Joint Legislative Public Hearing on 2017-2018 Executive Budget Proposal: Topic "Local Government Officials - General Government" - Testimonies

Hearing Event Notice:
https://www.nysenate.gov/calendar/public-hearings/january-30-2017/joint-legislative-public-hearing-2017-2018-executive-budget

Archived Video:
https://youtu.be/GSOMZcQ_OJY

________________________________

                                                                  1

 1  BEFORE THE NEW YORK STATE SENATE FINANCE
    AND ASSEMBLY WAYS AND MEANS COMMITTEES
 2  ----------------------------------------------------
            JOINT LEGISLATIVE HEARING
 3             In the Matter of the
            2017-2018 EXECUTIVE BUDGET
 4        ON LOCAL GOVERNMENT OFFICIALS/
                GENERAL GOVERNMENT
 5  ----------------------------------------------------
    
 6                           Hearing Room B                                                    
                             Legislative Office Building
 7                           Albany, New York
    
 8                           January 30, 2017
                             10:09 a.m.
 9  
    
10  PRESIDING:
    
11           Senator Catharine M. Young 
             Chair, Senate Finance Committee
12  
             Assemblyman Herman D. Farrell, Jr.
13           Chair, Assembly Ways & Means Committee
    
14  PRESENT:
    
15           Senator Liz Krueger 
             Senate Finance Committee (RM)
16  
             Assemblyman Robert Oaks
17           Assembly Ways & Means Committee (RM)
    
18           Senator Diane J. Savino
             Vice Chair, Senate Finance Committee
19  
             Assemblyman Michael Benedetto
20           Chair, Assembly Cities Committee
    
21           Senator Simcha Felder
             Chair, Senate Committee on Cities
22  
             Senator Kathleen A. Marchione
23           Chair, Senate Committee on Local Government
    
24  
    

                                                                 2

 1  2017-2018 Executive Budget
    Local Government Officials/
 2  General Government
    1-30-17
 3  
    
 4  PRESENT:  (Continued)
    
 5           Assemblyman Michael J. Cusick
    
 6           Senator Roxanne J. Persaud
    
 7           Assemblyman David Weprin
    
 8           Assemblywoman Catherine T. Nolan
    
 9           Assemblyman Jeffrion L. Aubry
    
10           Senator Gustavo Rivera
    
11           Senator Martin Golden
    
12           Assemblywoman Nicole Malliotakis
    
13           Senator Daniel Squadron
    
14           Assemblywoman Rebecca Seawright
    
15           Assemblyman Robert Carroll
    
16           Senator Terrence Murphy
    
17           Assemblyman Walter T. Mosley
    
18           Assemblywoman Nily Rozic
    
19           Senator Brad Hoylman
    
20           Assemblyman Erik M. Dilan
    
21           Senator Timothy Kennedy
    
22           Assemblywoman Rodneyse Bichotte
    
23           Assemblywoman Earlene Hooper
    
24           Assemblywoman Inez E. Dickens
    

                                                                 3

 1  2017-2018 Executive Budget
    Local Government Officials/
 2  General Government
    1-30-17
 3  
    
 4  PRESENT:  (Continued)
    
 5           Senator Andrea Stewart-Cousins
    
 6           Assemblyman David F. Gantt
    
 7           Senator Daniel Squadron
    
 8           Assemblywoman Tremaine Wright
    
 9           Assemblyman Christopher S. Friend
    
10           Assemblyman John T. McDonald, III
    
11           Senator Jesse Hamilton
    
12           Assemblyman Ron Castorina, Jr.
    
13           Assemblywoman Shelley Mayer
    
14           Assemblywoman Patricia Fahy  
    
15           Assemblyman Steven Otis
    
16           Assemblywoman Jo Anne Simon
    
17           Assemblywoman Diana C. Richardson
    
18           Senator James Sanders, Jr. 
    
19           Assemblyman Joseph S. Saladino
    
20           Assemblywoman Yuh-Line Niou
    
21           Assemblywoman Stacey Pheffer Amato
    
22           Senator Elaine Phillips
    
23           Assemblywoman Monica P. Wallace
    
24           Assemblyman Edward C. Braunstein
    

                                                                 4

 1  2017-2018 Executive Budget
    Local Government Officials/
 2  General Government
    1-30-17
 3  
    
 4  PRESENT:  (Continued)
    
 5           Senator John E. Brooks
    
 6           Assemblyman David Buchwald
    
 7           Assemblyman Brian P. Kavanagh 
    
 8           Assemblywoman Crystal D. Peoples-Stokes
    
 9  
    
10  
    
11                   LIST OF SPEAKERS
    
12                                   STATEMENT QUESTIONS
    
13  Honorable Bill de Blasio 
    Mayor 
14  City of New York                       9         39
    
15  Scott M. Stringer 
    Comptroller 
16  City of New York                     211        223
    
17  Honorable Byron W. Brown
    Mayor 
18  City of Buffalo                      266        278
    
19  Honorable Kathy M. Sheehan
    Mayor
20  City of Albany                       310        321
    
21  Honorable Lovely A. Warren
    Mayor 
22  City of Rochester                    346        353
    
23  Honorable Mike Spano
    Mayor
24  City of Yonkers                      366        377
    

                                                                 5

 1  2017-2018 Executive Budget
    Local Government Officials/
 2  General Government
    1-30-17
 3  
                       LIST OF SPEAKERS, Cont. 
 4  
                                    STATEMENT  QUESTIONS
 5  
    Honorable Stephanie A. Miner
 6  Mayor
    City of Syracuse                     389       
 7  
    Julissa Ferreras-Copeland
 8  Councilmember
    New York City City Council           400
 9  
    Peter A. Baynes
10  Executive Director
    Thomas Roach
11  Mayor, City of White Plains
    NYS Conference of Mayors
12   and Municipal Officials             411      427
    
13  Stephen J. Acquario
    Executive Director
14  NYS Association of Counties          451      463
    
15  Gerry Geist
    Executive Director
16  Supervisor Bill Moehle 
    Town of Brighton, Monroe County
17  Supervisor Ed Theobald
    Town of Manlius, Onondaga County
18  Town Clerk Rebecca Haines
    Town of Ellergy, Chautauqua County
19  Association of Towns of
     the State of New York               473      496
20  
    Barbara Bartoletti
21  Legislative Director
    League of Women Voters
22   of New York State                   507      515
    
23  Elena Sassower
    Director Center for 
24   Judicial Accountability             518
    

                                                                  6

 1                 CHAIRMAN FARRELL:  Good morning.  

 2          Today we begin the third in a series of 

 3          hearings conducted by the joint fiscal 

 4          committees of the Legislature regarding the 

 5          Governor's proposed budget for fiscal year 

 6          2017-2018.  The hearings are conducted 

 7          pursuant to Article 7, Section 3 of the 

 8          Constitution and Article 2, Sections 31 and 

 9          32A of the Legislative Law.

10                 Today the Assembly Ways and Means 

11          Committee and the Senate Finance Committee 

12          will hear testimony concerning the budget 

13          proposal for local government officials and 

14          general government.  

15                 In the interests of time and 

16          fundamental fairness to the other witnesses 

17          who have been scheduled to speak, limits on 

18          the questions and overall time period will be 

19          implemented for the first witness, Mayor de 

20          Blasio.  Any committee member in the seat in 

21          the room after 11:30 will not be permitted to 

22          ask questions.  For those of you that are 

23          upstairs in the chambers listening on TV, you 

24          must be down by 11:30 to ask a question of 


                                                                  7

 1          Mayor de Blasio.

 2                 All questioning of the mayor will 

 3          conclude at 1 p.m.  Any additional 

 4          questioning and photo opportunities should 

 5          then take place outside of the hearing room, 

 6          to allow us to promptly continue with the 

 7          next scheduled witness.

 8                 I will now introduce members from the 

 9          Assembly and Senator Young, chair of the 

10          Senate Finance Committee, will introduce 

11          members from the Senate.

12                 We have with us -- I'm going to get as 

13          many as I can and then we'll do it as I catch 

14          you later -- Assemblywoman Rozic, Assemblyman 

15          Mosley, Assemblyman Aubry, Assemblyman 

16          Carroll, Assemblywoman Seawright, Assemblyman 

17          Benedetto, Assemblyman Weprin, Assemblywoman 

18          Nolan, Assemblyman Cusick, Assemblywoman 

19          Simon, and Assemblywoman Hooper.  Those that 

20          I missed, I'll catch later.

21                 Senator.

22                 CHAIRWOMAN YOUNG:  Thank you very 

23          much, Mr. Chairman.  

24                 And I'm delighted to be here today, 


                                                                  8

 1          and I welcome everyone to these proceedings.  

 2          I am joined by several of my colleagues.  I 

 3          have Senator Diane Savino, vice chair of the 

 4          Senate Finance Committee.  Also we are joined 

 5          by Senator Simcha Felder, who serves as chair 

 6          of the Cities Committee, and also Senator 

 7          Kathy Marchione, who is chair of the Local 

 8          Governments Committee.  In addition to that, 

 9          we also are joined by Senator Elaine 

10          Phillips.  

11                 And I would turn things over to my 

12          colleague who is the ranking member on 

13          Finance, and that's Senator Liz Krueger, to 

14          introduce the members in her conference.

15                 SENATOR KRUEGER:  Good morning, 

16          everyone.  I am also joined by my colleague 

17          Senator Roxanne Persaud from Brooklyn and 

18          Senator Daniel Squadron from Brooklyn and 

19          Manhattan.  

20                 Thank you.  Welcome.

21                 CHAIRMAN FARRELL:  Assemblyman Oaks.

22                 ASSEMBLYMAN OAKS:  Yes, we're also 

23          joined by Assemblywoman Malliotakis and 

24          Assemblyman Castorina.


                                                                  9

 1                 CHAIRMAN FARRELL:  Good morning.

 2                 MAYOR DE BLASIO:  Good morning.

 3                 CHAIRMAN FARRELL:  Welcome.

 4                 MAYOR DE BLASIO:  Ready to go?  

 5                 CHAIRMAN FARRELL:  Yup, go ahead.

 6                 MAYOR DE BLASIO:  Okay, thank you.  

 7                 Well, I want to thank everyone, and 

 8          particularly thank the chairs for the 

 9          opportunity to be here today.  Senator Young 

10          and Assemblymember Farrell, thank you for 

11          your leadership of this joint hearing.  And I 

12          want to also thank your ranking members, 

13          Senator Krueger and Assemblyman Oaks.  

14                 I want to say, on behalf of the people 

15          of the city, a thank you to the legislative 

16          leadership across the board.  To Speaker 

17          Heastie and Majority Leader Flanagan, 

18          Democratic Conference Leader Stewart-Cousins, 

19          IDC Conference Leader Klein, Assembly 

20          Minority Leader Kolb, and all the members of 

21          the State Legislature here and across the 

22          board, thank you for your partnership and 

23          your support for the people of New York City.

24                 I want to thank two members of my team 


                                                                  10

 1          who will be joining me and will participate, 

 2          as warranted, in the Q&A.  Of course you know 

 3          them both, Dean Fuleihan, our director of New 

 4          York City Office of Management and Budget, 

 5          and Sherif Soliman, the city's director for 

 6          state legislative affairs.

 7                 I want to say up front that the 

 8          Legislature has been a crucial partner, and 

 9          that is important to all the work we do on 

10          behalf of the people of New York City.  And 

11          of course we are all in this together:  

12          New York City, and all the ways that we 

13          attempt to contribute to the larger State of 

14          New York and all the ways that the State of 

15          New York works with us.  This is part of a 

16          continuum, and we see our role as continuing 

17          to be an economic engine for the state as a 

18          whole and for the region.  And obviously we 

19          are the state's primary gateway to the rest 

20          of the world, and we know we have to play 

21          that role well.

22                 I think it's fair to say that the City 

23          of New York can only reach its full potential 

24          with the support of the State of New York.  I 


                                                                  11

 1          also think it's fair to say that New York 

 2          State succeeds when New York City succeeds, 

 3          and New York City succeed when New York State 

 4          succeeds.  It's a truly symbiotic 

 5          relationship.

 6                 And at this moment I can say and I'm 

 7          happy to report to you that New York City is 

 8          succeeding most clearly in the vein of 

 9          economic growth.  In the last two full years 

10          for which we have full information, 2014 and 

11          2015, New York City created more jobs itself 

12          than all but four states in the country, and 

13          that helped push forward New York State's 

14          overall gains in terms of economic growth and 

15          job creation.  And of course New York City 

16          accounts for almost 43 percent of the state's 

17          total population, 46 percent of the state's 

18          jobs, and 60 percent of the state's tax 

19          revenue.

20                 So we are very happy to play those 

21          roles, but we also know we have profound 

22          challenges and issues we have to address in 

23          terms of our 8.5 million people.  Examples 

24          are clear:  58 percent of New York State's 


                                                                  12

 1          Medicaid recipients live in New York City, 53 

 2          percent of the state's free and 

 3          reduced-price-lunch students attend school in 

 4          New York City.  So we have some of the most 

 5          powerful ways of contributing to the state; 

 6          we also have some of the biggest challenges 

 7          in the state.

 8                 We're investing, in our latest budget, 

 9          in the people of our city, but at the same 

10          time we're demanding savings from our city 

11          agencies.  We're setting aside unprecedented 

12          reserves, and we're spending within our 

13          means.  I'm proud to say that just last week, 

14          one of the rating agencies, Moody's, noted 

15          that our "diverse, vibrant economy drives 

16          growth needed to keep pace with fixed costs," 

17          and gave us a very positive review of our 

18          fiscal standing.

19                 Now, we have to continue our economic 

20          strength and our economic growth for the good 

21          of all.  And we face a variety of challenges, 

22          but we are prepared to address them head-on.  

23          We also know that we have to ensure, for all 

24          of you, that when we ask for state assistance 


                                                                  13

 1          that we can show you we're getting the 

 2          maximum impact from that state assistance and 

 3          the maximum bang for the buck.  

 4                 Examples are clear.  You, all the 

 5          members of the Legislature, played a crucial 

 6          role in allowing us to build out our pre-K 

 7          program.  Now 70,000 4-year-olds are enrolled 

 8          in pre-K, and we're making sure that that 

 9          investment pays off.  Again, I want to offer 

10          my profound thanks on behalf of the parents 

11          of the City of New York in allowing us to 

12          achieve this success.  This is part of a 

13          bigger initiative called Equity and 

14          Excellence to fundamentally alter and improve 

15          our school system, and we've already seen 

16          results with higher graduation rates and 

17          higher test scores.  And we believe those 

18          trends will continue because of these 

19          investments.  

20                 So that's an example of state support 

21          that's having a real and tangible impact in a 

22          very efficient manner.

23                 I also want to say, in terms of 

24          affordable housing, we are ahead of schedule 


                                                                  14

 1          in our initiative to build and preserve 

 2          200,000 affordable apartments, enough for 

 3          half a million people.  Already, over three 

 4          years of this plan, 62,000 apartments have 

 5          been either financed and built or preserved 

 6          already.  And that immediately is enough 

 7          affordable housing for almost 200,000 New 

 8          Yorkers.  That is the most affordable 

 9          apartments -- particularly in the last year, 

10          the most affordable apartments created or 

11          preserved in a single year since the time a 

12          quarter-century ago, that we have set a 

13          record for the last quarter-century for the 

14          pace of that production.

15                 Finally, I want to note, in the vein 

16          of impact, that your support has been part of 

17          our ongoing effort to make the City of New 

18          York the safest big city in America.  We're 

19          proud to say that the numbers have come in 

20          for 2016, and once again we've seen a 

21          reduction in crime across the board in New 

22          York City, while we've improved the 

23          relationship of police and community through 

24          our Neighborhood Policing initiative.  


                                                                  15

 1          Another example of investments that have 

 2          consistently paid off.

 3                 Now, we're going to continue our 

 4          efforts to keep our city's economy vibrant 

 5          and strong, and this is consistent in the 

 6          fiscal '18 preliminary budget that I 

 7          presented last week.  A few examples I want 

 8          to offer you.  We obviously know that for our 

 9          continued efforts on public safety, to 

10          succeed we need to keep training and 

11          equipping our police officers more 

12          effectively.  So we're investing 

13          $10.4 million to install bullet-resistant 

14          windows in every NYPD patrol car.  

15                 We know the city succeeds when people 

16          can afford to be there, and we know we have a 

17          particular obligation to those residents who 

18          live in public housing -- over 400,000 New 

19          Yorkers -- and we have to provide them safe 

20          and secure housing.  The City of New York has 

21          made a commitment to invest $1 billion over 

22          the next 10 years to fix the roofs at 729 

23          NYCHA buildings that have been found to have 

24          leaks that cause health problems for the 


                                                                  16

 1          residents.  This will allow us to reach 

 2          literally all of the buildings that have 

 3          serious roof problems causing health concerns 

 4          for residents.  

 5                 We know we succeed when our students 

 6          have the right environment to learn in and 

 7          are not subjected to overcrowding.  And we 

 8          know overcrowding has been a particular 

 9          concern for members of the Senate and the 

10          Assembly from New York City.

11                 So we're tackling the problem head-on 

12          by investing an additional $495 million to 

13          build 38,000 new school seats, part of the 

14          next five-year plan.  That total cost will be 

15          $4.6 billion.  Again, by creating 38,000 new 

16          school seats, we will substantially address 

17          overcrowding issues.

18                 Finally, we know that investment in 

19          infrastructure is absolutely necessary to 

20          sustain economic growth, so we're fully 

21          funding $303 million worth of construction on 

22          the Brooklyn and Queens stretch of the 3rd 

23          Water Tunnel.  Nothing more importantly, 

24          obviously, than providing clean and safe 


                                                                  17

 1          water to our residents and having redundancy 

 2          against all potential challenges.

 3                 3rd Water Tunnel, the foundation is 

 4          built, meaning the tunnel itself is in place.  

 5          It will be filled by the end of this year 

 6          with water, will be operational and 

 7          available, redundancy in the event of an 

 8          emergency, and then the additional work to 

 9          add shafts and other elements will be done 

10          with the $303 million.

11                 So when it comes to what we're able to 

12          do with our resources and with your support, 

13          we feel confident about the progress we're 

14          making.  But where we feel real uncertainty 

15          is on the federal front.  And we know that 

16          those uncertainties are sharp and profound.

17                 Already, of course, we've seen new 

18          policies that lead us to be very concerned 

19          about their impact on the people of New York 

20          City -- just last week, of course, the 

21          executive order on immigration, which has 

22          raised a host of concerns, and which I 

23          believe fundamentally runs contrary to the 

24          values of New York City.  We believe we will 


                                                                  18

 1          be on a firm legal footing to challenge it 

 2          and will do so as needed.  

 3                 But this is only a beginning.  The 

 4          great concern we have ahead, of course, is on 

 5          the budgetary front.  What will the impact of 

 6          proposals from the Trump administration and 

 7          Republican Congress be in terms of potential 

 8          cuts to services and funding that the federal 

 9          government currently provides?  This is a 

10          great unknown that will have a huge impact on 

11          not only the city budget but of course on the 

12          state budget that you're debating right now.

13                 One crucial example that we all are 

14          concerned about, we do not know what 

15          direction efforts to repeal the Affordable 

16          Care Act will take.  ACA now covers 

17          1.6 million New York City residents.  Changes 

18          to the Affordable Care Act or cuts to 

19          Medicaid would have an enormous impact on 

20          both the well-being of our people and on our 

21          ability to fund our public hospital system, 

22          our Health and Hospitals Corporation.

23                 Of the 1.2 million patients who depend 

24          upon our public hospital system, 30 percent 


                                                                  19

 1          are currently uninsured, and 45 percent are 

 2          on Medicaid.  Should the ACA be repealed, we 

 3          believe that up to 200,000 of our public 

 4          hospital patients could lose their insurance, 

 5          not only endangering their health but 

 6          potentially cost our public hospital system 

 7          hundreds of millions of dollars in revenue.

 8                 So we're quite clear that any actions 

 9          taken in Washington could create real pain 

10          for both state and city government.  And 

11          that's why it's so important that we -- and 

12          we ask your support in making sure that the 

13          state budget insulates and protects local 

14          governments and our work given these great 

15          uncertainties.

16                 I want to comment briefly on the State 

17          Executive Budget, where we certainly see some 

18          very good news but also some areas of 

19          concern.  In terms of education, the City of 

20          New York certainly appreciates deeply that 

21          the new Excelsior Scholarship Program, when 

22          added to existing tuition assistance 

23          programs, promises to further ease tuition 

24          costs for low- and middle-income students in 


                                                                  20

 1          our state.  

 2                 We're also gratified to see continued 

 3          support for the DREAM Act, which is 

 4          particularly important at this moment in 

 5          history.

 6                 The Executive Budget continues the 

 7          commitment to cap local Medicaid costs and 

 8          assumes control of Medicaid administration.  

 9          We certainly appreciate and support that.  

10          This will save the City of New York 

11          $130 million.  We appreciate this commitment, 

12          and we know that the city can assist the 

13          state in Medicaid reimbursements without the 

14          specific $50 million New York City mandate 

15          that was added in this budget.

16                 There's a three-year extension of 

17          mayoral control in the Executive Budget.  I 

18          think it's fair to say that educators, 

19          business leaders, and civic leaders alike 

20          have called for a multiyear renewal.  There's 

21          a strong and bipartisan consensus on this, 

22          and let's resolve to address this issue right 

23          away through the budget process.

24                 I'm obviously pleased to see election 


                                                                  21

 1          reform in the Executive Budget.  I want to 

 2          thank the Assembly for passing an election 

 3          reform package last year including early 

 4          voting, which is absolutely necessary given 

 5          the realities of modern lives and people's 

 6          schedules.  Early voting and same-day 

 7          registration are fundamental reforms we need 

 8          to improve the democratic process.

 9                 I continue to support Raise the Age 

10          and know we'll be a better and fairer state 

11          if we get this done.  While we wait for 

12          legislative reform in this area, my 

13          administration has already made a commitment 

14          to move 16- and 17-year-olds off of Rikers 

15          Island.

16                 I'm also pleased the Governor 

17          announced support for speedy trial reform.  

18          New Yorkers deserve their day in court, and 

19          the principles of fairness and justice demand 

20          that we ensure that day in court as 

21          expeditiously as possible.

22                 I'd like to commend Speaker Heastie 

23          for his leadership on this issue, as well as 

24          members of the Assembly Democratic Conference 


                                                                  22

 1          for championing these issues.

 2                 I also support changes to our bail 

 3          system that would reduce our reliance on 

 4          money bail and would allow judges to consider 

 5          whether a defendant poses a danger to the 

 6          community when making bail determinations.

 7                 New York City has expanded supervised 

 8          release so that 3300 individuals a year can 

 9          be safely supervised in the community instead 

10          of being detained.  Detaining those who 

11          actually pose a risk and releasing those who 

12          can safely remain in the community, doing 

13          both those things is good public policy, and 

14          I look forward to working with you on these 

15          issues during the session.

16                 I now want to talk about the larger 

17          economic reality of our city and how this 

18          state budget affects us.  We're still dealing 

19          with extraordinary challenges in terms of 

20          affordability in our city and income 

21          inequality that is widespread.  This is a 

22          problem everywhere.  

23                 I think everyone was struck by the 

24          recent Oxfam report that made clear that 


                                                                  23

 1          eight individuals possess as much wealth as 

 2          one-half of the residents of this globe.  And 

 3          we also know that the wealthiest among us 

 4          have every reason to expect a major new tax 

 5          break at the federal level, given the 

 6          proposals already put forward by President 

 7          Trump and the Congress.

 8                 We think, in light of the fact that 

 9          the wealthiest will be receiving a 

10          substantial federal tax break, that it's time 

11          that they pay their share in state and local 

12          taxes.  So I join the Assembly majority's 

13          push to extend and deepen the millionaire's 

14          tax.  This is critical to all that we are 

15          trying to do to improve our economy and 

16          support our people.  

17                 For similar reasons, I believe the 

18          time is now ripe to enact a mansion tax for 

19          New York City high-value home sales.  That 

20          means homes that start with a sales price of 

21          $2 million or higher.  The people who would 

22          be affected can certainly afford this 

23          additional tax, and the revenue would be used 

24          to keep 25,000 senior citizens in their homes 


                                                                  24

 1          at an affordable level.  So this would be an 

 2          additional 25,000 senior citizens who would 

 3          get affordable housing as a result of this 

 4          proposal.

 5                 Moreover, in this uncertain federal 

 6          climate, identifying local revenue sources 

 7          for affordable housing preservation is 

 8          paramount.  I think it's fair to say one of 

 9          the areas most threatened by potential 

10          federal budget cuts is affordable housing, 

11          public housing, Section 8 -- all of the 

12          things that so many of our residents in 

13          New York City and across the state depend on 

14          to be able to afford to live.

15                 Now, a few areas of concern that the 

16          City of New York has with the State Executive 

17          Budget.  First, we're concerned about the 

18          421-a tax abatement program.  We worked hard 

19          with so many of you to eliminate the old and 

20          broken version of the 421-a program, which 

21          subsidized luxury housing without enough 

22          affordable housing in return.  

23                 We advanced a proposal in 2015 that 

24          set forth some clear principles for what 


                                                                  25

 1          421-a should look like.  One, more 

 2          affordability per city tax dollar spent.  

 3          It's a matter of fairness to our taxpayers.  

 4          Two, that we could no longer subsidize luxury 

 5          housing.  And three, if a developer got a tax 

 6          exemption anywhere in New York City, they had 

 7          to provide affordable housing in return.  

 8          Those were the core principles.

 9                 The state's current proposal 

10          represents a departure from these principles.  

11          To illustrate, if the old, broken 421-a 

12          program was extended, the per-unit subsidy 

13          would have been $614,000 and likely would 

14          have produced only 12,400 affordable 

15          apartments over 10 years.

16                 By contrast, our proposal from 2015 

17          had a per-unit subsidy of $421,700 and would 

18          have produced almost twice as much affordable 

19          housing:  25,500 affordable apartments -- 

20          enough, on average, for over 75,000 New 

21          Yorkers.  In other words, it meant fewer 

22          taxpayer dollars spent for each apartment and 

23          more affordable housing created.

24                 Now, in the state's current proposal, 


                                                                  26

 1          the per-unit subsidy would be $544,300 and 

 2          produce 21,750 affordable apartments over 10 

 3          years.  In other words, more than $100,000 

 4          per unit above the cost of our proposal, with 

 5          less affordable housing.

 6                 Now, we're concerned by the additional 

 7          costs imposed by the state's current 

 8          proposal.  But we obviously look forward to a 

 9          conversation on how we can work together.  

10                 That being said, we're even more 

11          concerned with the potential expansion of any 

12          condominium program as negotiations proceed.  

13          And we're concerned that we not creep back in 

14          the direction of the old and broken system.  

15                 We are particularly adamant that we 

16          cannot support a plan that reverts back to 

17          subsidizing luxury condominiums.  Costs will 

18          balloon in that instance without improving 

19          affordability, which is the core objective of 

20          the program.  And we'd have to ask at that 

21          point whether we were repeating mistakes of 

22          the past and spending taxpayer dollars to 

23          subsidize luxury housing, which I think it's 

24          fair to say our taxpayers would not approve 


                                                                  27

 1          of.

 2                 A second area of concern is education.  

 3          There appears to be an effort to eliminate 

 4          the state's commitment to fully fund the 

 5          shortfall in aid owed to high-need school 

 6          districts all over the State of New York.  

 7          Almost a decade ago, the state charted a 

 8          course of reform in how school aid was 

 9          allocated.  After lawsuits, a study 

10          commission, a financial crisis and many 

11          budgets later, this vital commitment has yet 

12          to be completely fulfilled.  

13                 The state must continue its commitment 

14          to funding the Campaign for Fiscal Equity 

15          settlement.  Now, the city is doing its part.  

16          Since 2008, the city's share of education 

17          spending has increased from 49 percent to 57 

18          percent, while the state share has declined 

19          from 41 percent to 37 percent.  The state 

20          shortfall is currently $1.6 billion.  

21                 We are doing our part to provide 

22          equitable funding to our schools, but we need 

23          the state's partnership, and we need the 

24          state to do more.


                                                                  28

 1                 When I came into office, many schools 

 2          were at just 81 percent of the fair student 

 3          funding level, and the citywide average was 

 4          88 percent.  Over two years, with your help, 

 5          with the help of state assistance, we 

 6          increased the citywide average to 91 percent, 

 7          with no school below 87 percent of the 

 8          formula.

 9                 All, by the way, all of our Community 

10          and Renewal Schools are at 100 percent of 

11          their fair student funding level.

12                 Now, if the state provides a similar 

13          increase in education aid as it did over the 

14          last two years, we intend to go to a citywide 

15          average of 92.5 percent, with no school below 

16          90 percent next year.  And with the state's 

17          continuation of the commitment to CFE, the 

18          city has committed to raising all schools to 

19          a minimum of 100 percent by fiscal 2021.

20                 On another front, the state is 

21          proposing a much-needed consolidation of the 

22          administration of grant funding for pre-K.  

23          We support the goals of streamlining to 

24          address the administrative burden on school 


                                                                  29

 1          districts that come with complying with 

 2          separate funding structures, standards, and 

 3          reporting requirements.  

 4                 However, the proposal also plans to 

 5          cut the per-seat rate at a cost of 

 6          $34 million, or the equivalent of 3400 pre-K 

 7          seats in New York City.  The state has made a 

 8          giant leap forward over the last years in 

 9          supporting pre-K, but this proposal and this 

10          proposed cut is a leap backwards and counter 

11          to all the progress that we've made, with 

12          your partnership, in ensuring that 70,000 

13          4-year-olds had full-day, high-quality pre-K.  

14          This rate cut should not go forward.

15                 Additionally, the state is proposing 

16          to increase and shift charter school costs it 

17          has been paying previously.  The proposal 

18          strips state support away from charter 

19          schools and transfers this cost to school 

20          districts abruptly, and to an exorbitant 

21          degree.  For New York City alone, this would 

22          mean $198 million less funding for our 

23          schools.

24                 If the state chooses to enact this 


                                                                  30

 1          increase in funding for charter schools, then 

 2          it should cover the costs and fund it 

 3          separately from our basic school aid, as it 

 4          has for the past four years.

 5                 The Executive Budget also removes the 

 6          geographic cap on charter schools in New York 

 7          City.  The Legislature recently raised the 

 8          cap, and there are currently 30 charters 

 9          available for New York City, in addition to 

10          29 schools already approved to open.  This is 

11          ample, and there is no need to raise the cap 

12          at this time.

13                 Third, there are several cuts in the 

14          State Executive Budget that are going to have 

15          an effect on thousands and thousands of 

16          New Yorkers.  These cuts include, first of 

17          all, a $32.5 million cut through fiscal '18 

18          for public health programs, chipping away at 

19          the long history of state partnership in 

20          health funding in areas including disease 

21          control and emergency preparedness, 

22          particularly related to our efforts against 

23          Zika, maternal and child health programs, 

24          such as the Newborn Home Visiting program, 


                                                                  31

 1          HIV prevention activities, school-based 

 2          health services, Naloxone education and 

 3          distribution to address the opioid crisis, 

 4          and public health campaigns on anti-smoking 

 5          and obesity-related illnesses.  

 6                 There is a cut of almost $66 million 

 7          through fiscal '18 with the shift of state 

 8          costs for the education and care provided to 

 9          8,900 foster-care youth.  There's a cut of 

10          $25.5 million through fiscal '18 through the 

11          reduction of senior center funding, affecting 

12          65 neighborhood programs for seniors serving 

13          over 6,000 seniors per today.  And there's a 

14          cut of almost $30 million through fiscal '18 

15          with the elimination of the state share in 

16          funding services for more than 800 special 

17          education students who have highly 

18          specialized needs.  These are key areas of 

19          need for the city that the budget does not 

20          address.

21                 A couple more points.  I want to say 

22          we must all together note the glaring and 

23          inexplicable omission of New York City in the 

24          design-build authorization in the budget.  


                                                                  32

 1          The Executive Budget extends and expands 

 2          design-build for state agencies, state 

 3          authorities, and counties outside of New York 

 4          City.  

 5                 According to a 2016 report by the 

 6          Empire State Development Corporation, which 

 7          evaluated projects in New York State, 

 8          design-build accelerated dozens of projects 

 9          and saved taxpayers billions of dollars.  If 

10          the city also had access to this tool, 

11          similar benefits would be realized.  Our 

12          capital agencies have identified $7.3 billion 

13          in projects, with around $450 million in 

14          immediate savings for our taxpayers.  

15                 If the rest of New York State has 

16          access to design-build, New York City 

17          certainly should as well, as a matter of 

18          common sense.

19                 Now I'd like to discuss for just a 

20          moment the homeless crisis facing New York 

21          City, and I want to be clear up-front that my 

22          administration is fundamentally dissatisfied 

23          with the current homelessness situation in 

24          our city.  Next month we will be announcing a 


                                                                  33

 1          new, comprehensive vision for addressing it.  

 2                 Homelessness has been a growing 

 3          problem in our city for decades and only got 

 4          worse in the years since 2011, when the 

 5          Advantage rental assistance program was 

 6          canceled.  There's much more to do, and we 

 7          have made meaningful progress, however, over 

 8          the last three years.

 9                 Without our new initiatives, we 

10          project, instead of the 60,000-plus people 

11          who are in shelters now, that that number 

12          would be over 70,000.  We have evidence that 

13          some of our initiatives are working more 

14          consistently, including the fact that our 

15          anti-eviction legal services program has 

16          helped to reduce evictions by 24 percent 

17          since 2013.  

18                 We know our new HOME-STAT initiative, 

19          the most comprehensive program to address 

20          street homelessness anywhere in the United 

21          States, which began last year, has already 

22          brought 690 individuals off the streets and 

23          into safer surroundings where they can get 

24          support.


                                                                  34

 1                 Of course, the best way to address 

 2          homelessness is to prevent it from happening 

 3          in the first place.  That's why I'm pleased 

 4          to support Assemblyman Andrew Hevesi's Home 

 5          Stability Support proposal, which deserves 

 6          serious consideration in this budget process.  

 7                 Home Stability Support would create a 

 8          statewide, primarily state-and-federally- 

 9          funded rental subsidy program designed to 

10          keep people in their homes and out of the 

11          shelter.  It recognizes the state's 

12          responsibility in providing rental assistance 

13          and provides an option to local governments 

14          to go even farther in their own efforts.  And 

15          I will tell you right now, rest assured that 

16          New York City will do its share if this 

17          initiative is passed.

18                 I look forward to working with all of 

19          you and Assemblyman Hevesi to ensure that the 

20          final product is one that can have an 

21          immediate impact on people's lives while not 

22          imposing an unfunded mandate on local 

23          governments.

24                 I want to turn for a moment to the 


                                                                  35

 1          Memorandum of Understanding on housing that 

 2          would unlock $2 billion in housing funding 

 3          authorized in last year's state budget.  

 4          Housing is the single biggest expense for our 

 5          residents, and we welcome additional 

 6          affordable homes financed by the state as we 

 7          continue to work together to meet the needs 

 8          of so many New Yorkers who are one paycheck 

 9          away from not being able to afford their rent 

10          or their mortgage.

11                 Negotiating and signing the MOU is 

12          also critical because it would facilitate the 

13          production of supportive housing units that 

14          offer residents an apartment and services to 

15          keep their lives on track and help us to 

16          fundamentally address the problem of 

17          homelessness.

18                 My administration announced a 

19          commitment to fund 15,000 apartments for 

20          supportive housing over the next 15 years, 

21          the largest commitment ever made by the City 

22          of New York.  We've budgeted the necessary 

23          resources, and our first 550 apartments will 

24          be available this year for people in need.  


                                                                  36

 1          Over the next five years, New York City will 

 2          produce 4,000 apartments that will address 

 3          the needs of our most vulnerable residents 

 4          and have a direct impact on reducing our 

 5          shelter population.

 6                 But we have a related concern when it 

 7          comes to public housing.  While the city has 

 8          made a very substantial commitment to capital 

 9          improvements for public housing -- as I 

10          mentioned, $1 billion committed to fix the 

11          roofs in over 700 buildings -- the current 

12          total from the state falls short.  And we ask 

13          your assistance in providing help to the 

14          400,000 people who live in public housing.  I 

15          want to take a moment to thank Speaker 

16          Heastie and the Assembly Democratic 

17          Conference for fighting to add to that 

18          funding.

19                 As I wrap up, I want to underscore the 

20          importance of partnering with you and with 

21          all community leaders to address the housing 

22          crisis.  As I said, in February I will 

23          present a comprehensive vision related to 

24          homelessness.  And one thing that we will do 


                                                                  37

 1          as part of that vision is address a concern 

 2          that many of you have raised about community 

 3          notification.  We will include a notification 

 4          process for you and for community leaders 

 5          that will be implemented immediately upon the 

 6          announcement next month.

 7                 And post-notification, we'll proceed 

 8          with meaningful community engagement, one 

 9          that facilitates dialogue between city 

10          officials, elected officials, and community 

11          leaders, ensuring there's a clear framework 

12          and timeline for any shelter opening, and 

13          making sure that we're connecting shelter 

14          residents to the schools and jobs and 

15          community supports they need while addressing 

16          the concerns of neighborhood residents at the 

17          same time.

18                 I want to conclude my testimony by 

19          reflecting on how much of all of our work is 

20          happening under clouds of uncertainty.  As a 

21          result of the new administration in 

22          Washington, we all must live with the 

23          possibility that many things will change, and 

24          very much in unexpected ways.  I think the 


                                                                  38

 1          events of the last 48 hours certainly 

 2          illustrate that.  

 3                 I can assure you that no matter what 

 4          happens in Washington, New York City will do 

 5          its part to remain a growing and vibrant 

 6          economic anchor for our region and our state.  

 7          But in the face of this unprecedented 

 8          uncertainty from the federal level, your 

 9          partnership is more important than ever.  And 

10          now more than ever, it is important to 

11          remember a simple truth in terms of the 

12          relationship between New York City and New 

13          York State:  We are all in this together.

14                 Thank you, Chairs, for the opportunity 

15          to be here.

16                 CHAIRMAN FARRELL:  Thank you.  

17                 We've been joined by Assemblywoman 

18          Wright, Assemblywoman Wallace, Assemblywoman 

19          Pheffer Amato, Assemblywoman Richardson, 

20          Assemblywoman Bichotte, Assemblyman 

21          Braunstein, and Assemblyman Buchwald.

22                 ASSEMBLYMAN OAKS:  We've also been 

23          joined by Assemblyman Saladino.

24                 CHAIRWOMAN YOUNG:  Thank you very 


                                                                  39

 1          much.  

 2                 And we've also been joined by Senator 

 3          Golden, Senator Hamilton, Senator Sanders, 

 4          and Senator Hoylman.

 5                 CHAIRMAN FARRELL:  And to question, 

 6          Michael Benedetto, chair of the Cities 

 7          Committee.

 8                 ASSEMBLYMAN BENEDETTO:  Thank you, 

 9          Denny.  

10                 Good morning, Mr. Mayor.  Thank you 

11          for being here.  Always a pleasure.

12                 MAYOR DE BLASIO:  Thank you.

13                 ASSEMBLYMAN BENEDETTO:  I have three 

14          questions, and I'll try to ask them quickly, 

15          and I hope we can get a quick answer so I can 

16          get them in.

17                 You mentioned that you want 

18          design-build to be part of New York City, and 

19          I tend to agree with you.  However, some of 

20          the problems we had with design-build was 

21          allaying the fears of women- and 

22          minority-owned businesses, labor unions.  

23          Could you tell me about your efforts in those 

24          areas and what you have done to improve our 


                                                                  40

 1          chances of getting this bill passed?  

 2                 MAYOR DE BLASIO:  The simple, fast 

 3          answer, we've made a clear 30 percent 

 4          commitment in terms of MWBEs for all 

 5          contracting.  We're going to need your help 

 6          with some of the legislative elements that 

 7          would help us to speed that effort.  But the 

 8          City of New York is now committed to a 30 

 9          percent goal in all contracting for MWBEs.  

10                 In terms of labor, as I think you've 

11          seen, Assemblyman, we have signed PLAs with 

12          labor unions, for example, for public housing 

13          that are unprecedented and prove that we can 

14          create a very positive, cooperative framework 

15          for labor having a substantial core role in 

16          so much of the work we do.  We'd like to see 

17          that continue across everything we do.

18                 So I think those are examples of the 

19          direction we're ready to take.  The bottom 

20          line on design-build is it will allow for 

21          much faster projects and huge savings, which 

22          will not only allow for fairness for 

23          taxpayers, but it will help us to do even 

24          more.  And you know how immense our 


                                                                  41

 1          infrastructure problems are in New York City.  

 2                 So while we're waiting to see what 

 3          happens in Washington -- and as we know, 

 4          there's a tremendous uncertainty -- one thing 

 5          that would help us right now to use our own 

 6          resources more effectively is design-build.

 7                 ASSEMBLYMAN BENEDETTO:  Thank you.  

 8          Let's hope we get that.

 9                 New York City passed, Mr. Mayor, a 

10          tax -- you call it a fee -- on plastic bags.  

11          Okay?  And while we understand the 

12          environmental concerns and the reasons for 

13          it, we -- at least many of us in the Assembly 

14          have concerns with that and the cost it's 

15          going to be for some of the people who are 

16          rather challenged financially in the City of 

17          New York.  

18                 We would like to see possibly a 

19          postponement in that bag tax so we can have 

20          hearings on it, possibly develop a 

21          alternative recycling program -- just for 

22          such plastic bags -- that could be good for 

23          the environment and also save our citizens in 

24          the City of New York this nickel tax.


                                                                  42

 1                 Your view, sir.

 2                 MAYOR DE BLASIO:  Assemblyman, you 

 3          know we share a common understanding that a 

 4          lot of people in our city are hurting 

 5          economically and struggling to make ends 

 6          meet.  I would never belittle that challenge.  

 7          But at the same time, we all face the immense 

 8          challenge of an earth in crisis because of 

 9          climate change and environmental degradation.  

