Editor's note: A shorter version of this interview appears in the Jan. 7 print edition of The Observer.

Location: With the budget, the city faces a gap of over $1 billion for the next fiscal year, mostly only by using the surpluses of prior years. Do you expect we’ll need another tax increase?
Ms. Quinn. I hope we won’t need to raise taxes further. Certainly, I don’t think we can go back to the property-tax well if we do need to raise taxes.

Why is that?
To go further than that [the recent repeal of a 7 percent property-tax cut] would take us to a property-tax level beyond where we raised property taxes after September 11. I think, while although no one was happy then, there was an understanding of why we had to do it. I think to go above that level would really be asking a lot, and too much, of New Yorkers.

Though it’s a lot harder for the Council and the city to raise taxes other than the property tax.
We have far fewer taxing options than the state of New York or the federal government. And we certainly can’t, like the federal government, run a deficit. … That said, if we have to go to further taxes come June: One, we should only do that after having fully exhausted our ability to make cuts in spending. … Two, you want to root out anything that is wasteful. Three, you want to take out anything that is good, but isn’t critical, out of the budget.

We’re going to have to find those things that are good, but not critical, in a significant level before we get to raising taxes, and if—if—we have to raise taxes again, we’re going to find other revenue streams beyond property taxes. And one of the things about property taxes versus, say, personal incomes taxes is it’s not the most progressive tax out there.

So is that to say you favor a personal income tax as the next step?
If we had to look for another tax to help stabilize the city, I think the place to start looking would be at personal income taxes of folks who are making a higher amount of money in the city of New York. That’s not easy or fun, but certainly there’s a greater fairness to people who have an ability to pay more to pay more. But I hope we’re able through efficiencies and cuts not to have to go there.

Do you think East River bridge tolls could pass the Council?
I’m not sure that they necessitate a home-rule message. … And although this is a little bit odd to say for me being from Manhattan, the problem with East River tolls is Manhattan continues to get a free ride, as opposed to in congestion pricing when that wasn’t the case. I haven’t taken a position yet on the tolls—I was supportive, of course, on congestion pricing. … I’m going to want to do some consultation with my colleagues, but I’m not at all sure that this is going to be something that necessitates a home-rule.

How, generally, has the extension of term limits changed the mood around here?
After the term-limits vote was done, people went back to work. You know what I mean? The next stated meeting, I think it was, we passed Willets Point, or not long thereafter—we passed the Willets Point rezoning, a very significant land-use action—something that many people have been talking about for decades. … Not long after that, we took significant budget actions to keep the city’s budget balanced, as well as a number of other important pieces of legislation. So people went right back to work.

Were you surprised at all by how contentious the term limits vote was?
No. Term limits have never been something that I supported—I think they’re bad policy. I accept that there are two sides to that argument just on whether they are good policy, a, and, b, I understand why folks think it would have been better to do a referendum. It might have, in a perfect world, been better to do a referendum. That’s not how the timing worked out—we didn’t have that option. I respect that there are two sides to that opinion, and accept that some folks disagree.

How does it feel to not be running for mayor right now?
I am incredibly, incredibly lucky to have a job which, in some ways, is beyond my wildest dreams. I’m very honored to have it, both as the local council member from the West Side of Manhattan, and to be speaker of the City Council, and I’m very honored to have the opportunity to run for reelection for both of those positions.

Looking back three years now, did you think that your relationship with the mayor was going to be as good as it has been?
When we can find points of agreement that make people’s lives better, I’m going to do that. So it’s not about personally, whether the mayor and I like each other or don’t like each other—though I like to think of myself as likable—it’s about getting the job done, and that means trying to agree when you can. We can’t always agree … but we’re going to try to agree where we can, and find those points of commonality and move things forward. I do find it curious that there’s been so much attention paid to the fact that the mayor and I don’t hate each other. I’m not quite sure why we have grown to expect elected officials who are in significant positions to hate each other, and that the modus operandi should be sniping and backstabbing.

Do you think you’ll be challenged for speaker?
Yeah, it’s a democratic process—who knows? That said, I’m very optimistic about my ability to be reelected speaker.

Do you feel the mayor and the administration give enough credit to the Council, where credit is due?
Who wouldn’t love more credit—we love credit. But I think the mayor, actually, and his staff are quite appropriately crediting of us.

About a year ago, you announced a task force that would devise a method to create widespread housing that is affordable to the middle class—
And I have a meeting about it this afternoon with the HPD [commissioner]—soon to be—[U.S. Department of Housing and Urban Development] Secretary Donovan. And we’ve made some very, very good progress. Things shifted, somewhat in the midst of that, with the credit market shrinking substantially. So that has both been a challenge and an opportunity.

Is that to say you think it’s possible to create such a program without really substantial city subsidy?
I think the city is always going to have to be part, in some way or another, of the effort to create and preserve affordable housing at all levels, particularly for the middle class. And I think the mayor started that with his 165,000 new units. That’s a good start, it’s not enough.

How do you feel generally about the city’s seven-month land-use review process?
The ULURP process?

Yes.
In the next couple of years, we have a charter revision commission. I think that is a good opportunity for us to look and see how we can make ULURP even more democratic—small ‘d’—and even more community participatory. Although I think ULURP is a good and sound process, I am frustrated at times by the issue of scope, and about how decisions are made when it gets to the Council—what is or isn’t in scope. That’s something where I think a change should be made in how that is determined—not leaving it solely within the hands of the City Planning Commission.

It seems a lot of times you can just tweak [proposals in the process].
You don’t really, if you’re the community or the Council, have the control over requiring the EIS [environmental impact statement] to be as broad as you want, so you get a little bit stuck with scope; so I think the issue of scope is something that has to be reviewed when we do the charter review commission—something I’m going to be very vocal about.

How about the borough presidents, do you think they should still have a say in the process?
I think since the community board is, in all cases, half-appointed by the borough presidents, it’s very appropriate for them to have a voice in the land-use process.

Do you think the length of time is appropriate? Developers certainly would wish to see it take less time.
Are there places where you could tweak the timing? Maybe, and that’s something I would certainly take input on, but if the community thinks it’s too quick and developers think it’s too long, you might be in the right spot.

The state’s latest plans for the Javits Center call for a renovation and then expansion up to 40^th Street, and the sale of a block and a half of property. You’ve been a critic in the past—how do you feel about the plans?
First, we obviously need to do the renovation. We need to have a real, honest discussion about what the renovation is going to cost, and have a real budget. I remain concerned about selling any of the adjacent properties. One, because they may not bring us the revenue that Governor Spitzer had budgeted anyway, given the collapse in the market. But, two, if you sell that property, you are basically saying Javits will never be as big as we once thought it would be. Now I don’t think New York will ever compete with Vegas or some of those other really big convention centers out there, but we can be a first-class urban convention center, which is a different model. … What we need to have is we need to get back in to this conversation—we need to agree, statewide, that that’s a goal for the city of New York, then figure out how much space and what type of space we need to do that.

All is to say you don’t think the state’s done sufficient work to identify—
I’m not criticizing Governor Paterson, because he’s barely been in office a year, and he’s had one major challenge after another, as it relates to the state’s budget, so I understand why this may not be something they’ve fully addressed yet, because he’s had so many challenges that he has faced. But it’s something we have to get to very soon, and we shouldn’t sell off that property until we get to it.

Do you have any interest at all in replacing Hillary Clinton as senator? You haven’t seemed to make a push as other people have.
Obviously, being in the Senate is a great job, but I’m very lucky to have this job, and I’m focused on keeping it.