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Increase in Tax Revenue Lifts New York City’s Finances

The de Blasio administration released an updated plan on Tuesday for the current fiscal year, painting a relatively rosy financial picture amid higher-than-anticipated tax revenue and strong returns on pension investments.

New York City officials said future deficits had been significantly reduced, and announced an initiative intended to curb agency costs by eliminating ineffective programs and reducing a reliance on consultants or outside contracting, among other means. In a letter to agency commissioners, the city’s budget director, Dean Fuleihan, said the administration “will not accept recommendations that will lead to a reduction in current service levels.”

The administration outlined a shift from the approach of its predecessors at City Hall, where discussions of agency cuts were long accompanied by explicit targets.

“We want people to look at their agencies and decide if there are some things that aren’t working well enough, if there are some things that should be changed,” Mayor Bill de Blasio said at an unrelated news conference on Tuesday. “Over time, if we have to get into more of a numerical exercise, we certainly know what that looks like.”

Mr. Fuleihan said that past agency targets “were always negotiated” anyway, typically moving to “very different places” when discussions concluded. The Bloomberg administration had framed the practice, known as the “Program to Eliminate the Gap,” as an effective tool in driving down costs, including more than $6 billion in annual recurring savings from rounds of cuts starting in 2007.

The size of the budget for the 2015 fiscal year, which runs through next June, grew by nearly $2 billion, to nearly $77 billion, compared with a plan laid out in June. The spending increase was almost entirely due to an infusion of federal funds like Hurricane Sandy recovery money, the city said.

A preliminary budget for the 2016 fiscal year, which begins next July, will be presented in early 2015.

A version of this article appears in print on  , Section A, Page 23 of the New York edition with the headline: Increase in Tax Revenue Lifts the City’s Finances. Order Reprints | Today’s Paper | Subscribe

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