10          We have to stop taking plastic bags made with 

11          petroleum products.  So they're right there, 

12          fossil fuels, hurting our environment, 

13          exaggerating climate change further because 

14          it's fossil fuels being used, and then adding 

15          to our landfills, which is bad for the earth 

16          and costs taxpayers money.  

17                 This is the right thing to do to break 

18          with the status quo that we're in right now.  

19          Plastic bags no longer have a place in our 

20          lives.  I would not -- I absolutely respect 

21          your question, but I would not encourage 

22          delay.  We have made clear that we believe, 

23          with the education efforts and with a 

24          concerted effort to provide consumers with 


                                                                  43

 1          permanent bags that they can bring to 

 2          markets -- as our ancestors did long before 

 3          there were plastic bags -- we think that can 

 4          solve the problem.  And the City Council 

 5          initiated this concept, but I was happy to 

 6          sign the bill because I think it's about 

 7          protecting the earth.  

 8                 So we believe we can get to the core 

 9          of your concern that folks of limited means 

10          not end up paying more than they can afford 

11          by giving them the tool that will allow them 

12          to go about their shopping with no additional 

13          cost.

14                 ASSEMBLYMAN BENEDETTO:  Has anything 

15          been looked into as a possible recycling 

16          program just for such plastic bags?  Because 

17          bags we get from the dry cleaner's, for 

18          instance, bags that are given on takeout 

19          foods, they're not going to be included on 

20          this.  So we're still going to have this 

21          problem.  

22                 But if you do have a recycling plan 

23          for those types, maybe we can suit both ends. 

24                 MAYOR DE BLASIO:  I appreciate the 


                                                                  44

 1          thought.  I've been down this road on other 

 2          issues like Styrofoam.  I think we have to 

 3          get away from the use of fossil fuels, 

 4          period.  I think we all know -- maybe there 

 5          are some in Washington who deny climate 

 6          change, but I think in general in the State 

 7          of New York, it's fair to say New York State 

 8          and New York City have been leaders in 

 9          addressing climate change.  And we don't have 

10          any time to waste.  

11                 So any product made that's -- any 

12          petroleum-based product is a problem unto 

13          itself.  We have to get away from it.  

14          Recycling doesn't solve the problem 

15          sufficiently.  

16                 I think if you knew that all of your 

17          constituents would have an opportunity to 

18          have a bag they could use on a regular basis 

19          that did not require plastic bags any longer 

20          and they could go about their lives without 

21          that additional cost, you'd feel comfortable.  

22          That's exactly what we want to achieve.  

23          Between public education and providing the 

24          maximum number of permanent bags, take that 


                                                                  45

 1          economic burden off people but take, most 

 2          importantly, the burden off the earth that 

 3          threatens us all.

 4                 ASSEMBLYMAN BENEDETTO:  Thank you, 

 5          Mr. Mayor.

 6                 You have proposed, I believe, 

 7          $275 million in the budget for the police 

 8          firing range down at Rodman's Neck in the 

 9          Bronx.  What have -- and we thank you for 

10          that, because it's certainly well-needed.  

11          But what have you done to address the 

12          concerns of many of us who are worried about 

13          the pollution, lead pollution that's going to 

14          go -- it's going into the water, and has 

15          been, and possibly avoiding lawsuits about 

16          federal regulations about water pollution?

17                 MAYOR DE BLASIO:  I'll start and I 

18          just will say, as with any answer, if my 

19          colleagues want to add some specificity, I'm 

20          sure they'll jump in.  

21                 Bottom line vision for the investment 

22          at Rodman's Neck.  We have a facility for our 

23          police officers that is absolutely essential 

24          for their ability to use their firearms 


                                                                  46

 1          properly.  It is outmoded.  We need to 

 2          improve firearms training for all reasons, 

 3          starting with a terror threat -- and this is 

 4          where we'll do more and more effective 

 5          active-shooter scenarios for our officers, 

 6          which literally is about stopping any act of 

 7          terror in progress and protecting both our 

 8          residents and our officers alike.  These are 

 9          scenarios also that will help in everyday 

10          policing in terms of the ongoing effort to 

11          deescalate confrontations and to reduce the 

12          use of firearms to the maximum extent 

13          possible.  

14                 This training is quintessential to all 

15          we have to do for our city.  An improved 

16          Rodman's Neck facility will allow us to do 

17          it.

18                 Now, there's been two concerns that 

19          have to be addressed.  One, the noise concern 

20          of City Island and surrounding areas.  This 

21          will allow us to do that.  Two, the pollution 

22          concern.  As we modernize the facility, it 

23          gives us a chance to address that concern 

24          head-on.


                                                                  47

 1                 So I will be able to have our team get 

 2          you details of it, but the notion here is 

 3          that the additional work we'll do at Rodman's 

 4          Neck will allow us to not see any of the 

 5          residue seep -- from the activity seep into 

 6          the water.  This is an environmental upgrade 

 7          as well as a sound upgrade.

 8                 ASSEMBLYMAN BENEDETTO:  There are many 

 9          in the area who, while they applaud your 

10          attention, might not be satisfied fully with 

11          that.

12                 Lastly --

13                 MAYOR DE BLASIO:  That sounds like all 

14          New Yorkers, Assemblyman.

15                 ASSEMBLYMAN BENEDETTO:  Yes.  Yes.  

16                 And speaking of not being satisfied, 

17          and at the risk of having a few on the panel 

18          here rolling their eyes, I must direct your 

19          attention to the great City of Co-op, Co-op 

20          City, with close to 50,000 people in it who 

21          have many concerns.  

22                 I have asked you about numerous 

23          concerns in regards to the people in Co-op 

24          City, and I get basically a Reagan-era motto:  


                                                                  48

 1          "Just say no."  Can you give me any hope for 

 2          the residents of Co-op City?  

 3                 MAYOR DE BLASIO:  We don't tend to -- 

 4          I don't hear a lot of comparisons to Ronald 

 5          Reagan, so this is a unique moment.  I know 

 6          it's a compliment.

 7                 We are having a meeting next week with 

 8          leaders of Co-op City to try and address a 

 9          number of outstanding issues, the asbestos 

10          issue and other issues.  I know Co-op City is 

11          one of the foundations of affordable housing 

12          in New York City.  I've spent a lot of time 

13          there.  I think the residents' concerns are 

14          real and honest.  We're still trying to find 

15          solutions.  

16                 But there will be a delegation from 

17          Co-op City meeting with senior members of the 

18          administration -- I'll be a part of that 

19          meeting as well -- I believe it's next week.

20                 ASSEMBLYMAN BENEDETTO:  Well, let's 

21          keep it affordable, Mr. Mayor.

22                 MAYOR DE BLASIO:  Yes, sir.

23                 ASSEMBLYMAN BENEDETTO:  Thank you, 

24          sir.


                                                                  49

 1                 CHAIRMAN FARRELL:  Thank you.  

 2                 Senator?

 3                 CHAIRWOMAN YOUNG:  Thank you, 

 4          Mr. Mayor, and welcome to Albany.  And we 

 5          certainly are appreciating the fact that 

 6          you're here and that you're actively engaged 

 7          with us.  

 8                 As chair of the Finance Committee, I 

 9          have several questions that I will go over in 

10          a few minutes.  But at this point I'd like to 

11          cede my time to Senator Simcha Felder, who is 

12          the chair of the Cities Committee.  

13                 SENATOR FELDER:  Good morning, 

14          Mr. Mayor.

15                 MAYOR DE BLASIO:  Good morning, 

16          Senator.

17                 SENATOR FELDER:  Thank you for being 

18          here.

19                 Last year, on May 4th, you testified 

20          here before the Education Committee.  You 

21          made a commitment then to the parents of 

22          special-needs children to finally implement, 

23          before the start of this school year, 

24          three-year IEPs for special-needs students 


                                                                  50

 1          that require no changes to their IEPs.  That 

 2          never occurred.  

 3                 Although you did provide a letter to 

 4          my office on May 13th, such policy was not 

 5          implemented, and children and families are 

 6          still suffering humiliation and financial 

 7          hardship to maintain their IEPs by having to 

 8          pay lawyers over and over and over again 

 9          despite the fact that there are no changes.

10                 So the example I gave last time is if 

11          a child has Down syndrome, autism, there's no 

12          fix for that, unfortunately, and there's no 

13          need to force them to do this over and over 

14          again.

15                 September 6th of 2016, I requested a 

16          meeting in writing to discuss this critical 

17          issue and received no response.  I called 

18          several times after September 6th, received 

19          no response.  I wrote again on December 6th; 

20          still no response.  

21                 Mayor, I'm not hurt or disturbed 

22          personally by your lack of response to me.  

23          In fact, many of my colleagues in government 

24          have told me of similar experiences regarding 


                                                                  51

 1          your office's inattentiveness, not being 

 2          responsive.  So I know that you share that 

 3          same love with many of my colleagues as you 

 4          do with me in not responding.  

 5                 But New Yorkers, and especially 

 6          families with special-needs children, are 

 7          suffering, and they demand your response and 

 8          require you to live up to your commitments.  

 9                 And I thank you for the strides and 

10          improvements that you've made, no question 

11          about that.  But that doesn't give me or 

12          anyone else a pass on doing what we have to 

13          do to help these families.  So I sincerely 

14          hope New Yorkers can count on your 

15          commitments in 2017.

16                 MAYOR DE BLASIO:  Senator --

17                 SENATOR FELDER:  I didn't finish.  

18          Let's start fresh in 2017 and hope for the 

19          best.

20                 Now, shortly after you made those 

21          commitments, the City Council passed the 

22          controversial bag tax that was referred to by 

23          my colleague by I think a close vote, 28 to 

24          20.  Let me be clear.  I think New Yorkers 


                                                                  52

 1          are tired of being insulted and lied to.  The 

 2          debate about the plastic bag tax, fee, 

 3          charge, whatever you want to call it, has 

 4          nothing to do with whether people care or 

 5          don't care about the environment or whether 

 6          people care or don't care about climate 

 7          change.  That is not the issue.  I don't 

 8          believe there's anyone here that wants to 

 9          hurt the environment.  

10                 The issue is whether we have to be 

11          punitive every time that there is an issue.  

12          And that's the way things go regularly.  If 

13          government doesn't have a way to fix 

14          something, no problem:  Tax.  No problem:  

15          Ticket.  No problem:  Fine.  

16                 So the bag tax was scheduled to be 

17          implemented this past October.  There was a 

18          postponement.  It's quite shocking to me, 

19          based on what the mayor just mentioned to the 

20          Assemblymember, why there would have been 

21          even a short postponement.  But after -- and 

22          it went -- it was supposed to be implemented 

23          in October, and instead it was postponed to 

24          February 15th.  An overwhelming outcry of 


                                                                  53

 1          New Yorkers opposed to being 

 2          nickeled-and-dimed and fined, and my 

 3          colleagues and I introduced legislation to 

 4          stop it.  

 5                 It was passed in June, then New York 

 6          City delayed it to February 15th.  And it was 

 7          common knowledge at the time that a 

 8          commitment was made to the Assembly by you 

 9          and the New York City Council to use the 

10          five-month intervening delay to make changes 

11          to the bag tax and possibly work towards a 

12          better solution to protect New Yorkers and 

13          the environment.  Let's stop saying that the 

14          only way you can protect the environment or 

15          address climate change is by taxing people.

16                 Neither your office or the City 

17          Council tried at all to work out a solution 

18          or a compromise.  Strangely, no media 

19          coverage, no publicity on implementation of 

20          the bag tax or a compromise to be worked out.  

21          Nothing.  Until late last fall, when notices 

22          were mailed to local retailers telling them, 

23          guess what, the tax is going into effect 

24          February 15th.  The commitment made to work 


                                                                  54

 1          on a solution was yet another commitment 

 2          ignored.

 3                 We're now about two weeks away from a 

 4          crisis facing average New Yorkers.  And 

 5          Mr. Mayor, I'm sure you're familiar with the 

 6          saying "Fool me once, shame on you; fool me 

 7          twice, shame on me."

 8                 So my question, Mr. Mayor, is please 

 9          set the record straight.  What steps have you 

10          taken to eliminate, reform the onerous tax?  

11          And based on some of the comments you made 

12          earlier, it sounds like you don't want a 

13          postponement because you don't want to make 

14          any adjustments.  Did you make -- did your 

15          administration make any adjustments or 

16          attempts to improve this bill during the 

17          five-month postponement that existed?  

18                 I'm finished now.  

19                 (Laughter.)

20                 MAYOR DE BLASIO:  Senator, we -- I say 

21          this with deep respect, and we've known each 

22          other a long time and worked together a long 

23          time.  But we just disagree very 

24          substantially on these matters.  And I think 


                                                                  55

 1          it's respectful to be blunt about that 

 2          disagreement.  

 3                 I fundamentally disagree that this is 

 4          an issue that isn't urgent to address in 

 5          terms of climate change.  Our entire -- our 

 6          city, our state, our nation, we are so far 

 7          behind right now where we need to be to 

 8          protect our earth, and it's going to have 

 9          devastating impacts if we don't address it on 

10          all levels.  And what we saw with Sandy is 

11          just an example of things to come.

12                 So we must do this, and we have now 

13          even more urgency, because we don't know 

14          whether the federal government is going to 

15          take a step backwards on addressing climate 

16          change.  

17                 So I don't think there's any 

18          contradiction in saying to you that this is 

19          an urgent matter, as are a host of other 

20          things that we are trying to do 

21          simultaneously to address climate change.

22                 Second, as I said to the Assemblyman, 

23          we believe that a combination of public 

24          education and providing consumers with bags 


                                                                  56

 1          that they can use addresses this issue.  And 

 2          that was true for generations and 

 3          generations.  Plastic bags as a common part 

 4          of our society is a few decades old.  I do 

 5          not believe it's a matter of unfairness to 

 6          people to work us all away from plastic bags.  

 7          And I believe if people have permanent bags, 

 8          they don't need a plastic bag, they're not 

 9          paying anything.  And those permanent bags 

10          will be provided for free.  A lot of people 

11          have them already.

12                 So it is about changing -- all of us 

13          have to change our behavior in a lot of ways 

14          to address this new reality or it will 

15          endanger us and our children and our 

16          grandchildren.

17                 So I believe that we said that from 

18          the beginning.  The City Council initiated 

19          this, as I said, but we believe they were 

20          working in the right direction.  The two 

21          pillars of educating people and providing 

22          them with an alternative are how you address 

23          this issue.

24                 One thing I know for sure is the 


                                                                  57

 1          status quo is not acceptable.  If we continue 

 2          using petroleum-based products on a mass 

 3          scale when we don't need them, we're only 

 4          exacerbating climate change.  We're a very 

 5          big market in New York City, we have a very 

 6          big impact on the world, and it's our job to 

 7          do it differently.

 8                 On the special education question, 

 9          Senator, I -- again, we've had this 

10          conversation before.  I will only say my 

11          instruction to all of my employees, whether 

12          in the Albany office or at City Hall, is that 

13          when any member of the Senate or the Assembly 

14          has a concern, we need to be in dialogue with 

15          them immediately, whether it's a sit-down 

16          meeting, a phone call, a letter.  I make that 

17          a priority.  

18                 And I said in the beginning of my 

19          testimony we appreciate all of the 

20          partnership we've had.  If you believe 

21          there's a widespread belief among your 

22          colleagues that they are not given the proper 

23          communication, that's what you've heard.  

24          I've heard something very different from a 


                                                                  58

 1          lot of your colleagues.  But if anyone here 

 2          or any member of the Senate or Assembly feels 

 3          they did not get the kind of response they 

 4          deserve, I want to fix that.  

 5                 But I -- the instruction has been 

 6          given, and I have plenty of evidence of the 

 7          instruction being followed.  And I don't know 

 8          what's happening in the specific case of the 

 9          communication between your office and my 

10          office, and we will work to fix that.

11                 But I disagree with you fundamentally 

12          on how far we have come on special education.  

13          I agreed energetically with the vision of 

14          addressing the original problem of our 

15          parents having to litigate for services they 

16          already deserve.  This was something I worked 

17          on as public advocate.  I appreciate your 

18          leadership.  I think we all got to a very 

19          good place several years ago that actually 

20          started real change, and I've heard from 

21          numerous parents, unsolicited, how much 

22          change has occurred in their lives.

23                 And then you further -- I think 

24          appropriately -- raise the issue of locking 


                                                                  59

 1          in three-year plans when there aren't any 

 2          variations in the IEP or the programing to 

 3          support the IEP.  And I agreed to that, 

 4          again, openly, energetically.  And that is 

 5          being implemented.  Not all of it happens 

 6          overnight, but it is being implemented.

 7                 But I can tell you that we have 

 8          specific evidence of moving consistently 

 9          towards more and more cases being settled 

10          without litigation.  That's the order I have 

11          given to our Department of Education.  And 

12          we'll get you the chapter and verse on how 

13          that is moving.

14                 We also know there are some cases that 

15          are complex.  That's a given.  You said that 

16          too, I remember, when you offered the point 

17          that you knew not every case was easy and 

18          that there would be cases where there would 

19          be a change in IEP or a change in the needs 

20          of a child year to year.  

21                 But I agree with the vision you've 

22          laid out, and we are energetically 

23          implementing it.  And I think there should be 

24          a battle of facts.  I'm happy to have that 


                                                                  60

 1          battle of facts, and we will give you all of 

 2          our information, chapter and verse, on what 

 3          we're doing.

 4                 SENATOR FELDER:  Well, first of all, I 

 5          just want to address the chair that I know 

 6          there's a time limit, but obviously the mayor 

 7          didn't hear anything I said.  Because the 

 8          first thing I said was that we're not 

 9          debating whether to address climate change or 

10          whether to address the environment.  The 

11          question is how to do it.  That's the issue.

12                 Mr. Mayor, do you know how much a 

13          pound of bread costs today?  Do you know how 

14          much a dozen eggs costs a regular family?  

15          Let me tell you, I was in a local shop a week 

16          ago and a mother came in with a few children 

17          and put down whatever she wanted, and they 

18          did not have enough money.  And the store 

19          owner said this was the price, and she had to 

20          put back sliced cheese.

21                 So again, the issue is not about 

22          protecting the environment.  That's -- 

23          everybody agrees.  The crisis you've 

24          mentioned very clearly.  I never said it 


                                                                  61

 1          shouldn't be given priority.  You know, when 

 2          I got into this business, somebody said when 

 3          they ask you questions that you don't want to 

 4          answer, you answer whatever you want.  You 

 5          don't have to talk about what they asked you.

 6                 I'm not talking about that.  I'm 

 7          talking about regular New Yorkers and why the 

 8          city has to be punitive all the time.  It's 

 9          just not fair.  Every poll has shown that 

10          most New Yorkers oppose a tax.  The question 

11          here now is not whether we have to do 

12          something about the environment.  Everyone 

13          agrees.  No matter how many times I say it, 

14          you say it, everybody else, we are not going 

15          to make this debate about whether the 

16          environment is or is not important.  It is, 

17          period.

18                 How do you get it done?  Why can't it 

19          be positive?  Why don't you give a nickel 

20          back to New Yorkers for every bag they don't 

21          use?  A nickel back, for a change.  Reward 

22          positive behavior.  Implement the law that 

23          exists for store owners to do what they're 

24          supposed to do for the last 10 years, have 


                                                                  62

 1          recycling bins in front of the stores so that 

 2          people can recycle it.

 3                 What are we doing?  We're not taking 

 4          the nickel and putting it to protect the 

 5          environment.  We're giving the store owners 

 6          another nickel profit.  From who?  From poor 

 7          and middle-class New Yorkers.  So that's not 

 8          protecting.  

 9                 Recycle.  We educate.  Give them back 

10          a nickel.  Give them reusable bags.  And what 

11          about incentivizing businesses?  Patagonia 

12          uses recycled plastic to make clothes.  Trex 

13          uses recycled bags to make synthetic lumber.  

14          Why can't New York City?  You talked about a 

15          mansion tax before.  This is a mansion credit 

16          for the 1 percent.  The mayor always talks 

17          about the 99 percent?  Well, let me tell you, 

18          this is a 99 percent tax on the 99 percent.  

19          It's a credit for the 1 percent.  Because the 

20          people who have limousines, chauffeurs, 

21          nannies are not dragging their groceries, 

22          they're getting them delivered or brought 

23          home by somebody else.

24                 It's irrational and it's punitive.  


                                                                  63

 1          The issue is not whether we want to do 

 2          something or not do something, the issue is 

 3          why New Yorkers have to be overtaxed, 

 4          overfined, overticketed, and can't be treated 

 5          like mature adults instead of like children 

 6          who you decide you can't discipline any other 

 7          way and smack them across the face over and 

 8          over by charging them -- it doesn't make 

 9          sense.  It doesn't make sense.

10                 CHAIRWOMAN YOUNG:  Thank you.  Thank 

11          you, Senator Felder.

12                 CHAIRMAN FARRELL:  Assemblyman Cusick.

13                 ASSEMBLYMAN CUSICK:  Mr. Mayor --

14                 CHAIRMAN FARRELL:  I hope everybody is 

15          watching the clock.

16                 ASSEMBLYMAN CUSICK:  I'm watching it 

17          right now, Mr. Chairman.  Thank you, 

18          Mr. Chairman.  

19                 Thank you, Mr. Mayor, for attending 

20          today.  I'm just going to echo quickly what 

21          the two speakers before me said, the chairmen 

22          of our Cities Committee.  

23                 As you know, I'm the sponsor of the 

24          bill that companions Senator Felder's in the 


                                                                  64

 1          Assembly.  For many of my constituents, it's 

 2          just that they feel that rather than going to 

 3          a tax first, that they wanted to see that 

 4          there are other alternatives that we looked 

 5          at.  Possibly recycling, if recycling was 

 6          looked at.

 7                 No one is more sensitive to the 

 8          environmental issue than I am.  I represent 

 9          the area that used to have the world's 

10          largest garbage dump.  I know the issues of 

11          climate change.  I know the issues of what 

12          plastic bags do to our environment.  But I 

13          think that many of us feel that there might 

14          be another way to do this, and we'd like to 

15          work with the city to come up with an 

16          alternative that will work for all 

17          New Yorkers.

18                 MAYOR DE BLASIO:  Assemblyman, I know 

19          you care deeply about the environment and I 

20          know you've seen the effects of climate 

21          change.  No place knows that better than 

22          Staten Island.  

23                 We're always willing to work together.  

24          We feel urgency, and we feel that -- you say 


                                                                  65

 1          recycling.  Again, you're still talking about 

 2          a petroleum-based product that will be 

 3          recycled by some people some of the time.  

 4          You and I both know other times it won't be.  

 5          So we're going to keep using something that 

 6          ultimately is bad for the earth.

 7                 And look, part of why cities and 

 8          localities around the country turn to this 

 9          approach is because we have to break out of a 

10          cycle that was harming us.  And again, I'll 

11          tell you, when my grandmother came here from 

12          Italy, I'm sure she understood that she could 

13          go shopping without a plastic bag.  And she 

14          did that for her whole life.  So I'm not 

15          trying to be flip, I'm saying some of this is 

16          about learning some new habits.  We're all 

17          learning smaller cars and more fuel-efficient 

18          cars, all sorts of other things are changing 

19          that are making us more able to protect the 

20          earth.

21                 But the notion is not to be punitive 

22          in the least.  The notion is to just break us 

23          out of a habit, provide people with the 

24          alternative of a permanent bag, do the 


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 1          education we need to.  I think it's the best 

 2          way to address the problem.  But if there's 

 3          other good ideas, of course we're always 

 4          willing to work together.

 5                 ASSEMBLYMAN CUSICK:  Right.  And I 

 6          think what many of us are concerned about is 

 7          that there is state law in effect that 

 8          mandates supermarkets to have these bins 

 9          accessible to people to recycle, and it's not 

10          being done, whether it's the city or the 

11          state.  That's something that I know many of 

12          the members of the Assembly and Senate are 

13          looking into.  I think that that's what we 

14          want to do, is work together to come up with 

15          -- because people are exhausted.  They're 

16          exhausted by constant fees, the fares, 

17          everything.  And not that I'm putting that 

18          all on the city or you, Mr. Mayor.  But the 

19          issue here is that they just want to know 

20          that there are other alternatives looked at 

21          before we went to a tax.  And that's just 

22          what a lot of the folks are relaying to me.

23                 But I just -- I see my time is running 

24          out.  I want to also talk, Mr. Mayor, ask you 


                                                                  67

 1          about the alternative exemption for property 

 2          taxes for veterans the New York State 

 3          Legislature last year passed that would allow 

 4          New York City to opt into what's happening 

 5          throughout the State of New York.  It would 

 6          amend and extend the property tax exemption 

 7          for veterans.  

 8                 The City Council could vote to allow 

 9          this to happen.  I know that it wasn't in 

10          your preliminary budget.  I know there's a 

11          price tag to this.  I wanted to see, is there 

12          a possibility that this is being discussed to 

13          be in your next stage of budget proposals?  

14                 MAYOR DE BLASIO:  Assemblyman, we're 

15          definitely going to discuss it in the next 

16          phase.  I thank you for supporting this 

17          proposal so strongly.

18                 You know, we've worked together on 

19          making sure there's property tax relief at 

20          times for veterans, and obviously we created 

21          in the City of New York our new Department of 

22          Veterans Services, and we've expanded a lot 

23          of what we're doing to serve our veterans.  

24          So I certainly appreciate this proposal.  


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 1                 You're right, there are cost 

 2          implications, other implications we have to 

 3          look at.  But this is something we very much 

 4          look forward to working with you and the 

 5          Council on as we look ahead to the Executive 

 6          Budget.

 7                 ASSEMBLYMAN CUSICK:  And I urge you to 

 8          -- if you could put it in the budget, it's 

 9          very important.  As you know, there are a 

10          quarter of a million veterans throughout New 

11          York City.  This is much needed.  Again, it 

12          goes to the cost of living in New York City.  

13          And it's something that's very important.  

14                 And again, it now allows the city to 

15          opt in.  And we would just like to see if in 

16          the city budget we could get the funding for 

17          it.

18                 MAYOR DE BLASIO:  Thank you.

19                 ASSEMBLYMAN CUSICK:  Thank you, 

20          Mr. Chair.

21                 CHAIRMAN FARRELL:  Senator.

22                 CHAIRWOMAN YOUNG:  Thank you very 

23          much.  

24                 Mayor, I have several questions, as I 


                                                                  69

 1          said.  And you know, you unveiled your city's 

 2          preliminary budget, I believe last week, and 

 3          it continues to assume significant increases 

 4          in property taxes.  For example, you expect 

 5          to receive $24.2 billion in the city fiscal 

 6          year '17, which ends June 30th, from the 

 7          general property tax, and $25.6 billion in 

 8          '18, which is an increase of $1.4 billion, or 

 9          5.9 percent.

10                 We talk about affordability and 

11          New York City and the fact that homeowners 

12          and commercial property owners are 

13          suffocating in many ways, whether it's 

14          through the bag tax, whether it's through 

15          other fees, but also through property taxes.  

16          And as you know, on the state level we have 

17          limited the growth of property taxes to 2 

18          percent or less.  And I was wondering what 

19          you're doing to address this issue.  Because 

20          obviously it's always all tied together, as 

21          far as the economy, as far as people having 

22          affordable housing and building owners being 

23          able to stay in business and the whole thing.

24                 So could you please address that for 


                                                                  70

 1          us?

 2                 MAYOR DE BLASIO:  Yes.  Madam Chair, 

 3          first of all, I made very clear now in the 

 4          fourth budget that there will not be a 

 5          property tax rate increase in New York City.  

 6          As you know, this was something that was done 

 7          under my predecessor, it's something I've 

 8          been very clear I do not agree with.  And we, 

 9          four budgets running, have not had a property 

10          tax rate increase.

11                 We're also trying to defray other 

12          costs for homeowners, reducing the rate of 

13          growth of water bills and in fact trying to 

14          get a credit back for homeowners on water 

15          bills, and we're in court right now trying to 

16          move that program forward.  

17                 So I'm a homeowner myself, in 

18          Brooklyn.  I certainly feel deeply the 

19          challenges that homeowners face.  The rising 

20          assessments, as you know, as the value of 

21          real estate in New York City has gone up, 

22          have caused a number of homeowners to have to 

23          pay more.

24                 We have to look at the entire system, 


                                                                  71

 1          our entire property tax system.  There's a 

 2          number of issues that have to be addressed.  

 3          I think that's going to be a very intensive 

 4          multiyear process.  It's one that I'm 

 5          committed to, to create a more transparent 

 6          and consistent system.

 7                 So in the meantime, my mission is to 

 8          make sure that the rate doesn't go up.  My 

 9          mission is to see if we can reduce costs 

10          elsewhere, like the water bills, and reduce 

11          some of the unfair fines that homeowners have 

12          suffered from.  We've reduced fines in a 

13          number of agencies, many of which were 

14          applied very arbitrarily.  But I think the 

15          property tax dynamic is going to need a very 

16          full treatment to be addressed fairly.

17                 CHAIRWOMAN YOUNG:  Well, thank you for 

18          that.  But as you point out, it's the 

19          assessments that are driving the revenues up.  

20          And it's a shell game, because you can say 

21          that I haven't increased the tax rate, and 

22          that's true, but the assessments continually 

23          go up and go through the roof.  

24                 And you're talking about possibly 


                                                                  72

 1          revamping the tax system, but we had a 

 2          lengthy conversation in this very room last 

 3          year, and I was wondering when that's going 

 4          to happen.  Because maybe you could fill us 

 5          in on anything that you've done in the past 

 6          year to change the tax system.  Because as 

 7          far as I can tell, nothing has happened.

 8                 MAYOR DE BLASIO:  Two points, Madam 

 9          Chair.  

10                 On the first point, I respect you and 

11          we've worked well together.  I respectfully 

12          don't agree with your terminology.  I was 

13          part of a city where property tax rates went 

14          up.  I assure you, homeowners felt that 

15          deeply.  It is a very different issue than 

16          assessments going up.  Assessments were going 

17          up at the same time as that rate increase 

18          occurred, so people were hit by both.  And 

19          homeowners will tell you, and I'll say it as 

20          one myself, that not having a property tax 

21          rate increase is a very important issue for 

22          everyday homeowners.

23                 But on the question of how we will go 

24          forward, I look forward to bringing a 


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 1          specific idea.  This is something that is 

 2          going to have to be very carefully 

 3          constructed.  It's going to have to be an 

 4          approach that will maximize public input and 

 5          transparency but deal with an exceedingly -- 

 6          as you know better than anyone, an 

 7          exceedingly complicated issue of taxation, 

 8          and trying to balance all of the different 

 9          needs of all the different types of property 

10          owners.  

11                 Again, a very difficult, intensive 

12          work.  It's something I'm committed to doing, 

13          and we'll put forward a specific vision of 

14          how to do that.

15                 CHAIRWOMAN YOUNG:  Thank you.

16                 Switching to education, the state 

17          provides the city with more than $10 billion, 

18          and most of that is in unrestricted operating 

19          aid.  How does the city decide what to use 

20          these funds for, and which schools are they 

21          directed to?  And when are we -- I know that 

22          we passed some legislation this past year, 

23          but you're concerned about mayoral control, 

24          and we really need this information.  


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 1                 So could you tell us where the funding 

 2          is going?

 3                 MAYOR DE BLASIO:  Let me defer in 

 4          terms of the mechanics of how we take in 

 5          state funding and distribute it, to my 

 6          colleagues, starting with Mr. Fuleihan, but 

 7          just say at the outset, I think if I had to 

 8          summarize what I believe you would want us to 

 9          do with the funding, is to continually 

10          produce better results.

11                 It's a fact -- and it's all based on 

12          the analysis of the State Department of 

13          Education -- it's a fact that our graduation 

14          rates are the highest they've ever been in 

15          the history of New York City, over 70 

16          percent.  It's a fact that our test scores 

17          have continued to improve.  In fact, our 

18          English test scores improved in all 32 of our 

19          school districts in New York City.  It's a 

20          fact we've provided things that are 

21          foundational to the future, like pre-K for 

22          all.  

23                 So in terms of return on investment, I 

24          believe we're doing the things you would want 


                                                                  75

 1          us to do, and doing them efficiently.  But 

 2          I'd like Mr. Fuleihan to talk to you about 

 3          specifically how we've taken the funding and 

 4          determined its use.

 5                 DIRECTOR FULEIHAN:  So we -- the mayor 

 6          actually -- am I on?  Yes.  The mayor 

 7          outlined, actually, in the opening comments, 

 8          in the --

 9                 CHAIRWOMAN YOUNG:  Dean, could you 

10          pull that a little bit closer?

11                 DIRECTOR FULEIHAN:  I apologize.  

12          Better?

13                 CHAIRWOMAN YOUNG:  Thank you.

14                 DIRECTOR FULEIHAN:  The mayor outlined 

15          in his testimony one of the major uses that 

16          we're doing.  And when the mayor called for 

17          meeting the CFE obligation, he pointed out 

18          that we began with really no improvement in 

19          the fair student funding, how we distribute 

20          aid among our schools, and that we are 

21          allocating our dollars, the dollars you 

22          provide us, to reach 100 percent of fair 

23          student funding.

24                 So as you give us an increase, we are 


                                                                  76

 1          committed, and the mayor made that 

 2          commitment, to get to a hundred percent.  

 3          We're already at a hundred percent on our 

 4          Renewal and Community Schools, and we're 

 5          willing to do it for every single school.  

 6          And those dollars are teachers, directly 

 7          teachers in those schools that were neglected 

 8          in years past.  

 9                 We also do other mandates -- and we 

10          are happy to give you book and verse on 

11          this -- but English language learners -- for 

12          other poverty-related programs.  And we're 

13          happy to go through and delineate every 

14          single one of those dollars, including the 

15          mandates that are imposed on us by the state 

16          that we're happy to comply with.

17                 CHAIRWOMAN YOUNG:  Thank you very 

18          much.  I think that the law says that you 

19          should be giving that information to us.  

20          It's been very difficult to get the specifics 

21          and the breakdown as to where the money is 

22          actually going, especially with particular 

23          schools.

24                 The Governor's budget provides --


                                                                  77

 1                 DIRECTOR FULEIHAN:  We will be happy 

 2          to provide whatever information you need on 

 3          specific information, and I'm quite sure we 

 4          do that.

 5                 CHAIRWOMAN YOUNG:  Great.  When could 

 6          we expect that?  

 7                 MAYOR DE BLASIO:  Senator, I just 

 8          wanted -- if I may add, that in addition 

 9          to -- we'll answer any and all of your 

10          questions, but as Mr. Soliman just reminded 

11          me, in May that we're going to be providing a 

12          comprehensive report based on last year's 

13          discussions here in the Legislature.  That's 

14          going to be coming to you on time.

15                 CHAIRWOMAN YOUNG:  Okay, that's great.  

16          So we should expect that information by May.

17                 MAYOR DE BLASIO:  Well, in addition to 

18          any other specifics you're asking our team to 

19          put together, we'll happily do for you.

20                 CHAIRWOMAN YOUNG:  Okay, great.  Thank 

21          you very much.

22                 I was wondering, too, if you could 

23          include in that -- and maybe it's included in 

24          your preliminary budget.  But how much of the 


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 1          Foundation Aid increase that goes to 

 2          high-needs districts, how much is that -- 

 3          your Department of Education funding in your 

 4          budget going to the individual high-needs 

 5          districts?  Could you give us an accounting 

 6          of that?

 7                 DIRECTOR FULEIHAN:  We'll give you -- 

 8          I will get back to you on specifically how 

 9          much the total dollar value.  What we did 

10          say, and the challenge that we made to you, 

11          was with any increase you give, we would take 

12          those funds and put them towards reaching our 

13          goal.

14                 I will say the mayor also pointed out 

15          that of the Executive Budget that provides us 

16          $240 million in additional formula-driven 

17          school aid, it then effectively takes away 

18          $200 million by redirecting it to the 

19          charters.

20                 CHAIRWOMAN YOUNG:  How much funding 

21          per pupil does the city provide to its 

22          high-needs districts?  Could you include that 

23          in any kind of information that you get to 

24          us?


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 1                 DIRECTOR FULEIHAN:  Yes, we will.  No, 

 2          I understood the question.

 3                 CHAIRWOMAN YOUNG:  And how does that 

 4          compare to the city's funding of its other 

 5          schools?  If that could be an element of 

 6          that.  

 7                 And the other question I had was 

 8          maintenance of effort.  So state funding to 

 9          education in New York City has increased at a 

10          rate of more than one-third faster than the 

11          city's funding increases, even though the 

12          city's reserves are at historically high 

13          levels and the city isn't subject to either 

14          the 2 percent spending cap or the 2 percent 

15          property cap, as I pointed out previously.

16                 So I'm wondering why, Mr. Mayor, the 

17          city hasn't provided additional money for 

18          education.

19                 MAYOR DE BLASIO:  Madam Chair, I think 

20          it's very important that we compare specific 

21          facts, and we want to do that with you.  

22                 I would say, as I noted in my 

23          testimony, we believe that the city's 

24          investment in education has continued to grow 


                                                                  80

 1          constantly.  It was true in the Bloomberg 

 2          administration, it's true in my 

 3          administration with our own city dollars.  We 

 4          appreciate state support.  I think I would 

 5          argue that our facts would show you that 

 6          additional city investment has grown more 

 7          rapidly than additional state investment.  So 

 8          I'd like us to compare statistics and see if 

 9          we're saying the same thing.

10                 CHAIRWOMAN YOUNG:  Thank you.  

11                 DIRECTOR FULEIHAN:  I would just add 

12          that during the tenure of this 

13          administration, we have done, I believe, over 

14          double what the state has committed in actual 

15          direct support to our schools.  

16                 And the mayor cited the share 

17          difference.  While the state's share of total 

18          support for New York City has actually 

19          declined, the city's share has increased.  So 

20          we're now 57 percent, where the state is now 

21          37, and the state used to be in the 40s.

22                 CHAIRWOMAN YOUNG:  Thank you.  And any 

23          more information you can get us on that would 

24          be helpful.


                                                                  81

 1                 I just wanted to touch briefly on 

 2          failing schools.  The State Education 

 3          Department has determined that JHS 162 failed 

 4          to show it was making demonstrable 

 5          improvement since it was identified as a 

 6          persistently struggling school, which means 

 7          that it was performing in the lowest 

 8          5 percent of schools for student achievement 

 9          for more than 10 years.

10                 The state required the placement of an 

11          independent receiver, but your 

12          administration, Mr. Mayor, determined that 

13          the school was not making improvement.  

14          However, under the New York City -- your 

15          Renewal Schools Program, the school was 

16          considered to be improving in that it was 

17          meeting five of its six benchmarks.  

18                 This will be the fourth school to 

19          close under the city's Renewal Schools 

20          Program.  So the questions are, what accounts 

21          for the drastic differences in the 

22          determination of the state finding the school 

23          is not improving and needing an outside 

24          independent receiver to run the school, and 


                                                                  82

 1          your own Department of Education's 

 2          determination that the school met five of its 

 3          six benchmarks?  

 4                 Are the city's standards too low?  

 5          Because that's quite a discrepancy.

 6                 MAYOR DE BLASIO:  Again, I respect the 

 7          question deeply, Madam Chair, but I would 

 8          argue we have a different perspective.  A 

 9          school can meet the benchmarks, but that 

10          doesn't mean we don't come to the conclusion 

11          that it needs to be closed.

12                 The question of our Renewal School 

13          Program is that a school has to constantly 

14          make progress to the day that it will no 

15          longer be in the program.  And there are 

16          dozens of schools in our Renewal School 

17          initiative that we believe are making that 

18          progress, and we look forward to the day when 

19          they graduate out of that status.

20                 There are others that we've already 

21          said either needed to be merged or 

22          consolidated, because they had become 

23          ineffective at their small size, or that we 

24          were already moving to close.  And then 


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 1          coming up at the end of this year, we will 

 2          announce judgment on the entire remaining 

 3          group of schools, which ones we believe have 

 4          graduated out of Renewal Schools, which ones 

 5          are on the pathway to it, and which ones we 

 6          believe are not going to make it and need to 

 7          be closed.

 8                 I think the difference here is that we 

 9          felt -- I saw this with my own eyes, I talked 

10          to parents all over the city -- that the 

11          previous approach, which emphasized the 

12          previous administration's strong focus on 

13          closing schools, with unfortunately a lot of 

14          negative impact on kids who were left behind 

15          as the school phased out.  That problem 

16          needed to be addressed.  Schools that could 

17          be turned around were not being given 

18          sufficient opportunity.  

19                 We had to go with those problems.  And 

20          what we've found with Renewal Schools is we 

21          have seen a real increase in graduation 

22          rates, we've seen a real increase in test 

23          scores, better attendance, a lot of promising 

24          signs.  But we're going to look at each one, 


                                                                  84

 1          with, as I said, final judgment happening by 

 2          the end of this year.  

 3                 And I said from the moment I announced 

 4          the Renewal School Program, I have no problem 

 5          closing a school if we've made every effort 

 6          over these last few years to address its 

 7          needs and turn it around and provide it 

 8          better leadership, more master teachers, 

 9          et cetera.  If that's not enough, move to 

10          closure.  If it is enough, that's a huge 

11          thing for the parents and kids of that 

12          community, that a school that was struggling 

13          got back on track rather than disruption and 

14          many unintended consequences that happen with 

15          the closure.

16                 So in this one case, we were very 

17          comfortable working with the state on PS 162 

18          to say, you know what, we understand where 

19          the state's coming from, we're happy to work 

20          with that, we were happy to do a closure and 

21          come up with a new plan.

22                 CHAIRWOMAN YOUNG:  But it just seems 

23          like instead of trying to fix the schools, 

24          that you're opting to close them rather than 


                                                                  85

 1          go to a state receivership.  

 2                 And you were very critical of your 

 3          predecessor for closing schools, and you're 

 4          talking about how your stance has changed.  

