New York City Mayor Michael Bloomberg said Tuesday that with an $8 billion pension bill squeezing the city's finances, state legislators should back the governor and create a new lower pension tier for future municipal and state workers.

New York's large and expensive public payrolls are starting to decline, pared down by more baby boomers hitting retirement age, special retirement incentives offered last year and renewed pressure to cut spending that are all starting to cut costs for taxpayers.

New York Gov. Andrew Cuomo's proposal to establish a new, less generous pension system for future state, local and school employees is expected to face resistance in the waning days of the current legislative session.