New York City Statement Following a Meeting With Mayor Edward I. Koch.

I was pleased to meet with Mayor Koch today to discuss New York City's current fiscal condition and its recently developed budget and financing plans to cover the next 4 years.

Mayor Koch is an able and courageous man whose administration shows great promise in its early days. He has a series of difficult decisions to make. We both share a commitment, which I believe reflects the expectation of the Congress, that he will make those decisions in a way that will restore New York to a sound financial footing.

I assured him of my commitment to preserve New York City's solvency. This administration recognizes that New York is the nerve center of some of the most important activities in this country, and I reiterate that bankruptcy is not an acceptable solution to its problems.

I reminded Mayor Koch that my commitment to find a financial solution for the city has always presumed a maximum effort by all the local parties with an interest in the city's future—the State, the financial community, the city and State pension funds, the labor unions. I am certain that the Congress would not approve a Federal financing role, or other assistance, on any other basis.

For these reasons, I have asked Secretary Blumenthal to discuss with all of these parties what they can do. Once I am satisfied that they all will do their part, I will work hard to persuade the Congress to enact a bill that will end the financial uncertainty in New York.