 5          And this is a direct quote from November 19, 

 6          2015:  "Bloomberg opted to condemn schools 

 7          rather than fix them, treating closure as a 

 8          panacea."  And so it just seems that you have 

 9          changed your tune quite a bit --

10                 MAYOR DE BLASIO:  No.

11                 CHAIRWOMAN YOUNG:  -- and why not fix 

12          these schools?  

13                 MAYOR DE BLASIO:  Again, Madam Chair, 

14          with real respect, I just disagree that there 

15          is a change in my belief.  There is not.  

16                 I believe the previous administration 

17          moved to close too frequently, without 

18          accounting for the unintended consequences 

19          caused by the closure and without a honest 

20          effort to turn around a lot of schools that 

21          could be turned around.  

22                 The proof will be in the pudding.  We 

23          started with 94 schools.  We're going to show 

24          you, by the time we get to the end of this 


                                                                  86

 1          calendar year, we'll have an assessment of 

 2          which ones have made enough progress and 

 3          which ones didn't.  And we'll act according.  

 4                 But for every school that we turn 

 5          around and get on track without dislocating 

 6          all the families and all the students, I 

 7          think that's a victory.  I think parents 

 8          would agree with me.  We ultimately work for 

 9          our residents and our parents.  They don't 

10          want to see a school closed if it can be 

11          turned around.  If it can't be turned around, 

12          the parents are the first to agree with the 

13          closure.  

14                 I think in the case of PS 162, we got, 

15          again, to the point where we agreed with the 

16          state's assessment that we could do something 

17          better, we could come up with a new approach.  

18          And we think it will succeed.  

19                 But I don't think there's anything 

20          about the statement you read that I disagree 

21          with at this point.  

22                 CHAIRWOMAN YOUNG:  Thank you.

23                 And switching gears, I want to talk 

24          about ACS right now.  And there have been a 


                                                                  87

 1          lot of press questions and stories about the 

 2          ACS and mismanagement, negligence.  And the 

 3          budget for ACS in 2016 was nearly $3 billion, 

 4          and the total state funding of this was about 

 5          $680 million, which is 23 percent of the 

 6          budget.  We've had several high-profile cases 

 7          of children dying, people not following up 

 8          when they are supposed to follow up.  And, 

 9          you know, there's really a deep cause for 

10          concern because what's happening is that 

11          people are not only getting hurt, but they're 

12          actually dying because of this.

13                 And there are several things that I 

14          would like to point out.  Seventy-three 

15          percent, or 2,360 cases of the closed ACS 

16          investigations lacked the required minimum 

17          number of manager's reviews.  In 68 percent, 

18          or 2,516 cases, of both open and closed 

19          high-priority ACS investigations, a risk 

20          assessment profile was not completed within 

21          the required 40 days.  Thirty-two percent 

22          lacked the required number of supervisor's 

23          reviews.  Fifty-three investigations were 

24          closed without ACS investigators ever meeting 


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 1          with a child who was allegedly abused.  In 22 

 2          percent of the investigations, ACS 

 3          investigators did not meet with the child 

 4          within 24 hours of the abuse allegation.  In 

 5          26 percent of the investigations, ACS 

 6          investigators did not meet with the child the 

 7          required number of times.

 8                 So obviously there's something wrong 

 9          with the system.  And the question is, why 

10          shouldn't the state withhold the funding for 

11          the Administration for Children's Services 

12          until you address the situation?

13                 MAYOR DE BLASIO:  Madam Chair, I want 

14          to once again respectfully disagree with some 

15          of that assessment.  And also even the facts 

16          you cite were based on a look at a small 

17          amount of the work of ACS.

18                 You have a real expert sitting down 

19          the row from you in Senator Savino, who knows 

20          this work very well.  

21                 I spent eight years when I was a 

22          legislator in our City Council as the 

23          chairman of the Oversight Committee; I spent 

24          a tremendous amount of time and energy 


                                                                  89

 1          working on the issue of protecting our 

 2          children.  And Madam Chair, I can tell you 

 3          that when I started on this work in 2002, the 

 4          City of New York was nowhere near as able to 

 5          protect children as it is today.  That is a 

 6          factual statement.  The tragic case of 

 7          Nixzmary Brown in the year 2006 pointed out 

 8          vast gaps in the city's approach to 

 9          protecting children.  

10                 I commend the Bloomberg administration 

11          for making some of the reforms that were 

12          needed.  We have continued to make additional 

13          reforms.  But we also know that there was a 

14          disinvestment in ACS for years that we've 

15          been working intensely to correct, hiring 

16          more caseworkers, reducing caseworker ratios, 

17          providing more training to the caseworkers 

18          that they desperately needed, providing them 

19          more support from other agencies like NYPD 

20          and the Department of Education.  

21                 This is very personal for me.  I'm a 

22          parent, and I've worked on these issues.  And 

23          I consider it a moral issue that we have to 

24          protect every single child.  But I have to 


                                                                  90

 1          put in context, Madam Chair, there are 

 2          between 50,000 and 60,000 complaints called 

 3          in every year from New York City of potential 

 4          abuse and neglect of children.  

 5                 In the overwhelming majority of those 

 6          cases, the Administration for children's 

 7          Services plays a crucial role in stopping 

 8          abuse against children and stopping that 

 9          neglect and protecting those children.  In 

10          many cases, ACS asks a court for the right to 

11          remove a child from the home, and a court 

12          disagrees and stands in the way of that 

13          action of ACS, something that I think needs 

14          to be looked at more carefully, because ACS 

15          often is taking a more aggressive stance and 

16          is not allowed to follow through, by a 

17          judge's decision.  

18                 The vast majority of our caseworkers 

19          do their jobs well and protect our children.  

20          And if you look at the overall trend over the 

21          last few years, thank God, the number of 

22          child abuse and neglect cases has gone down, 

23          and the number of child abuse deaths has gone 

24          down.  But one is one too many.


                                                                  91

 1                 So I just have to disagree with the 

 2          premise.  We have real work to do, and when 

 3          someone in our employ does something wrong, 

 4          we fire them.  As you saw in the recent case, 

 5          the Zymere Perkins case, people were fired 

 6          who didn't do their job.  And we'll do that 

 7          each and every time.  There will be new 

 8          leadership soon at ACS, and we're going to 

 9          continue to deepen reforms and we'll make 

10          whatever investment we need to.

11                 But I just think a lot of the 

12          assumptions that are being made are unfair.  

13          They're not based on facts, they're not based 

14          on the overall history of what's happened 

15          here, and they're certainly not showing 

16          respect for the women and men who do this 

17          work every day of protecting our children.  

18          You know, I don't think I've seen a single 

19          article talking about the children who are 

20          saved every single day.  I only see coverage 

21          when there's a tragedy.  

22                 The tragedy grabs at me like every one 

23          of us, and we're not going to allow these 

24          tragedies.  But Madam Chair, I have to tell 


                                                                  92

 1          you, the vast majority of the work of that 

 2          agency is life-saving.  And I need it to 

 3          continue, and we're going to keep supporting 

 4          it.

 5                 CHAIRWOMAN YOUNG:  Thank you, 

 6          Mr. Mayor.  And I think that, you know, 

 7          you're saying that you dispute the facts.  

 8          The facts are the facts.  And also the facts 

 9          are that we have several cases and names of 

10          children.  Like Mikey Guzman, age 5 years 

11          old, Sherlin Yeslin Camacho, age 3 months, 

12          Zymere Perkins, age 6 years.  

13                 And we have to do better.  And as I 

14          said, the state is investing a lot of money 

15          into the system, and we have to do better.

16                 And the final question is so your 

17          Commissioner Gladys Carrion is still there, 

18          and it just came out recently that she was 

19          still there.  I was just wondering what the 

20          status is, and why is she there?  If there 

21          are so many failures under the system, why is 

22          she there?

23                 MAYOR DE BLASIO:  Again, Madam Chair, 

24          I respect the question, but I have spent a 


                                                                  93

 1          lot of my life working on these issues.  And 

 2          I think -- I am not saying the facts aren't 

 3          the facts.  I agree.  But unfortunately, the 

 4          facts are not being represented fairly by the 

 5          media, even in the cases that you just 

 6          delineated.  And I happen to have access, of 

 7          course, to a deeper understanding of some of 

 8          the details than the general public does.  In 

 9          too many cases, the media are suggesting a 

10          fact pattern that does not exist -- and of 

11          course these cases are subject to very, very 

12          careful attention because of confidentiality 

13          issues.  And a picture is painted for the 

14          public that is not fair, because the vast 

15          majority of the work at ACS is succeeding in 

16          protecting children's lives.  We're going to 

17          continue that work.

18                 But in terms of the commissioner, the 

19          commissioner has spent 40 years of her life 

20          protecting children, including as the state 

21          commissioner.  She, in the last three years, 

22          implemented a series of reforms and 

23          improvements at ACS.  There were some cases 

24          not handled properly, I've said that 


                                                                  94

 1          publicly.  And it angers me, and people have 

 2          been fired.  And anyone who doesn't handle a 

 3          case will be fired, it's as simple as that.  

 4                 Commissioner Carrion announced her 

 5          resignation, and it was clear there would be 

 6          a transitional period.  That transitional 

 7          period will end at end of this week.  Her 

 8          first deputy commissioner will take over for 

 9          the interim.  A new commissioner will be in 

10          place by the end of February or beginning of 

11          March.

12                 I further want to note we're going to 

13          deepen the close working relationship between 

14          the NYPD and ACS.  Again, going back to the 

15          Nixzmary Brown case, one of the most 

16          prominent and tragic cases this city ever 

17          went through, one of the fault lines, one of 

18          the problems was there was not that 

19          relationship that was needed between NYPD and 

20          ACS.  We've improved over time.  There's more 

21          to do.  

22                 Chief Robert Boyce, who is our chief 

23          of detectives, one of the most respected 

24          leaders in the NYPD, will be working more 


                                                                  95

 1          closely with ACS -- in fact, will cochair the 

 2          ChildStat process, which is the ACS 

 3          equivalent of CompStat at the NYPD.  He'll be 

 4          cochairing that with the acting commissioner 

 5          going forward to intensify our efforts to 

 6          look deep into each case and look for any 

 7          potential danger.  And I think the growing 

 8          cooperation and partnership between ACS and 

 9          NYPD will allow us to go much farther in 

10          protecting children.

11                 CHAIRWOMAN YOUNG:  Thank you.

12                 CHAIRMAN FARRELL:  Assemblyman Weprin.

13                 ASSEMBLYMAN WEPRIN:  Thank you, 

14          Mr. Chairman.  

15                 Thank you, Mayor.  As the new chair of 

16          the Correction Committee, I appreciate your 

17          comments on bail reform and on voluntarily 

18          raising the age, removing 16- and 

19          17-year-olds from Rikers.  As you know, the 

20          Assembly has long supported raising the age, 

21          and hopefully with the Governor putting it in 

22          his budget, it will be an issue that may 

23          finally come this year.

24                 I know there is a commission taking 


                                                                  96

 1          place now where Judge Lippman is discussing 

 2          some of the issues, along with some 

 3          colleagues on the commission, about Rikers 

 4          Island.  And I know they're due to have a 

 5          report soon.  One of my first meetings as 

 6          chair of the Correction Committee was with 

 7          Commissioner Joe Ponte, and I was very 

 8          impressed with his concern about safety at 

 9          Rikers.  And I know -- I've had a discussion 

10          with you as well, and I know there have been 

11          a number of incidents, and I'm happy to see 

12          that you're working on that.

13                 But I know there have been some 

14          proposals to the commission, and possibly 

15          from outside the commission, on the 

16          possibility of closing Rikers.  I think we're 

17          talking about close to 10,000 inmates at 

18          Rikers.  What are your thoughts on what 

19          should be done at Rikers, and what is your 

20          knowledge as to what the commission is going 

21          to report, the Lippman commission on Rikers, 

22          and what is their timing?

23                 MAYOR DE BLASIO:  Assemblyman, I'm 

24          certainly not going to steal Judge Lippman's 


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 1          thunder.  That commission continues to work; 

 2          my understanding is we'll hear a report from 

 3          them in the spring.  

 4                 I've said, when I announced the 

 5          preliminary budget, that we'll have a lot 

 6          more to say on the future of our correction 

 7          system at the time of the Executive Budget.  

 8                 I want to thank you as you assume the 

 9          chairmanship.  We very much look forward to 

10          working with you and appreciate the 

11          partnership we've had already.  And I 

12          appreciate you meeting with our correction 

13          officials, and I think you're seeing already 

14          that Commissioner Ponte has achieved some 

15          pretty extraordinary reforms.  And we have 

16          some examples of both reduction of violence 

17          and improvement in the way that we treat and 

18          rehabilitate our inmates that are very, very 

19          compelling.  We want to do a lot more.

20                 In terms of the future of Rikers, 

21          again, I'll reserve the broad judgment until 

22          the time of the Executive Budget.  But I will 

23          say this.  You know, a very powerful report 

24          came out a few weeks ago pointing out that 


                                                                  98

 1          the mass incarceration issue is becoming even 

 2          more of a debate all over this country -- and 

 3          a bipartisan one, I want to say, in a good 

 4          and healthy way.  There's a recognition that 

 5          mass incarceration failed and was inhumane 

 6          and extraordinarily costly in human and 

 7          economic terms.  

 8                 One of the better stories in this 

 9          country is in New York City, where over the 

10          last few decades we've reduced the population 

11          at Rikers by 55 percent.  It's now getting 

12          closer to 9,000 than 10,000.  Of course there 

13          are variations in any given week or month, 

14          but we do see a good downward trend and we 

15          intend to continue that and deepen that.

16                 So whatever we do in terms of the 

17          specific facilities -- and there's a lot of 

18          complexities we have to address, not only at 

19          Rikers Island today, but the other correction 

20          facilities around the city.  And any plan 

21          that we would have going forward, we'd have 

22          to talk about all of them.

23                 But what I can say is we are reducing 

24          the number of people incarcerated, 


                                                                  99

 1          consistently.  We're coming up with 

 2          alternatives that are working.  And more 

 3          important than anything, we're reducing 

 4          crime, which reduces the flow of people into 

 5          the correction system.  And I want to give 

 6          credit to all the men and women in the NYPD 

 7          for a three years running reduction in crime, 

 8          particularly in serious crime.  That's the 

 9          gateway to everything else.

10                 So what I can safely say to you is for 

11          anyone who wants to see change in our 

12          correction system, support us in the changes 

13          we're making in policing that are allowing us 

14          to drive down crime and get to the root 

15          cause.

16                 ASSEMBLYMAN WEPRIN:  Well, I look 

17          forward to working with you and your staff 

18          over the next weeks and months for various 

19          reforms at Rikers, and hopefully we're there 

20          to be as helpful as possible working with 

21          you.

22                 MAYOR DE BLASIO:  Thank you very much.

23                 CHAIRMAN FARRELL:  Thank you.

24                 We've been joined by Assemblywoman 


                                                                  100

 1          Yuh-Line Niou and Assemblyman Brian Kavanagh.

 2                 Senator?  

 3                 CHAIRWOMAN YOUNG:  We've been joined 

 4          by Senator Terrence Murphy and Senator 

 5          Gustavo Rivera.  

 6                 And our next speaker is Senator 

 7          Krueger.

 8                 SENATOR KRUEGER:  Good morning, Mayor, 

 9          and your staff.

10                 MAYOR DE BLASIO:  Good morning.

11                 SENATOR KRUEGER:  Let's do some 

12          lightning round, if you can.

13                 MAYOR DE BLASIO:  Okay, I'm ready.  I 

14          feel like I'm on NY-1.

15                 SENATOR KRUEGER:  Thank you.  

16                 So there seems to be a lot of 

17          information here, I guess coming out of both 

18          the Governor's office and in the question you 

19          got, that New York City has been decreasing 

20          its MOE to education.  I just want to 

21          reiterate what I thought I heard Dean 

22          Fuleihan say, that actually it's the 

23          opposite.  Could you repeat that data?

24                 MAYOR DE BLASIO:  I'll repeat from the 


                                                                  101

 1          testimony, and then Dean will take it from 

 2          there, because we think the fact is pretty 

 3          good here.  Hold on.  Oh, Dean was way ahead 

 4          of me, okay.  

 5                 Since 2008, the city's share of 

 6          education spending -- so let me just affirm 

 7          this, the Bloomberg administration and my 

 8          administration, both of which increased city 

 9          spending on education.  Since 2008, the 

10          city's share of education spending has 

11          increased from 49 percent to 57 percent, 

12          while the state share has declined from 

13          41 percent to 37 percent.

14                 SENATOR KRUEGER:  Thank you.

15                 Senator Young brought up the ACS 

16          issues.  And she is right, it's a crisis when 

17          children die.  And it's a crisis when workers 

18          don't get the support they need to do the 

19          right thing, and they should be removed when 

20          they don't.

21                 But it sounded like I was hearing that 

22          the state gives you so much more money for 

23          child welfare now than it has in the past.  

24          And I didn't think that was correct.  I'm 


                                                                  102

 1          looking at, again, your budget director.  

 2                 MAYOR DE BLASIO:  Again, I'll let Dean 

 3          speak to the history.  I think the state 

 4          support for our child welfare efforts issues 

 5          is crucial.  And again, what is too often 

 6          lost in this discussion, between 50,000 and 

 7          60,000 cases -- because you're talking about 

 8          every single call to the state registry has 

 9          to be investigated.  

10                 By definition, and we can give you the 

11          chapter and verse on the tragedies that have 

12          occurred, we feel every one very humanly.  

13          But thank God, they are a very small number 

14          compared to the tens of thousands of cases 

15          where our ACS workers get to the bottom of 

16          the situation, stop problems before they 

17          happen, provide preventive services -- which 

18          is something I've backed for many years, and 

19          we've expanded.  Which means literally the 

20          ability of charitable and nonprofit 

21          organizations to intervene with the family 

22          and support them and help them deal with 

23          their problems.  That work has continued and 

24          has deepened, and that is why so many 


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 1          children have been saved.  

 2                 And further, I've been very blunt 

 3          about this, there are a number of times, 

 4          hundreds of times, when ACS has asked for the 

 5          removal of children from a family only to 

 6          have a judge refuse.  That's unfair to the 

 7          people who do such hard work at ACS, that if 

 8          they are requesting removal and a judge will 

 9          not let them do that.  The judge may have a 

10          reason in their own mind, but we have to 

11          grade fairly here.  

12                 Just as we would our police or our 

13          firefighters or anyone else who's a first 

14          responder, our ACS workers are another type 

15          of first responders, and they're regularly 

16          saving lives.  They get precious little 

17          credit for it.  

18                 But when something goes wrong, I feel 

19          it personally.  And we are not afraid to take 

20          the most resolute action to deal with anyone 

21          who doesn't do their job.

22                 SENATOR KRUEGER:  And in other parts 

23          of -- oh, I'm sorry.  You said Dean.

24                 DIRECTOR FULEIHAN:  And state funding 


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 1          has not changed.  

 2                 SENATOR KRUEGER:  It has not changed.  

 3                 So in other parts of the state, as 

 4          charters have expanded, the state has made a 

 5          commitment to not have the local district 

 6          have to absorb those costs out of its school 

 7          funding.  But I believe your testimony was 

 8          that New York City would actually have to 

 9          kick in an additional $200 million of its 

10          school funding for the charter proposal this 

11          year?

12                 DIRECTOR FULEIHAN:  Correct.  Correct.

13                 SENATOR KRUEGER:  And that's a new 

14          demand on the city.

15                 DIRECTOR FULEIHAN:  Yes.

16                 SENATOR KRUEGER:  And because there's 

17          also a proposal to not lift the charter cap 

18          statewide, but to allow whatever charters are 

19          unassigned now to all come to New York City, 

20          do you have an estimate of additional cost to 

21          yourself if that all were to happen, 

22          particularly the building costs?

23                 DIRECTOR FULEIHAN:  We'll get you that 

24          estimate.  I don't have a quick estimate.  


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 1          I'll try and get one now.

 2                 SENATOR KRUEGER:  It's my 

 3          understanding it was -- up until now, there 

 4          was this sort of interesting the city kicks 

 5          in the first 40 million, but then after that, 

 6          not.  But if we suddenly see a massive 

 7          increase in charters opening in New York City 

 8          under the Governor's language, could you 

 9          potentially see a much bigger cost to 

10          yourselves, not just on operating but on 

11          capital as well?

12                 DIRECTOR FULEIHAN:  Yes.  We would 

13          definitely see cost increases.  

14                 But as the mayor pointed out, there's 

15          already room in the existing cap that applies 

16          to New York City for charters.

17                 SENATOR KRUEGER:  Correct.  But there 

18          could be so many more.

19                 DIRECTOR FULEIHAN:  Yes, there would 

20          be additional costs.

21                 SENATOR KRUEGER:  Thank you.

22                 Pre-K, you said there was a cut in 

23          funding for pre-K in New York City in the 

24          state budget?  


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 1                 MAYOR DE BLASIO:  Yeah.  And again, 

 2          it's in the context of something good, which 

 3          is the consolidation of how the grant funding 

 4          is used.  We applaud that.  But the poison 

 5          pill that has to be addressed is that the 

 6          per-seat rate would be cut in the bargain.  

 7          And we think those things should be 

 8          dealing -- we think consolidation is smart 

 9          government, but cutting the per-seat rate is 

10          not good for our children, obviously.  It 

11          means 3400 seats that are currently funded 

12          would not be funded.

13                 SENATOR KRUEGER:  So to be parochial, 

14          my district is one of the two districts in 

15          the city that still has incredible wait lists 

16          for pre-K.  We don't have adequate pre-K 

17          seats.  Your people know that.  And partly 

18          it's because our schools are overcrowded and 

19          our rental costs for alternative sites have 

20          been so high.

21                 I don't want to see any cuts in pre-K 

22          money at all, but I also really want the kids 

23          in my district to have the same rate to go to 

24          pre-K as the other districts.


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 1                 MAYOR DE BLASIO:  Senator, as you 

 2          know, although I am a Brooklynite, I am 

 3          living currently on the Upper East Side, and 

 4          I talk to people all the time about this 

 5          problem.

 6                 One, we absolutely want to do more to 

 7          solve it.  We've made some progress in terms 

 8          of school seats in general, and pre-K seats 

 9          in specific, for the Upper East Side.

10                 But as you indicated, it is literally 

11          the hardest territory in the city for us to 

12          address because, one, it's so thoroughly 

13          built out and, two, because of the costs 

14          involved with the very limited new 

15          development that is happening.

16                 We are still trying to find creative 

17          solutions.  But I want to just -- a 

18          respectful minor correction.  Even though it 

19          is not what we ideally would want for any 

20          district -- which is the maximum seats 

21          immediately, you know, geographically where 

22          parents want them ideally -- every single 

23          student is guaranteed a pre-K seat.

24                 Now, in your district, I think, again, 


                                                                  108

 1          one of the most difficult situations in all 

 2          of the City of New York.  We still work very 

 3          hard, parent by parent, with a facilitated 

 4          enrollment system that's literally a person 

 5          who is a specialist working individually with 

 6          that parent to find them the closest 

 7          available seat that works for them.  For many 

 8          parents, as you know, that might be closer to 

 9          their work than it is to their home.  That 

10          might be better for them.  A lot of parents 

11          feel good about a seat that's very near their 

12          workplace, for a variety of reasons.  

13                 But we will work with any one of your 

14          constituents to find a placement.  They will 

15          have a placement for free.  We'll do our 

16          damnedest to make sure it's as convenient as 

17          possible while we're trying to build out the 

18          capacity.

19                 SENATOR KRUEGER:  We continue to 

20          struggle.

21                 I want to shift to housing.  While 

22          some people apparently feel plastic bags is 

23          biggest crisis facing New York City, I would 

24          argue the lack of affordable housing is, and 


                                                                  109

 1          the future environmental damage that will 

 2          continue until we radically change our 

 3          consumer production and our production 

 4          behavior.

 5                 The 421-a proposal that's been 

 6          renamed -- although I'm calling it the -- you 

 7          know how the old 421-a was bad; this has a 

 8          new name, but it's worse.  There are some 

 9          people actually proposing that co-ops get 

10          brought back into this.  You in your 

11          testimony testified about the old 421-a, your 

12          proposal -- which I didn't love either, by 

13          the way.

14                 MAYOR DE BLASIO:  You're equal 

15          opportunity, Senator.

16                 SENATOR KRUEGER:  There you go.

17                 The new one, can you project what the 

18          loss of city revenue would be if co-ops were 

19          brought back into this program the way they 

20          were in the old program?

21                 MAYOR DE BLASIO:  I will give you a 

22          broad answer, and then my colleagues may give 

23          you something more specific.  But here's the 

24          bottom line.  We had a program, which I say 


                                                                  110

 1          is the old broken 421-a, that cost taxpayers 

 2          a lot and subsidized luxury housing.  We 

 3          can't let that happen again.  It's not in the 

 4          interest of our people and it's not in the 

 5          interest of our taxpayers.  I think at this 

 6          moment it would be even more unacceptable 

 7          than it was years ago.

 8                 So right now, as you saw from the 

 9          numbers we put forward, the current proposal 

10          is inching back towards the same cost as the 

11          previous one, which rewarded luxury housing.  

12          And we fear that the door is now open for the 

13          inclusion of luxury housing, which could make 

14          it as costly or even more costly -- quickly, 

15          easily could be more costly than the old 

16          421-a.  So that would then be the worst of 

17          all worlds, where taxpayers are being hit 

18          worse than they were in the past, we're not 

19          getting the affordability we deserve, and 

20          we're subsidizing luxury buildings again.

21                 I think a lot of people -- look, there 

22          is a particular building on 57th Street, a 

23          luxury building, very tall luxury building, 

24          that when New Yorkers found out that that got 


                                                                  111

 1          a tax break for purely luxury housing, no 

 2          affordable housing, there was a massive 

 3          outcry in New York City.  We just cannot go 

 4          back to those days.  

 5                 So we are happy to work with all 

 6          members of the Legislature and the Governor 

 7          and all other interests on the current 

 8          proposal, which in our view has merits and 

 9          has issues we want to address too.  But going 

10          back in the direction of the old proposal 

11          would be untenable and would make it a net 

12          loss for the people of New York City.

13                 SENATOR KRUEGER:  I agree, although 

14          again, I think it's even worse.  Because even 

15          without the condos, the new proposal would 

16          allow market rate to take advantage of 421-a 

17          even if there was no affordable units in a 

18          specific building.  

19                 So again, I would urge everyone 

20          listening to look carefully at that proposal 

21          and the damage it would do.  Personally, if I 

22          had $2.4 billion in city taxpayer revenue, 

23          I'd actually want to buy $2.4 billion in 

24          affordable housing with it, not maybe $150 


                                                                  112

 1          million in affordable housing.

 2                 There was a bill passed last year -- 

 3          which we then did a counter bill, but then 

 4          the Governor vetoed -- on the MTA sort of 

 5          real estate not related to transportation 

 6          being able to violate New York City zoning, 

 7          actually anyone's zoning in the 12 MTA 

 8          counties.  Disappointingly, the Governor 

 9          vetoed the Legislature's attempt to reverse 

10          that.

11                 Is the City of New York attempting to 

12          do anything about that at this point?  And do 

13          you see that as causing problems for you in 

14          the future?  

15                 MAYOR DE BLASIO:  You know, Senator -- 

16          I'll start, and again my colleagues may want 

17          to add -- that we worked very productively 

18          with our colleagues in suburban counties.  By 

19          the way, on a bipartisan basis.  There was a 

20          lot of unity on this point, that it was not 

21          the place of the State of New York or any 

22          entity of the State of New York, like the 

23          MTA, to override local zoning.  Which is, I 

24          think, pretty sacrosanct.  There's a number 


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 1          of things localities do -- policing, 

 2          education, zoning -- that all of us can say 

 3          are decisions best handled locally with 

 4          maximum citizen input.  And the MTA should 

 5          not be overriding that reality.  

 6                 And I think clearly there was 

 7          tremendous support in both the Senate and the 

 8          Assembly, having heard from local leaders of 

 9          all different-size jurisdictions and both 

10          parties, you know, we felt very much 

11          appreciative for the support we received in 

12          the Legislature.  

13                 We disagreed with the Governor's 

14          decision, obviously.  We think we need to 

15          restart that process again and build up even 

16          more support from the local level, because I 

17          think it's something people feel deeply.  

18          They do not want to see their local rights 

19          trampled on.  And it matters a lot in a place 

20          like New York City, but I could argue it 

21          matters even more in smaller jurisdictions, 

22          that it fundamentally changes the trajectory 

23          of their cities and towns to have major new 

24          development that is done without their 


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 1          approval.  

 2                 So we are going to work closely with 

 3          all of you and with our colleagues in local 

 4          government to once again try and address 

 5          this.

 6                 SENATOR KRUEGER:  And then -- I know 

 7          I'm at zero, but I'm taking advantage of 

 8          ranking status for a moment.  In your 

 9          testimony, you proposed that a mansion tax go 

10          into effect for apartments or houses selling 

11          for over $2 million and say that the money 

12          would be used for senior housing.  

13                 Can you explain a little bit about how 

14          much money you project this to be?  And what 

15          kind of senior housing program would you be 

16          starting with it?  

17                 MAYOR DE BLASIO:  We project it would 

18          provide us with $330 million a year.  It 

19          would allow us to provide ongoing support for 

20          25,000 seniors who are having trouble 

21          affording housing.  It would mean that for 

22          all seniors who are part of this initiative, 

23          it would pay no more than 30 percent of 

24          whatever income they have.  And we know so 


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 1          many of our seniors are on low fixed incomes.  

 2                 That would be 25,000 apartments on top 

 3          of our current 200,000-apartment plan.  So 

 4          everything we're doing in our housing plan, 

 5          200,000 apartments, reaches half a million 

 6          people by 2024.  This new initiative -- which 

 7          again I think is fair because it only reaches 

 8          those who have homes of $2 million or more in 

 9          value when it's sold, and people who are 

10          about to get a major tax break from the 

11          federal government, as everyone knows -- this 

12          will allow us to reach 25,000 more seniors on 

13          an ongoing basis, lock in affordability for 

14          them long-term through preservation.  So we 

15          would be subsidizing apartments in place for 

16          the long-term.

17                 SENATOR KRUEGER:  Thank you.  And 

18          thank you for your last sentence, which was 

19          reminding everyone that Washington is very 

20          likely to change our tax structure to lower 

21          taxes for the highest-income Americans very, 

22          very soon.  And that in fact will translate 

23          into less money available from the federal 

24          government for the programs we depend on and 


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 1          actually is a reason to support the 

 2          Assembly's proposal to increase the 

 3          millionaire tax, as they put it, and also to 

 4          recognize that proposing a tax on high-cost 

 5          house sales or apartment sales still will 

 6          translate, when we do the math, I assume, to 

 7          be a significant reduction in people's 

 8          federal taxes, even if they see some increase 

 9          upon the sale of a home or some increase 

10          because they're in the highest income 

11          brackets as a state resident.

12                 MAYOR DE BLASIO:  I would argue, 

13          Senator, even if nothing changed on taxation, 

14          this would be fair to ask those who own homes 

15          of $2 million or more to do a little more to 

16          help seniors who built our city, built our 

17          state, and now are struggling to have 

18          housing.  I think it would be fair under any 

19          circumstance.

20                 But given that -- I agree with you -- 

21          this will unfortunately, from my point of 

22          view, when the federal government gets done, 

23          when the Congress gets done with its tax 

24          plan, unquestionably the tax breaks for 


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 1          wealthy individuals will far outstrip 

 2          anything we're talking about here, and the 

 3          wealthy will be paying less in taxes overall 

 4          than they're paying now, even with the 

 5          continuation of the millionaire's tax, or 

 6          extension of it, or improvement of it.  And 

 7          with a mansion tax, still, wealthy people are 

 8          going to end up with more money in their 

 9          pocket under any scenario, based on what 

10          we're hearing from Washington.

11                 SENATOR KRUEGER:  Do you happen to 

12          know where a lot of those wealthy people 

13          live?

14                 MAYOR DE BLASIO:  Again, please?

15                 SENATOR KRUEGER:  Do you happen to 

16          know where a lot of those wealthiest people 

17          live?  

18                 MAYOR DE BLASIO:  There's a number of 

19          districts I could name.  One of them might be 

20          yours.

21                 SENATOR KRUEGER:  Thank you.  

22                 Thank you very much.

23                 CHAIRMAN FARRELL:  Thank you.  We've 

24          been joined by Assemblyman Dilan and 


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 1          Assemblyman Otis.

 2                 Next to question, Assemblywoman Nolan.

 3                 ASSEMBLYWOMAN NOLAN:  Thank you, 

 4          Mr. Chairman.  

 5                 Mr. Mayor, welcome to Albany.

 6                 MAYOR DE BLASIO:  Thank you.

 7                 ASSEMBLYWOMAN NOLAN:  I do have a 

 8          question, but I want to point out something 

 9          that was said earlier.  It referenced it as 

10          someone who's a parent of a child in a city 

11          public school.  It's actually quite easy to 

12          find the budget for each individual school, 

13          each of the 1600 schools that the city 

14          administers.  You just go to the website and 

15          you type in "school budgets," and you can get 

16          the budget for every single individual 

17          school.  

18                 And as someone who's complained at 

19          times about those budgets, I would point out 

20          that it's something that is relatively 

21          recent.  And I congratulate you and 

22          Chancellor FariÒa for providing that 

23          information, which in prior administrations 

24          was not available by individual school.  And 


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 1          it is very helpful for parents advocating for 

 2          their children, and it is available on a 

 3          school-by-school basis.

 4                 I do have a question on trailers.  

 5          I've asked both you and Mayor Bloomberg about 

 6          it, and you know that it's a continuing sore 

 7          spot for many of us, particularly in the 

 8          Bronx, Brooklyn, and Queens, where I 

 9          represent.  And I know there is a report that 

10          we've required to be filed, but I would like 

11          to hear from you what the progress is on 

12          eliminating trailers.

13                 MAYOR DE BLASIO:  I'm going to start, 

14          and I think Sherif will add.  

15                 But look, the bottom line has been we 

16          are committed to a phaseout of all trailers.  

17          As we've been honest with you, it takes time 

18          and is complicated in some specific 

19          locations.  But in fiscal '13, we had 352 

20          trailers in use.  We are continuing to 

21          decline.  Now, in fiscal '17, we are down to 

22          245.  We are projecting the next jump for 

23          next year to go down to 176.  We're just 

24          going to continue consistently to move.  And 


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 1          we obviously have put substantial resources 

 2          in the budget to do so.

 3                 ASSEMBLYWOMAN NOLAN:  Thank you very 

 4          much.  

 5                 I want colleagues to understand that 

 6          even -- and this is really great progress, 

 7          and you deserve credit for it.  But even with 

 8          this progress, there are still more children 

 9          attending school in a trailer in the City of 

10          New York than in some of the largest 

11          districts in our state, and that has been the 

12          case for over 30 years.

13                 So again, the contrast, colleagues, 

14          that there are more children attending school 

15          in a trailer in the City of New York for the 

16          last 30 years than the size of most of the 

17          districts of the 700 school districts of our 

18          state.

19                 One of the reasons I bring this up is 

20          that we tried very hard to give you some 

21          additional revenue to get rid of these 

22          abominations, and the city is due, I believe, 

23          $700 million from the Smart Schools Bond Act.  

24          You didn't mention the bond act in your 


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 1          testimony, but I wondered if you would care 

 2          to comment.  My understanding is the city's 

 3          application is there.  Do we know why the 

 4          Executive has not acted on it?

 5                 MAYOR DE BLASIO:  In terms of the bond 

 6          act, I'm going to defer to Dean.

 7                 DIRECTOR FULEIHAN:  So thank you.  

 8                 We have, as you know, completely 

 9          allocated funding for the removal of the 

10          trailers.  So that is completely in the city 

11          budget.  It is now going through the process 

12          that the mayor outlined.  

13                 And no, we have had our application 

14          before the state, and we're waiting for 

15          approval.  

16                 ASSEMBLYWOMAN NOLAN:  Do we have any 

17          idea whether the bond act -- have they 

18          reached out to you, the people on the board 

19          of the state bond act?

20                 DIRECTOR FULEIHAN:  I believe we 

21          submitted in November -- I'm going to ask 

22          behind me -- in last May, and we have not --

23                 ASSEMBLYWOMAN NOLAN:  The Education 

24          Committee intends to keep some focus on 


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 1          what's happening with the Smart Schools Bond 

 2          Act, so we will follow up with Chancellor 

 3          FariÒa.

 4                 DIRECTOR FULEIHAN:  We would 

 5          appreciate that.  Thank you.

 6                 ASSEMBLYWOMAN NOLAN:  And we will 

 7          certainly be following up with the Executive.

 8                 I would like the mayor just to 

 9          comment, if you would.  In your testimony you 

10          talked a little bit about the importance of 

11          the CFE settlement.  Some suggest that public 

12          school parents like you and I have been duped 

13          into thinking that it's been settled or 

14          resolved.  I find that statement shocking.  I 

15          don't want to get into who said it, but I 

16          thought it was very ill-advised.  

17                 As someone who's son never really -- 

18          my son is graduating, your son has already 

19          graduated, and your daughter.  We were part 

20          of this so long ago, we never really saw the 

21          true fulfillment of CFE.  Do you believe that 

22          CFE has been finished or fulfilled and that 

23          you and I were duped into thinking that there 

24          was enough money for the city schools -- and 


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 1          all the schools in our state, many of whom, 

 2          rural, poor areas as well, would benefit by a 

 3          full CFE?  

 4                 MAYOR DE BLASIO:  Assemblymember, 

 5          first of all, this is an occasion for me to 

 6          thank you for what you do as chair of the 

 7          Education Committee, which is so crucial and 

 8          important for the children in New York City.  

 9          It really is.  Because you're asking a 

10          question that needs to be answered and hasn't 

11          been in our public discourse, and it amazes 

12          me it has not been.

13                 No, there has not been a resolution on 

14          CFE.  Yes, there has been a consistent effort 

15          to dupe people into thinking the issue is 

16          resolved and in the past.  It's not in the 

17          past.  It's perfectly alive today, to the 

18          tune of $1.6 billion.  

19                 Every single person here and every 

20          parent in New York City who says, Why is my 

21          school not getting 100 percent of the fair 

22          funding formula, it's because we should be 

23          getting $1.6 billion more in our budget, 

24          according to a decision of the Court of 


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 1          Appeals, the highest court in the state, a 

 2          decade ago.  And there are some who allege 

 3          that that decision was not binding.  It was 

 4          absolutely binding.  

 5                 And further proof is that in the Eliot 

 6          Spitzer administration, CFE was implemented 

 7          and funding was changed -- not just for New 

 8          York City, but other high-needs districts in 

 9          upstate cities and rural areas as well.  So 

10          the State of New York not only recognized a 

11          decision by our highest state court, but then 

12          proceeded to implement it.

13                 But for a change of administration and 

14          one of the greatest economic crises in the 

15          history of this country, I suspect we would 

16          have seen steady progress and we'd be having 

17          a very different discussion today.

18                 But no, it cannot be airbrushed out of 

19          history.  Our children have suffered for the 

20          lack of that funding.  And you've seen it and 

21          I've seen it as public school parents.  We're 

22          not going to let it go.  And what we are 

23          concerned about is we see a change in the 

24          State Budget terminology that suggests an 


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 1          attempt to remove the notion of CFE once and 

 2          for all from the discussion.  That's not 

 3          particularly legal, in our view.

 4                 ASSEMBLYWOMAN NOLAN:  Thank you.  

 5                 CHAIRWOMAN YOUNG:  Thank you very 

 6          much.  

 7                 Our next speaker is Senator Marty 

 8          Golden.

 9                 SENATOR GOLDEN:  Thank you, Madam 

10          Chair.

11                 Thank you, Mr. Mayor, for being here.  

12          I'm sure it's been a long morning, and it's 

13          going to be a little longer, I presume.  

14                 On some of the questions -- I had to 

15          leave for some press conferences, so my 

16          questions may have been asked and answered.  

17          And one of them I heard when I came in, 

18          Senator Krueger was talking about -- and I 

19          know Cathy had spoken about the ACS.  I don't 

20          think anybody in this room doesn't believe 

21          ACS has to be revamped, that they need help 

22          and something has to be done, and funding has 

23          to be put into them.

24                 We passed a bill out last week, we 


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 1          passed it last year and the Governor vetoed 

 2          it, and that's limiting the number of cases 

 3          to the ACS workers to 15.  You may even be 

 4          under that number.  But there are other 

 5          counties across the state that are not.  So 

 6          we want to limit the number of caseloads to 

 7          each caseworker.  Would you be supportive of 

 8          that bill?

 9                 MAYOR DE BLASIO:  Having not seen the 

10          language of the bill, I just want to reserve 

11          judgment.  But let me agree with the concept.  

12          We have been trying to drive down caseloads, 

13          and we succeeded at that by additional city 

14          funding.  So our goal, which we've acted on, 

15          is reduced caseloads and more training for 

16          the caseworkers, who have very, very 

17          difficult, complex jobs.

18                 I also -- what you didn't hear, and I 

19          want to reiterate, is we announced that the 

20          first deputy commissioner will be taking over 

21          the agency as of next Monday, that a 

22          permanent new commissioner will be in place 

23          at the end of February, beginning of March.  

24          But an additional important point, someone 


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 1          you probably know well, Chief Bob Boyce, of 

 2          the NYPD --

 3                 SENATOR GOLDEN:  Excellent.  

 4          Excellent.

 5                 MAYOR DE BLASIO:  -- will be coming 

 6          over not -- he's going to be doing all his 

 7          regular job too, but in addition he's going 

 8          to come over to ACS and cochair the ChildStat 

 9          program, which is based on CompStat, which 

10          has had so much success in driving down 

11          crime.  ChildStat was initiated in the 

12          Bloomberg administration, to their credit.  

13          We're going to enhance that approach and make 

14          it even closer in its mindset to CompStat and 

15          bring over the chief of detectives of NYPD to 

16          cochair those meetings and even get deeper 

17          into the cases to determine how we can do 

18          better.

