessions amounted to 14.5% of initial rent, a figure Evercore ISI described as “meaningfully higher” than the fourth-quarter figure of 11.4% and a signal that bargaining power is strengthening for potential tenants.
A penthouse atop a new condo building in Chelsea is hitting the market this week for $40,000,000, marking the neighborhood’s most expensive property currently on the market. Designed in collaboration between Robert A.M. Stern Architects and Olson Kundig, The Cortland at 522 West 22nd Street is a 25-story tower with waterfront views and 144 luxury [...]
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