All city agencies will be expected to cut their budgets by an additional 3% for the 2009 fiscal year, the director of the city’s Office of Management and Budget, Mark Page, said today at City Hall.

Mayor Bloomberg explained the decision today at a press conference. “We just don’t have the money,” the mayor said, blaming the cuts on a lack of money from Albany and a struggling national economy.

“The governor’s budget, as proposed, would cut roughly $700 million out of aid from Albany, which is really our money we’re sending up there,” the mayor said. “That will put another hole in our budget.” He added that Wall Street’s declining profits and the subprime mortgage crisis are also impacting the city’s fiscal health.

Despite the cuts, Mr. Bloomberg said the city would strive to keep a proposed $400 property tax rebate in the budget, and uphold a 7% reduction in the property tax rate. The mayor warned that the tax cuts could be re-evaluated if the city’s fiscal outlook worsens.

“We have a long time between now and our budget adoption, we’ll see what happens to the economy,” the mayor said. “But before we even think about increasing the revenue side, we’re going to work on the expense side.”

Mr. Bloomberg noted that the city still enjoyed several advantages in weathering a widely predicted recession. He described the weak dollar as “a godsend for us,” which encourages tourism to the city. The mayor also cited low crime rates as a positive asset, saying the relative safety encourages people to live and invest in the city.

Repeating a familiar refrain, the mayor called on the nation to resist “xenophobia,” and bring in more immigrants, whom he said would “create new jobs and invent new things here.”

The City Council and the mayor will negotiate the budget over the next several months, giving the city some time to assess the state of the economy before agreeing on a final budget in June.