19                 SENATOR GOLDEN:  Mr. Mayor, if the 

20          question's already been asked and answered, 

21          just tell me it's been -- because my members, 

22          I'm sure more members want to speak, and I'm 

23          sure that we can look it up later and find 

24          out what the testimony was.


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 1                 There's another bill that we had 

 2          last -- two years ago and a year ago, and 

 3          it's about giving our ACS workers, the 

 4          protective workers into the home, iPads, and 

 5          let them do their actual work within the home 

 6          so that the cross-grids can show that the 

 7          individual is there taking a picture of the 

 8          inside of the home and taking a picture of 

 9          the child and a picture of the house itself.  

10          Hopefully you can be supportive of that bill.  

11                 And there's a backup piece to this 

12          that has not yet been put forward, but there 

13          is technology out there that today gives you 

14          in-time technology of how many times that 

15          child has been in and out of foster care, 

16          what the frailties of the child are, the 

17          abuse of the child, the parents, the parent's 

18          background, the foster parent's background, 

19          and domestic violence.  All of those things 

20          are there in this technology.  

21                 It's working in Chemung County, and 

22          it's working -- Suffolk County is going to do 

23          a pilot program.  I don't think it should be 

24          a pilot program, I think it should be a 


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 1          statewide program.  But if not, at least 

 2          hopefully the city will take the initiative 

 3          to turn around and have these interviews with 

 4          these individuals that have this technology 

 5          and try to get that into your iPads and get 

 6          the workers in the homes with these iPads so 

 7          that we can get a true picture of what's 

 8          going on in the true time.  I think that's 

 9          important.

10                 MAYOR DE BLASIO:  Senator, a couple of 

11          points.  

12                 One, I now have clarification on your 

13          proposed legislation on the caseload cap at 

14          15 cases.  I want to just formally say we 

15          endorse and support your legislation.

16                 Second, one of the things we want to 

17          do -- the NYPD has had such success with the 

18          use of new technology.  And the work of ACS 

19          and NYPD parallel in crucial areas.  But as 

20          you know -- and this was the tragic truth in 

21          the Nixzmary Brown case in 2006 -- the two 

22          agencies didn't have a culture of connection 

23          the way we needed them to.  There's been real 

24          progress.


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 1                 Under Commissioner O'Neill and Chief 

 2          Boyce, there is an intensified idea of 

 3          deepening the interconnection between ACS and 

 4          NYPD, which will be exemplified by the 

 5          cochairing of the ChildStat process.  Your 

 6          point is well taken, that we should also 

 7          learn from the positive example of NYPD, 

 8          which is the smartphones, Bill Bratton's 

 9          great focus on bringing that handheld 

10          technology to our officers, which has had a 

11          tremendously positive effect.  Any number of 

12          crimes have been stopped with those 

13          smartphones that would not have been in the 

14          past.

15                 I agree with that concept in terms of 

16          ACS workers.  We have to figure out details 

17          in terms of cost, training, et cetera.  But 

18          in principle, I think that's a very 

19          productive idea.

20                 SENATOR GOLDEN:  Another issue, the 

21          veterans program.  You introduced that 

22          beautiful veterans program a year ago, two 

23          years ago, tremendously successful.  We have 

24          a tremendous number of homeless in our city, 


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 1          I'm sure it's been addressed.  But where I 

 2          live, in Bay Ridge and Fort Hamilton Army 

 3          Base, I have homeless; probably about 40 

 4          percent of it is military.  And one of the 

 5          reasons is because the VA hospital is there, 

 6          the other reason is because Fort Hamilton is 

 7          there.

 8                 I was a little distressed to see that 

 9          you cut an employee from that and that you've 

10          taken some funding from there.  I do believe 

11          -- I hope that you look at that and redo -- 

12          it's in the budget, cutting one employee and 

13          one -- what was the name of the program?

14                 MAYOR DE BLASIO:  Just -- Dean and I 

15          are not aware of any cut to that program, so 

16          we will follow up with you.

17                 SENATOR GOLDEN:  Do me a favor.  I 

18          read it, so it's out there.  So if it is, 

19          please put an end to that for sure.

20                 MAYOR DE BLASIO:  We want to correct 

21          it if it's wrong, for sure.

22                 SENATOR GOLDEN:  Okay.  The other 

23          thing is the 421-a.  I know that everybody's 

24          talking about these luxury condos.  We're not 


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 1          talking about luxury condos, we're talking 

 2          about condos in the outer boroughs so people 

 3          can have affordable living.  

 4                 MAYOR DE BLASIO:  May I?

 5                 SENATOR GOLDEN:  We want people to be 

 6          able to -- yes, sir.

 7                 MAYOR DE BLASIO:  Sorry to interrupt, 

 8          I want to just -- you're -- I want to 

 9          differentiate, because you're making a fair 

10          point.  

11                 But on the previous, thank you for the 

12          acknowledgement.  New York City has ended 

13          chronic veteran homelessness, and the federal 

14          government recognizes that fact.  And it was, 

15          as you know, a big job.  We had thousands of 

16          veterans that we had to address, and we were 

17          able to.

18                 There still are veterans who are not 

19          chronically homeless but still at times are 

20          homeless.  That's still not good enough, from 

21          my point of view.  I want to reach every 

22          single one of them.  And the mandate is to 

23          find housing for each and every one.  

24                 So we've made real progress in that 


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 1          area.  We've been adding positions to address 

 2          veteran housing needs.  So we'll check on 

 3          that --

 4                 SENATOR GOLDEN:  It's a good program.  

 5          Keep it up.

 6                 MAYOR DE BLASIO:  But I can just jump 

 7          ahead on the condo issue.  What I've tried to 

 8          say in the testimony is right now the 

 9          proposal the state has made, after all the 

10          negotiation with the different players, there 

11          are some very good elements to that proposal, 

12          there are some areas of concern we still want 

13          to talk through.  It is more expensive to the 

14          taxpayer than what we originally proposed, 

15          and it doesn't achieve as much affordability.  

16          But it still has merits, it's still much 

17          better -- hold on one second while I make 

18          this -- much better than what was originally 

19          going on a few years ago with 421-a.

20                 Our concern is not what you have 

21          proposed, which you're right, is outer 

22          borough and for folks of -- I wouldn't say 

23          limited means, but certainly not luxury 

24          apartments.  Our concern centrally is 


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 1          anything that would take us another step back 

 2          toward the old broken 421-a --

 3                 SENATOR GOLDEN:  We don't want to go 

 4          there.

 5                 MAYOR DE BLASIO:  -- which literally 

 6          subsidized pure luxury apartments.

 7                 SENATOR GOLDEN:  I agree with you.  

 8          There is a problem, obviously, there's a 

 9          billion dollars off the street right now.  

10          That money is someplace else.  It's not being 

11          invested in housing.  It's not being invested 

12          in low-income housing.  It's not giving the 

13          city its fair shot.  That money is somewhere 

14          else.  It could be in Philadelphia, it could 

15          be offshore, it's anywhere.  

16                 And the longer it takes us to get that 

17          bill done, the longer that money is off the 

18          street.  We need the people building those 

19          units, we need all of the players at the 

20          table, and we need to close down on this bill 

21          ASAP so we can get that money distributed to 

22          the city for affordable housing.  We cannot 

23          afford to leave this out any longer, sir. 

24                 Okay, I know my time is limited, so 


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 1          that's why I'm running through this.  

 2          Three-quarter disability with the New York 

 3          City Police Department.  The police 

 4          department obviously -- it's a negotiation, 

 5          and the last thing you want to do is get in 

 6          the middle of a negotiation here.  But you've 

 7          got 13,000 or 14,000 police officers out 

 8          there without three-quarter disability.  It 

 9          doesn't make much sense to keep that many 

10          officers out there without disability.  We're 

11          keeping them on the job anyway, so it's 

12          costing us more money than getting them off 

13          on disability.

14                 So I would suggest that we try to come 

15          to a close on that if we can.  I know that 

16          that the NYPD was at 4 percent, you were at 2 

17          percent.  I'm sure somewhere in the middle we 

18          can come to some ground.  I'm sure that the 

19          -- dealing with the -- and I'm not going to 

20          ask you to get involved, I'm just asking you, 

21          as a Senator and as a representative from the 

22          City of New York, that you come to some 

23          resolution on that as soon as possible.

24                 MAYOR DE BLASIO:  Let me give this 


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 1          very brief response.  First of all, Senator, 

 2          in addition to your current public service, I 

 3          thank you for the time you spent as a member 

 4          of the NYPD.

 5                 SENATOR GOLDEN:  Thank you.

 6                 MAYOR DE BLASIO:  And I will just 

 7          state the fact so everyone's clear on it.  We 

 8          have almost every municipal union -- this is 

 9          a striking reality -- almost every municipal 

10          union under contract in New York City, 

11          including every uniformed service union 

12          except the PBA, every other police union -- 

13          which you know there are four others -- 

14          except the PBA.  That's the contract side.

15                 On the disability side, as you know, 

16          we've come to an agreement with our 

17          firefighters, our sanitation workers, and our 

18          correction officers, on the disability plan, 

19          each one tailored to the specific reality of 

20          their department.  All agreed to, all 

21          implemented.  Again, the only place we have 

22          not been able to find an agreement is with 

23          the PBA, and we have sought that agreement, 

24          and we will continue to.  There's a mediation 


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 1          process going on right now.  And I have said 

 2          very clearly that I will do anything and 

 3          everything to work together to see if we can 

 4          come to a positive result.

 5                 But Senator, I just emphasize, we're 

 6          very proud that we have all of our other 

 7          uniformed service workers under contract and 

 8          with the kind of disability plans that are 

 9          fair to them.  We want to continue that 

10          progress.

11                 SENATOR GOLDEN:  Last question before 

12          my cochairs here kill me.  The Brooklyn 

13          hospitals, the hospital Brooklyn 1, have you 

14          been briefed?  Do you understand what's going 

15          on at the state level?

16                 MAYOR DE BLASIO:  I'm sorry, the part 

17          you said a moment -- the hospital --

18                 SENATOR GOLDEN:  In Brooklyn, Brooklyn 

19          North, they're going to have a condensing 

20          four hospitals into a -- similar to what you 

21          have, Health & Hospitals.  I'm not sure, but 

22          I think there's a deficit there of a 

23          billion-plus.  I'm not sure we're not moving 

24          into the same here with the state program.


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 1                 But are you briefed on that with the 

 2          state fully from the Governor's office?

 3                 MAYOR DE BLASIO:  Not fully.  I think, 

 4          from what I know so far, it's an honest 

 5          effort to try and deal with the ever-changing 

 6          realities of healthcare costs, which are 

 7          already in a very difficult place in terms of 

 8          handling it, and only going to get worse if 

 9          the ACA is repealed.  

10                 So I think, from what I've seen, it's 

11          a productive proposal, but I cannot say I've 

12          seen all the details of it.

13                 SENATOR GOLDEN:  I would ask you to 

14          delve into that, because it just -- Kings 

15          County is ground zero when it comes to 

16          healthcare, not just for the city but for the 

17          state and for the nation.  As Brooklyn goes, 

18          so shall the state, so shall this nation.  I 

19          don't want them closing University Hospital, 

20          I don't want them closing any hospitals, 

21          because we need those hospitals open and 

22          available to the people of our communities.  

23                 I'm from Brooklyn South, but if you 

24          close a hospital in Brooklyn North, it 


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 1          affects Brooklyn South, it affects New York 

 2          City, it affects Queens, it affects us all 

 3          the way around.  So if I can, I appreciate 

 4          your indulgence in that.  Thank you.

 5                 MAYOR DE BLASIO:  Thank you.

 6                 CHAIRWOMAN YOUNG:  Thank you, Senator 

 7          Golden.

 8                 SENATOR GOLDEN:  Thank you.

 9                 CHAIRMAN FARRELL:  Thank you.

10                 Assemblywoman Malliotakis.

11                 ASSEMBLYWOMAN MALLIOTAKIS:  Thank you, 

12          Mayor, for being here.

13                 MAYOR DE BLASIO:  Thank you.

14                 ASSEMBLYWOMAN MALLIOTAKIS:  First let 

15          me thank you for investing in the bulletproof 

16          windows for our NYPD patrol vehicles.  I 

17          think that is a wise investment and something 

18          unfortunately, in this day and age, that is 

19          needed.

20                 Additionally, let me say I share your 

21          concern about the senior centers and 

22          potential loss of funding with the shifting 

23          that the Governor is looking to do with the 

24          Title 20 funding that perhaps would take 


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 1          what's discretionary right now to the city 

 2          and move it to a mandate for something else, 

 3          which would be, in this case, childcare, 

 4          which could also be a worthy cause.  But 

 5          again, we don't want to be taking money away 

 6          from our senior citizens.

 7                 So I want to say that I agree with you 

 8          on that and I share your voice in saying to 

 9          the Governor to please leave the Title 20 

10          funding alone.

11                 However, there's one area where you 

12          and I seem to have a disagreement on, and 

13          that is with what has been transpiring over 

14          the last week, the potential for New York 

15          City to be losing billions of dollars in 

16          federal funding if they do not comply with 

17          federal law.  And for the city, this could 

18          potentially mean $7 billion.

19                 Now, as you're aware, the federal 

20          government only issues detainer requests for 

21          individuals who are here illegally under 

22          certain circumstances.  It is limited, it's 

23          not just a blanket if someone is here 

24          illegally or if they merely commit a traffic 


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 1          violation, as you have said in some news 

 2          shows over the weekend.  It's strictly for 

 3          individuals who pose a threat to public 

 4          safety or have previously been convicted.

 5                 Under Local Law 58 and 59, which you 

 6          signed into law in 2014, the city no longer 

 7          complies, necessarily, with detainer requests 

 8          in certain circumstances.  In fact, over a 

 9          two-year period from October 1, 2014, to 

10          September 30, 2016, the city only complied 

11          with 32 out of 584.  And as I mentioned, the 

12          federal government only issues those requests 

13          in certain circumstances:  Someone poses a 

14          threat to the public or has previously had a 

15          conviction.

16                 My issue is why would the mayor of the 

17          City of New York, who is entrusted to protect 

18          the safety of our citizenry, say that they're 

19          not going to comply with these detainer 

20          requests when they're only in certain 

21          circumstances?  So for instance, if an 

22          individual is here, conducts sexual 

23          misconduct, forcible touching, sexual abuse 

24          in the second or third degree, grand larceny, 


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 1          welfare fraud, identity theft -- this is just 

 2          a small list of a much larger list in which 

 3          the city refuses to comply with detainer 

 4          requests from the federal government.

 5                 Why would you protect individuals who 

 6          are here illegally, committing these crimes, 

 7          instead of putting your citizenry first and 

 8          foremost and making -- ensuring that we 

 9          receive the federal funding we need for our 

10          law enforcement to do their job?

11                 MAYOR DE BLASIO:  Assemblymember, I 

12          know you are a true believer in your 

13          ideology, and I am in mine.  And we have very 

14          different facts we're working from, so we're 

15          just going to have to disagree, I think, on 

16          even the premise of the question, in my 

17          opinion.  But let me go piece by piece real 

18          quick.

19                 There are 170 offenses that as a 

20          matter of New York City law, when any of 

21          those offenses is committed, we cooperate 

22          with ICE.

23                 ASSEMBLYWOMAN MALLIOTAKIS:  I agree 

24          with you on that, there are 170.  But there's 


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 1          even more that are not included --

 2                 MAYOR DE BLASIO:  Well, but again, I 

 3          respectfully think that I've seen this 

 4          attempt to confuse the meaning of what we're 

 5          doing.

 6                 If there are some offenses that we 

 7          should add, we are willing to do that always.  

 8          But I would say anyone in good conscience who 

 9          reads that list of 170 offenses -- which is 

10          essentially any act of violence, anything 

11          involving a weapon, anything involving 

12          terror, any major drug offenses, it's quite 

13          comprehensive -- understands the intent is to 

14          protect the safety of all New Yorkers.  And 

15          we will cooperate fully with ICE, and we have 

16          cooperated fully with ICE.

17                 I would disagree with you -- and 

18          again, and I'm willing to add offenses if 

19          they're -- when you come up with a list of 

20          170 offenses, if there were several more that 

21          should be included, I'm perfectly happy to 

22          include them.

23                 But on the point about how ICE makes 

24          its requests, I think it is unfair to say 


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 1          that every one of their requests, even 

 2          previously, let alone under a new 

 3          administration, would track that same notion 

 4          of serious and violent crime.  We have no 

 5          such guarantee.  

 6                 So we are concerned that any 

 7          offense -- in the examples I've given, 

 8          low-level marijuana possession, for example, 

 9          could, in the eyes of ICE, be considered for 

10          deportation.

11                 The problem is we have 500,000 people 

12          in our city, a number of whom are parents of 

13          children or breadwinners for their families.  

14          Now, I would argue, on a humane and moral 

15          level -- and I can certainly say that 

16          Cardinal Dolan has spoken out in the same 

17          vein, and many other faith leaders -- but I 

18          also will tell you on a practical level, from 

19          the point of view of taxpayers, is it right 

20          to deport someone who did a very minor 

21          offense, leave a family without a 

22          breadwinner, leave children without their 

23          parents?  Is that good public policy?  No.

24                 So a final point, on the $7 billion.  


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 1          Respectfully, by the decision of our -- or 

 2          the evaluation of our corporation counsel, 

 3          Zach Carter, former U.S. Attorney, that is 

 4          not a figure that we see any scenario for 

 5          dealing with.  The only -- according to the 

 6          Supreme Court decision in 2012 written by 

 7          Justice Roberts, the current Chief Justice, 

 8          any attempt to cut funding must conform to a 

 9          specific funding stream.  In the executive 

10          order it mentions only two agencies, Justice 

11          and Homeland Security.  The grand total of 

12          their funding to New York City is between 

13          $150 million and $200 million.  And that 

14          means if they went ahead with that, we 

15          believe we can defeat it in court on many 

16          levels.  But let's say it were to happen.  

17          Then the federal government would make a 

18          decision to take away anti-terror funding 

19          from New York City.  I believe they're going 

20          to think twice before doing that, beyond all 

21          the questions of legality.

22                 So talk to Commissioner O'Neill, talk 

23          to police chiefs all around the country, they 

24          will tell you that maintaining the working 


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 1          relationship between immigrant communities 

 2          and police is foundational to public safety.  

 3          That the minute this type of detainer 

 4          situation gets to be much more extensive and 

 5          based on much more minor offenses, it will 

 6          shut down the willingness of undocumented 

 7          folks to speak to police officers for fear of 

 8          deportation.  It will make us all less safe.  

 9          That's the belief structure we're working 

10          from.

11                 ASSEMBLYWOMAN MALLIOTAKIS:  Well, I 

12          think that we can be compassionate and at the 

13          same time look at protecting our citizens.  

14          And I think there is an issue here.  Because 

15          when violent and serious crimes -- that's the 

16          only case in which -- what the city defines 

17          violent and serious crime, that's the only 

18          case in which the city will comply.  But 

19          there's a whole slew of other crimes.

20                 And you asked for suggestions, so 

21          sexual misconduct, forcible touching, sex 

22          abuse in the second and third degree --

23                 CHAIRMAN FARRELL:  Your microphone's 

24          off.


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 1                 ASSEMBLYWOMAN MALLIOTAKIS:  -- grand 

 2          larceny, welfare fraud, and identity theft, 

 3          all crimes that currently an individual can 

 4          commit and the city will refuse to comply 

 5          with a detainer request.  I think that's 

 6          something we need to look at and make sure 

 7          our priorities are focused on ensuring public 

 8          safety -- and making sure that we're 

 9          complying with the federal law so we get the 

10          $7 billion dollars, because we can't afford 

11          to lose that.

12                 MAYOR DE BLASIO:  Again, I'd just 

13          really quickly -- Assemblymember, I think 

14          those are two separate concepts.  I think we 

15          believe that the executive order, on its 

16          face, is contradictory and attempts to do 

17          things beyond that which the Supreme Court 

18          has allowed.  And we're going to challenge it 

19          if -- if there's an effort to even take away 

20          funding.  Until that time, it's abstract.  

21          But we will challenge it in court, and I know 

22          a number of other cities and states will as 

23          well.

24                 The last time we had a scenario like 


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 1          that, it was President Obama's executive 

 2          action on immigration, which you remember was 

 3          challenged in court by states and ultimately 

 4          defeated.  So we remind people of that 

 5          history.

 6                 But I would caution, you list in good 

 7          faith a number of offenses you believe are 

 8          not included.  I would like our lawyers to 

 9          talk to you to show you how we constructed 

10          the 170 offenses, because I think they do 

11          overlap with some of the categories you've 

12          talked about.  I think there are some, and 

13          you mentioned, that I believe are not on our 

14          list and deserve full consideration, and 

15          we'll work with you on that.  

16                 I think there are others -- because if 

17          you look on all sorts of areas of sexual 

18          abuse, for example, that clearly delineate a 

19          number of offenses, I believe we are 

20          addressing those issues.  But I will 

21          certainly want a dialogue to see if there's 

22          areas we should add.

23                 ASSEMBLYWOMAN MALLIOTAKIS:  I 

24          appreciate that.  


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 1                 First, sexual abuse in the first 

 2          degree is included on your list, but second 

 3          and third degree are not, so I appreciate you 

 4          -- and we'll continue the dialogue.

 5                 MAYOR DE BLASIO:  Thank you.

 6                 CHAIRMAN FARRELL:  Thank you.

 7                 Senator?  

 8                 CHAIRWOMAN YOUNG:  Our next speaker is 

 9          Senator Squadron.

10                 SENATOR SQUADRON:  Thank you very 

11          much, Chairs.

12                 Thank you, Mr. Mayor.  And actually, I 

13          extend that with some specific ones in the 

14          last year.  The city has expended significant 

15          funds to make good on the prior 

16          administration's promise to make Bushwick 

17          Inlet Park a reality, $160 million.  

18          Greenpoint and all of the city really 

19          appreciate that.  It shows that a promise can 

20          be kept; sometimes it takes the next 

21          administration, but it can.

22                 You referenced design-build earlier, 

23          which -- for the BQE process, which is going 

24          to cut like a scar through my district for a 


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 1          number of years.  The city, I want to point 

 2          out, is funding $1.7 billion of that rehab, 

 3          which is a hundred percent of the funding.  

 4          We appreciate that quite a bit.

 5                 And on resiliency in Lower 

 6          Manhattan -- Assemblymember Niou is also here 

 7          and has already started that fight.  The city 

 8          has put in significant funding, well over 

 9          $100 million, towards a continuous storm 

10          barrier from 23rd Street around the tip of 

11          Lower Manhattan and back around.  We still 

12          have a gap, and we want to continue working, 

13          but your resilience folks have been strong on 

14          that.  Last year's budget was an investment.  

15                 We appreciate all of those things.  

16          There's no question, in that, just a number 

17          of thank yous.

18                 I do, though, want to talk about 

19          Rivington House briefly, which is also in my 

20          district.  I think many here have heard of 

21          it.  In December I sent a letter to the 

22          corporation counsel suggesting that based on 

23          the administration's comments on Rivington 

24          House, it appeared from the public record 


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 1          that there could potentially be a False 

 2          Claims Act case to pursue here.

 3                 And just to take you through it, in 

 4          September Deputy Mayor Shorris used the term 

 5          "deceptive practices."  Last March, former 

 6          Press Secretary Hinton said Allure misled the 

 7          city.  In July of 2016, Deputy Mayor Shorris 

 8          said that he believed the sellers intended to 

 9          keep it as a nursing home.  

10                 I'll continue.  Mr. Mayor, you in 

11          August said that "They misled us."  In 

12          September, you called them "unscrupulous 

13          developers looking to make a buck."  And 

14          we've already spoken about housing here.  In 

15          April, you said "We are looking at all legal 

16          options because there's a lot of evidence 

17          they misled us."  In April, again, you 

18          reiterated that.

19                 Unfortunately, since I sent the letter 

20          on the False Claims Act, the only comment in 

21          response from the administration -- and this 

22          is unfortunately sometimes a pattern -- was 

23          at a press conference where you dismissed the 

24          entire thing out of hand as a simple press 


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 1          release.

 2                 Well, the letter is here, it's quite 

 3          substantive.  We have no idea what hasn't 

 4          been shared with the public, because it 

 5          hasn't been shared with the public.  Based on 

 6          what has, the Lower East Side community has 

 7          good reason to believe a False Claims Act 

 8          case, with treble damages, could move 

 9          forward.  

10                 We appreciate the moderate investment 

11          to replace what happened at Rivington House 

12          from the city, but it's moderate.  It does 

13          not replace Rivington House.  Treble damages 

14          on a False Claims Act could have a 

15          significant impact.  Why did you dismiss that 

16          out of hand, and why isn't the city pursuing 

17          a False Claims Act case on the Rivington 

18          House --

19                 MAYOR DE BLASIO:  Senator, look, you 

20          and I have worked together for a long time, 

21          and I know you put forward the suggestion in 

22          good faith.  I may have been speaking out of 

23          frustration; I didn't mean to make that too 

24          personal.  I apologize for that.


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 1                 But clearly, all the quotes you read 

 2          were based on a very heartfelt anger at what 

 3          the developer did, and a sense that the 

 4          people were cheated.  And you know me, I have 

 5          a lot of concerns about some of the ground 

 6          rules in our laws related to the free 

 7          enterprise system that I think are overly 

 8          generous.  I would love nothing more than to 

 9          find a way to recoup what has been done to 

10          the community.

11                 But respectfully, long before your 

12          letter, I have asked this question probably 

13          two dozen times of my corporation counsel, 

14          who goes back and looks constantly for a 

15          pathway and cannot find it, one that he 

16          believes will legally be effective.  We're 

17          not going to bring an action if we believe 

18          it's susceptible to immediate defeat.

19                 So if you know something we don't 

20          know, I will directly arrange for a 

21          conversation between you and Zach Carter.  If 

22          you've found a path we haven't, I will thank 

23          you publicly and we will implement it.  But 

24          to date, we have not found a way to recoup 


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 1          that, and it angers me deeply.

 2                 What I can say is because we have 

 3          changed our administrative approach, you know 

 4          now that no such action can be taken without 

 5          my personal signature.  And if this had been 

 6          presented to me, I would have turned it down, 

 7          you know, faster than I can finish this 

 8          sentence.  And the City Council has passed 

 9          laws to regulate the process going forward.  

10          There's not going to be another situation 

11          like this.  But I would love to get the 

12          resources back; I just don't know how.

13                 SENATOR SQUADRON:  Mr. Mayor, to be 

14          clear, I don't have any information the city 

15          doesn't have.  That's the problem.  All I 

16          have is the extensive public record that I 

17          read, plus the report of the Attorney 

18          General and, you know, executive news reports 

19          about multiple ongoing investigations at lots 

20          of levels and the report of the City 

21          Comptroller on it.

22                 But, you know, the False Claims Act is 

23          pretty clear.  It uses very similar language 

24          to the language we've seen out of the 


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 1          administration.  And what I would urge and 

 2          request, respectfully, is that if there's 

 3          something you know that we don't, you share 

 4          it with us.  Because it frankly leads to 

 5          questions when there's this very strong 

 6          public outcry at the highest levels of the 

 7          administration accusing them of misleading 

 8          around the amount they were paying for a deed 

 9          restriction that, you know, in everyone's 

10          intent would have required a healthcare 

11          facility, though a for-profit one.  And, you 

12          know, to just be told "We agree, but we 

13          can't" is not sufficient for a community 

14          that's still smarting from the loss of a 

15          healthcare facility.

16                 MAYOR DE BLASIO:  Well, Senator, look, 

17          I think it's absolutely fair to say it would 

18          be helpful to your community to delineate our 

19          legal understanding.  We can certainly do 

20          that.  

21                 You know, in addition to the reforms 

22          to make sure that no such incident happens 

23          again, that we have made major commitments to 

24          the community to try to in some way make up 


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 1          for what was lost.  You know that the 

 2          Rivington facility had gone through changes 

 3          and was being used less than it had in the 

 4          past.  But we've committed to a nursing 

 5          facility, as part of our Health and Hospitals 

 6          system, that will help low-income seniors in 

 7          your community, as one way to try and give 

 8          back some of what was lost.  And that is a 

 9          good-faith effort.

10                 But the whole episode -- I've been so 

11          angry since this happened, angry for all of 

12          us.  And as Attorney General Schneiderman 

13          pointed out in his report, it's quite clear 

14          these developers attempted to game the 

15          system.  And I wish they would pay for that.  

16          And you've noted in other situations we have 

17          not done business with them.

18                 But right now, we will look under 

19          every stone.  If you can help us find a 

20          better approach, if we have a legal leg to 

21          stand on, we will go for it.

22                 SENATOR SQUADRON:  And I do hope that 

23          the corporation counsel or the mayor's office 

24          does respond with exactly that legal 


                                                                  157

 1          delineation of why a False Claims Act is not 

 2          appropriate here, sooner rather than later.  

 3          I think we would really appreciate it.

 4                 And thank you for the time and for 

 5          those other items.

 6                 MAYOR DE BLASIO:  Thank you.

 7                 CHAIRWOMAN YOUNG:  Thank you, Senator 

 8          Squadron.

 9                 CHAIRMAN FARRELL:  Assemblywoman 

10          Hopper -- Hooper.

11                 UNIDENTIFIED SPEAKER:  Hooper.

12                 CHAIRMAN FARRELL:  Hooper, I'm sorry.  

13                 ASSEMBLYWOMAN HOOPER:  I didn't 

14          recognize the name.

15                 (Laughter; off-the-record comments.)

16                 ASSEMBLYWOMAN HOOPER:  I'm sorry, 

17          Mr. Chair, I didn't recognize the name.  When 

18          you said Hopper, I thought we had a new 

19          member.

20                 CHAIRMAN FARRELL:  If I kept going, 

21          I'd get the right one.

22                 ASSEMBLYWOMAN HOOPER:  All right, 

23          thank you.  

24                 Before I ask the esteemed mayor maybe 


                                                                  158

 1          just one question, really, I'd like to 

 2          acknowledge Dean Fuleihan, whom you had the 

 3          wisdom to take into your administration.  

 4                 And Dean, remember, I always told you 

 5          it doesn't matter where you go, I shall 

 6          always find you.  Welcome to Albany.

 7                 MAYOR DE BLASIO:  I think that was 

 8          heartfelt.  

 9                 (Laughter.)

10                 ASSEMBLYWOMAN HOOPER:  It was 

11          heartfelt, yes.  Dean and I had a strong, 

12          wonderful working relationship.  And one of 

13          the brightest men and one of the brightest 

14          persons I've had the privilege to work with.  

15          And you're really blessed to have him aboard.

16                 My question to Mayor de Blasio relates 

17          to something that definitely has an impact on 

18          Nassau County, from where I hail.  Anything 

19          that happens in New York City definitely has 

20          an impact throughout the state.  And as we 

21          have witnessed over the past few hours, the 

22          President has taken positions that are quite 

23          unusual as it relates to what we do in the 

24          United States, generally speaking.  I'm 


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 1          waiting for the other shoe to fall.  

 2                 And this question is seeking from you 

 3          an opinion as it relates to the unaccompanied 

 4          undocumented illegal youths who arrived in 

 5          this nation and specifically New York State 

 6          in the school year 2015-2016.  In the school 

 7          district in Hempstead, Nassau County, we have 

 8          probably the highest number of undocumented 

 9          unaccompanied youth outside of New York City.  

10                 And I would like to know if you would 

11          share with me what type of plans would you 

12          have when the President, from what I 

13          understand, will be initiating the removal of 

14          these youth from the United States.  How 

15          would you respond to that, so that we might 

16          have some idea of how we should respond when 

17          this -- I anticipate very shortly that the 

18          President will present an executive order to 

19          remove these young people.  Could you share 

20          that with me, please?  

21                 MAYOR DE BLASIO:  Yes, absolutely, 

22          Assemblymember.  I thank you for the 

23          question.  It's one of the most powerful 

24          questions before us as a nation right now.


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 1                 Look, I raised this concern to the 

 2          President when I met with him, and it was --

 3                 ASSEMBLYWOMAN HOOPER:  Excuse me, you 

 4          said you raised that specific issue?

 5                 MAYOR DE BLASIO:  The concern about 

 6          the --

 7                 ASSEMBLYWOMAN HOOPER:  About the 

 8          children?

 9                 MAYOR DE BLASIO:  You can call them 

10          Dreamers, you can call them DACA children, 

11          whatever way you want to call them.

12                 ASSEMBLYWOMAN HOOPER:  Yes, the DACA 

13          children.

14                 MAYOR DE BLASIO:  The way we talked 

15          about it was specifically about children who 

16          came here not of their own choice, grew up 

17          here, essentially, have only known America, 

18          and in many instances would have no 

19          connection to the country they came from.  

20          And at that moment in the discussion with the 

21          President, then President-Elect, the then 

22          Senator, now Attorney General, Mr. Sessions, 

23          participated in the conversation.  

24                 And I spoke very explicitly about the 


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 1          impact that it would make on children and 

 2          families to have these children deported, 

 3          what it would mean morally, what it would 

 4          mean humanly, what it would mean for the 

 5          families left behind, what it would mean 

 6          again for the relationship with our police in 

 7          communities.  We went into great detail.  

 8                 I will not typify the President -- 

 9          then President-elect, now President Trump's 

10          response.  But I will say that I think he 

11          recognized that this was a different part of 

12          the reality than the larger immigration 

13          debate.  And he has made several statements 

14          since becoming president that suggest he may 

15          treat those eligible for DACA differently.  

16          Now, I do not want to assume anything, 

17          especially given what I see as the extremism 

18          of the recent executive orders.  But I'm 

19          going to hold out hope that there will be 

20          some understanding in the new administration 

21          that those children should be treated, 

22          unquestionably, as you would any other 

23          American, because that's the only thing 

24          they've known, the vast majority of them.  


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 1          And a lot of them are contributing greatly to 

 2          our nation right now and have great promise 

 3          and should be treated as children of promise 

 4          who love this country.  

 5                 So I'm going to offer that as, I hope, 

 6          an indicator of something that may turn out 

 7          better than we fear.  

 8                 In the event it does not, we will 

 9          actively engage in any legal action we can, 

10          working with other cities and states -- and I 

11          know many will join -- to stop any effort to 

12          deport our Dreamers.  

13                 And we will also, as we've started to 

14          do in New York City, provide legal assistance 

15          to help families not be torn apart.  Again, 

16          this is moral, and some of our faith leaders 

17          are speaking out deeply on this.  In fact, 

18          the U.S. Conference of Bishops is meeting 

19          here on an emergency basis to address this 

20          crisis, because they believe as Pope Francis 

21          believes, that all immigrants should be 

22          respected wherever they are in the world.  

23                 But it's also a very practical 

24          challenge.  Because the minute Dreamers are 


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 1          deported in any appreciable numbers, that 

 2          will be the final straw, again, in the 

 3          relationship between police and community.  

 4          It also will leave many families without a 

 5          breadwinner and start to force more and more 

 6          responsibility for those families onto 

 7          taxpayers.  It's a very slippery slope.  

 8                 So our best option, if we do get to 

 9          that moment, is to, one, fight legally with 

10          all the tools we have, and, two, provide 

11          individual support for those families to try 

12          and stop those individual deportations.  

13                 ASSEMBLYWOMAN HOOPER:  I really 

14          appreciate the position that New York City 

15          has taken.  As you are aware, we in the 

16          Assembly have been working diligently to 

17          address the issues of the Dreamers.  But 

18          specifically I'm speaking about what I 

19          believe I heard, or maybe read, that the 

20          President has indicated that anyone who has 

21          come here and has used his or her information 

22          fraudulently -- in other words, the wrong 

23          address or illegal information -- I'm 

24          thinking now about the youth who came here 


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 1          who were unaccompanied, without adults, who 

 2          have been here less than two years and are in 

 3          elementary school.  

 4                 In the Village of Hempstead, we have a 

 5          very large influx of those youth, as well as 

 6          in the Roosevelt School District.  And I 

 7          assume that you have that representation also 

 8          in the City of New York.

 9                 With the Dreamers and those who have 

10          been here, they have not -- they do not have 

11          a history of any other place except the 

12          United States.  But these young children who 

13          came unaccompanied, undocumented, have been 

14          here less than 24 months, how would you 

15          address that should your President decide to 

16          say that because they used an address that 

17          was really not a legal address, or an 

18          incorrect address, and they are using funds 

19          that are somehow or another directed from the 

20          federal government into the school district, 

21          how would you -- how could you suggest that 

22          we address that issue if those youth are 

23          being attempted to be removed?  I'm talking 

24          about children under the age of 18.


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 1                 MAYOR DE BLASIO:  Right.  Yeah.  I 

 2          think it's the same -- I think it's -- you're 

 3          raising an important piece of the equation.  

 4          I think it's the same response, that the 

 5          bottom line in whatever technicality is used, 

 6          it still will mean a family torn apart, which 

 7          none of us who are in public service should 

 8          be party to, and it means a lot of unintended 

 9          consequences.

10                 I think we need to recognize and just 

11          broaden the point, there's 11 or 12 million 

12          people in this country.  And the fact that 

13          for years and years, a lot of Republicans, 

14          including Ronald Reagan, tried to find 

15          constructive ways to acknowledge that reality 

16          and work with it in a positive, appropriate 

17          path forward rather than try mass 

18          deportation.  

19                 And it is -- you know, we've obviously 

20          heard at moments in the campaign, the -- 

21          Candidate Trump said some very shocking 

22          things, including at one point praising a 

23          deportation effort from the 1950s that was a 

24          truly mass deportation initiative.


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 1                 But look, it's important that he had 

 2          to go all the way back to the 1950s.  That if 

 3          you go from the 1960s to present, Democrats 

 4          and Republicans alike did not attempt mass 

 5          deportation.  In fact, President Reagan 

 6          attempted to find some kind of way to address 

 7          the issue at its root.  

 8                 I think the answer is the same either 

 9          way, to try and use every legal recourse we 

10          have and to try and support those individual 

11          families -- because, otherwise, a lot of 

12          families torn apart, a lot of 

13          responsibilities that will then fall on 

14          localities that aren't able to handle it as 

15          families are torn apart.

16                 ASSEMBLYWOMAN HOOPER:  Thank you.  

17          Lastly --

18                 CHAIRMAN FARRELL:  Thank you.

19                 ASSEMBLYWOMAN HOOPER:  Just one last 

20          question?  Oh, I'm out of time.  I'll ask you 

21          later.  Thank you.

22                 MAYOR DE BLASIO:  Thank you.  

23                 CHAIRMAN FARRELL:  Thank you.

24                 CHAIRWOMAN YOUNG:  Thank you.  


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 1                 Senator Persaud.

 2                 SENATOR PERSAUD:  Thank you.  Thank 

 3          you, Mr. Mayor, for being here so that we can 

 4          discuss issues affecting New York City in 

 5          particular.  

 6                 You mentioned that you will be 

 7          unveiling a new comprehensive program to deal 

 8          with the homeless population.  As we know, 

 9          last November our studies showed that 

10          New York City had the highest number of 

11          homeless people ever.  Most of the people, 

12          particularly the individuals who are living 

13          on the streets, are there because of mental 

14          illnesses.  

15                 In this comprehensive plan that you 

16          will unveil, will you have an aggressive plan 

17          to deal with the mental health issues of the 

18          homeless population?  

19                 MAYOR DE BLASIO:  Senator, thank you.  

20          And the quick answer is yes, that that piece 

21          of the equation is already in motion.  I 

22          think you're pointing out something we have 

23          to discuss more in the discussion on 

24          homelessness.  


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 1                 There are two fronts in this battle:  

 2          Street homelessness, meaning absolutely, 

 3          permanently, 24-hour permanently homeless 

 4          folks who, depending on the survey that's 

 5          taken, typically number between 3,000 and 

 6          4,000 people.  Which is obviously too big a 

 7          number, but is nowhere near the number of 

 8          folks in a shelter.  And when we talk about 

 9          street homeless, we have to exclude 

10          panhandlers who have a home, we have to 

11          exclude people who have a shelter but go out 

12          during the day and hang out on the street.  

13                 The real core of that problem you 

14          indicate is 3,000 to 4,000 people.  They need 

15          mental health services, they need substance 

16          misuse services.  Overwhelmingly, they are 

17          there because of one of those two problems.  

18                 And now through the HOME-STAT 

19          initiative, the most intensive outreach 

20          effort in the history of the city or any 

21          city, 700 of them since March have come in 

22          and accepted services and not gone back out, 

23          which is a very promising sign.

24                 On the other side, the other battle is 


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 1          on homelessness that takes the form of folks 

 2          ending up in a shelter.  That's, today, just 

 3          over 60,000 people.  It was higher a few 

 4          months ago, thank God has come down a little.  

 5                 Those folks increasingly are families, 

 6          increasingly because of economic reasons, not 

 7          mental health or substance reasons, 

 8          increasingly are working people or people who 

 9          recently were working.  And that has all to 

10          do with the growing cost of housing in the 

11          city and the lack of good-paying jobs.

12                 That's what we're focused on now.  And 

13          so that plan that will come out will 

14          particularly focus on the shelter population, 

15          because the thrust in terms of street 

16          homelessness -- we've seen great success with 

17          HOME-STAT, we're seeing great success with 

18          the Safe Haven Program, which is finding 

19          smaller facilities that people would come 

20          into off the street.  

21                 We're seeing great success with the 

22          NYPD playing a leadership role now, 

23          supervising and managing safety and security 

24          in our shelters.  That's having a real 


                                                                  170

 1          impact.  We think that will help get more 

 2          people off the street.  

 3                 And we now have the biggest mental 

 4          health initiative we've ever had, the Thrive 

 5          program that my wife initiated, which means 

 6          that we have much more available for people 

 7          who need mental health services, when they do 

 8          come off the street, we have more options for 

 9          them now.

10                 So I think you'll see in the plan a 

11          lot of strength on the street homelessness 

12          side, a lot more we have to do and do better 

13          on the shelter homelessness side.

