BEAME TO ORDER SPENDING LIMITS AT M.A.C. URGING
By John Darnton
Mayor Beame, bowing to pressure from Munic Assistance Corp, on Aug 6 imposes 3-yr 'stringent ceilings' on NYC spending under his control, news conf; repts formation of mgt advisory bd headed by Met Life Ins Co pres Richard R Shinn; denies he capitulates to corp demands; corp members privately say they feel spending limit meets their main demand; Beame aides, holding move is not capitulation, note he did not set tax limitation and that ceiling applies only to spending under Beame's control, excluding such things as interest costs, and allows for up to 2% annual rise in event of 'unforseen contingencies'; mgt bd is blend of Beame plan for Mayor's Mgt Council, made up of businessmen working on part-time basis, and corp pressure for own rev bd; bd will consist of nonpaid advisers still to be selected and will have task force headed by City Planning Comm Chmn John E Zuccotti and assistance corp exec dir Herbert Elish reptg to it; Beame stresses bd's recommendations will be implemented by Deputy Mayor James A Cavanagh; move heads off talk of separate team of up to 50 auditors and accountants reportable to corp alone; Beame holds Elish post should make it unnecessary for corp to gather own mgt staff; corp repr agrees; Shinn, who will retain Met Life post, says bd is not in adversary position with corp; says Beame has convinced him that stress will be on bd's mgt role, not its advisory role; says bd execs are not used to having their suggestions rejected; warns not to expect 'immediate breakthroughs' in streamlining govt and achieving mgt reforms; series of meetings that led to compromise noted; Gov Carey, Carey's aides David Burke and Judah Gribetz, Beame, Cavanagh, assistance corp chmn William M Ellinghaus and corp finance com head Felix Rohatyn and Howard Rubenstein, public relations specialist close to Beame, attended secret Aug 5 meeting on budget ceiling; mgt review panel was worked out during series of secretive sessions involving Cavanagh, Elish, Rubenstein and Jack Bigel, consultant to munic unions; Carey and corp members hail Beame's announcement; Carey says steps will help restore NYC's proper place in credit mkts; assistance corp continues efforts to piece together $1-billion pkg to meet Aug loan obligations, meeting with 33 reprs of corp, banks, munic unions and city to work out accord for city and state pension systems to buy $250-million in corp bonds; trustees of NYC Employes' Retirement and Teachers Retirement Systems approve purchase of $125-million in bonds; State Controller Arthur Levitt, who attends meeting, is pressed to match purchase with state pension money; says he must 1st conf with funds advisory bd; says, before meeting with Beame, that bonds are 'sound investment'; Civil Service Employes Assn pres Theodore C Wenzl opposes using state pension funds to aid NYC; holds bonds are poor risk because of city's history of fiscal irresponsibility; weighs suit to bar purchase; Beame says Levitt appears 'willing to do something'; corp says pension-fund accord would bring it within $180-million of goal; Sen Majority Leader Warren M Anderson urges Levitt to buy bonds; assistance corp bond prices rise on bond mkt for 3d straight day; Shinn por (L)
