The House Banking Committee yesterday approved, on a 32-8 vote, federal loan guarantees for New York City securities in order to keep the city solvent after June 30.
But banking committee chairman Rep. Henry S. Reuss (D-Wis.), said he does not plan to bring the bill to the House floor until he has some indication the Senate will also take action on New York City financing.
A spokesman for Senate Banking Committee Chairman William Proxmire (D-Wisc.) said Proxmire remains adamant against taking any action until New York City and its municipal unions agree on a new three-year labor contract.
Adminstration officials worry that if Proxmire waits that long there will not be enought time to get a bill through Congress by June 30.
The labor negotiations have been deadlocked for weeks, with the unions demanding as a minimum, a pact equivalent to the one negotiated between the city and its transit workers, a settlement that has yet to be approved by the rank and file transit-workers.
Mayor Edward Koch insists that the city cannot afford to give its municipal workers as much as the transit workers received and still be able to balance its budget by 1982, the goal of the bill approved by the House committee yesterday. The state of New York picked up most of the tab in the transit worker settlement.
The budget Koch announced last week allows $610 million for the municipal settlement. Officials estimate that a pact equivalent to the one worked out between the city and the transit workers would cost between $800 and $900 million.
House Banking Committee officials were surprised by the overwhelming vote in the committee. Although a subcommittee approved the bill 12-2 last week, a much closer vote was expected in the full committee. Chairman Reuss said the size of yesterday's vote is good omen for overall House approval, although there will be a much harder time guiding a New York aid plan through the full body.
The bill, which with minor modifications is the one proposed in March by the administration would guarantee up to $2 billion in New York City securities issued between July 1, 1978, and July 1, 1982. The guarantees would be for 15 years.
A special government program to help New York with its seasonal financing needs expires June 30 and administration officials are worried that if a new aid plan is not in place by then the city could go bankrupt because it will be unable to borrow in the capital markets. Proxmire has said he does not think New York City needs any federal help but has promised to hold hearings on the administration's plan after the labor pacts are negotiated.
Opponents to giving aid to New York say they worry that it would set a precedent for other municipalities who find it difficult to balance their budgets and would come to the federal government for help.
New York officials and the administration have said that a New York City bankruptcy could not be averted without federal help and that the consequences of such a bankruptcy would overwhelm the nation's financial markets.