14                 SENATOR PERSAUD:  Okay, another thing 

15          on the homeless.  I had the opportunity to 

16          tour a site, a homeless shelter, a couple of 

17          weeks ago.  And the underlying complaint that 

18          many of them had was about getting an 

19          apartment.  They have vouchers, but the 

20          owners and landlords are not willing to 

21          accept the vouchers.  

22                 What is the city doing to stress to 

23          the landlords to accept vouchers so that we 

24          can remove these people who have the means of 


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 1          getting into an apartment, to get into an 

 2          apartment?  

 3                 And landlords are also saying that 

 4          when they accept vouchers, if the client no 

 5          longer pays their portion of it, they're left 

 6          without funding.  What is the city doing to 

 7          let landlords understand that they will not 

 8          be left high and dry?  

 9                 MAYOR DE BLASIO:  Two crucial 

10          initiatives.  First, I had the honor when I 

11          was in the City Council to be the author of 

12          legislation which banned discrimination 

13          against Section 8 holders and other folks who 

14          got income from affordable housing programs.  

15          That was very important because a lot of 

16          people were being turned away simply because 

17          their own government said, You qualify, 

18          here's support -- they were being turned away 

19          literally because they had that support.  

20          That is now illegal in New York City.  We've 

21          intensified enforcement of that.  Our Human 

22          Rights Commission has been beefed up to be a 

23          stronger player in that enforcement.

24                 Second, I've met personally with some 


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 1          of the leading landlords who provide housing 

 2          for folks with Section 8 and other programs.  

 3          I have told them my personal commitment, 

 4          which we've stayed true to.  I've told them 

 5          that unlike the past, when Advantage was 

 6          canceled -- which I think was the biggest 

 7          single mistake in the history of homelessness 

 8          in New York City, and that was April 2011.  

 9          At that point there were about 36,000 people 

10          in shelter.  By the end of the Bloomberg 

11          administration, there were 50,000 people in 

12          shelter.  And the linear connection between 

13          the choice to end Advantage and that huge 

14          uptick, April 2011 to December 2013, you can 

15          see it right there, is because of the loss of 

16          Advantage.  

17                 That also burned a lot of landlords 

18          who had been told they could depend on it.  

19          When I came in, I met with a lot of them, and 

20          my senior leaders of the administration have 

21          met with them, to say we believe in these 

22          subsidy approaches, rental assistance 

23          approaches, they have worked, they're much 

24          better for the taxpayer.  


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 1                 The taxpayer saves a huge amount of 

 2          money with a subsidy rather than somebody 

 3          ending up in a shelter.  Remember, the cost 

 4          of a family in shelter is now, for a year, 

 5          pushing $40,000.  A rental subsidy is nowhere 

 6          near that.  

 7                 So I've made clear to those landlords 

 8          that we are there for the long haul.  And I 

 9          think they've heard it.  But we have more 

10          work to do to convince them.  

11                 What I can say is that under previous 

12          administrations, the follow-through with 

13          landlords was very shoddy by the government.  

14          They had every right to say that the 

15          inspections took too long, the reimbursements 

16          took too long.  We've made major strides in 

17          fixing those problems and showing them that 

18          we will not let the bureaucracy stand in the 

19          way of them getting the resources they 

20          deserve.

21                 SENATOR PERSAUD:  Thank you very much.

22                 CHAIRWOMAN YOUNG:  Thank you.

23                 CHAIRMAN FARRELL:  Thank you.  

24                 Assemblyman Castorina.


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 1                 ASSEMBLYMAN CASTORINA:  Thank you, 

 2          Mr. Mayor, for being here.  

 3                 Thank you, Chair.

 4                 I have two very brief questions.  The 

 5          first is with respect to mayoral control of 

 6          the schools.  We had a vote last year, I 

 7          voted no.  Which is unusual, because I am 

 8          very much in favor of mayoral control.  I 

 9          think it's a good plan, it's a good model.  

10          But what concerns me is that throughout the 

11          time that we've had mayoral control in the 

12          City of New York, there's been lots of 

13          opportunity for people to criticize the way 

14          it's been implemented and to talk about the 

15          structure, and there's been so many 

16          opportunities for the city to hear these 

17          concerns.  But it doesn't appear as though 

18          anything has been done.  

19                 And particularly my concern is that 

20          the board itself essentially operates as a 

21          rubber stamp for the mayor.  There's no real 

22          autonomy.  And so I'd like for you to speak a 

23          little bit about that.

24                 And then the second question relates 


                                                                  175

 1          to the issue that my colleague Assemblymember 

 2          Malliotakis brought up.

 3                 MAYOR DE BLASIO:  Sure.  On the first 

 4          point, Assemblyman, I appreciate the 

 5          question.

 6                 Assemblyman, there is a reason why so 

 7          many business leaders in New York City 

 8          support mayoral control.  People are 

 9          absolutely, adamantly focused on the bottom 

10          line and the future of our city and our 

11          workforce because of the simple -- I'll give 

12          you the easiest statistic in the world.  The 

13          day that Mayor Bloomberg achieved mayoral 

14          control, which I praised at the time and have 

15          praised ever since, our graduation rate was 

16          under 50 percent.  Today our graduation rate 

17          is over 70 percent.  That was achieved in 

18          less than 15 years, and we are aiming for 

19          80 percent over the next eight years.  And 

20          we're going to get there.

21                 Our test scores have continually gone 

22          up.  We are now essentially equivalent with 

23          the rest of the state in terms of where we 

24          stand on graduation rate and in many ways are 


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 1          getting close on test scores.  These were 

 2          inconceivable ideas -- I was a school board 

 3          member in my communities in Brooklyn in the 

 4          beginning of the 2000s.  If you had told me 

 5          that we could make that kind of progress in 

 6          this kind of time, I would have told you, 

 7          Wow, you're a dreamer, that's impossible.  

 8          But it happened because it was a better 

 9          system.  And I commend Mayor Bloomberg and I 

10          commend my colleagues in the business 

11          community who have stood with us every step 

12          along the way.

13                 The bottom-line question you raised 

14          about autonomy, I can tell you there have 

15          been many times, many times when the members 

16          of the PEP have rejected a proposal that came 

17          forward in the initial discussion, and that 

18          it had to be modified to meet their concerns.  

19          There have been times when a proposal was 

20          agreed upon and then, in the debate at the 

21          meeting, was rejected.

22                 Now, with all due respect to my 

23          predecessor, you may remember on the question 

24          of social promotion when he had some members 


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 1          vote against his proposal, he removed them 

 2          the same day.  That's not how I have 

 3          operated.  I have said I'm naming good people 

 4          with diverse views, and I expect them to 

 5          exercise their judgement.  And they've pushed 

 6          back many a time, and they've voted things 

 7          down, and they're still in their seat.

 8                 So I think we've improved upon the 

 9          dynamics of the original iteration.  

10          Remember, and I say this with real respect 

11          for my predecessor -- I always had 

12          disagreements too -- but he had his own brand 

13          of mayoral control.  I've tried to make it 

14          more responsive to checks and balances and 

15          more responsive to parents as a public school 

16          parent myself, which is obviously something 

17          that's very different from my predecessor.  I 

18          lived it with my own kids, I was a school 

19          board member.  I think we've made progress.  

20                 But the number-one thing I want to say 

21          as you consider your vote this year, I think 

22          you rightfully demand of us results.  The 

23          best measures, literally the very best 

24          measures, graduation rate and test scores, I 


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 1          can show you chapter and verse why we keep 

 2          succeeding.  And those numbers are going to 

 3          continue to improve.  That's helping kids' 

 4          lives.  

 5                 But if I didn't have the ability to 

 6          make things happen quickly -- this is a story 

 7          of pre-K too.  The only reason, with your 

 8          support, we moved pre-K in two years from 

 9          20,000 to 70,000 kids -- we could never have 

10          done that without mayoral control.  It would 

11          have taken a decade or more.  

12                 I just ask that you consider that, 

13          because I know -- and we come from different 

14          parties.  That doesn't mean we can't find 

15          common ground.  I know you want efficient 

16          government, I know you want the taxpayers' 

17          needs to be respected --

18                 ASSEMBLYMAN CASTORINA:  And 

19          transparency.

20                 MAYOR DE BLASIO:  Right.  I think we 

21          have it with mayoral control in a way we 

22          never had in the past.

23                 ASSEMBLYMAN CASTORINA:  I'm likewise 

24          concerned about the fiscal implications of 


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 1          the City of New York deciding not to follow 

 2          an executive order of the President.  I think 

 3          it's wrong, I think it's -- In fact, I think 

 4          it would be illegal.

 5                 Instead of going forward and digging 

 6          in on the notion of sanctuary cities, why not 

 7          reach out to the administration and talk 

 8          about a real pathway to citizenship?  Why not 

 9          focus resources in that direction as opposed 

10          to this face-off of sorts?  Which is 

11          certainly only going to create more acrimony, 

12          may put the city at risk for losing billions 

13          of dollars in federal aid, and also the fact 

14          that the notion of a sanctuary city creates 

15          really a second-class citizen of sorts, 

16          people that have to live in the shadows, 

17          people that have to operate in a different 

18          economy at times.  And it would make more 

19          sense, I think, from a humane, from a moral 

20          perspective, that we work toward a pathway to 

21          citizenship for these undocumented folks.  

22                 And I wonder if you have had the 

23          opportunity to speak with either the 

24          President-elect or the President about this 


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 1          issue, and if you plan on doing so.

 2                 MAYOR DE BLASIO:  I would happily 

 3          engage in that conversation.  I began that 

 4          conversation when he was President-elect, and 

 5          when it was Senator Sessions, by describing 

 6          what we are doing in New York City.

 7                 I think the term "sanctuary city" is 

 8          being used very broadly, and I think we need 

 9          to reevaluate the understanding of that 

10          concept because it's different in lots of 

11          different places, first of all.  And 

12          secondly, I don't think it gets to the heart 

13          of the matter.

14                 Back I think as far as Ed Koch, New 

15          York City made a decision that for public 

16          safety reasons alone, we could not create a 

17          dynamic where our undocumented immigrants 

18          feared talking to the police if they saw a 

19          crime or were a victim of crime.

20                 This is a reality all over this 

21          country when you talk about 11 million or 

22          12 million people.  We at the local level 

23          have to make decisions what to do with the 

24          reality as we have received it.  We didn't 


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 1          create the immigration reality -- it 

 2          occurred, and now we have to deal with it.  

 3                 What we've seen is consistency by 

 4          local leaders of both parties.  We have seen 

 5          this from police chiefs all over the country, 

 6          we've seen it with faith leaders all over the 

 7          country.  The common thread in all regions of 

 8          the country has been to recognize that if we 

 9          are cutting off communication between police 

10          and immigrants, it has very dangerous 

11          ramifications for public safety.  And if we 

12          end up in a situation where people are 

13          deported -- again, breadwinners deported, 

14          parents deported, children left behind -- 

15          immoral, in my view, but from a practical 

16          point of view, of course the taxpayer is 

17          going to be left holding the bag, and in a 

18          situation that creates huge human pain.  

19                 So this is very practical.  "Sanctuary 

20          cities" as a phrase suggests something 

21          ideological.  That's why I don't tend to use 

22          it.  I come to a very practical place.  Now, 

23          Mayor Koch felt this, Mayor Dinkins felt 

24          this.  Famously, Mayor Giuliani felt it and 


                                                                  182

 1          explicitly continued for eight full years 

 2          that concept as a practical matter.  And so 

 3          on, Mayor Bloomberg and straight through to 

 4          me.

 5                 I think we have to look at that and 

 6          understand -- and this is why I talked to 

 7          President Trump -- that that's a reality.  

 8          And I urged him to talk to the police chiefs 

 9          of the nation -- Commissioner O'Neill has 

10          spoken out, Chief Beck in L.A. has spoken 

11          out, many other cases.  I said, "Let's take 

12          it away from the politicians.  Talk to the 

13          police chiefs and seek their guidance, I 

14          guarantee you they will tell you this is a 

15          dangerous situation that cannot be acted on 

16          too precipitously."

17                 Now, as for a path to citizenship, I 

18          agree with you, that's what we should get the 

19          conversation back to.  There can be 

20          differences, but I think again you've noticed 

21          a bipartisan trend up through the last few 

22          years of both sides looking for a solution 

23          that did involve a pathway to citizenship.

24                 ASSEMBLYMAN CASTORINA:  It's 


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 1          pragmatic, I agree.

 2                 MAYOR DE BLASIO:  It's in everyone's 

 3          interest.  And I believe in comprehensive 

 4          immigration reform with a pathway to 

 5          citizenship.  There are plenty of Republicans 

 6          who have told me privately they do too -- 

 7          different iterations, but they do too.

 8                 I think we should get the conversation 

 9          back there.  We're going to use everything 

10          we've got to work with everyone in Washington 

11          to reframe the conversation back to that 

12          core, root problem.  

13                 But I will tell you that I referred 

14          explicitly in my conversation with the 

15          President-elect and the then-Senator Sessions 

16          to the 170 offenses that we fully cooperate 

17          with ICE on.  And I said I think this might 

18          be a helpful model for getting past it, 

19          because I don't think anyone can debate that.  

20                 And I can have a respectful 

21          disagreement with your colleague on whether 

22          we've gotten exactly the right 170, but I 

23          think we all agree on those 170.  Forget if 

24          you say there's more or you think we should 


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 1          add -- I think if you look at those 170, 

 2          though, you'll find nothing there you would 

 3          say to take away.  I think if that were the 

 4          concept all over the country, let's get to 

 5          some unity and bipartisanship.  We all should 

 6          agree on that.  And if New York City could do 

 7          it, anywhere could do it.  Then we could also 

 8          open the door to a better discussion around 

 9          respecting the kids who qualify for DACA who 

10          really are different than the people who made 

11          the decision to come here, and a different 

12          discussion about what would a pathway to 

13          citizenship look like for anyone who's here 

14          and what they would have to do to qualify for 

15          it.  That would be healthier.  

16                 Finally, to your opening point, we do 

17          not see this as an act of defiance for 

18          defiance's sake.  We see an executive 

19          order -- which, as you'll remember again, 

20          President Obama's immigration action was 

21          challenged by dozens of states.  Even if I 

22          disagree with them, they exercised their 

23          rights under the Constitution and they 

24          prevailed.  We saw an executive order that we 


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 1          would thought would make our city less safe, 

 2          and we also thought it could at maximum be 

 3          applied very narrowly, according to the 

 4          Supreme Court decision.  That's our right and 

 5          obligation as a city, to go and defend our 

 6          interests and assert that.  We do not believe 

 7          that Justice Robert's decision would allow it 

 8          ever to get near the larger pool of money 

 9          that the city receives.

10                 But to say we will accept funding cuts 

11          and therefore do something that we think will 

12          make us less safe in the bargain, I don't 

13          think I'd be serving the people of New York 

14          City for that to be my position.

15                 CHAIRMAN FARRELL:  Thank you.  

16                 ASSEMBLYMAN CASTORINA:  Thank you.  

17          Thank you, Mr. Chairman.

18                 Thank you, Mayor.

19                 MAYOR DE BLASIO:  Thank you.  

20                 CHAIRWOMAN YOUNG:  Senator Murphy.

21                 SENATOR MURPHY:  Hello, Mayor.

22                 MAYOR DE BLASIO:  Hello, Senator.  

23                 CHAIRMAN FARRELL:  We have two more 

24          people, one Senator Murphy and one over here. 


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 1                 SENATOR MURPHY:  Welcome to Albany.  

 2          It was great to see you down in Washington at 

 3          the inauguration.

 4                 MAYOR DE BLASIO:  Yes.  

 5          Congratulations again.

 6                 SENATOR MURPHY:  Mayor, last year I 

 7          asked you to convince me of why I should 

 8          trust you with mayoral control, billions of 

 9          dollars, the ability to educate over 

10          1 million kids and give them the opportunity 

11          to succeed.

12                 In my eyes, you failed.  I did not.  

13          Now you're back here one year later asking 

14          for three years of mayoral control.  And I 

15          just find this absolutely, incredibly 

16          astonishing, with everything that's going on 

17          with you and your administration.  Mayor, 

18          things have only gotten worse, not -- and I 

19          repeat, not -- better for you and your 

20          administration.  

21                 And what I mean by that, which should 

22          be of grave concern to every single person in 

23          this room, is the two sitting grand juries, 

24          is the $11 million that you're asking the 


                                                                  187

 1          taxpayers to pay for representation for you 

 2          and your administration.  I say we take the 

 3          $11 million and we give it to our veterans 

 4          who represent New York State and the 

 5          United States.  

 6                 So I'm here again to ask you, convince 

 7          me why I should vote yes for mayoral control 

 8          and give you billions of dollars, with all 

 9          the scrutiny that's going on with you and 

10          your administration.

11                 MAYOR DE BLASIO:  Senator, 

12          respectfully, I have asserted consistently 

13          that we have handled all matters of 

14          government appropriately, made every effort 

15          to cooperate in investigations, providing 

16          information that we believe will show that 

17          beyond a shadow of a doubt.

18                 In terms of the governance of our 

19          school system, again, if you're interested in 

20          results -- I would hope you would be -- for 

21          1.1 million children, consistently improved 

22          graduation rates, consistently improved test 

23          scores should mean something to you.

24                 In terms of the needs of taxpayers, 


                                                                  188

 1          don't believe me, believe the business 

 2          leadership of New York City, which across the 

 3          board supports mayoral control of education.  

 4          And they have watched the three years of 

 5          progress that we have added on top of what 

 6          Mayor Bloomberg started, and they 

 7          wholeheartedly and energetically support 

 8          mayoral control, and they come here to Albany 

 9          to say it.  And they've contacted a lot of 

10          you to say it.  They believe removal of 

11          mayoral control would set New York City back 

12          deeply and return to a system -- not 

13          allegations, Senator, allegations against me 

14          that I believe fundamentally --

15                 SENATOR MURPHY:  These aren't my 

16          allegations.

17                 MAYOR DE BLASIO:  Senator, I'm sorry, 

18          they are allegations --

19                 SENATOR MURPHY:  These are not my 

20          allegations.  This is at another whole level 

21          besides me.

22                 MAYOR DE BLASIO:  Senator -- 

23          Senator -- allegations are one thing.  In the 

24          previous system of educational governance, 


                                                                  189

 1          they weren't just allegations, there was 

 2          proof of corruption and chaos year after year 

 3          after year.  That's what Mayor Bloomberg 

 4          decided to break us out of, and I commended 

 5          him at the time.  And this is a much, much 

 6          better system.

 7                 So you can vote against something that 

 8          has been proven to work.  As I mentioned, in 

 9          less than 15 years, the graduation rate going 

10          from under 50 percent to over 70 percent.  

11          You can vote against something the entire 

12          business establishment believes is good for 

13          the children of New York City.  You can vote 

14          against something that philosophically I 

15          would hope you would agree with.  

16                 Because you don't like me, or you 

17          don't agree with me, that's your business.  

18          But this is more than about any of us.  This 

19          is about a decision on how we're going to 

20          govern our schools and whether we're going to 

21          serve 1.1 million children or not.  If you 

22          want to vote for the old system of chaos and 

23          corruption, that's your choice.

24                 SENATOR MURPHY:  How many kids go on 


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 1          to college?  

 2                 MAYOR DE BLASIO:  Wait a minute.  I'm 

 3          the first to say we had a school system under 

 4          the previous governance structure that failed 

 5          our children in terms of graduation, failed 

 6          our children in terms of getting into 

 7          college.  We have said openly that we need to 

 8          retool this school system in so many ways to 

 9          increase not only graduation rates but 

10          college readiness, which is unacceptably low.  

11                 But this entire school system, we have 

12          only begun the work of retooling it.  

13          Full-day pre-K is part of it.  Training all 

14          our teachers on a higher level is part of it.  

15          If you prefer to vote for a system that was 

16          typified by chaos and corruption, that's your 

17          choice.  I can tell you that people in 

18          New York City will tell you, especially our 

19          business leadership, that you would be voting 

20          to take us backwards.

21                 SENATOR MURPHY:  Well, I don't believe 

22          it has gotten any better --

23                 MAYOR DE BLASIO:  Well, given these 

24          facts, I don't know how you can --


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 1                 SENATOR MURPHY:  -- under your 

 2          administration.  I'd like to know what your 

 3          graduation rate was, having people go on to 

 4          graduation --

 5                 MAYOR DE BLASIO:  You actually deny -- 

 6                 SENATOR MURPHY:  -- what kind of 

 7          careers they come out with --

 8                 MAYOR DE BLASIO:  Wait, wait, wait, 

 9          wait.  You deny graduation --

10                 SENATOR MURPHY:  -- are they coming 

11          back to New York City.

12                 MAYOR DE BLASIO:  Senator, you would 

13          literally --

14                 SENATOR MURPHY:  These are some of the 

15          simple questions that I'd like answered.

16                 MAYOR DE BLASIO:  If you're saying the 

17          State Department of Education is misreporting 

18          graduation rates around the state, then you 

19          should take that up with the State Department 

20          of Education.  These are not my numbers, 

21          they're their numbers.

22                 Graduation rate and test scores, those 

23          are things you will learn from the State 

24          Department of Education.  They have made 


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 1          clear the steady progress we've made in 

 2          New York City under two administrations.  

 3          Those are matters of fact.

 4                 SENATOR MURPHY:  Well, like I said 

 5          last year, it was a matter of trust.  And the 

 6          trust factor --

 7                 MAYOR DE BLASIO:  It's a trust system, 

 8          Senator.

 9                 SENATOR MURPHY:  -- the -- excuse me, 

10          I'm talking.  The trust factor is just 

11          something that everybody in this room and 

12          everybody in New York State should be worried 

13          about.  And you did not, you did not convince 

14          me last year.  And just the little dialogue 

15          that we've had this year, it's just still not 

16          convincing to me --

17                 MAYOR DE BLASIO:  Senator, you 

18          obviously have a bone to pick --

19                 SENATOR MURPHY:  -- okay?

20                 MAYOR DE BLASIO:  You obviously have a 

21          bone to pick.  If you're literally going to 

22          vote for a system of chaos and corruption, 

23          that's your business.  And people will 

24          remember that vote.  


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 1                 But I'm telling you, if you are 

 2          denying an increase in graduation rate, 

 3          denying an increase in test scores, 

 4          denying -- 

 5                 SENATOR MURPHY:  I did not say 

 6          anything of the sort.

 7                 MAYOR DE BLASIO:  -- mayoral control 

 8          of education started by a Republican mayor --

 9                 SENATOR MURPHY:  All's I wanted was 

10          the statistics that you should provide for 

11          us.  That's all I asked for.

12                 MAYOR DE BLASIO:  If you think a 

13          system started by a Republican mayor and 

14          backed up by the business community in a 

15          New York City is a bad system, I look forward 

16          to you having that conversation with the 

17          business community.  I think they'll feel 

18          differently about your view.

19                 SENATOR MURPHY:  Thank you, Mayor.

20                 CHAIRWOMAN YOUNG:  Thank you.

21                 CHAIRMAN FARRELL:  Thank you.  

22                 To close, Mr. Carroll.

23                 ASSEMBLYMAN CARROLL:  Good afternoon, 

24          Mayor de Blasio.  


                                                                  194

 1                 First I want to applaud you and the 

 2          City Council for your leadership on the 

 3          plastic bag issue.  Conservation is very 

 4          important.  And not so coincidentally, I have 

 5          my reusable bag, because I don't leave home 

 6          without it.

 7                 MAYOR DE BLASIO:  Well done, 

 8          Assemblyman.

 9                 ASSEMBLYMAN CARROLL:  My first 

10          question is about voting reforms here in New 

11          York State.  I'm glad that you support 

12          same-day registration and early voting.  But 

13          do you support shortening the time period a 

14          voter has to wait to change their party 

15          enrollment, which in some cases can be 

16          11 months?  

17                 MAYOR DE BLASIO:  Assemblyman -- and I 

18          just want to note, thank you for your 

19          service.  Because you are my Assemblyman in 

20          Brooklyn, and I welcome you to your new role.

21                 I think we need same-day registration, 

22          early voting, electronic poll books, a series 

23          of reforms that are all -- you know, all over 

24          the nation.  We're one of the only states 


                                                                  195

 1          that has none of those.

 2                 I think that we rightfully have a 

 3          system that recognizes party membership and 

 4          respects it in the primary process, but I 

 5          think our deadlines are too long.  I would be 

 6          comfortable with a much shorter time period, 

 7          a few months or whatever might be 

 8          appropriate, because I think people honestly, 

 9          especially in a very dynamic political 

10          environment, make a decision sometimes that 

11          they are changing -- I've certainly met 

12          people who have made decisions personally to 

13          change their party affiliation, go from 

14          independent to party member or from one party 

15          to another one for very real reasons.  

16                 But enough of a time gap to discourage 

17          what exists now in some states, which is in 

18          the morning you're a Democrat, you sign up to 

19          be a Republican for just that day, just that 

20          caucus or primary, and by evening you're back 

21          to being a Democrat.  I don't think that's 

22          fair.  I think then people are trying to game 

23          each election and have an impact that really 

24          is not about, you know, the broader views of 


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 1          the people, but trying to get inside and 

 2          manipulate the specific process.  

 3                 General elections, obviously everyone 

 4          gets to vote equally.  But in primaries, I 

 5          think party identifications matter.  But we 

 6          shouldn't create such a barrier that 

 7          people -- like a year away, I think is our 

 8          current reality.  It's just too onerous and 

 9          doesn't reflect the realities of human 

10          decision-making.

11                 ASSEMBLYMAN CARROLL:  My next question 

12          is about the mansion tax that you proposed.  

13          Is this tax in addition to the current tax on 

14          $1 million home sales, or is it taking its 

15          place?

16                 MAYOR DE BLASIO:  Go ahead.

17                 DIRECTOR FULEIHAN:  It's in addition.

18                 ASSEMBLYMAN CARROLL:  It's in 

19          addition.  And what is the rate?

20                 DIRECTOR FULEIHAN:  The current rate 

21          is 2.5 percent.  It's a marginal -- the 

22          marginal rate at that level will be 

23          2.5 percent.  So the marginal rate right now 

24          is 1.4 percent.


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 1                 ASSEMBLYMAN CARROLL:  My next question 

 2          is a question that both myself and my 

 3          colleague Assemblymember Richardson care 

 4          deeply about, and it's about area median 

 5          income and whether you've spoken with our 

 6          federal representatives about seeing if we 

 7          can change the way area median income is 

 8          computed so that it is more locally based.

 9                 MAYOR DE BLASIO:  Look, yes, I think 

10          that's a powerful issue.  First of all, I 

11          think area median income is such a difficult 

12          thing for average people to understand.  I 

13          struggle with it, everyone in meetings 

14          struggles with their different charts and 

15          all.  

16                 I think it would be better for all of 

17          us to, one, start talking about household 

18          income, which is really the thing people can 

19          make sense of.  And two, you're right, the 

20          federal measure is so broad it doesn't 

21          reflect local reality.  

22                 I'm not sure how to go about getting 

23          that changed, but it's the kind of thing we'd 

24          like to see action on.  And we need to do a 


                                                                  198

 1          better job, again, translating the numbers.

 2                 But one of the things that we are 

 3          going to try and address, because we hear it 

 4          from -- we've heard it from you and 

 5          Assemblymember Richardson and we've heard it 

 6          from other members of the Legislature and the 

 7          Council, is we understand there's tremendous 

 8          frustration that so many folks have lower 

 9          incomes and are grappling with trying to find 

10          enough housing.  

11                 In a number of the affordable housing 

12          projects we're working on, we think there's 

13          ways to improve the mix of units so that more 

14          can be lower-income.  We're going to have 

15          more to say on that soon.

16                 But second, I've got to do a better 

17          job of explaining to the people of New York 

18          City the underlying theory of the affordable 

19          housing program, which is for folks of 

20          different income bands on purpose.  We could 

21          have had a program that was just middle-class 

22          affordable housing, just working-class 

23          affordable housing, just low-income 

24          affordable housing.  We said we needed to do 


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 1          some of all of the above to have a strong, 

 2          vibrant city.

 3                 There are folks -- I told the story 

 4          the other day of parents who were part of my 

 5          son Dante's -- their kids were on my son's 

 6          Dante's travel baseball team.  You know the 

 7          78th Precinct Youth League very well.

 8                 ASSEMBLYMAN CARROLL:  I do.

 9                 MAYOR DE BLASIO:  And these two 

10          parents, literally a New York City 

11          firefighter and a nurse at one of our local 

12          hospitals -- I remember the day we were 

13          sitting in the bleachers together and they 

14          said to me they looked all over Brooklyn, 

15          they could not find a home they could afford 

16          in Brooklyn.  This was maybe -- you know, 

17          less than 10 years ago, eight years ago, 

18          perhaps.  Quintessential, you know, 

19          two-income, hardworking folks doing public 

20          service jobs.  

21                 And my answer is that our housing plan 

22          is supposed to serve them too.  So you'll see 

23          middle-class affordable housing in our plan, 

24          in addition to working-class, in addition to 


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 1          low-income.  We're trying to strike that 

 2          balance.  I think what a lot of elected 

 3          officials have said to us is, Can you find 

 4          ways to get to some more lower-income, deepen 

 5          the affordability, and as you say, adjust it 

 6          more to a specific neighborhood.  We're 

 7          trying to do that.

 8                 ASSEMBLYMAN CARROLL:  My last question 

 9          is, as you know, the city is the economic 

10          driver of the state.  How do you feel that 

11          the state only allocates about 5 percent in 

12          economic development funds towards the city 

13          and that we're currently still looking at a 

14          $1.6 billion loss in CFE and we possibly 

15          might see budget shortfalls in the capital 

16          budget of the MTA for this capital period?  

17                 MAYOR DE BLASIO:  Well, I will give 

18          you a balanced answer on that because I feel 

19          like -- you know, I spent a lot of time 

20          working around the State of New York when I 

21          had the honor of serving in the federal 

22          government at the U.S. Department of Housing 

23          and Urban Development.  I worked in all parts 

24          of the state -- in upstate cities, in 


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 1          suburbs, in rural communities.  Look, a lot 

 2          of New York State has deep, deep economic 

 3          development needs.  And so -- and as I said 

 4          at the beginning of the testimony, what's 

 5          good for New York City, I believe, is good 

 6          for the state, because we're an economic 

 7          engine.  But I think what's good for the 

 8          state is good for the city.  So I certainly 

 9          don't want to for a moment suggest that there 

10          aren't a number of areas that need help even 

11          more than New York City.  They do.

12                 But that, I think, should be balanced.  

13          If we say there are particular economic 

14          development needs in other parts of the state 

15          that must be addressed, that should be 

16          balanced with a recognition of where some 

17          other needs are in a place like New York City 

18          that are even more profound than some other 

19          parts of the state, and education is a great 

20          example.  

21                 But to me that goes far beyond 

22          philosophy.  I don't understand how we can 

23          ignore a decision of the highest court in the 

24          state.  The Court of Appeals made a decision, 


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 1          period.  No one has ever legally successfully 

 2          challenged that or written a law that 

 3          overwrote it.  It is a decision of the Court 

 4          of Appeals.  It needs to be acted on.  

 5                 And we all understood during the Great 

 6          Recession that the state was on its heels, 

 7          and everyone understood that.  But that's not 

 8          true anymore.  It hasn't been true for years.  

 9                 So I would argue I respect that there 

10          are parts of the state that have special 

11          needs, and we want to see those needs met.  

12          And we give more revenue by far, we're 

13          60 percent of the state's revenue coming out 

14          of New York City.  We are happy to 

15          participate in helping our brothers and 

16          sisters in other parts of the state.  But 

17          recognize our needs on education are going 

18          unmet.  And that's not going to be good for 

19          anyone if a lot of our kids are not properly 

20          educated.

21                 ASSEMBLYMAN CARROLL:  Thank you.

22                 MAYOR DE BLASIO:  Thank you.

23                 CHAIRMAN FARRELL:  One more?

24                 CHAIRWOMAN YOUNG:  Okay.  Senator 


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 1          Savino, as vice chair.

 2                 SENATOR SAVINO:  Thank you, Senator 

 3          Young.

 4                 Thank you, Mr. Mayor, for being so 

 5          patient and putting up with all of us.  I'll 

 6          be actually very brief.  The reason I wanted 

 7          to go last is I wanted to make sure I didn't 

 8          go over things that people had already asked 

 9          you.  

10                 So you know my position on the plastic 

11          bag thing; you don't need to hear it.  You 

12          know my position on some other issues. 

13                 I am anxiously awaiting the new policy 

14          on community notification that you'll be 

15          rolling out in a couple of weeks, because we 

16          are all very concerned about the homeless 

17          issue and how it affects our communities.  

18                 I do want to speak very briefly about 

19          ACS.  And I want to acknowledge publicly the 

20          changes in the administration under your 

21          mayorship.  I've been through four mayors 

22          with this agency in the 26Ω years that I've 

23          been involved in ACS, and I don't think it 

24          gets stressed publicly enough the commitment 


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 1          of your administration.  When I disagree with 

 2          you, I have no problem saying so.  You know 

 3          that.  But you are putting real resources and 

 4          efforts into this agency.  

 5                 And I don't think that the media 

 6          properly portrays what goes on on a 

 7          day-to-day basis with the front-line CPS 

 8          staff and the fact that unless you've knocked 

 9          on someone's door in the middle of the night 

10          and convinced them to hand you their child, 

11          you really don't understand how difficult 

12          this job is.  So I do think it's important 

13          that we get that out there.

14                 And I have recently met with your 

15          administration at ACS to talk about some 

16          changes I'm going to propose here in Albany, 

17          legislative changes, to undo what I think 

18          over the years has been some unnecessary 

19          requirements on the CPS staff that take them 

20          away from their core mission of identifying 

21          risks that exist in homes so that they can 

22          properly assess more quickly and provide the 

23          right type of services.  

24                 So I'm going to pursue that here.  I'm 


                                                                  205

 1          going to work very closely with your 

 2          administration to help make that possible, 

 3          because I think we all have the same goal, 

 4          whether it's providing enough funding to the 

 5          administration, whether it's the commitment 

 6          to protecting children, keeping families 

 7          together where it's appropriate, and 

 8          separating them where it's appropriate.

 9                 I will say, though, I have had several 

10          conversations with some front-line CPS 

11          staffers and I have heard from more than one 

12          that they have been overruled by judges when 

13          they have requested a remand in court.  That 

14          is a departure from past practice.  It is one 

15          that concerns me greatly.  Because again, the 

16          decision should not be to keep families 

17          together when all indications are that they 

18          should not be kept together.  

19                 So I'm going to work very closely, I 

20          think, with the current administration there.  

21          Whoever you bring in, hopefully they will be 

22          someone who understands the complexities of 

23          New York City's child welfare system, its 

24          vast nonprofit structure that supports it, 


                                                                  206

 1          and, you know, how hard it is to protect 

 2          children in this city.  

 3                 But I just want to say publicly you 

 4          have made the commitment that other mayors 

 5          didn't, and I don't think that that gets said 

 6          enough.

 7                 MAYOR DE BLASIO:  Senator, I really 

 8          appreciate that.  And I indicated earlier 

 9          you're one of the people in this state who 

10          understands these issues the best -- I know 

11          you've devoted your life to it -- and I 

12          appreciate your acknowledgment of the 

13          investments we've made and the focus.  

14                 I also would say that, you know, my 

15          predecessors came from different backgrounds.  

16          This was a lot of work I did in my career 

17          focused on the issues of children, so I feel 

18          this very personally.

19                 I think it's important -- you and I 

20          are both frustrated when someone who is 

21          trained to understand the danger to children 

22          asks a judge to remove a child as an active 

23          caution -- it's not forever, but to avoid an 

24          immediate danger -- and a judge says no.  


                                                                  207

 1                 You know, I respect, of course, the 

 2          division of powers in our government.  But 

 3          it's very frustrating, because I'm a believer 

 4          that you do the safe thing, you do the 

 5          abundance-of-caution thing in every case 

 6          involving a child's life.  And we need to ask 

 7          our judges to think long and hard before 

 8          turning down a request that professionals say 

 9          is in the interests of protecting a child.

10                 But on your earlier point about the 

11          work we can do to clarify the role of our 

12          protective workers, I'm very open and 

13          appreciate your suggestions.  Look, I think 

14          the historical thing that also does not get 

15          noted is that every administration has 

16          grappled with these issues.  They're some of 

17          the most challenging issues in public 

18          service.  We're talking about broken 

19          families, by any definition, and lots of 

20          social ills that have come into a family.  

21          We're talking about things we can't even see 

22          sometimes -- you know this from your work -- 

23          as we've often seen, for example, a quote, 

24          unquote boyfriend coming into the house that 


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 1          we don't even know is there who is often the 

 2          perpetrator.  

 3                 We are constantly trying to figure out 

 4          how to improve this work.  To the credit of 

 5          my predecessors -- look, I had lots of 

 6          disagreements with Mayor Giuliani, but after 

 7          the death of Elisa Izquierdo, he brought Nick 

 8          Scoppetta in, he made major changes.  But he 

 9          had to learn the hard way what we were not 

10          doing well enough.  

11                 Mayor Bloomberg, after the death of 

12          Nixzmary Brown, made major changes, many of 

13          which I agreed with.  But he had to learn 

14          what we were missing.  Good people served as 

15          commissioners.  No one fully cracked the code 

16          on everything we have to do.  

17                 And I learned a lot in a parallel 

18          reality with NYPD, working with Bill Bratton, 

19          working with Jimmy O'Neill, seeing how every 

20          day they're trying to figure out how to do 

21          things better than they did in the past.  

22                 ACS has been going that same route but 

23          not getting credit for it.  We still have 

24          more to do.  There's no question we have more 


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 1          to do.  But I'll tell you one thing, our new 

 2          commissioner is going to have full support, 

 3          have the resources that he or she needs, the 

 4          deeper involvement of the NYPD.  I think 

 5          that's going to make a world of difference.  

 6          And we're going to keep working to get it 

 7          right.

 8                 SENATOR SAVINO:  I certainly hope so.  

 9                 And also I think it's worth noting 

10          that the agency that I went to work for 26 

11          years ago is not the same agency that exists 

12          today.  You don't -- I don't think the public 

13          and even the media takes the time to 

14          recognize that the majority of the children 

15          and families are not directly supervised by 

16          ACS, they are supervised by a nonprofit 

17          structure of volunteer agencies who have 

18          direct contact with these families on a 

19          regular basis.  And that is a structure that 

20          is understaffed, overstretched.  The turnover 

21          rate in those agencies is, you know, at 

22          astronomical levels.  And that also hinders 

23          the ability to provide for many of these 

24          families.  And we need to strengthen that 


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 1          sector of the service provision as well.  

 2                 And so again, I look forward to 

 3          working with your administration and with 

 4          this sector of our very important work that 

 5          we do in government.  So I want to thank you.

 6                 MAYOR DE BLASIO:  Thank you.  And 

 7          quick response that we are going to be -- we 

 8          have been investing more in preventative 

 9          services than any previous administration.  

10          But you're making a key point.  The 

11          investment is great, but we have to make sure 

12          the quality is there, we have to make sure 

13          the staff are actually retained, we have to 

14          figure out the kinds of things that will 

15          constantly improve the quality.  

16                 You're right, we can't do it 

17          without -- we have faith-based partners, 

18          community-based partners, all sorts of 

19          organizations that do what government could 

20          never do on its own.  We have to constantly 

21          help improve their work at the same time.  

22          And that's going to take real focus and real 

23          investment, but we're committed to it.  

24                 Thank you.


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 1                 SENATOR SAVINO:  Thank you.

 2                 CHAIRMAN FARRELL:  Thank you.

 3                 CHAIRWOMAN YOUNG:  Thank you.

 4                 MAYOR DE BLASIO:  That's it?

 5                 CHAIRMAN FARRELL:  That's it.

 6                 MAYOR DE BLASIO:  Thank you, Chairs, 

 7          appreciate it.

 8                 CHAIRMAN FARRELL:  Thank you.  

 9                 (Pause.)

10                 CHAIRWOMAN YOUNG:  So Chairman Farrell 

11          will be right back, and then we'll start.

12                 (Discussion off the record.)

13                 CHAIRMAN FARRELL:  New York City 

14          Comptroller Scott Stringer.

15                 Good afternoon.

16                 NYC COMPTROLLER STRINGER:  Good 

17          afternoon.  

18                 And I want to start out by thanking 

19          Chair Young and Chair Farrell and members of 

20          the committees and the Legislature for having 

21          me here today.  

22                 You know, in these uncertain times, 

23          it's great to be surrounded by old friends 

24          and colleagues who share the notion that our 


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 1          New York values will withstand the turbulence 

 2          of these next four years.  

 3                 And I'm joined here today by my deputy 

 4          comptroller for budget, Preston Niblack, who 

 5          many of you know from New York City.  

 6                 I know from my 13 years of service in 

 7          the Assembly that today marks only the 

 8          beginning of the budgeting process.  I 

 9          welcome the opportunity to speak about the 

10          Governor's proposed Executive Budget on 

11          behalf of New York City, and I look forward 

12          to working with all of you toward a budget 

13          that will progress New York as a leader in 

14          the fight for fairness and opportunity for 

15          all our people, and not just some.  

16                 Last year the Senate and the Assembly 

17          worked together to enact meaningful change to 

18          do just that.  New York passed a $15 an hour 

19          minimum wage, which will benefit 1.5 million 

20          people and boost wages by more than 

21          $10 billion.  New York became only the fourth 

22          state in the country to guarantee paid family 

23          leave, so that no working person will have to 

24          choose between keeping their job and caring 


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 1          for a loved one.  

 2                 And our state government's Minority 

 3          and Women-Owned Business Development program 

 4          has continued to grow, promoting equal 

 5          opportunity for our businesses and helping to 

 6          create wealth in all of our neighborhoods. 

 7          The state's goal of 30 percent procurement 

 8          with MWBEs is an important one, and we must 

 9          ensure that the city has tools to match or 

10          surpass it.  

11                 And that's why I support Assemblywoman 

12          Bichotte's legislation that would enable city 

13          agencies to develop capacity-building 

14          programs for MWBEs, expand the city's ability 

15          to use prequalification lists when awarding 

16          contracts, and create more flexibility to use 

17          best value in evaluating bids or proposals 

18          for city contracts.  

19                 I'd also like to commend the Assembly 

20          for passing the Reproductive Health Act and 

21          the Comprehensive Contraception Coverage Act, 

22          which ensure that women in New York can make 

23          their own healthcare decisions and have 

24          access to affordable services.  The Governor 


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 1          has taken the first step towards guaranteeing 

 2          that important gains in access to women's 

 3          healthcare and reproductive services are not 

 4          undone by a potential repeal of the 

 5          Affordable Care Act.  

 6                 The Governor's and the Assembly's 

 7          actions are perfect examples of how we need 

 8          to respond when policymakers in Washington 

 9          threaten the rights of all New Yorkers.  I do 

10          encourage the State Senate to follow that 

11          lead.  

12                 And going forward, we must build on 

13          these accomplishments to ensure we foster an 

14          economy in which every New Yorker has a fair 

15          chance to get ahead.  But we cannot do so 

16          without facing the fact that this President 

17          and this Congress are determined to abdicate 

18          the federal government's responsibility 

19          towards our citizens and actively impede our 

20          efforts to build a fair and just society.  

21                 I know you are all familiar with the 

22          risks that face our state's economy under 

23          this administration, but I'd like to speak 

24          today about potential ramifications for 


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 1          New York City.  

 2                 My office analyzed the potential 

 3          impact of federal funding cuts and found that 

 4          aid is concentrated at 11 city agencies that 

 5          serve our must vulnerable citizens and keep 

 6          our city safe.  Federal funds support 

 7          60 percent of counterterrorism efforts, half 

 8          of the budget for child protective services 

 9          and numerous critical housing and healthcare 

10          programs, like Section 8 vouchers, which 

11          support 124,000 New York City families.  

12                 The safety net that we've worked for 

13          decades to strengthen in New York is now at 

14          risk of collapsing.  The city's Housing 

15          Authority, which is home to more than 400,000 

16          New Yorkers, or 5 percent of the city's 

17          population, depends on the federal government 

18          for 60 percent of its budget.  And our public 

19          hospital system requires hundreds of millions 

20          of dollars in federal aid to survive.  

21                 These federal cuts are a jockeying 

22          tool between a President and Republican 

23          Congress to see who can cut taxes the most 

24          for the wealthy.  Meanwhile, the President's 


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 1          proposed tax plan would cost the federal 

 2          government trillions of dollars in lost 

 3          revenue and leave our most vulnerable 

 4          citizens without access to the services they 

 5          depend on.  The only things that will trickle 

 6          down to states and localities are spending 

 7          cuts. And with the city's revenues slowing, 

 8          alongside the state's, we have to be prepared 

 9          for harder times ahead.  

10                 One tool for saving is the city's 

11          budget cushion. At the beginning of the 

12          fiscal year 2009, prior to the Great 

13          Recession, the city had accrued a cushion 

14          equal to 17 percent of expenditures, which 

15          was indispensable in helping us weather that 

16          downturn.  As of now, we will start fiscal 

17          year 2018 with a cushion of only 10 percent. 

18          We're going to do everything we can to 

19          identify more savings in the city budget.  

20                 And meanwhile, our homelessness crisis 

21          continues to consume precious budget 

22          resources, with total city spending on 

23          homelessness rising to $2.1 billion this 

24          year.  Assemblymember Hevesi has put forward 


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 1          a bold new plan that deserves your serious 

 2          consideration.  Home Stability Support is a 

 3          potential long-term solution to this crisis 

 4          that could offer a real path out of the 

 5          shelter system for thousands of New Yorkers 

 6          and save the city millions in shelter costs.  

 7                 The City and the State must stand 

 8          together to protect our core values and 

 9          guarantee that all of our working families, 

10          homeless or otherwise, have a fair chance to 

11          get ahead.  This Executive Budget includes 

12          many initiatives to do just that, and I 

13          encourage you to support them.  

14                 First, with looming threats of 

15          deportation, we should all stand behind the 

16          Governor's call to defend our immigrant 

17          friends and neighbors.  

18                 Second, we must make it easy for all 

19          New Yorkers to participate in our democratic 

20          process by curbing barriers to voting.  

21                 And third, we have to expand access to 

22          higher education.  I ask you all to pass the 

23          DREAM Act, so that thousands of undocumented 

24          students in New York can get the financial 


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 1          support they need to go to college.  

 2                 The proposed Excelsior Scholarship is 

 3          another important tool to help middle-class 

 4          families afford higher education.  College is 

 5          a gateway to a lifetime of financial 

 6          security, but not if students are left buried 

 7          under mountains of debt on graduation day. 

 8          The Legislature should accept the Governor's 

 9          proposal and move to expand upon it.  

10                 First, we should include part-time 

11          students, many of whom simply cannot afford 

12          to attend full-time.  Right now, 80,000 CUNY 

13          students attend part-time, primarily because 

14          they need to work to support themselves and 

15          their families.  Those students also deserve 

16          to benefit from this program.  

17                 I urge you to fully fund CUNY in the 

18          state budget.  Since 2010, CUNY's cumulative 

19          shortfall in state funding is now over 

20          $700 million.  Let's open the gateway to a 

21          high-quality education for all our students.  

22                 I also strongly support the Governor's 

23          proposed expansion of the childcare tax 

24          credit.  The average statewide cost of 


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 1          center-based infant care is more than $14,000 

 2          per year, and about $12,000 for pre-K.  

 3          Paying for child care for an infant and a 

 4          4-year-old is comparable to the cost of 

 5          renting a $2,000 per month apartment, and 

 6          that's just so unrealistic for too many of 

 7          our New Yorkers.  I support the proposal to 

 8          double the existing credit for families 

 9          earning between $50,000 and $150,000.  

10                 Our students are our future, and I 

11          cannot emphasize enough the need for 

12          continued investment in our public schools 

13          and pre-K programs.  That's why I support the 

14          extension of mayoral control and the 

15          Governor's further investments in community 

16          schools.  I hope the Legislature will keep us 

17          moving in the right direction towards 

18          ensuring the quality education guaranteed by 

19          the Campaign for Fiscal Equity decision.  

20                 This Executive Budget also raises an 

21          important issue that my office has been 

22          focused on since I became comptroller.  Since 

23          2012, the city has failed to collect more 

24          than $450 million in Medicaid reimbursements 


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 1          for supportive health services to our 

 2          students.  It's time for the city to fix this 

 3          long-standing problem and bring these funds 

 4          back into the classroom, with the support of 

 5          the State.  

 6                 But we need to set a realistic 

 7          timetable to ensure our children do not miss 

 8          out on funding for critical services because 

 9          the city fails to meet the state's targets. 

10          So I would urge you to work collaboratively 

11          and cooperatively to improve the Department 

12          of Education's Medicaid reimbursement 

13          claiming process, and stop leaving precious 

14          dollars on the table.  

15                 Together we can also lift roughly 

16          15,000 New Yorkers out of poverty by allowing 

17          the city to triple its contribution to the 

18          Earned Income Tax Credit to 15 percent of the 

19          federal allocation.  The EITC is the most 

20          effective anti-poverty program in America, 

21          and by tripling its input, the city could add 

22          more than $200 million directly back into our 

23          businesses, our neighborhoods, and most 

24          importantly, our families.  


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 1                 This Executive Budget does include 

 2          some provisions that I hope you will reject.  

 3                 First, the appropriations bills 

 4          contain language that would give the budget 

 5          director unilateral authority to push the 

 6          burden of federal aid cuts down the food 

 7          chain onto local governments.  I would urge 

 8          you, the Legislature, to reject such an 

 9          approach that would bypass this legislative 

10          body and do tremendous harm to cities and 

11          counties throughout the state.  

12                 I would also ask you to reject cost 

13          shifts for foster care, public health, and 

14          special education that single out New York 

15          City.  

16                 Finally today, I urge you to not just 

17          extend the millionaire's tax this session, 

18          but to expand it.  But let's be clear, this 

19          is not robbing Peter to pay Paul.  I'm not 

20          here today to tag on a tax for the rich just 

21          for the sake of it.  The fact is, even with a 

22          tax increase at the state level, New York's 

23          millionaires will still stand to gain 

24          $3 billion in annual savings from Trump's 


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 1          proposed tax plan, with an average increase 

 2          in their after-tax income of more than 

 3          5 percent.  Meanwhile, middle-class taxpayers 

 4          will get much smaller savings, and in many 

 5          cases could actually pay more than they do 

 6          under current law.  

 7                 Raising the millionaire's tax to help 

 8          address the impact of federal spending cuts 

 9          is not just a matter of fairness, it's going 

10          to be a necessity.  

11                 So in conclusion, I feel confident in 

12          this Legislature's ability to advance a fair 

13          and balanced budget despite the challenges 

14          and uncertainties of new leadership in 

15          Washington.  As federal leaders are poised to 

16          roll back progress of the last eight years, 

17          New York must continue to push forward 

18          without leaving any of our people behind.  

19          Let us instead work together -- city, 

20          counties, and state, legislative and 

21          executive branches -- to protect our values 

22          and maintain New York as a fair and equitable 

23          home to all of our people.  

24                 I want to thank you again for giving 


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 1          me this opportunity, as you do every year, to 

 2          come and testify.  And if you have any 

 3          questions, I'll be happy to answer them.  

 4          Thank you very much.  

 5                 CHAIRMAN FARRELL:  Thank you very 

 6          much.  

 7                 We've been joined by Assemblywoman 

 8          Crystal Peoples-Stokes.

 9                 First to ask questions, Michael 

10          Benedetto, chair of the Cities Committee.

11                 ASSEMBLYMAN BENEDETTO:  Thank you, 

12          Denny.

13                 Welcome, Mr. Comptroller.  Always good 

14          to see you.  Glad you're here.

15                 One question.  You know Co-op City, 

16          and I represent Co-op City, and Co-op City is 

17          a great place.  Co-op City does a lot of 

18          things to help the City of New York.  Co-op 

19          City, for instance, has installed a garbage 

20          compactor.  And so the Sanitation Department, 

21          instead of going around to all the buildings 

22          in Co-op City two times, three times a week, 

23          they -- Co-op City collects their own trash, 

24          brings it to the compactor, where the 


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 1          sanitation trucks of the City of New York 

 2          once a week come in just to pick it up and 

 3          go.  Probably saving the great City of 

 4          New York millions of dollars.  And for this 

 5          service, Co-op City gets nothing.  

 6                 Co-op City has their own police force, 

 7          90 men and women who do a wonderful job 

 8          within the city.  And thus the police 

 9          department, who we all love and does a 

10          wonderful job in the 45th Precinct that 

11          covers Co-op City, they don't have to patrol 

12          as much in Co-op City.  In fact, they really 

13          don't have to patrol at all; Co-op City takes 

14          care of it.  And for the expenses that Co-op 

15          City pays out in their own police force, 

16          Co-op City is reimbursed, by the City of 

17          New York, nothing.

18                 Now, in lieu of this, are there any 

19          other places in the City of New York that may 

20          get some reimbursement for services provided 

21          that New York City should be providing but 

22          doesn't?

23                 NYC COMPTROLLER STRINGER:  So off -- 

24          you know, nothing of what you're suggesting 


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 1          comes to mind.  But I do know that Co-op City 

 2          is truly a city within a city.  And my 

 3          grandmother lived in Co-op City, so as a kid 

 4          I remember running around the complex.  And 

 5          since I've been comptroller, I've gotten to 

 6          know much of the leadership there.  

 7                 I would be happy to sit down with you 

 8          and the leadership of Co-op City to figure 

 9          out what we can do, to crunch some numbers, 

10          to look at what you're talking about and sort 

11          of figure out, going forward, if there's any 

12          initiatives that we should be looking at so 

13          that we can continue to make Co-op City as 

14          vibrant as ever for the families and for the 

15          seniors who live there.  I'd be happy to work 

16          with you.  

17                 And as a former chair of the 

18          Cities Committee, I know you care about all 

19          the cities, especially Co-op City.

20                 ASSEMBLYMAN BENEDETTO:  And of course 

21          Co-op City is a fine example of affordable 

22          housing, affordable middle-class housing, 

23          what we greatly need in the great City of 

24          New York.


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 1                 NYC COMPTROLLER STRINGER:  No 

 2          question.  No question.  

 3                 ASSEMBLYMAN BENEDETTO:  No more 

 4          questions.  Thank you.

 5                 CHAIRMAN FARRELL:  Thank you.

 6                 Senator?  

 7                 CHAIRWOMAN YOUNG:  Thank you.  

 8                 Senator Sanders.

 9                 SENATOR SANDERS:   Thank you.  Thank 

10          you, Madam Chair.

11                 Well, I just want to start by saying I 

12          represent the Co-op City of Queens --

13                 NYC COMPTROLLER STRINGER:  You do.

14                 SENATOR SANDERS:  -- Rochdale Village, 

15          so I am also interested in the conversation 

16          that you may have.  If there is any way, then 

17          we in Queens certainly could use it also.

18                 I want to offer you a friendly 

19          amendment to your conversation earlier, to 

20          your testimony.  I carry the MWBE in the 

21          Senate, and my school bill, if you wish, my 

22          community college bill, predates the 

23          Governor's proposals.  And as a matter of 

24          fact, most of my proposals end up in the 


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 1          Governor's proposals.  

 2                 But I want to speak to you about MWBE 

 3          for a moment.  And I want to just ask and see 

 4          if I can't get a better understanding.  

 5          Assuming the rate of returns are at least 

 6          even, what prevents you from putting more 

 7          pension funds or more of your funds, rather, 

 8          into banks of color, so-called minority 

 9          banks?

10                 NYC COMPTROLLER STRINGER:  Well, I 

11          mean, part of what we have focused on in our 

12          office is a number of things.  First, as you 

13          know, we hired the city's first chief 

14          diversity officer.  And we each year evaluate 

15          the procurement spending of each city agency.  

16          And that has, I think, shone an important 

17          transparent light on just the fact that we're 

18          not focusing on contracts -- actual spend for 

19          women- and minority-owned businesses.

20                 The second thing we've also been 

21          having some success with is we've said to the 

22          people who manage pension dollars that, Look, 

23          at the end of the day, when you have diverse 

24          money managers -- women, people of color, 


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 1          people of all different backgrounds -- the 

 2          fact is the investments do better.  Right?  

 3                 That's true with corporate boards.  

 4          When you have different people on a board, 

 5          the company tends to be better.  If the 

 6          companies are all male or pale or -- you 

 7          know, those boards suffer from groupthink.  

 8                 So diversity, in addition to being a 

 9          civil rights issue, as a fiduciary, it's 

10          critical that we diversify those boards.  And 

11          we have made it clear to the money managers 

12          that we expect to see investors who are 

13          diverse.  Because that is now, for the first 

14          time in the history of our pension fund, a 

15          criteria for whether we will do business with 

16          you.  

17                 And in direct answer to your question, 

18          we have upped the spending in more asset 

19          classes in excess of a billion dollars than 

20          any comptroller in history.  And we continue 

21          to look at ways we can create a funding 

22          mechanism to give people an opportunity.  

23                 Part of what we do is we look at this 

24          through a fiduciary lens, because this is not 


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 1          my money or the city's money, this is really 

 2          the money of our pensioners, our 

 3          firefighters, police officers, teachers, city 

 4          workers.  So everything we do, there's a 

 5          caveat which says we have to do it through 

 6          the lens of our returns and what's best for 

 7          the pension fund.  

 8                 But diversity is a key criteria for 

 9          enhancing the value of our pension fund.

10                 SENATOR SANDERS:   I look forward to 

11          working with you on that.

12                 My last question, can I encourage you 

13          to look at the sanctuary city movement in 

14          terms of its impact on New York City, that we 

15          should at least understand that if our 

16          President does carry through his stated 

17          position, we should know what this means for 

18          New York City in terms of -- and for any 

19          other sanctuary city in the state.  We should 

20          at least know what we're talking about so we 

21          can have an intelligent conversation.

22                 NYC COMPTROLLER STRINGER:  So I've 

23          issued two reports in the last couple of 

24          weeks.  The sanctuary city report that we 


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 1          issued identified $165 million in money we 

 2          could lose immediately.  

 3                 Incredibly, the money that we would 

 4          lose is the money that we use to fight 

 5          terrorism.  So that's about $156 million.  

 6          That's the money for cameras and for the 

 7          hardware that we use, technology.  Everybody 

 8          knows New York City is the number-one 

 9          terrorist target.  You would think the 

10          President would understand that.  

11                 So we have $156 million there, and 

12          there's a $9 million DOJ grant that I think 

13          would be wiped out if there would be any 

14          changes.

15                 Long term, we've identified -- and I 

16          mentioned this in our testimony -- we've 

17          identified that the city could lose up to 

18          $7 billion in federal aid, aid that primarily 

19          goes to the poorest people in the city, 

20          through a certain number of agencies that 

21          make up at least between 33 percent and 

22          50 percent of an agency.  So Department of 

23          Homeless Services.  You know, you all talked 

24          a lot with the mayor about ACS.  


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 1                 So the stakes have never been higher.  

 2          And we will continue in this office to crunch 

 3          the data so that you can look at it as you 

 4          grapple with adopting a state budget, making 

 5          sure that we continue to get our fair share 

 6          of funding.  And I'll try to provide with you 

 7          that information on an ongoing basis.  And if 

 8          you or anyone else here needs us to take a 

 9          look, Preston or our investigative team would 

10          be happy to work with you.

11                 SENATOR SANDERS:   Thank you.  

12                 Thank you, Madam Chair.

13                 CHAIRWOMAN YOUNG:  Thank you, Senator.  

14                 CHAIRMAN FARRELL:  Thank you.  

15                 Assemblywoman Hooper.

16                 ASSEMBLYWOMAN HOOPER:  Thank you, 

17          Mr. Chair.  

18                 Scott, it's always good to see you.  

19          And because of you, I remained in my seat to 

20          acknowledge you and to ask you just a -- not 

21          a question, but to make a statement and ask 

22          your support.

23                 In reading, looking over the 

24          presentation that you gave, you did refer to 


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 1          the looming threats of deportation.  And that 

 2          you are asking us to support the Governor's 

 3          call to defend our immigrant friends and 

 4          neighbors.  And certainly I believe that we 

 5          shall, those of us who understand the 

 6          importance of immigration as it relates to 

 7          the history of this nation.

 8                 So I'm asking, in your very august 

 9          position as the Comptroller of New York City, 

10          when you have an opportunity to talk in 

11          reference to the deportation and the 

12          immigration issue as it relates in New York 

13          City, to look at what has happened 

14          historically to those attempted immigrants 

15          from the country of Haiti.  

16                 As you are aware -- perhaps you are 

17          aware -- that when the Haitians attempt to 

18          access this great nation and they are 

19          encountered in the shark-infested waters 

20          which they attempt to transverse, they are 

21          turned back without an opportunity to even 

22          access the rewards of this nation.  

23                 So would you be kind enough, in your 

24          position, to, when this President's executive 


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 1          order expires and it returns to where it was 

 2          as related to the Haitians, in New York City 

 3          lead the way that the Haitians should also be 

 4          considered those persons, those human beings 

 5          who have a right to come to this great nation 

 6          and access the services and the great 

 7          American life?  I would appreciate that very 

 8          much.  Because I don't hear -- I rarely hear 

 9          anyone speaking on behalf of the Haitian 

10          community.  And I have a sizable community, a 

11          sizable representation in my district.  And I 

12          would appreciate that.

13                 NYC COMPTROLLER STRINGER:  Well, I 

14          would tell you that in New York City we have 

15          an incredible Haitian community that 

16          contributes mightily to the economy of 

17          New York City, as Diana -- Assemblywoman 

18          Richardson -- well knows.  And it's a growing 

19          community and an important community.

20                 But you know, you raise an interesting 

21          question, which is people should understand 

22          the contributions of immigrants, especially 

23          in New York City.  And we've put out a 

24          report -- we've been busy lately -- we put 


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 1          out a report to showcase the contributions of 

 2          immigrants in New York City.  And here's 

 3          something people have to understand:  

 4          New York City would not be the great economy 

 5          it is without immigrants.  Forty-six percent 

 6          of our workforce is foreign-born.  More than 

 7          half of the business owners today are 

 8          immigrants, 83,000.  In total, immigrants 

 9          earn $100 billion in annual income, one-third 

10          of all income earned in New York City.  And 

11          the city is home to an estimated 500,000 

12          undocumented immigrants.  

13                 The point is that in a city of 

14          immigrants, this city has flourished.  And by 

15          the way, it's not just immigrants coming here 

16          and opening up a small business or a small 

17          restaurant.  Today immigrant communities, 

18          Haitians included, are in the medical field, 

19          entertainment field, financial field.  And 

20          you just can't, you just can't appreciate 

21          just how critical immigrants are to our 

22          economy.

23                 Now, it's really incredible that in 

24          Washington -- and the President, he has no 


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 1          understanding of this, considering he's a 

 2          New Yorker and he's done business in New York 

 3          City.  So his ideological ranting and raving 

 4          has just no basis in fact or understands the 

 5          contributions of immigrants.  

 6                 I would argue that the report that I 

 7          did outlining the incredible contributions of 

 8          the immigrant community, you probably could 

 9          do that same report for Chicago, L.A., 

10          counties and towns across America.  It's not 

11          just New York City.  And that's the 

12          foundation of the United States of America.  

13          People from all over the world come here, 

14          sometimes with very little money or no money, 

15          and their entrepreneurial spirit and the 

16          hustling and, you know, the entrepreneurship 

17          creates wealth in so many parts of America.  

18          And we need to keep the focus on that.

19                 ASSEMBLYWOMAN HOOPER:  I appreciate 

20          that.  I appreciate that.  But in closing, 

21          also there's some of us immigrants who have 

22          contributed very much to the wealth of this 

23          great nation, and we came -- we did not 

24          voluntarily come.  So I need to keep that in 


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 1          perspective as well.

 2                 NYC COMPTROLLER STRINGER:  I lost my 

 3          voice over the weekend because I've been 

 4          going to so many rallies to support 

 5          immigration.  And the first thing I say when 

 6          we're at a rally supporting the Muslin 

 7          community is I say, "Listen, I'm an American 

 8          Jew, and I stand with Muslims.  Because when 

 9          they come for the Muslims, they're going to 

10          come for the Jews."  And they come for the 

11          Haitians, they're going to come for the 

12          Latinos.  And we all are now in the same 

13          boat.  It's no longer people separated, we 

14          are literally in the same boat.  

15                 And maybe that's a good thing at the 

16          end of the day.  Because I happen to think -- 

17          not to get political here, but I actually 

18          think Trump has been a tremendous unifier in 

19          this country.  Everyone is coming together 

20          against his policies.  And you usually don't 

21          see that in the first 10 days of a 

22          presidency.

23                 (Laughter.)

24                 ASSEMBLYWOMAN HOOPER:  Thank you very 


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 1          much.

 2                 NYC COMPTROLLER STRINGER:  And by the 

 3          way, as comptroller, you know, I do the 

 4          numbers.  You know?  And there was nobody at 

 5          his inauguration.  I did that --

 6                 ASSEMBLYWOMAN HOOPER:  I wonder why.  

 7                 Thank you.

 8                 NYC COMPTROLLER STRINGER:  I don't 

 9          mean to be ideological.

10                 ASSEMBLYWOMAN HOOPER:  Thank you very 

11          much.

12                 NYC COMPTROLLER STRINGER:  Thank you.  

13                 CHAIRMAN FARRELL:  Senator.

14                 CHAIRWOMAN YOUNG:  Senator Savino.

15                 SENATOR SAVINO:  Thank you, Senator 

16          Young. 

17                 Thank you, Comptroller Stringer.  I 

18          just have one or two questions.  

19                 First, I want to thank you for 

20          pointing out something that doesn't get 

21          mentioned enough in the budget.  Almost at 

22          the end of your testimony, you make the point 

23          that the budget language contains some 

24          interesting verbiage about how, in the event 


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 1          of some cuts -- and there are very 

 2          significant cuts that could be coming down 

 3          from Washington, actions that we might not be 

 4          able to anticipate, that the budget doesn't 

 5          take into consideration -- that in fact they 

 6          wouldn't have to bring it back to the 

 7          Legislature, that the administration could 

 8          just act unilaterally, affecting not just the 

 9          state budget, usurping our authority to 

10          oversee it, but county and local governments 

11          as well.  

12                 So thank you for pointing that out, 

13          because I really don't think people have paid 

14          enough attention to that.  And that, you 

15          know, if there are going to be cuts that come 

16          as a result of actions in Washington, those 

17          of us who help craft the budget here in 

18          Albany should be part and parcel of any 

19          decisions on how we're going to redirect 

20          funding or cut funding to programs that we've 

21          already made decisions about.  So I want to 

22          thank you for pointing that out.  

23                 I want to ask you, though, about 

24          MWBEs, because I know you're committed to it.  


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 1          And you and I have had this discussion in the 

 2          past.  I think -- last year I did a hearing 

 3          on it when I shared the Senate Banking 

 4          Committee.  Assemblywoman -- she's not here 

 5          now, she's stepped out -- Bichotte and I 

 6          cochaired the hearing around access to 

 7          capital and credit and the difficulties that 

 8          many of the MWBEs face getting access to 

 9          capital and credit from traditional banking 

10          sources, including those that have been set 

11          up for that express purpose.  

12                 And later in the year we did a 

13          roundtable in the district and one in 

14          Brooklyn with The Black Institute, led by 

15          Bertha Lewis.  And she has a proposal that 

16          would direct the city's pension system to set 

17          aside some funding for that purpose.

18                 Has there been any further discussion 

19          around that, expanding on that, about the 

20          possibility of creating a pool of dollars for 

21          that purpose?  

22                 NYC COMPTROLLER STRINGER:  Well, yes.  

23          And we have been meeting with The Black 

24          Institute throughout, our financial advisors 


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 1          have been working with The Black Institute 

 2          staff.  And, you know, the talks are ongoing 

 3          and we're really working hard.  That's I 

 4          think a critical gap.  And if we can get 

 5          there from the fiduciary lens, we're going to 

 6          do everything we can.

 7                 In the meantime, we have been -- this 

 8          office has been the most aggressive in the 

 9          history of this office on women- and 

10          minority-owned businesses, on financial 

11          services.  I think it really helps having a 

12          chief diversity officer.  

13                 And look, we said the city should have 

14          a chief diversity officer, and then every 

15          agency.  I mean, it's pretty incredible that 

16          the city spends 15.3 billion on procurement, 

17          buying paperclips, paper -- the amount of 

18          money we spend is larger than some 

19          countries -- and only 4.8 percent of that 

20          spending goes to women, African-Americans, 

21          Latinos, Asians.  It is just a paltry sum.

22                 And so I think we have to shake the 

23          system up.  And that's what we've done in our 

24          office.  And we've issued forward-thinking 


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 1          reports, we've done the budget analysis.  And 

 2          the reason why I mentioned it here is because 

 3          the state has made some tremendous progress.  

 4          And the Bichotte legislation that you've 

 5          highlighted in your hearings will go a long 

 6          way in unlocking some of the challenges that 

 7          small firms have -- access to capital, 

 8          bonding authority, all the things that keeps 

 9          a small business small.  

10                 And I'll continue to work with you and 

11          Bertha and everybody to keep working on this.

12                 SENATOR SAVINO:  And following up with 

13          that, the Senate Labor Committee last year, 

14          under the previous chairmanship of Senator 

15          Martins, did a hearing on prompt payment in 

16          the construction industry to some of our 

17          MWBEs.  It turns out that we have the same 

18          problem there where MWBEs are not able to 

19          compete because once they get a contract, 

20          guess who the worst payers are?  Government.  

21          Particularly the MTA.  

22                 So we state that we have a stated 

23          goal, it's in the public interest to have 

24          30 percent of our contracts go to MWBEs, 


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 1          particularly around the construction 

 2          industry -- and then, in the end, we're not 

 3          paying promptly enough.  And they don't have 

 4          access to capital and credit from traditional 

 5          lending sources, they then go out of 

 6          business, they can't meet payroll, they get 

 7          debarred, and they can't compete.  

 8                 So anything that we can do to help 

 9          support this effort I want to continue 

10          working on it, because --

11                 NYC COMPTROLLER STRINGER:  Let's 

12          continue to collaborate.  You're raising some 

13          very important issues.  You're absolutely 

14          right.  You know, the big firms can absorb 

15          the hit and they have enough revolving 

16          revenue to, you know, wait for the paycheck.  

17          And you're absolutely right, the small 

18          struggling firms can't.  

19                 And look, we also need better 

20          public-private partnerships -- we need a 

21          better partnership between big firms and 

22          small firms, because what you really want to 

23          do is you just don't want to keep MWBEs in 

24          the subcontractor role, you want to start 


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 1          small and then build it up.  

 2                 And I can't stress enough, as we do 

 3          some of the economic analyses, these small 

 4          businesses, these MWBEs, are so critical to 

 5          wealth creation in a community.  You know, we 

 6          think it's just, okay, we're helping the 

 7          small business.  But that small business 

 8          grows into a large business, hires locally, 

 9          they operate -- they don't necessarily 

10          operate in the Manhattan business district, 

11          they're actually operating throughout our 

12          boroughs.  And that's a wealth creator in the 

13          community.  

14                 And we need that.  Given high rent and 

15          some of the cost of living, we need to just, 

16          you know, up the amount of revenue in a 

17          community.

18                 SENATOR SAVINO:  Thank you.

19                 NYC COMPTROLLER STRINGER:  Thank you.

20                 CHAIRMAN FARRELL:  Senator?  

21                 CHAIRWOMAN YOUNG:  Thank you.  I think 

22          we're done.

23                 CHAIRMAN FARRELL:  Oh, no, we're not 

24          done.


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 1                 CHAIRWOMAN YOUNG:  On our side.

 2                 CHAIRMAN FARRELL:  Assemblyman 

 3          Carroll.

 4                 ASSEMBLYMAN CARROLL:  Thank you.  

 5                 Thank you for coming here today, 

 6          Comptroller Stringer.  I have two questions.  

 7                 The first is about your EITC program.  

 8          I agree with you that it's a wonderful 

 9          anti-poverty program.  I want to know if your 

10          office has looked into expanding those tax 

11          credits, especially for individuals who are 

12          single without dependents, because I think 

13          the program doesn't do a great job there.  I 

14          think there are lots of folks who are single 

15          without dependents but actually do have 

16          children.  Or it's a way to also combat youth 

17          unemployment, to persuade folks to come into 

18          the workforce.  And so I'd just like to know 

19          your thoughts on that.  

20                 And the second question is about 

21          whether your office has looked into, if 

22          Donald Trump does follow through with 

23          defunding sanctuary cities, ways that the 

24          city can help stop its residents from 


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 1          remitting tax dollars to the federal 

 2          government.  Because we are a tax provider.  

 3          We actually put more much more into the 

 4          federal government than we receive.  And so 

 5          if they're going to defund our city, we 

 6          should just not -- you know, we should be 

 7          capturing as many tax dollars as possible.

 8                 NYC COMPTROLLER STRINGER:  I'm not 

 9          going to advocate tax evasion here today.  

10          So --

11                 (Laughter.)

12                 ASSEMBLYMAN CARROLL:  Okay.  We can 

13          talk about the EITC then, I guess.

14                 NYC COMPTROLLER STRINGER:  We can talk 

15          about EITC.  

16                 Look, I think -- and you can be 

17          assured that New York City, the mayor's 

18          office, the comptroller's office, we're going 

19          to work very hard to use every tool at our 

20          disposal to legally challenge whatever comes 

21          down from Washington that puts our city in 

22          economic jeopardy or harms our immigrant 

23          brothers and sisters in the city.

24                 As relates to money that we remit to 


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 1          Washington, I do believe that knowledge is 

 2          power.  And when people understand the 

 3          billions we send to Washington -- that, by 

 4          the way, we never get back.  As much money as 

 5          we get from the federal government, it's not 

 6          as much as what we give.  And, you know, 

 7          New Yorkers know that.  You know, we always 

 8          have given more to this country.

 9                 And so I think we have to continue to 

10          talk about these issues.  That's why we're 

11          preparing these reports.  That's why we did 

12          the report on the value of immigrant 

13          contributions to the New York City economy.  

14          That's why we're exposing the fact of the 

15          $7 billion in potential cuts, the collapse of 

16          the safety net.  

17                 And I look forward to working with all 

18          of you on these issues, because the truth is 

19          I get a lot of ideas from legislators on 

20          these issues.  And, you know, not to stray to 

21          another topic, but as Assemblywoman Niou 

22          knows, you know, part of the reason why we 

23          were able to do the Rivington investigation 

24          was because the community came to us and 


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 1          said, There's something wrong here, would you 

 2          take a look at it, would you do an analysis?  

 3          And that's what led to the investigation and 

 4          exposed the $72 million that we were losing.  

 5                 But, you know, it doesn't only come 

 6          out of my office.  I really do need eyes and 

 7          ears to tell me what's going on.

 8                 ASSEMBLYMAN CARROLL:  And EITC?  

 9                 NYC COMPTROLLER STRINGER:  Listen, I 

10          think single with children, yes.  Also 

11          seniors.  And we're going to continue to work 

12          with the Legislature.  I hope you consider 

13          giving us the authority to do this.

14                 ASSEMBLYMAN CARROLL:  Thank you.

15                 CHAIRWOMAN YOUNG:  Mr. Comptroller, I 

16          do have maybe one or two questions that 

17          crossed my mind.

18                 We had a discussion earlier with Mayor 

19          de Blasio, very briefly, about the 

20          Administration for Children's Services.  And 

21          in December of 2016, you actually issued a 

22          letter, following up with a July 2016 report, 

23          on the failures at ACS.  Could you just very 

24          briefly go over that?  And then I have a 


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 1          follow-up.

 2                 NYC COMPTROLLER STRINGER:  Before that 

 3          letter, we issued an audit in which we found 

 4          a lot of issues related to the management of 

 5          ACS.  And part of my audit responsibility is 

 6          not just to raise issues but also to follow 

 7          up to see if our recommendations were being 

 8          implemented.  And I do think that the people 

 9          in ACS, the front-line workers, the 

10          overwhelming majority are doing everything 

11          they can.  There's a lot of heroes in that 

12          agency.  There's a lot of people who dedicate 

13          their lives to saving children.  I don't 

14          think we talk about that enough.

15                 But when you look at some of the 

16          management failures at ACS, the high 

17          caseloads, the lack of ACS following their 

18          own protocols -- they're not my protocols, 

19          they're ACS protocols -- we find that very 

20          troubling.  And we have called -- raised this 

21          issue with the agency and the mayor's office.

22                 CHAIRWOMAN YOUNG:  So you think that 

23          some of the recommendations are being 

24          followed; however, there's much further to 


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 1          go?  Not to put words into your mouth, but 

 2          you think that there's a lot of work to do?  

 3                 NYC COMPTROLLER STRINGER:  I think 

 4          that's a very accurate characterization of 

 5          where we're coming from.

 6                 CHAIRWOMAN YOUNG:  So one of the 

 7          reasons I wanted to ask was -- first of all, 

 8          I applaud you for taking on this issue.  

 9          Obviously this is so crucial and we have, 

10          unfortunately, an abysmal track record of 

11          children being severely hurt and killed 

12          because of mismanagement, as you pointed out.

13                 In the executive proposal that's 

14          before us right now, there is additional 

15          responsibilities under the Raise the Age 

16          program that would have to be undertaken by 

17          ACS.  And I just wanted to get your opinion.  

18          If they haven't fixed what's wrong already, 

19          how would they be able to manage additional 

20          responsibilities?

21                 NYC COMPTROLLER STRINGER:  I think 

22          it's going to be very challenging.  But look, 

23          we are going to continue to highlight the 

24          problems there as a way of moving the city to 


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 1          act, you know.  And I couldn't tell you -- I 

 2          couldn't break it down for you today, but I 

 3          certainly can work with you to get you that 

 4          information.  

 5                 But look, we have real challenges in 

 6          our city.  We have an exploding homeless 

 7          population.  And we have children who are 

 8          dying that shouldn't be dying.  And to the 

 9          extent that we can work with the city by 

10          offering analysis and audit, that's part of 

11          what I'm supposed to do.  At the end of the 

12          day, transparency is important because it 

13          gives us an opportunity to see what's really 

14          going on.

15                 CHAIRWOMAN YOUNG:  Thank you.

16                 CHAIRMAN FARRELL:  Thank you.

17                 Assemblyman Weprin.

18                 ASSEMBLYMAN WEPRIN:  Good afternoon, 

19          Comptroller Stringer.  And it's great to see 

20          my old friend Preston Niblack, a great 

21          acquisition.  When I was chair of the City 

22          Council Finance Committee and he was our 

23          director, he was invaluable and we could not 

24          have done what we did back in those years 


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 1          without Mr. Niblack.

 2                 NYC COMPTROLLER STRINGER:  That's what 

 3          he told me when he interviewed.  

 4                 (Laughter.)

 5                 NYC COMPTROLLER STRINGER:  But he is a 

 6          great addition.

 7                 ASSEMBLYMAN WEPRIN:  I know you've 

 8          done a couple of audits -- I think you did 

 9          one in 2014, and you did one recently in 

10          November 2016 -- involving Rikers Island.  

11          And I'm the new chair, as you know, of the 

12          Corrections Committee.  And I know there's a 

13          former Judge Lippman Commission report that's 

14          supposed to report back on some of the issues 

15          in Rikers.  

16                 Could you kind of summarize -- I think 

17          you talked about the increased cost per 

18          inmate at Rikers recently and also some of 

19          the violence involving Rikers.  Could you 

20          kind of give a little synopsis of your audit 

21          and what is being done as a follow-up?  

22                 NYC COMPTROLLER STRINGER:  As the 

23          population in Rikers decreases, the cost per 

24          inmate is rising, which makes no sense to me.  


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 1          It's now $137,000.  Now, some of that, to be 

 2          fair, are new programs that are being 

 3          implemented.  

 4                 But part of why we're focusing on this 

 5          is that violence is increasing, the cost is 

 6          going up, and we don't have a long-term 

 7          Rikers plan, and that's something that we 

 8          have to continue to talk about.  One option 

 9          on the table -- and perhaps the Lippman 

10          Commission will address it -- is how do we go 

11          about closing Rikers, because it is an 

12          antiquated place.  I've been there 

13          voluntarily, and it's -- it's -- you know --

14                 ASSEMBLYMAN WEPRIN:  I'm glad you 

15          clarified that.

16                 (Laughter.)

17                 NYC COMPTROLLER STRINGER:  Well, in 

18          these times.

19                 It is a place that is in desperate 

20          need of reform, and the physical plant is in 

21          just terrible condition.

22                 But I'm very excited that you are the 

23          new chair, and I do look forward to working 

24          with you.  We are going to continue to look 


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 1          every few months at some of the issues facing 

 2          Rikers, because it's important for the people 

 3          there that we do everything we can to make 

 4          Rikers safe, cost-effective, and efficient.

 5                 ASSEMBLYMAN WEPRIN:  Do you think 

 6          closing it is an option?

 7                 NYC COMPTROLLER STRINGER:  I think it 

 8          absolutely should be studied.  I think it's 

 9          critical that we look at this huge place that 

10          has just been operating in a way that's just 

11          in a different era.  And when you think about 

12          how we can best house our inmates, keep them 

13          safe, and keep costs down, I mean I think 

14          that all goes hand in hand.

15                 ASSEMBLYMAN WEPRIN:  Okay.  Well, if 

16          we did close it, where would the -- you know, 

17          it's a little bit less than 10,000 inmates 

18          now; at one point it was 20,000.

19                 NYC COMPTROLLER STRINGER:  It's about 

20          9,000, yeah.

21                 ASSEMBLYMAN WEPRIN:  Where would you 

22          suggest that we house those inmates?  

23                 NYC COMPTROLLER STRINGER:  Well, 

24          that's going to be up to you.  And part of 


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 1          what we'll have to do is work on having a 

 2          discussion with city officials -- we're 

 3          certainly not there today.  I think we do 

 4          need to do research and analysis, what is the 

 5          best way to house our inmate population.  

 6                 The Rikers footprint is huge, and it 

 7          is a plant that is slowly falling into 

 8          disrepair.  So the cost of maintaining it, 

 9          you know, may turn out to be 

10          cost-prohibitive.  And so this is not 

11          something that's going to happen overnight.  

12          But sometimes you have to start laying the 

13          groundwork for different options.  And I 

14          think we have to talk to people, our 

15          constituents in New York City, show them it's 

16          costing $137,000 a year just to, you know, 

17          incarcerate an inmate when there's so many 

18          forward-thinking ideas in terms of how we 

19          house our inmates in a safe way that's 

20          cost-effective.  And with you as chair, I 

21          think you'll breathe some life into that 

22          discussion.

23                 ASSEMBLYMAN WEPRIN:  Thank you very 

24          much, Comptroller.


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 1                 NYC COMPTROLLER STRINGER:  Thank you.  

 2                 CHAIRMAN FARRELL:  Thank you.  

 3                 Senator?  

 4                 CHAIRWOMAN YOUNG:  Senator Krueger.

 5                 SENATOR KRUEGER:  Hi, how are you, 

 6          Comptroller Stringer?

 7                 NYC COMPTROLLER STRINGER:  You're 

 8          back.

 9                 SENATOR KRUEGER:  I'm back.  I 

10          apologize, I had to run off to do something 

11          with the Governor and got back.

12                 Thank you for being here.  I did have 

13          a chance to review your testimony quickly, 

14          and you cover so many important progressive 

15          issues for the City of New York and where we 

16          need to go.

17                 NYC COMPTROLLER STRINGER:  Thank you.

18                 SENATOR KRUEGER:  I was just curious, 

19          today on the floor of the Senate there's 

20          going to be a bill -- I'll be voting no on 

21          it -- that would limit New York City's 

22          property tax to the same kind of formula the 

23          rest of the state's property tax caps are set 

24          at.  And I'm curious whether you have any 


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 1          analysis of what that would mean for the 

 2          city's finances if in fact the bill -- that I 

 3          believe Senator Lanza sponsors in the 

 4          Senate -- were to become law.

 5                 NYC COMPTROLLER STRINGER:  You know, I 

 6          think that's sort of comparing apples to 

 7          oranges.  I don't think, say, a 2 percent cap 

 8          for the city would work at all.  Our 

 9          expenses are going up by around 5 percent a 

10          year, given all the issues and things that we 

11          deal with.  So I think to sort of strangle us 

12          in that way would not be smart financially, 

13          fiscally.

14                 I think there's a better conversation 

15          to be had, but I don't think that's the way 

16          to do it.  And I would say, as somebody who 

17          watches the finances of the city, I commend 

18          you for voting no.

19                 SENATOR KRUEGER:  Thank you.

20                 And you spoke of, in your testimony, 

21          supporting the continuation of what people 

22          euphemistically talk about as the 

23          millionaire's tax, and even extending it.  

24          And I publicly have supported it already 


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 1          earlier today.  

 2                 There's always somebody who argues if 

 3          you do this, you'll lose all your 

 4          millionaires and you'll actually end up 

 5          losing tax revenue for the city.  Can you 

 6          speak from your experience, since we've now 

 7          had this tax for multiple years?

 8                 NYC COMPTROLLER STRINGER:  Well, as I 

 9          mention in the testimony, the very wealthy 

10          actually stand to benefit greatly from 

11          federal tax cuts.  And we estimate that 

12          New York City residents making more than 

13          $1 million would reap a $3 billion federal 

14          tax cut under the Trump plan.  So we think 

15          that under the federal tax plan, we're 

16          actually going to see millionaires doing very 

17          well.

18                 The people we're concerned about are 

19          in some cases the middle class, who would get 

20          a relatively paltry tax cut, and in some 

21          cases no tax cut at all.  We think that to 

22          make up the revenue, that to support the 

23          Assembly tax plan makes sense today.  

24                 Now remember, the millionaire's tax 


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 1          was first proposed in 2009 during the Great 

 2          Recession.  The top bracket raised to 

 3          $1 million for single filers and $2 million 

 4          for joint filers.  The top rate is only 8.97.  

 5          That has been lowered to 8.82 percent, right?  

 6                 So we think that this is a good time 

 7          to generate a little more because of the 

 8          trillions that are going to be taken off the 

 9          table.

10                 SENATOR KRUEGER:  Thank you.

11                 And one more question --

12                 NYC COMPTROLLER STRINGER:  And let me 

13          just mention something.  

14                 SENATOR KRUEGER:  Certainly.

15                 NYC COMPTROLLER STRINGER:  Because we 

16          did an analysis in our office that found that 

17          half of all taxpayers with incomes greater 

18          than $1 million, right, do not actually live 

19          in New York, and that these taxpayers are 

20          less likely to move than lower-income 

21          taxpayers.  So half the people don't even 

22          live here.

23                 SENATOR KRUEGER:  And I always enjoy 

24          discussing fiscal issues with you as the city 


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 1          comptroller, so you're the perfect person for 

 2          me to ask these questions of.  So thank you.

 3                 In the Governor's budget, something I 

 4          don't think came up yet today, there's a 

 5          proposal to basically expand on Internet fair 

 6          taxation.  So we've had the -- what they 

 7          euphemistically call the Amazon tax, and in 

 8          the Governor's proposal it expands it, which 

 9          some people are saying but if they have no 

10          bricks and mortar in New York, why should we 

11          be able to tax them?  And of course others 

12          point out as more and more commerce moves to 

13          the Internet, you have fewer people shopping 

14          retail and less sales tax coming into local 

15          governments.  

16                 Do you have a position for sales tax 

17          revenue to the City of New York from this 

18          proposal?  

19                 NYC COMPTROLLER STRINGER:  We think 

20          under the proposal we would see $40 million 

21          for New York City.  We already have a process 

22          in place to capture that revenue.  This would 

23          just make the provider responsible for 

24          collecting it.  So I actually think it would 


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 1          be a benefit to the city.

 2                 SENATOR KRUEGER:  And you don't see a 

 3          negative for the City of New York if we were 

 4          to implement this?  

 5                 NYC COMPTROLLER STRINGER:  We're in a 

 6          new world when it comes to this.  But this, I 

 7          think, is a moderate way to take a look at 

 8          how we can, you know, look at revenue without 

 9          hurting businesses, but at the same time 

10          making sure that New York City is capturing 

11          what it's supposed to in terms of sales tax.

12                 SENATOR KRUEGER:  Thank you very much 

13          for your testimony.

14                 NYC COMPTROLLER STRINGER:  Thank you, 

15          Senator.

16                 CHAIRMAN FARRELL:  Thank you.  

17                 Mr. Lupinacci.  Braunstein, I'm sorry.

18                 ASSEMBLYMAN BRAUNSTEIN:  Can you hear 

19          me?  Good afternoon, Mr. Comptroller.  

20                 As you're aware, significant inequity 

21          exists within New York City's property tax 

22          system.  If you look at effective property 

23          tax rates for co-op owners in the outer 

24          boroughs compared with their neighboring 


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 1          single-family homeowners as well as co-op 

 2          owners in Manhattan and parts of Brooklyn, 

 3          you'll see that outer borough co-op owners 

 4          pay significantly higher effective property 

 5          taxes than their similarly situated 

 6          neighbors.  

 7                 The reason co-ops in Manhattan and 

 8          Brooklyn are assessed differently than the 

 9          outer boroughs has to deal with comparables 

10          and sometimes they use rent-regulated 

11          comparables, and that's an issue for another 

12          time.  But one of the reasons that 

13          single-family homeowners have relatively 

14          lower property taxes is because there's caps 

15          on assessments at 6 percent a year, 

16          20 percent over five years.  

17                 In the district I represent, many 

18          people can't afford to buy a home.  So we 

19          have young families, middle-class families, 

20          seniors on fixed incomes who live in co-ops, 

21          and they're seeing their property taxes rise 

22          at an exponential rate.  And it's forcing 

23          many people to make difficult decisions about 

24          whether or not they can continue to stay in 


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 1          their home.

 2                 I introduced legislation in 2013, in 

 3          coordination with the City Council -- and 

 4          Mr. Niblack here helped me work on it as 

 5          well -- that would cap assessments on co-ops 

 6          at 8 percent a year, 30 percent over five 

 7          years.

 8                 I've pleaded with the de Blasio 

 9          administration to help us push this proposal 

10          because, while we can unilaterally do it up 

11          here, generally as a policy, when we make 

12          major tax changes to a locality, we tend to 

13          try and get a green light, especially in the 

14          Assembly.

15                 Would you be open to supporting an 

16          8 percent assessment cap per year, 30 percent 

17          over five years, for co-ops?

18                 NYC COMPTROLLER STRINGER:  Listen, I 

19          think you've been a leader to make our 

20          property tax system more fair and equitable.  

21          I do think we should review our property tax 

22          system.  We haven't had a real discussion 

23          about it for a very long time.  We do have a 

24          system that does not treat everybody equally, 


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 1          and I think you're right to raise these 

 2          issues, as was the City Council.  

 3                 As a former chair of the Real Property 

 4          Taxation Committee in the Assembly some years 

 5          ago -- more than a decade ago -- we talked 

 6          about taking a look at this system.  And I'll 

 7          be happy to work with you.  I don't want to 

 8          commit today on your bill, partly because I 

 9          haven't reviewed it.

10                 ASSEMBLYMAN BRAUNSTEIN:  Sure.

11                 NYC COMPTROLLER STRINGER:  But I do 

12          think that we're long overdue to just simply 

13          start talking about the tax system.  I think 

14          we could make some headway.  I'm going to ask 

15          Preston just to talk about it from -- because 

16          of his experience --

17                 ASSEMBLYMAN BRAUNSTEIN:  No, I just 

18          wanted to bring it to your attention because 

19          it's becoming a very serious problem --

20                 NYC COMPTROLLER STRINGER:  No, I 

21          understand.

22                 ASSEMBLYMAN BRAUNSTEIN:  Especially 

23          seniors on a fixed income, that property tax 

24          is passed on to their maintenance.  And their 


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 1          pension has not gone up like that, their 

 2          Social Security benefits aren't going up like 

 3          that, but they're seeing -- I mean, 

 4          exponential.  I've gone to the co-op board 

 5          meetings, and you see the curve of how much 

 6          the property tax has gone up, and even in the 

 7          next few years it's going to be a big 

 8          problem.

 9                 NYC COMPTROLLER STRINGER:  You're 

10          right, you're absolutely right to raise it.  

11          It's time to have that discussion.

12                 NYC DEPUTY COMP. NIBLACK:  I think the 

13          problem that we were trying to address with 

14          your bill, your proposal, really at its core 

15          was about the assessment process and how it 

16          treats buildings -- like mine, frankly, on 

17          the Upper West Side, that is compared to a 

18          set of rent-controlled apartment buildings 

19          and is underassessed as a result, as opposed 

20          to the buildings out in your district, which 

21          we looked at very closely, that get assessed 

22          at something that's much closer to market 

23          value.  

24                 And it creates distortions, that 


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 1          assessment method creates distortions.  I 

 2          spent lots of time with David Weprin on this 

 3          as well.  And that's really the core of this 

 4          problem.  

 5                 ASSEMBLYMAN BRAUNSTEIN:  I mean, 

 6          theoretically that sounds like a good 

 7          proposal, but there's so many winners and 

 8          losers in that plan that it's almost 

 9          politically untenable.  Whereas a straight 

10          cap on assessments across the board is 

11          something that I think everybody could 

12          support.  So I'm just happy to bring it to 

13          your attention.

14                 NYC COMPTROLLER STRINGER:  

15          Assemblyman, we'll be happy to work with you 

16          on this, absolutely.  

17                 CHAIRMAN FARRELL:  Thank you.  

18                 Senator?  

19                 CHAIRWOMAN YOUNG:  I think we're all 

20          set.

21                 CHAIRMAN FARRELL:  Thank you very 

22          much.  

23                 NYC COMPTROLLER STRINGER:  Thank you 

24          very, very much.  Best of luck in the 


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 1          deliberations.  Thank you.

 2                 SENATOR KRUEGER:  Thank you.

 3                 CHAIRWOMAN YOUNG:  Thank you, 

 4          Mr. Comptroller.

 5                 CHAIRMAN FARRELL:  Sophia said to say 

 6          hello.  I told her you would be here.

 7                 NYC COMPTROLLER STRINGER:  Is she 

 8          here?

 9                 CHAIRMAN FARRELL:  No, she isn't.  She 

10          wanted to be.

11                 NYC COMPTROLLER STRINGER:  Max and 

12          Miles say hello.

13                 (Discussion off the record.)

14                 CHAIRMAN FARRELL:  City of Buffalo, 

15          Mayor, the Honorable Byron Brown.  

16                 This is the long version, right?

17                 MAYOR BROWN:  Yes.  That's a longer 

18          version than I'm going to give.

19                 CHAIRMAN FARRELL:  It's as long as 

20          this?

21                 MAYOR BROWN:  No, it's shorter than 

22          that.

23                 Chairman Denny Farrell, chairman of 

24          Ways and Means, Senator Catharine Young, our 


                                                                 267

 1          Finance chair, and to all of the members of 

 2          the Legislature, it's a wonderful pleasure to 

 3          be back here with you in Albany and to have 

 4          the opportunity to give my perspective on 

 5          Governor Cuomo's proposed budget.

 6                 I have with me today City of Buffalo 

 7          Commissioner of Administration and Finance 

 8          Donna Estrich.  And as per the indirect 

 9          instructions of Chairman Farrell, I will give 

10          an abbreviated presentation of what you have 

11          in front of you.

12                 I want to just first of all say that 

13          my administration has worked continuously to 

14          improve Buffalo's fiscal situation, which has 

15          created a strong business environment and 

16          continues to attract investment and create 

17          jobs.  There has been a remarkable revival in 

18          the City of Buffalo.  And while there is 

19          still much that we need to accomplish in 

20          Buffalo, our efforts have produced incredible 

21          results. 

22                 For example, we've delivered 11 

23          balanced budgets.  It has been five years 

24          since Buffalo's hard control board shifted to 


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 1          a soft advisory panel.  Overall, the crime 

 2          rate has dropped 32 percent, and violent 

 3          crime is down 27 percent.  The City of 

 4          Buffalo has added over 1,400 affordable 

 5          housing units since 2006.  

 6                 And I know earlier there was much 

 7          discussion with Mayor de Blasio and 

 8          Comptroller Stringer about minority- and 

 9          women-owned businesses and concerns about 

10          immigration and the recent immigration 

11          orders.  I have hired the first chief 

12          diversity officer in the City of Buffalo a 

13          year ago, to support the growth and 

14          development of minority- and women-owned 

15          businesses, and we are seeing great success 

16          in that area.  

17                 And I have also created the Office of 

18          New Americans to ease the transition of 

19          immigrants and refugees into the City of 

20          Buffalo.

21                 The city has also improved its bond 

22          ratings with the Big 3 credit rating 

23          agencies, receiving an A+ from Standard & 

24          Poor's, an AA- from Fitch Ratings, and an A1 


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 1          from Moody's Investor Services.  We are 

 2          continuing to keep costs down and create a 

 3          more open and efficient government.  

 4                 We've reduced our costs by switching 

 5          over to a VOIP telecommunications system.  

 6          We've implemented a fuel monitoring system 

 7          and installed GPS in much of our municipal 

 8          fleet to reduce waste and be more efficient.  

 9                 The City of Buffalo recently acquired 

10          a downtown federal building to consolidate 

11          police and fire administrative offices into 

12          one location, and we are fully confident that 

13          this will create efficiencies and save money 

14          in both operations.  This will also enable us 

15          to sell the police building, which is 

16          considered valuable real estate, in the 

17          current downtown market.  

18                 We created and implemented the BPD21C 

19          Police Academy Pre-Employment Scholarship 

20          Program, a first of its kind in the nation 

21          program, which has put new police officers on 

22          the streets more quickly and saved the city 

23          millions while developing a community police 

24          force that better reflects the demographics 


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 1          of our diverse city.

 2                 After 242 public meetings to assess 

 3          and consider input from residents across the 

 4          city, I signed a new unified development 

 5          ordinance into law earlier this month, the 

 6          "Green Code."  It is the first major overhaul 

 7          to Buffalo's zoning laws since 1953 and will 

 8          serve as a blueprint for zoning and 

 9          development in the 21st century.  And Buffalo 

10          joins only two other major American cities 

11          that have done this, and so we're very proud 

12          of that accomplishment.

13                 The City of Buffalo is also working 

14          with the Sunlight Foundation and the 

15          Johns Hopkins University Center for 

16          Government Excellence to improve the use of 

17          data-driven decisionmaking and analysis.  I 

18          issued an executive order to create an open 

19          data policy, and will soon release an RFP to 

20          procure an open data portal that will be a 

21          central repository for city data and will 

22          enhance transparency in city government.

23                 And last year, I want to thank you for 

24          the land bank superbid power that you passed 


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 1          for the City of Buffalo and was signed by the 

 2          Governor.  I want to thank Assemblymember 

 3          Crystal Peoples-Stokes, for being the 

 4          Assembly sponsor of that legislation, and 

 5          State Senator Patrick Gallivan, for being the 

 6          Senate sponsor.  

 7                 This has enabled us in the City of 

 8          Buffalo to break the cycle of foreclosed 

 9          properties being purchased by absentee owners 

10          who seldom invest in them, and to create 

11          homeownership opportunities for residents to 

12          contribute to the stabilization of our 

13          neighborhoods.  

14                 I am proud to report that the City of 

15          Buffalo, thanks to a lot of support that we 

16          have received from the Legislature and the 

17          Governor, and the hard work that we have done 

18          locally, is in sound financial condition.  

19          You have been very instrumental in our 

20          renaissance, and I want to thank you for 

21          that.  

22                 This year's Executive Budget proposal 

23          makes important investments that will ensure 

24          Buffalo's continued prosperity.  I am 


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 1          grateful for the faith and commitment that 

 2          Governor Cuomo has shown in the potential of 

 3          our city, with the Buffalo Billion initially 

 4          and now the Buffalo Billion 2.  The focus on 

 5          job creation and providing support to 

 6          businesses and entities that stimulate 

 7          development will continue the tremendous 

 8          progress that has been made under the 

 9          original Buffalo Billion program.

10                 I'd also like to thank Governor Cuomo 

11          for including $10 million for the Better 

12          Buffalo Fund in this year's budget.  The 

13          Better Buffalo Fund has supported projects 

14          that have boosted the growth of small 

15          businesses and increased employment and 

16          housing options along corridors served by 

17          public transportation.  These investments are 

18          building neighborhoods and improving quality 

19          of life.  

20                 Fifty years of deindustrialization and 

21          disinvestment has impaired the ability for 

22          rapid progress on the East Side of Buffalo 

23          more than any other neighborhood in our city. 

24          The rapid population loss from the 1970s 


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 1          through the 2000s, coupled with the high 

 2          concentration of poverty, has led to an 

 3          abundance of abandoned and dilapidated 

 4          housing.  The Governor's proposal to invest 

 5          $10 million to help eliminate zombie 

 6          properties and revive and reinvent blighted 

 7          areas on the East Side and in the suburb of 

 8          Cheektowaga will have a profound impact on 

 9          the quality of life in these neighborhoods.

10                 To guide unemployed or underemployed 

11          individuals into advanced manufacturing and 

12          energy industries which are growing in the 

13          City of Buffalo, Governor Cuomo has allocated 

14          $10 million for a workforce development plan 

15          to support job growth and ensure Buffalo has 

16          a workforce with skills to meet the 

17          requirements of the jobs of the future, and 

18          we certainly support that. 

19                 Approximately $60 million of the 

20          proposed Buffalo Billion 2 funding is 

21          currently targeted for East Side 

22          revitalization projects where the city is 

23          experiencing high poverty.  I applaud the 

24          Governor for this much-needed investment.


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 1                 The new funding for the Buffalo 

 2          Niagara Medical Campus, as part of the 

 3          Buffalo Billion 2, will support the region's 

 4          growth of medical startups, another area that 

 5          is driving record amounts of employment 

 6          opportunities for residents of the City of 

 7          Buffalo.  

 8                 I'm also enthusiastic about the 

 9          Governor's budget proposal to make college 

10          tuition free for middle-class families at 

11          SUNY and CUNY.  Many of Buffalo's 

12          top-performing high school students never 

13          apply to college even though they have 

14          displayed the ability to succeed 

15          academically.  A majority of these students 

16          come from low-income households.  

17                 The City of Buffalo has made 

18          modernizing our municipal infrastructure a 

19          top priority.  Buffalo has invested over 

20          $217 million -- $95 million of that in 

21          drinking water, and $122 million in sewer 

22          improvements -- since 2006.  I applaud the 

23          Governor for including over $2 billion for 

24          clean water infrastructure.


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 1                 Buffalo is continuing to protect the 

 2          progress it has made and add tools that will 

 3          allow the City of Buffalo to reach its full 

 4          potential.  We continue to need assistance to 

 5          continue our fiscally responsible growth 

 6          strategy.  For example -- and I am going to 

 7          summarize these, because you have the 

 8          testimony in front of you -- we're seeking to 

 9          build a public works campus and consolidate 

10          the operations of our Public Works 

11          Department, consolidating six facilities into 

12          one.  Phase 1 would be a $30 million 

13          investment.

14                 Cars Sharing Main Street funding -- 

15          I've been before you before and talked about 

16          the fact that 30 years ago our Main Street 

17          was closed to vehicular traffic when the 

18          light-rail rapid transit system was 

19          installed.  And to date we have been able to 

20          invest close to $60 million in opening up 

21          Main Street to vehicular traffic, with 

22          federal, state, and City of Buffalo dollars.  

23          It has been of major benefit to the City of 

24          Buffalo, and we would like to continue that 


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 1          process with an allocation of $30 million to 

 2          open up another two blocks of our 

 3          Main Street.

 4                 I will tell you that the $60 million 

 5          of investment with public resources that we 

 6          have been able to make has stimulated over 

 7          $500 million of private-sector investment.  

 8                 We'd also like to create a unique 

 9          Tax-Reduction Incentive Program.  And we'd 

10          like Buffalo to be the model for that 

11          program, where our state would provide an 

12          incentive for those municipalities who 

13          actually cut taxes and maintain those tax 

14          cuts for at least five years.  The details of 

15          the program are in our presentation before 

16          you.

17                 We would also like to close the 

18          utility services tax loophole.  We've talked 

19          about this before.  Cities like Buffalo, 

20          Rochester, and Yonkers previously have had 

21          the ability -- and we still do -- to collect 

22          the 3 percent tax on gross receipts of local 

23          services provided by utility companies, but 

24          we are not able to do that on the wireless 


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 1          companies.  The state has adopted legislation 

 2          to give the state the ability to impose an 

 3          excise tax on telecommunications, and that is 

 4          not the case with cities outside of New York 

 5          City.  And that would be very important to 

 6          Buffalo and other upstate cities to have this 

 7          ability.

 8                 Finally, AIM funding is the lifeblood 

 9          of municipal governments, and any decrease or 

10          disruption in this funding jeopardizes 

11          essential services.  As you know, in 2010 the 

12          AIM program was cut by 7.6 percent and has 

13          not been fully restored since that time.  As 

14          the operating costs of running a municipality 

15          have continued to increase at an almost 

16          unsustainable pace over the last seven years, 

17          AIM funding has remained flat.  My request is 

18          that AIM funding be increased to coincide 

19          with the rate of inflation.

20                 Again, through hard work and careful 

21          planning, and with the support of the 

22          Governor and this legislative body, we have 

23          been able to make significant progress in the 

24          City of Buffalo.  We have worked hard to 


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 1          build a foundation for future growth and 

 2          investment.  We are grateful to your role in 

 3          that, and we're asking for your continued 

 4          support and assistance as you deliberate this 

 5          year's state budget.

 6                 Thank you very much.

 7                 CHAIRMAN FARRELL:  Thank you.  

 8                 Mr. Benedetto?

 9                 ASSEMBLYMAN BENEDETTO:  Yes.  Welcome 

10          here, Mayor, and it's a pleasure to have you 

11          in the hall.

12                 MAYOR BROWN:  It's a pleasure to be 

13          here.

14                 ASSEMBLYMAN BENEDETTO:  Everything 

15          sounds like things are going in the right 

16          direction in Buffalo, and you are rather 

17          laudatory towards our Governor and for the 

18          things he has done.

19                 MAYOR BROWN:  And the Legislature as 

20          well.

21                 ASSEMBLYMAN BENEDETTO:  Okay.  We'll 

22          take that.

23                 The Governor has various competitions.  

24          The municipal consolidation and efficiency 


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 1          competition -- have you taken advantage of 

 2          that?  Do you have any nearby cities or towns 

 3          that you can join with, and have you?

 4                 MAYOR BROWN:  We have been able to 

 5          implement a number of efficiencies in the 

 6          City of Buffalo, some of them I outlined in 

 7          my presentation, that have saved the 

 8          residents and taxpayers of our city in some 

 9          cases hundreds of thousands of dollars -- in 

10          other cases, potentially millions of dollars.

11                 Buffalo is the largest municipality in 

12          the Western New York region, and many 

13          consolidations have been done over a long 

14          period of time.  So, for example, at one time 

15          the city and the county both had health 

16          departments.  Those have been consolidated. 

17          There's only a county health department.  The 

18          city and county once had separate library 

19          systems.  The library systems have been 

20          consolidated.

21                 So a lot of the major consolidations 

22          that could have been implemented in our 

23          region over the years have been implemented, 

24          so it would be hard for us to identify other 


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 1          consolidations with our neighboring suburban 

 2          municipalities.

 3                 ASSEMBLYMAN BENEDETTO:  So this 

 4          particular one would not really apply to you 

 5          enough really to benefit from.

 6                 Tell me about the Car Sharing Main 

 7          Street project.  I'm not familiar with it, 

 8          but it sounds like a wonderful program.  

 9          Enlighten me.

10                 MAYOR BROWN:  So about 30 years ago, a 

11          light-rail rapid transit system was installed 

12          on Main Street in downtown Buffalo.  The 

13          installation of the light rail was heralded 

14          as being a great thing for retail and 

15          business in downtown Buffalo, but the project 

16          took so long it essentially killed retail in 

17          downtown Buffalo and caused the closure of 

18          many businesses in our downtown.

19                 During my entire tenure as mayor, we 

20          have been working to assemble funds to reopen 

21          Main Street to vehicular traffic and to 

22          stimulate private-sector reinvestment in the 

23          downtown and the City of Buffalo, and we have 

24          been very successful in doing that.  We've 


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 1          attracted federal funds, we've been able to 

 2          secure state funds, and we have put City of 

 3          Buffalo funds into the project, almost 

 4          totaling about $60 million, opening three 

 5          blocks of Main Street.  

 6                 And in opening those three blocks of 

 7          Main Street, we have seen substantial 

 8          private-sector investment and business 

 9          relocation and startup in those areas where 

10          we have been able to reopen the Main Street 

11          and downtown to vehicular traffic.

12                 ASSEMBLYMAN BENEDETTO:  Very 

13          interesting.  One of these days I'll have to 

14          get up and visit Ms. Peoples and take an 

15          actual look and see how things are going.

16                 MAYOR BROWN:  We would love to host 

17          you.

18                 ASSEMBLYMAN BENEDETTO:  Thank you for 

19          your time.

20                 CHAIRMAN FARRELL:  Thank you.

21                 Senator?

22                 CHAIRWOMAN YOUNG:  Thank you very 

23          much,  Mr. Chairman.  Thank you.

24                 It's always great to see a fellow 


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 1          Western New Yorker here, so I welcome you, 

 2          Mayor.  I'm so happy to see you again.

 3                 MAYOR BROWN:  Great to see you, 

 4          Senator Young.

 5                 CHAIRWOMAN YOUNG:  We are just 

 6          thrilled with the rejuvenation of Buffalo and 

 7          your good work and what we've been able to do 

 8          as partners on the state level.  

 9                 I just did have one really quick 

10          question.  Recently you signed into law 

11          Green Code legislation which would affect 

12          many aspects of development in the city, from 

13          historic preservation to environmentally 

14          friendly policies to even walkability.  And 

15          there have been many articles about what it's 

16          going to do as far as impacting the 

17          community, and I was wondering about the 

18          city's budget.  And could you give us an 

19          outline as to what you think the impact will 

20          be on the city budget, not only this year but 

21          prospectively?

22                 MAYOR BROWN:  Well, what the Green 

23          Code will do is really update our land use 

24          planning, and it will be a unified 


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 1          development ordinance for the City of 

 2          Buffalo.  As I mentioned in my testimony, we 

 3          haven't updated our zoning laws in any 

 4          substantial way in 63 years.  So this has 

 5          been a major undertaking, a major planning 

 6          effort for us.  

 7                 We're one of only three major cities 

 8          in the country to do a complete overhaul of 

 9          our zoning laws, and we believe it will make 

10          the development process in the City of 

11          Buffalo quicker and more predictable.  It 

12          will make it easier for people who want to 

13          build things to be able to do that, and it 

14          will give citizens who previously have been 

15          concerned about some development the 

16          opportunity to weigh in and say what they 

17          would like to be built, how they would like 

18          it to be built, and where they would like it 

19          to be built, built into the codes that will 

20          address everything, as you mentioned, from 

21          walkability to historic preservation and 

22          other issues as it relates to development.

23                 We think budgetarily it will have the 

24          impact of stimulating additional economic 


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 1          development.  We think it will add to our tax 

 2          base.  We have tried to be extremely 

 3          efficient in the City of Buffalo.  We have 

 4          really tightened our belts over the years, 

 5          and we are looking forward to now being able 

 6          to reap the benefit of that by being able to 

 7          generate additional tax revenue because we're 

 8          bringing more businesses and residents into 

 9          the city.

10                 CHAIRWOMAN YOUNG:  Thank you.

11                 CHAIRMAN FARRELL:  Thank you.

12                 We've been joined by Assemblywoman 

13          Fahy and Assemblyman McDonald.

14                 Next to question, Crystal 

15          Peoples-Stokes.

16                 ASSEMBLYWOMAN PEOPLES-STOKES:  Thank 

17          you, Mr. Chairman, for the opportunity to ask 

18          a few questions of the mayor of the great 

19          City of Buffalo.

20                 Mr. Mayor, I want to thank you and 

21          your commissioner for being here this morning 

22          to share with us your thoughts on the 

23          Governor's proposed budget.  I did want to 

24          ask you one thing that you did not mention in 


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 1          your presentation that the Governor has 

 2          included in his proposed budget, and that's 

 3          ride-sharing and Uber.  So I wanted to 

 4          hear -- well, did you -- your thoughts on 

 5          that.  Did you support the Governor's 

 6          position on it?  Do you have some concerns 

 7          about local control?  Where are you on that 

 8          issue?

 9                 MAYOR BROWN:  We certainly support 

10          ride-sharing in the City of Buffalo.  

11                 I have been a very vocal proponent of 

12          ride-sharing.  We think it provides another 

13          option for transportation for residents and 

14          visitors in the City of Buffalo.  

15                 We think also, being a very large 

16          college community with a number of colleges 

17          and universities, it also provides a measure 

18          of safety for our young people when they go 

19          out on weekends, to make sure that they can 

20          call one of the ride-sharing companies and 

21          safely be able to get home without the 

22          potential of driving and drinking.  We think 

23          it will reduce that in communities, as has 

24          been evidenced in other communities where 


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 1          ride-sharing exists.

 2                 And then we also believe that it is 

 3          another option to provide employment 

 4          opportunities for members of our community 

 5          where we do have high poverty in some 

 6          segments of the population. 

 7                 So we are very much in favor of the 

 8          Governor's proposal for ride-sharing.  I know 

 9          that many in the Legislature have also been 

10          very strong proponents of ride-sharing, and 

11          we believe that it can be done without having 

12          a detrimental impact on the traditional 

13          taxicab industry.

14                 ASSEMBLYWOMAN PEOPLES-STOKES:  Well, 

15          can you just explain a little bit about how 

16          you think that can be done without having 

17          that detrimental impact?  Because I'm hopeful 

18          that it can be done without that 

19          detrimental -- but I haven't heard the 

20          clarity on that yet, from the Governor's 

21          perspective.

22                 MAYOR BROWN:  Well, you know, like 

23          you, we're certainly waiting for more 

24          details.  What we have always done when we 


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 1          have expressed our support for ride-sharing 

 2          is also express that we support the 

 3          traditional taxicab industry, and we would 

 4          like to see a proposal developed that allows 

 5          for healthy business competition but also 

 6          allows those two types of businesses to exist 

 7          to provide more transportation options for 

 8          our residents.

 9                 So I am hopeful that as the proposal 

10          is more fully fleshed out and developed, we 

11          will see that kind of detail and we will see 

12          a proposal that will allow those 

13          transportation options for the community.  

14          Because I think the more options we can 

15          provide to people and the more business 

16          competition that is offered, we will see 

17          pricing go down and people having the 

18          particular transportation option that best 

19          suits their needs.

20                 ASSEMBLYWOMAN PEOPLES-STOKES:  Great.  

21          Thank you.  I concur, and I think it will be 

22          a huge economic benefit to the region as 

23          well.  So I'm hopeful that through these 

24          conversations we will work it out so that 


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 1          both the new Uber driver and the traditional 

 2          taxi driver can work collaboratively.

 3                 The other question I wanted to ask, if 

 4          you could just expound on it a little bit, is 

 5          the whole issue of land grant, which as you 

 6          know was a pretty significant measure to get 

 7          done.  I certainly want to give many thanks 

 8          to my colleague Mr. Gallivan, and certainly 

 9          the Governor for signing the bill.

10                 But the thought process that your 

11          administration has on using those properties 

12          to actually allow people to become first-time 

13          homeowners.  Have you implemented that 

14          process yet?  And if so, how many people has 

15          it positively affected?

16                 MAYOR BROWN:  So we're in the process 

17          of implementing that policy now.  We will be 

18          certainly in communication with your office 

19          and other members of the Western New York 

20          delegation to give them a preview of the 

21          details of the program that we will be 

22          initiating to assist people in becoming 

23          owner/occupants with the properties that we 

24          have been able to secure in the in rem 


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 1          foreclosure auctions.  

 2                 Thanks to you and your colleagues, in 

 3          this first foreclosure auction since we got 

 4          the superbid power, we've been able to 

 5          acquire 60 properties in the City of Buffalo.  

 6          And our goal with all of those properties is 

 7          to assist people who are currently renters in 

 8          the neighborhoods surrounding the properties 

 9          to become homeowners.

10                 The other thing that is important to 

11          note is in being able to do that, we will 

12          work with people in various city 

13          neighborhoods and establish what is called 

14          homebuyers clubs, where we will help people 

15          repair their credit, where we will help 

16          people become prequalified for mortgages so 

17          that they can not only take advantage of 

18          these city housing opportunities through the 

19          land bank, but other housing opportunities 

20          that exist in the neighborhoods in the City 

21          of Buffalo.  

22                 So this is a critically important 

23          piece of legislation that not only will 

24          promote home ownership but will help to 


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 1          stabilize the tax base in the City of Buffalo 

 2          and help people improve their personal 

 3          finances.  

 4                 And I also want to just thank you, 

 5          Assemblymember, for the work that you have 

 6          been doing with my office in partnership to 

 7          help people strengthen and stabilize their 

 8          finances in the city.  And one example of 

 9          that is the series of wills and estates 

10          workshops that we have done in the City of 

11          Buffalo that actually help people establish a 

12          will for themselves so that when they pass 

13          on, and we will all do that, it is determined 

14          where their property will go so that we can 

15          keep wealth and assets in families.

16                 ASSEMBLYWOMAN PEOPLES-STOKES:  Well, 

17          thank you for your comments on that, because 

18          it is a very important initiative that we're 

19          doing.

20                 But you know, I just want to add this.  

21          I think your work in creating home ownership 

22          for people who are now renters in communities 

23          that are close to becoming gentrified means 

24          they have an opportunity not only to stay in 


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 1          the communities where they have always been, 

 2          but also to be in a community that is 

 3          transitioning in terms of the quality of the 

 4          housing stock, and quite frankly the support 

 5          of the businesses that will come there as 

 6          well.

 7                 MAYOR BROWN:  This is just one tool 

 8          that we will use to try to prevent 

 9          gentrification in the community.  Also, in 

10          addition to using this as a tool, we have 

11          been meeting in different communities to talk 

12          about this and how it will work.  So it's 

13          going to -- there will be extensive community 

14          outreach so people are aware of this.  

15                 Because initially when this 

16          legislation was passed, people felt that it 

17          would give the city the ability to come in 

18          and take their homes.  So we are going to be 

19          in intense communication with the residents 

20          to let them know that this has been 

21          established for their benefit.

22                 I also want to just finally mention, 

23          on this point, the properties that the city 

24          was able to secure with this superbid power 


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 1          were not -- were taken from absentee owners 

 2          not living in the City of Buffalo.  So we did 

 3          not take a property from someone that lived 

 4          in the city, that lived in the home.  So no 

 5          one's personal property was taken as a result 

 6          of this legislation.  These were all 

 7          absentee-owned properties that the city 

 8          acquired.

 9                 ASSEMBLYWOMAN PEOPLES-STOKES:  Right.  

10                 So again, I want to commend your 

11          administration for figuring out a strategy, a 

12          legislative strategy, albeit, that we were 

13          happy to get through for you that will really 

14          kind of help deal with this great problem 

15          that we have.

16                 Our economy is growing, we're excited 

17          about that, people are moving in, excited 

18          about that -- but at the end of the day, we 

19          don't want to force the existing constituent 

20          into a place where they can't afford to live 

21          in the communities that they've traditionally 

22          lived in.  So I want to thank you for your 

23          efforts on that.  

24                 Finally, I will just ask about the 


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 1          Tax-Reduction Incentive Program.  Is that a 

 2          concept that you and your administration have 

 3          come up with that could be beneficial to the 

 4          state and other municipalities across the 

 5          state, or is this something that has been in 

 6          place for some time somewhere else?

 7                 MAYOR BROWN:  No, it's a new concept 

 8          that we are proposing to the Governor and to 

 9          the Legislature.  

10                 What we've tried to do is -- we know 

11          that there is a tax burden in the state that 

12          we're all concerned about, and what we've 

13          tried to do is actually come up with an 

14          incentive to encourage municipalities on 

15          their own, in partnership with the state, to 

16          find ways that they can reduce their tax 

17          burden.  And as they find ways to reduce that 

18          tax burden, the way that the state would 

19          partner would be to provide them with an 

20          incentive to do that.

21                 So there is the stick approach and 

22          there is the carrot approach.  We are 

23          proposing a carrot approach for those 

24          municipalities that work in partnership with 


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 1          the state to find ways to reduce the tax 

 2          burden on the local level.  We think we have 

 3          found ways to do that in the City of Buffalo.  

 4          We would like to be a model for how that can 

 5          be done, and we think that this could become 

 6          a statewide program, particularly for upstate 

 7          cities.

 8                 ASSEMBLYWOMAN PEOPLES-STOKES:  Thank 

 9          you.  Thank you, Mr. Chairman.

10                 CHAIRMAN FARRELL:  Thank you.

11                 Senator?

12                 CHAIRWOMAN YOUNG:  Senator Krueger.

13                 SENATOR KRUEGER:  Thank you. 

14                 How are you, Mr. Mayor?

15                 MAYOR BROWN:  I'm doing well, Senator 

16          Krueger.  Good to see you.

17                 SENATOR KRUEGER:  Nice to see you 

18          again.

19                 So you answered the question before 

20          that under the Governor's proposed 

21          consolidation between cities and counties, 

22          that for you, you really believe you've done 

23          this before with Buffalo and Erie.

24                 And yet, as I read the Governor's 


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 1          proposal, if you didn't do something and get 

 2          it past your local election process, you'd 

 3          lose money.  Is that your understanding?

 4                 MAYOR BROWN:  That is our reading of 

 5          it.  

 6                 SENATOR KRUEGER:  I can't imagine you 

 7          really want to lose your AIM funding.

 8                 MAYOR BROWN:  We do not want to lose 

 9          money.

10                 SENATOR KRUEGER:  Me either.  I don't 

11          want you to lose that AIM funding either.

12                 Second, in the Governor's budget 

13          language, he puts a sentence in several 

14          different sections of bill language that if 

15          we lost federal revenue, or otherwise lost 

16          revenue, that he would be able to cut aid to 

17          localities.  

18                 Now, you and I were legislators 

19          together, so this would actually pull the 

20          Legislature out of the process of 

21          reevaluating the budget at a time where we 

22          might see a reduction in certain kinds of 

23          revenue.  How do you feel about that?

24                 MAYOR BROWN:  Well, you know, I would 


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 1          say that clearly, as a former legislator, I 

 2          do believe in the checks and balances in our 

 3          system of government.  And I'm certainly 

 4          hopeful through these budget deliberations 

 5          and negotiations that this will be resolved 

 6          in a way that will be beneficial to 

 7          municipalities across the state.

 8                 SENATOR KRUEGER:  Thank you.

 9                 My final question, so I've been to 

10          your lovely city, I know how close it is to 

11          this country called Canada, across the 

12          bridge.  I even met with the Canadian 

13          representatives when they were here in town, 

14          I guess -- two weeks ago?  Two weeks ago.  

15          And I was very disturbed to read an article 

16          over the weekend that President Trump intends 

17          to require a new process for allowing people 

18          to cross the border, and there were people 

19          from I think both sides of the border saying 

20          this could increase the time frame for people 

21          to cross the Canadian-New York border, you 

22          know, by 10 or 20 times what it takes them 

23          now.

24                 What do you believe the impact would 


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 1          be on your city if basically people couldn't 

 2          really cross the border to come from Canada 

 3          across to Buffalo and vice versa?

 4                 MAYOR BROWN:  That would be a major 

 5          concern for us.  Obviously Canada is one of 

 6          our largest trading partners.  Being a border 

 7          city, we see the folks on the border as our 

 8          friends and our neighbors and in some cases 

 9          family members.  We have enjoyed the ability 

10          to move pretty quickly back and forth across 

11          the Canadian border, and in fact over the 

12          last few years American and Canadian agencies 

13          as well as the State of New York have worked 

14          very diligently together to make the speed of 

15          crossing even faster at the Canadian border 

16          with Buffalo and with Niagara Falls.  We 

17          certainly would not want to see that time 

18          substantially increase.

19                 We are concerned about the President's 

20          new immigration executive orders.  We have 

21          made it quite clear, I have made it quite 

22          clear, that Buffalo is a welcoming city, that 

23          we welcome immigrants and refugees.  We've 

24          also made it clear that we are concerned 


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 1          about some elements of the immigration 

 2          orders, and we have communicated -- we will 

 3          be communicating our concerns to the 

 4          White House, but we certainly would not want 

 5          to see some of these provisions enacted that 

 6          would slow the ability to move freely between 

 7          the U.S. and the Canadian border.

 8                 SENATOR KRUEGER:  I certainly agree 

 9          with your position.  I would just highlight I 

10          think this proposal, unlike some of the other 

11          disturbing executive orders around 

12          immigration and refugees, would serve to keep 

13          shoppers and tourists from coming across from 

14          Canada to Buffalo and Western New York.  And, 

15          you know, I've talked to other colleagues 

16          about the incredible tourism we get into the 

17          Adirondacks and the Great Lakes areas and the 

18          Thousand Islands during the summer.  And it 

19          seems to me this could shut all of that down, 

20          with an enormous economic negative impact.  

21                 MAYOR BROWN:  That could have a 

22          disastrous economic impact for Buffalo and 

23          Western New York.  If you go to many of our 

24          areas for shopping in the City of Buffalo, in 


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 1          Western New York, if you go to Buffalo Bills 

 2          games or Buffalo Sabres games, there are 

 3          literally thousands and thousands of 

 4          Canadians that come to shop, that come to 

 5          sporting events, that are pumping millions of 

 6          dollars into our economy.  

 7                 So we would be very concerned, and we 

 8          are very concerned about this proposal.

 9                 SENATOR KRUEGER:  I am too.  Thank you 

10          very much, Mr. Mayor.

11                 MAYOR BROWN:  Thank you.

12                 CHAIRMAN FARRELL:  Thank you.

13                 Mr. McDonald.

14                 ASSEMBLYMAN McDONALD:  Thank you.  

15          Mr. Mayor, good to see you.

16                 MAYOR BROWN:  Good to see you too, 

17          Assemblymember.

18                 ASSEMBLYMAN McDONALD:  So, glad to see 

19          your DPW effort is still moving ahead.  I 

20          think it's great and it's a great effort of 

21          consolidating but also making opportunities 

22          available.

23                 I was interested in your TRIP program, 

24          the Tax-Reduction Incentive Program.  And in 


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 1          it you mentioned the idea of the state 

 2          incentivizing by -- I guess it's providing 

 3          $2 million for every 1 percent of combined 

 4          real property tax reductions, so reducing the 

 5          levy by 1 percent.

 6                 So what does that mean?  Quantify it 

 7          in regards to Buffalo.  What does that, in 

 8          dollars and cents, mean?  A reduction of X 

 9          will lead to $2 million.

10                 MAYOR BROWN:  You know, so for Buffalo 

11          and other communities it could mean 

12          significant resources.

13                 ASSEMBLYMAN McDONALD:  No, I 

14          understand.  I mean, is it -- a 1 percent 

15          reduction is equal to what, $300,000, 

16          $50,000?  Reducing the levy -- what would 

17          that 1 percent be?

18                 COMMISSIONER ESTRICH:  I think we're 

19          talking about reducing the tax rate.

20                 ASSEMBLYMAN McDONALD:  You're talking 

21          about reducing the rate or the levy?

22                 COMMISSIONER ESTRICH:  The tax rate.

23                 MAYOR BROWN:  The tax rate.

24                 ASSEMBLYMAN McDONALD:  The tax rate.


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 1                 MAYOR BROWN:  The tax rate.

 2                 ASSEMBLYMAN McDONALD:  Okay.

 3                 MAYOR BROWN:  So rate times levy, as 

 4          you know, equals the tax bill.

 5                 ASSEMBLYMAN McDONALD:  Right.  Okay, 

 6          okay.

 7                 I think the idea is great.  You know, 

 8          it's interesting, because I think property 

 9          taxes have been a challenge for every 

10          municipal leader.  I'm not too far removed 

11          from being one myself.  And oddly enough, 

12          probably the only option that hasn't been 

13          tried in the last several years is to 

14          financially incentivize municipalities to get 

15          to the desired target.  This is actually one 

16          of the few times that we do that.

17                 I know that we talked about AIM 

18          funding, and AIM funding is critical, it's 

19          important.  I personally don't believe it 

20          should be on the chopping block right now, 

21          trying to arrange these forced marriages 

22          that's being discussed with the referendum.  

23                 But I do believe an opportunity to 

24          incentivize municipal leaders to reduce their 


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 1          tax rate, if that's what you're saying, is a 

 2          step in the right direction.  Because at the 

 3          end of the day, Mrs. Jones looks at her tax 

 4          bill in 2015 and 2016 and doesn't really know 

 5          about the freeze, doesn't really know about 

 6          the rebate check that's coming, but when she 

 7          sees $3,000 and then sees it at $2,700, 

 8          that's actually real, achievable savings.

 9                 So I'm in concert with that idea, and 

10          I appreciate your making this suggestion.

11                 MAYOR BROWN:  Thank you, Assemblyman.

12                 ASSEMBLYMAN McDONALD:  Thank you.

13                 CHAIRWOMAN YOUNG:  Thank you very 

14          much.  

15                 Senator Kennedy?

16                 SENATOR KENNEDY:  Thank you, Senator 

17          Young.

18                 Mayor, welcome.  Welcome back.

19                 MAYOR BROWN:  Good to see you, 

20          Senator Kennedy.

21                 SENATOR KENNEDY:  It's always great to 

22          see you.  

23                 First of all, thank you for your 

24          testimony here today.  I think you 


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 1          highlighted some extremely important not only 

 2          numbers and programs but initiatives that 

 3          your administration has put forward.  

 4                 I think it -- suffice it to say that 

 5          the city is on extremely solid footing under 

 6          your leadership, and there has been quite a 

 7          transformation over the course of the last 

 8          decade.  As a matter of fact, I was in my 

 9          office talking to some young folks today 

10          about the transformation of the last 

11          10 years.  

12                 The last several years we have seen an 

13          unprecedented commitment from the state, and 

14          with your leadership and the leadership of 

15          your administration and the leadership of 

16          Governor Cuomo, we have enacted the Buffalo 

17          Billion initiative of funding from Albany.

18                 I know you touched on it in your 

19          testimony; the second round of the Buffalo 

20          Billion is upon us in the budget 

21          deliberations that are taking place right 

22          now.  Can you just speak to the importance of 

23          this initiative, the second round -- where 

24          we're at, the momentum that's been created 


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 1          because of the first Buffalo Billion, what it 

 2          means to Buffalo and how it will be 

 3          implemented moving forward?  

 4                 MAYOR BROWN:  Well, it means a great 

 5          deal to Buffalo.  Working very closely with 

 6          Governor Cuomo, the Western New York 

 7          legislative delegation, and the members of 

 8          the Legislature both in the Assembly and in 

 9          the Senate, we have seen transformational 

10          economic development in the City of Buffalo.  

11          Just from 2012 to present, we are now up over 

12          $6 billion of economic development projects 

13          that have broken ground in the city.  

14                 A number of those projects, many of 

15          those projects are being fueled by the 

16          Buffalo Billion, but some of those projects 

17          that are being developed and moving forward 

18          in our community now with the first 

19          Buffalo Billion have not even had their 

20          impact yet as facilities are being built out.

21                 Tonight, for example, I have a meeting 

22          where roughly 200 people will be in 

23          attendance for the Northland Workforce 

24          Development Center, a major workforce 


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 1          development center that will focus on green 

 2          technology, advanced manufacturing, that will 

 3          train thousands of people in Buffalo and 

 4          Western New York for the jobs that are coming 

 5          online in our community and pump new life 

 6          into an area of the city that has been 

 7          incredibly hard-hit with disinvestment for 

 8          several decades, where there are many 

 9          residents of that community living in serious 

10          poverty.

11                 The hope and opportunity that people 

12          are feeling that live in that surrounding 

13          area is just absolutely amazing.  I support 

14          strongly the Buffalo Billion 2.  A number of 

15          the items that went into that proposal were 

16          recommended by my administration to the 

17          Governor's office.  

18                 You know, I thank the Governor for 

19          partnering with us, for listening to us, for 

20          seeing that for many decades Buffalo, the 

21          second largest city in the State of New York 

22          and Western New York, one of the largest 

23          regions in our state, was largely left out of 

24          major state economic development investment 


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 1          for decades and decades and decades.  

 2                 This is creating a real interest -- 

 3          not just locally and regionally, but 

 4          nationally and internationally -- in 

 5          businesses wanting to invest in the City of 

 6          Buffalo.  I think that that is important for 

 7          the entire State of New York.  

 8                 The other things that I like about the 

 9          Buffalo Billion 2 is it is not just for the 

10          City of Buffalo in this round.  It addresses 

11          the City of Niagara Falls, it puts resources 

12          into surrounding suburban municipalities, it 

13          provides resources for small business, it 

14          provides resources for the East Side of 

15          Buffalo, which is largely an African-American 

16          section of the city where there is high 

17          poverty.  

18                 So I think it is very creative in its 

19          design.  I think it's going to pump more jobs 

20          into the region, that it's going to create 

21          more opportunity not only for city residents, 

22          city residents living in poverty, those who 

23          are unemployed and underemployed, but 

24          residents throughout the entire region, 


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 1          making that a strong region in the State of 

 2          New York.

 3                 SENATOR KENNEDY:  Thank you.  

 4                 You know, you touched on training and 

 5          education, and I know a large piece of that 

 6          second Buffalo Billion initiative is focused 

 7          on getting it to the folks that need it the 

 8          most, as you mentioned -- unemployed, 

 9          underemployed.  

10                 I want to touch on education as well.  

11          And you have been in the forefront of the 

12          Say Yes to Education initiative.  Part of 

13          that Buffalo Billion is focused on bringing a 

14          portion, about $10 million in the proposed 

15          budget, to Buffalo.  Last year Syracuse 

16          received a large portion in the budget, 

17          Buffalo this year will be receiving -- if all 

18          is enacted through the budget -- $10 million 

19          to the Say Yes to Education program.  

20                 Can you speak to that and the 

21          importance of that and what it means to the 

22          education of our youth, where it's taking our 

23          schools, and quite frankly -- in the 

24          interests of time I'll leave it at this -- 


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 1          what it means to a younger population being 

 2          educated, staying in the City of Buffalo, and 

 3          setting up roots, as we're seeing the 

 4          millennials staying in our community?

 5                 MAYOR BROWN:  Well, you know, as you 

 6          know, education is critically important as a 

 7          building block for people being able to 

 8          improve their lives and live out the American 

 9          dream.  We are fortunate that about four 

10          years ago now we were able to be selected for 

11          the Say Yes to Education program to come to 

12          Buffalo.  

13                 The first municipality in this state 

14          that got that program was the City of 

15          Syracuse, and we were able to look at the 

16          wonderful lessons learned in that great, 

17          great city, and we really came together as an 

18          entire community to bring this program to 

19          Buffalo that promises a college scholarship 

20          for every child that graduates from a Buffalo 

21          public or charter school.  

22                 But beyond that, it provides support 

23          to children and families to get our children 

24          to the point where they can actually qualify 


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 1          to graduate from high school and get into 

 2          college.  At this point, in the private 

 3          sector over $25 million has been raised for 

 4          the scholarship portion of the program, 

 5          showing the significant commitment that the 

 6          community has to the program.  And since the 

 7          program has been in place in our community, 

 8          high school graduation rates in Buffalo that 

 9          sadly were abysmally low, hovering around 

10          48 percent, are now up to 64 percent.  

11                 So the program has been a major 

12          benefit to children in the City of Buffalo, 

13          and I think what this $10 million infusion 

14          for Say Yes that the Governor has proposed -- 

15          we will see graduation rates continue to 

16          rise, we will see college matriculation 

17          increase in the City of Buffalo, and we will 

18          find more hope for families that previously, 

19          no matter how bright some of our children 

20          were, who didn't feel like they would be able 

21          to send their children to college to get a 

22          higher education.  Now those barriers are 

23          lifted, and that hope and opportunity for a 

24          good education and a brighter future exist 


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 1          for every child in the City of Buffalo.

 2                 SENATOR KENNEDY:  That's great.  Thank 

 3          you, Mayor.

 4                 CHAIRWOMAN YOUNG:  Thank you.

 5                 CHAIRMAN FARRELL:  Thank you.  

 6                 We've been -- David Gantt is here.  

 7                 That's it.  Thank you very much.

 8                 MAYOR BROWN:  Thank you, Mr. Chairman.  

 9          Thank you, Madam Chair, legislators.  Thank 

10          you all very much.  

11                 CHAIRWOMAN YOUNG:  Thank you.

12                 MAYOR BROWN:  Good luck with your 

13          deliberations.

14                 CHAIRMAN FARRELL:  The Honorable Kathy 

15          M. Sheehan, mayor, City of Albany.

16                 MAYOR SHEEHAN:  Good afternoon.  

17                 CHAIRMAN FARRELL:  Good afternoon.

18                 CHAIRWOMAN YOUNG:  Good afternoon.

19                 MAYOR SHEEHAN:  Are we ready?

20                 CHAIRMAN FARRELL:  Yes, we're ready.

21                 MAYOR SHEEHAN:  So I'd like to start 

22          by thanking Chairpersons Young and Farrell 

23          for inviting me here today to speak with you 

24          about the City of Albany.  And I want to 


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 1          thank the Senate Finance Committee and the 

 2          Assembly Ways and Means Committee and the 

 3          other members of the Senate and Assembly who 

 4          are present, along with members of our 

 5          delegation.  I know I saw Assemblymember Pat 

 6          Fahy, Assemblymember McDonald is here, and 

 7          Senator Breslin, who works so closely with 

 8          the City of Albany with respect to all sorts 

 9          of issues, but in particular our financial 

10          challenges.

11                 So I'd like to start by reminding 

12          everybody about the City of Albany.  We are 

13          the capital of the state, as you know, and it 

14          is a city that doubles in population nearly 

15          every day.  And that's great for the economy, 

16          but it's actually a bit of a mixed blessing 

17          for the City of Albany because those 

18          employees, most of them, walk into tax-exempt 

19          buildings.  

20                 Our largest employers, other than 

21          state government, are Albany Medical Center, 

22          St. Peter's Hospital, the VA, Memorial 

23          Hospital, UAlbany, SUNY Poly, the Center for 

24          Disability Services -- those are the large 


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 1          employers in this area.  And all of them 

 2          enjoy a tax exemption.  

 3                 And while we would benefit from sales 

 4          tax revenues that employees generate at 

 5          lunchtime, many of these large 

 6          institutions -- actually, all of these large 

 7          institutions -- provide on-site dining, and 

 8          sales taxes are shared countywide.  So the 

 9          sales tax dollars generated in the City of 

10          Albany are taken by the county and then 

11          distributed countywide based on population.  

12          So it is a challenge for the City of Albany.  

13                 And we are a city of neighborhoods.  

14          We have 25 unique neighborhoods, and our 

15          homeowners and residents in those 

16          neighborhoods really bear a disproportionate 

17          burden of our tax levy.  So residents own 

18          about 35 percent of the value of all of the 

19          property in the City of Albany, yet they pay 

20          nearly 60 percent of the tax levy.  

21                 We are investing in our neighborhoods.  

22          We've seen a tremendous amount of investment 

23          in market-rate housing in our downtown, in 

24          Park South and in other areas of our city, 


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 1          and we're really proud of that growth and 

 2          seeking to incentivize and encourage that 

 3          type of growth.

 4                 I announced in my State of the City 

 5          this year that we have identified HUD funding 

 6          that we are going to be using $1 million of 

 7          to encourage investment in vacant buildings, 

 8          in collaboration with the land bank, so that 

 9          we can layer that funding on top of funding 

10          that's available from our land bank and other 

11          sources in order to get vacant buildings back 

12          on-line.  

13                 And we're providing a $300,000 pool 

14          for emergency repairs.  We have so many of 

15          our residents who are just above the 

16          threshold to receive HUD funding for those 

17          emergency repairs -- you know, they're just 

18          above that 80 percent of AMI -- and so we've 

19          identified a pool of funding from a repayment 

20          of a HoDAG loan that's going to allow us to 

21          help individuals who are in that 80 to 

22          125 percent stay in their homes, not lose 

23          their home because their furnace breaks down 

24          or they need to put in new stairs.  


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 1                 So we're really working to invest in 

 2          every neighborhood and to keep people in our 

 3          homes and to attract people to our city, 

 4          because that's how we grow our tax base here.

 5                 As you will note, if you look at the 

 6          fiscal stress test chart that we provided, 

 7          the New York State Comptroller fiscal stress 

 8          score, Albany is obviously significantly the 

 9          most fiscally stressed city in the state, and 

10          you can see that we are in significant fiscal 

11          stress.  The next closest city is just edging 

12          into that significant fiscal stress 

13          territory.  And the Comptroller, certainly 

14          being here in Albany, understands the 

15          challenges and how we got to where we were.  

16                 We've been deficit-spending since at 

17          least 2007, and we have depleted our Rainy 

18          Day Fund, and we've reached really the end of 

19          our ability to use that Rainy Day Fund to 

20          bridge the gap between what it costs to run 

21          the city and what we can reasonably raise in 

22          revenue.  

23                 But we are working to build that 

24          bridge.  Since I took office we have, with a 


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 1          tremendous amount of help from the state, 

 2          been able to implement Enterprise Resource 

 3          Planning software -- we have not had new 

 4          software since a purchase in 1998.  And so we 

 5          went to the Financial Restructuring Board, 

 6          they provided us with funding to be able to 

 7          purchase that software so that we could 

 8          realize immediate savings and not have to 

 9          finance that software going forward.  

10                 We've implemented an automated 

11          time-keeping system.  We've implemented new 

12          tax billing software that has allowed us to 

13          collect more of our taxes and be more 

14          effective and efficient.  And we've invested 

15          in additional technology to bring about 

16          efficiencies.  

17                 We've rolled out an automated 

18          recycling pilot program that automates the 

19          pickup of recycling that allows us to reduce 

20          the number of drivers on our trucks, reduce 

21          the number of injuries and our worker's 

22          compensation expenses.  In a city like 

23          Albany.  We can't deploy it throughout the 

24          entire city because we have many narrow 


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 1          streets and townhouses.  But everywhere that 

 2          we can, we're doing it.  And we're learning 

 3          from that program and looking to extend it to 

 4          all municipal solid waste.  

 5                 We have done a tremendous amount of 

 6          work to eliminate waste and find cost 

 7          reductions and savings, and so in my 2017 

 8          budget we were able to show a 2 percent 

 9          reduction, year over year, from '16 to '17.  

10          That's the largest expenditure decrease in 

11          more than 15 years, and only the third 

12          decrease in 18 years.  

13                 So it's important because we are 

14          working hard to cut our way to the 

15          efficiencies that we know we can get from 

16          these investments in technology, in 

17          consolidation opportunities and efforts, and 

18          working better with the county and even among 

19          our own departments in the City of Albany.  

20          And so we've already cut nearly $9.5 million.  

21                 We are asking again for $12.5 million.  

22          I want to start by thanking you for 

23          supporting the spinup that was in the 

24          Governor's budget last year.  We are 


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 1          requesting, though, that we seek a permanent 

 2          increase in funding for the capital city.  

 3                 The PILOT payment that we currently 

 4          receive from the state for the Empire State 

 5          Plaza really is equivalent to just about 

 6          0.36 percent of the value of all of the state 

 7          property that is in the City of Albany.  So 

 8          that's, I'll say that again, 0.36 percent.  

 9                 So we are really seeking to ensure 

10          that the capital city can provide services 

11          that we know are essential -- police, fire, 

12          emergency services, street maintenance -- for 

13          the nearly 200,000 people who come here to 

14          work every day, many of them in this building 

15          and in this plaza.  

16                 We are really working to close the 

17          revenue gap.  The Financial Restructuring 

18          Board highlighted that the city needs to 

19          expand revenue sources.  We thoroughly 

20          reviewed our finances again with an outside 

21          consultant that was provided by the state, 

22          and that consultant agrees that 

23          notwithstanding our cost-saving efforts, that 

24          gap still exists.  


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 1                 A patchwork of spinups and one-time 

 2          one-shots really helped to maintain our 

 3          solvency from year to year, but at this point 

 4          the structural deficit of $12.5 million is 

 5          real and it is a significant challenge for 

 6          the City of Albany.  If we were to have to 

 7          place that burden on our taxpayers, every 

 8          property owner would receive a 22 percent 

 9          property tax increase, if we were not able to 

10          receive the $12.5 million in capital city 

11          funding.  

12                 You know, overall, 63 percent of the 

13          property in the city is tax-exempt, and 

14          60 percent of that tax-exempt property is 

15          owned by the state.  And as I said, the 

16          current funding that we get under 19A is just 

17          0.36 percent of the value of all of that 

18          property.  

19                 I provided a map that just shows how 

20          widespread the amount of tax-exempt property 

21          is in the city.  And so what does that drive?  

22          Well, it certainly would drive a conversation 

23          with respect to AIM.  

24                 And I'm often asked, why is AIM for 


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 1          the City of Albany so low compared to the 

 2          other upstate cities?  If you look at the 

 3          upstate cities, we have the lowest amount of 

 4          AIM of any other city with a population of at 

 5          least 50,000 residents.  It's $128.84 per 

 6          capita, compared to $617 for Buffalo, 

 7          $494 for Syracuse, $419 for Rochester.  

 8                 And I'm not suggesting that these 

 9          municipalities do not need the AIM that they 

10          receive.  I provide this information because 

11          I think it's critically important to 

12          understand what impact this is having on the 

13          City of Albany, and really how effective 

14          we've been with taxpayer dollars and with our 

15          AIM money in being able to provide the level 

16          of service that we currently provide.  

17                 If you look at our actual city and 

18          school tax levies in dollars, which is the 

19          next chart that I provide, AIM as a 

20          percentage of our total levy is just 

21          7.8 percent.  In actual dollars, our city tax 

22          levy is higher than Rochester and Syracuse.  

23                 And the total tax levy of city and 

24          school is the highest -- almost.  Rochester 


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 1          beats us out by a little bit less than a 

 2          million dollars, or just about a million 

 3          dollars, in a city that is more than twice 

 4          the size.  

 5                 So it demonstrates to you that our 

 6          residents and our taxpayers and our 

 7          businesses are really bearing a significantly 

 8          and disproportionately heavy burden with 

 9          respect to property taxes.  And so what does 

10          that mean?  It's not even just across the 

11          state, it impacts our competitiveness right 

12          here in the Capital Region.  

13                 So, you know, a couple of places that 

14          I know where we see our legislators enjoying 

15          dinner is at Cafe Capriccio or at Jack's 

16          Oyster House, as compared to out on 

17          Wolf Road.  Many of the members like to go 

18          out there to places like Blu Stone Bistro -- 

19          the tax bill on Wolf Road for a restaurant is 

20          60 percent lower than the tax bill paid by 

21          that same establishment in the City of 

22          Albany.  Sixty percent.  So you can locate 

23          just across the line and significantly reduce 

24          your tax burden.  


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 1                 That's what I'm talking about with 

 2          respect to our need for this $12.5 million in 

 3          additional capital city funding.  

 4                 So, you know, our proposal is to 

 5          address the gap with $12.5 million in capital 

 6          city funding, amending the Public Land Law to 

 7          provide this as an additional source of 

 8          revenue, because it is consistent with the 

 9          amount of state property that is owned here 

10          and that we are so proud to be a part of, but 

11          that we just simply cannot continue down a 

12          path -- we have completely depleted our 

13          Rainy Day Fund.  

14                 And we are here to say thank you for 

15          the support that you've provided for this 

16          capital city funding, and to urge you to make 

17          this, rather than a spinup, additional aid 

18          for the capital city.

19                 Thank you.

20                 CHAIRMAN FARRELL:  Thank you.  

21                 Questions?

22                 CHAIRWOMAN YOUNG:  Hi, Mayor.  

23                 MAYOR SHEEHAN:  Hi.

24                 CHAIRWOMAN YOUNG:  Welcome today.  


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 1          We're very happy to have you here as part of 

 2          this discussion, and I just had a couple of 

 3          questions.

 4                 Last year you had asked for the 

 5          $12.5 million spinup, which was granted with 

 6          the condition that the Financial 

 7          Restructuring Board work with you to come up 

 8          with ways to solve your problems.  The 

 9          Financial Restructuring Board is supposed to 

10          help you come up with budgets that don't have 

11          the $12.5 million included.  Can you tell us 

12          what the status of the Financial 

13          Restructuring Board is, and where you're at 

14          as far as developing budgets that don't 

15          include the $12.5 million?

16                 MAYOR SHEEHAN:  So we worked with the 

17          consultant that was hired by the Financial 

18          Restructuring Board all throughout the course 

19          of last year.  We developed budget models 

20          that looked out three years, seeking to 

21          reduce the gap of that $12.5 million.  But in 

22          this year, even with the help of that 

23          additional resource, we were not able to -- 

24          and they were not able to -- identify a way 


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 1          to bridge the $12.5 million gap.  

 2                 We are exploring opportunities in the 

 3          outyears for reducing the amount of the 

 4          12.5 million; even that is particularly 

 5          challenging.  

 6                 But one of the things that we are 

 7          moving forward with is the possibility of 

 8          combining our 911 with the county 911.  The 

 9          county has already consolidated some other 

10          towns into that 911, which would result in 

11          some savings.  

12                 We are also looking at revenue 

13          opportunities with respect to the ability of 

14          us to look at how we collect municipal solid 

15          waste and what revenue opportunities might 

16          exist.  We do have a fee right now that may 

17          have to be expanded.  

18                 And we also are looking at the impact 

19          of purchasing our street lights.  Based on 

20          the study that we conducted with respect to 

21          savings, we could see an additional 

22          $2 million in savings if we are able to 

23          purchase back our street lights in a way that 

24          is affordable.  


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 1                 So we are looking at and have 

 2          identified, with that consultant, both 

 3          revenue opportunities and cost-savings 

 4          opportunities, but they were not able to 

 5          close the gap for 2017.  

 6                 And I also just want to be clear, you 

 7          know, we are requesting $12.5 million not in 

 8          a spinup, but in an addition to 19A payments 

 9          to the city for the tax-exempt property that 

10          is here.

11                 CHAIRWOMAN YOUNG:  Thank you.  And 

12          just a couple more questions.

13                 So when you talk about revenues -- and 

14          we have the presentation here, which is very 

15          nice to look at, but it doesn't have very 

16          many details in it.  But for example, last 

17          year and this year, when you talk about 

18          revenues and shortfalls, are you talking -- 

19          when you're discussing this with us and 

20          presenting information, are you including all 

21          of the revenues that the city gets and that 

22          information?  

23                 So for example, do you have the 

24          revenues from the water district and what you 


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 1          make on that, or do you separate those out?

 2                 MAYOR SHEEHAN:  So we have a separate 

 3          water authority, and the City of Albany does 

 4          not get the revenue from the water authority.  

 5          We have an operating agreement with our water 

 6          authority, and that does result in revenue 

 7          for the city.  They pay us approximately a 

 8          half-million dollars a year to provide their 

 9          IT services, we do their personnel services, 

10          their payroll -- it wouldn't make any sense 

11          for them to create that separately, and so we 

12          are reimbursed for providing them with that 

13          service.  

14                 But the revenues for the water 

15          department remain with the water department.  

16          They are a separate authority.  So that does 

17          not come directly to the City of Albany.  So 

18          yes, the budget that you see, that 

19          includes -- you know, we have to balance the 

20          budget, so it's all of our revenues and all 

21          of our expenditures.  

22                 Other than property taxes, our next 

23          most significant source of revenue is the 

24          sales tax revenue, which, as I said, is 


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 1          shared countywide.  It's just a formula, and 

 2          we project that revenue based on what the 

 3          county is projecting to happen to sales tax 

 4          revenue when they put together their budget.  

 5                 We also have been successful in 

 6          getting some voluntary payments from the 

 7          large not-for-profits in the City of Albany, 

 8          about a million and a half dollars, but every 

 9          little bit helps in this.  We were successful 

10          in getting that revenue in 2015 and 2016, and 

11          we have commitments for 2017 as well.

12                 CHAIRWOMAN YOUNG:  Thank you.

13                 CHAIRMAN FARRELL:  Mr. Otis.  

14                 ASSEMBLYMAN OTIS:  Good afternoon, 

15          Mayor Sheehan.  

16                 I just wanted to touch base with 

17          you -- and I've heard you testify on this 

18          topic in recent years -- what your current 

19          projection is for short-term or long-term 

20          water infrastructure repairs.  I know it's a 

21          big burden; you had a water main break 

22          recently.  But for that kind of forecasting, 

23          what can you share with us?

24                 MAYOR SHEEHAN:  Well, one of the 


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 1          benefits of the water authority being 

 2          separate is that this is not a city that has 

 3          raided water funds in order to fund 

 4          operations, and so the revenue that is raised 

 5          by the water authority stays with the water 

 6          authority.  And we have been successful in 

 7          receiving grants.  

 8                 We have been very successful with many 

 9          of the state programs that have been 

10          supported by you and others, and that has 

11          helped with the investment that we are able 

12          to make.  We've been able to double the 

13          amount of capital expenditures that we spend 

14          out of our operating budget every year in 

15          infrastructure.  

16                 We also have a number of projects that 

17          are going on -- because we're subject to a 

18          consent order with the DEC, and so we have a 

19          number of projects that we're required to 

20          undertake to reduce the amount of flow into 

21          the Hudson River.  And while we can always 

22          use more, I think that this is an area where 

23          we've demonstrated some pretty significant 

24          strength and good sound fiscal management in 


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 1          being able to invest in that infrastructure.  

 2          That said, it's very old, and we're dealing 

 3          with a sinkhole right now as we speak for a 

 4          sewer line that was built in the 1800s.  

 5                 So it is a significant challenge, but 

 6          it is one that I believe we're managing as 

 7          best as we possibly can.  And again, that's 

 8          not the reason that we have this 

 9          $12.5 million shortfall, because those assets 

10          are managed separately.

11                 ASSEMBLYMAN OTIS:  So your water 

12          authority handles drinking water, sanitary 

13          sewers, and stormwater?

14                 MAYOR SHEEHAN:  That's correct.

15                 ASSEMBLYMAN OTIS:  Okay.  Thank you 

16          very much.

17                 MAYOR SHEEHAN:  Thanks.

18                 CHAIRMAN FARRELL:  Senator.  

19                 CHAIRWOMAN YOUNG:  Senator Marchione.  

20                 SENATOR MARCHIONE:  Thank you.  

21                 Thank you, Mayor, for being here.

22                 You talked about your AIM funding 

23          being the lowest of some of the cities, but I 

24          didn't hear why.  Why is your AIM so much 


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 1          lower than the rest?

 2                 MAYOR SHEEHAN:  That is a question for 

 3          the ages.  It has been historic that the City 

 4          of Albany's AIM funding has been low.  The 

 5          formula that is used to determine AIM funding 

 6          is -- in other municipalities, there were 

 7          increases that were done when there was 

 8          fiscal stress in some of those cities, and so 

 9          it has resulted in a lot of disparity.  

10                 I think one of the challenges that we 

11          have in Albany is that like other upstate 

12          cities, we have the same issues with respect 

13          to poverty rates.  We have a poverty rate of 

14          approximately 26 percent.  We have huge 

15          challenges with graduation rates at our high 

16          school.  We have the lowest home ownership 

17          rate as a percentage of the other upstate 

18          cities, at around 42 percent.  

19                 So many of those indicia of challenges 

20          and stress that drove up AIM in other 

21          municipalities have impacted the City of 

22          Albany.  And I think one of things that made 

23          it become as emergent as it is is that when 

24          we saw such a huge increase in pension 


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 1          expenses and other expenses that occurred 

 2          after the recession, we had been able to 

 3          build up a bit of a Rainy Day Fund, but that 

 4          was quickly depleted because of it.  

 5                 And so in looking at the challenges 

 6          that the city faces, again, you know, if we 

 7          were at half of the AIM, of the average AIM 

 8          for the other upstate cities, I wouldn't be 

 9          here.  But looking at where we are now in 

10          that -- actual dollars -- we have to raise 

11          more in property taxes in order to balance 

12          our budget than these other, much larger 

13          upstate cities, demonstrates that we've 

14          reached the end of what we could possibly 

15          expect our taxpayers to bear, and we need to 

16          find a way of finding additional aid for the 

17          city.  

18                 And I think one of the things that 

19          makes us unique is the fact that we are the 

20          capital city and have so much tax-exempt 

21          property.

22                 SENATOR MARCHIONE:  Have you asked 

23          your legislators to carry legislation that 

24          might make some changes relative to the way 


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 1          the formula is?

 2                 MAYOR SHEEHAN:  You know, we've 

 3          discussed how to address this gap and what 

 4          the best way is to address this gap, and I 

 5          know that AIM funding is an incredibly 

 6          difficult conversation for any of us to have.  

 7          I certainly believe --

 8                 SENATOR MARCHIONE:  It seems like it 

 9          needs to be one -- 

10                 MAYOR SHEEHAN:  -- that AIM should be 

11          increased --

12                 SENATOR MARCHIONE:  -- it seems like 

13          it should be one that you need to have.

14                 MAYOR SHEEHAN:  Right.  

15                 But again, I think one of the things 

16          about the capital city that provides us with 

17          a unique opportunity to, you know, in the 

18          long run -- you know, my understanding is 

19          that the reason that the city got spinups in 

20          prior years to its 19A money was as a bridge 

21          to fix AIM.  

22                 And that started, as I understand it, 

23          I believe back in 2004.  It was many, many 

24          years ago.  And so it still has not been 


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 1          fixed.  And notwithstanding the willingness 

 2          of our representatives to engage in that 

 3          conversation, it creates challenges across 

 4          the state.

 5                 SENATOR MARCHIONE:  It sounds to me, 

 6          though, that you really need to have that 

 7          discussion, because it doesn't seem 

 8          appropriate that you would be at the bottom 

 9          of the AIM.

10                 MAYOR SHEEHAN:  As I've said, if we 

11          got the same AIM as Utica, I wouldn't have to 

12          come here and bother you every year.

13                 SENATOR MARCHIONE:  Your population 

14          and Utica's population, how do they compare?

15                 MAYOR SHEEHAN:  Utica's about 61,000.  

16          We're about 98,000.

17                 SENATOR MARCHIONE:  And you're getting 

18          that much lower than they?

19                 MAYOR SHEEHAN:  Yeah.

20                 SENATOR MARCHIONE:  Okay.  Also, do 

21          you know of any other cities that have as 

22          much tax-exempt property or close to 

23          tax-exempt property as Albany does?

24                 MAYOR SHEEHAN:  We are at the top of 


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 1          the large cities outside of New York City, 

 2          and there are some cities that are -- some 

 3          municipalities that are a little bit smaller 

 4          that have, say, a prison or a large presence.  

 5                 I think the thing, again, that's 

 6          unique about Albany is that the 

 7          infrastructure that we have here, the value 

 8          that we have here of tax-exempt -- it's not a 

 9          state park, it's not a prison that is sort of 

10          a unit unto itself.  We have to plow the 

11          streets, we have to provide police, we 

12          respond when somebody dials for 911, you 

13          know, for a health -- so we have to provide a 

14          significant amount of services to all of 

15          these tax-exempt entities that are here in 

16          the city.

17                 SENATOR MARCHIONE:  How many 

18          employees, Mayor, do you have in the city?

19                 MAYOR SHEEHAN:  We have 

20          approximately -- just under 1,200 FTEs.

21                 SENATOR MARCHIONE:  Wow, that's a lot 

22          of people.

23                 MAYOR SHEEHAN:  That includes the 

24          water department, though.  So that's where 


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 1          our -- you know, our operating agreement with 

 2          the water department comes into play, because 

 3          again, for efficiency purposes, we -- so that 

 4          they don't have to deal with hiring, we 

 5          provide that, and then they just reimburse us 

 6          for the expenses of those employees.

 7                 SENATOR MARCHIONE:  And are you 

 8          self-insured for health insurance for all 

 9          those employees?

10                 MAYOR SHEEHAN:  We are to an extent 

11          self-insured, but we also have CDPHP and some 

12          other insurance companies as well for our 

13          employees.

14                 For our Blue Cross, we're 

15          self-insured.  For the overwhelming majority 

16          of our employees, our union employees, we're 

17          self-insured.

18                 SENATOR MARCHIONE:  Have you had to 

19          experience any layoffs in the last three or 

20          four years?

21                 MAYOR SHEEHAN:  We have sought to 

22          reduce our workforce through attrition, and 

23          we've been able to, through 

24          reorganizations -- when we make changes with 


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 1          respect to the organizational structure, the 

 2          mantra is that the total dollar, the total 

 3          spend has to be lower with every 

 4          reorganization.  

 5                 So we've shifted people around, we've 

 6          been able to create some new positions to 

 7          give us the ability to be more efficient and 

 8          effective, but that has always resulted in an 

 9          overall reduction in our personnel spending.

10                 SENATOR MARCHIONE:  And when you talk 

11          about you have a lot of sales tax in the city 

12          but you have to share it with the county, I'm 

13          sure you recognize that as a city you could 

14          actually collect it yourself.

15                 MAYOR SHEEHAN:  Well, except that 

16          because our property taxes are so high, the 

17          major retailers are located just outside the 

18          city.  So Colonie Center, Guilderland, you 

19          know -- I'm not complaining about the 

20          sharing, it's just -- it's important to 

21          recognize that.  

22                 And I think it's -- you know, from the 

23          standpoint of a dollar spent anywhere in the 

24          county benefiting the whole county is overall 


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 1          a positive result with respect to encouraging 

 2          cooperation and collaboration.

 3                 SENATOR MARCHIONE:  So actually you 

 4          wouldn't collect as much --

 5                 MAYOR SHEEHAN:  We've never looked at 

 6          the numbers.  Some of the car dealerships are 

 7          here, some of them are just across the city 

 8          line.

 9                 SENATOR MARCHIONE:  Thanks very much, 

10          Mayor.

11                 MAYOR SHEEHAN:  Thank you.

12                 CHAIRMAN FARRELL:  Thank you.

13                 Mr. McDonald.

14                 ASSEMBLYMAN McDONALD:  Thank you.  

15                 Thanks for being here, Mayor, and 

16          thank you for continuing to tell the 

17          challenges with the capital city.

18                 And as much as AIM aid is a -- to me, 

19          it's a symptom of the disease.  I do agree 

20          that looking at the 19A, which kind of gets 

21          away from the "what about me" syndrome they 

22          made -- that's part of the problem, is that 

23          if you do one then you have to do the other, 

24          and that's part of the challenge here.  


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 1                 Meanwhile, by the same token, 19A is 

 2          19A.  It's public land.  And if it becomes 

 3          developed, if I remember correctly -- you've 

 4          talked about, in the past, about reducing 

 5          that number, if I remember correctly.

 6                 MAYOR SHEEHAN:  That's right.  There 

 7          was a proposal at one point in time, 

 8          particularly with respect to the Harriman 

 9          Campus, that would have resulted in a PILOT 

10          payment for the Harriman Campus that would be 

11          reduced to the extent that it was offset by 

12          tax revenue from privatization of any of that 

13          property.

14                 ASSEMBLYMAN McDONALD:  And the 

15          Harriman Campus today is still -- as much as 

16          it's had some fits and starts, we haven't 

17          gotten anywhere with it.

18                 MAYOR SHEEHAN:  Right.  You know, I 

19          think when I first started coming here -- 

20          this is my fourth time here -- and we were 

21          optimistic about private development at the 

22          Harriman Campus, the former Convention Center 

23          site, and none of those have seen 

24          development.  There was an RFP that was put 


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 1          out for the Harriman Campus, and it received 

 2          no bids, and the former Convention Center 

 3          site still remains undeveloped.  

 4                 So our ability to expand our tax 

 5          base -- while we have expanded our tax base 

 6          over the last three years, and we've seen 

 7          growth, it has not been enough to offset the 

 8          challenge that we face.

 9                 ASSEMBLYMAN McDONALD:  You were one of 

10          the first to -- and I think it was almost at 

11          the beginning of your term -- jump right into 

12          the fray with the FRB.  And I think the state 

13          did provide you -- was it $5 million?

14                 MAYOR SHEEHAN:  That's right.

15                 ASSEMBLYMAN McDONALD:  A one-time --  

16          one-time $5 million which allowed you to 

17          carry out some of the items that you talked 

18          about today.  

19                 And I think I've forgotten, although 

20          we talk almost daily -- the streetlights, 

21          which in the outyears could provide some 

22          savings with the conversion.  Do we know what 

23          the cost would be to actually take over the 

24          streetlights, to be in that position to save?


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 1                 MAYOR SHEEHAN:  So we're in the 

 2          process right now of asking National Grid -- 

 3          they have to give us basically an asking 

 4          price.  

 5                 And we are, right alongside that, 

 6          going to be working to ensure that we have a 

 7          GIS of every streetlight and know the 

 8          condition of it so that we're doing our due 

 9          diligence before we buy them.

10                 ASSEMBLYMAN McDONALD:  My 

11          recollection, and it's been a while since 

12          I've looked at streetlight inventory, is the 

13          strain of the investment cost is not 

14          insignificant.

15                 MAYOR SHEEHAN:  It's very significant.  

16          And so again, looking at opportunities for 

17          assistance with funding that -- but even with 

18          looking at the different options that are 

19          available, we believe that we would still 

20          have operating savings.  And it is far better 

21          than either a do-nothing scenario or even 

22          a -- working with National Grid to have them 

23          change over all the streetlights to LED.

24                 ASSEMBLYMAN McDONALD:  Thank you.


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 1                 MAYOR SHEEHAN:  Thanks.

 2                 CHAIRMAN FARRELL:  Senator.  

 3                 CHAIRWOMAN YOUNG:  Senator Krueger.

 4                 SENATOR KRUEGER:  Hi, Mayor.

 5                 So last year when you were making your 

 6          plea for additional money and using the 

 7          example of AIM funding, I pointed out 

 8          somebody must really not like you.  I'll just 

 9          point out, the one who they dislike more is 

10          New York City, because New York City hasn't 

11          seen AIM now in five, six, seven years.

12                 Your examples -- 60 percent of your 

13          property is tax-exempt because the State of 

14          New York is using it.  You're at the highest 

15          rate of crisis with your educational funding 

16          because property tax pays for schools, but 

17          you can't tax most of the property in your 

18          city.  And you can't push it farther for the 

19          people who are taxpayers for two reasons:  

20          One, we cap you; and two, as you've already 

21          pointed out, they'll all pick up and move out 

22          of Albany.

23                 You know, if I were you, I'd be 

24          screaming.  I wouldn't be smiling and being 


                                                                 341

 1          very polite, I'd be saying, like, "You people 

 2          are killing the City of Albany."  And the 

 3          concept that Albany still denies that we are 

 4          starving particularly our upstate cities, and 

 5          the revenue-sharing formulas are 

 6          ridiculous -- Kathy Marchione pointed out 

 7          somebody ought to do something about that.  

 8                 Yes, we should have a formula that's 

 9          based on population for AIM calculations.  

10          That doesn't seem like brain surgery.  I 

11          could probably do a spreadsheet pretty easily 

12          for towns and villages and counties.  And I 

13          really think that everybody needs to get 

14          louder in their demands on Albany, that we do 

15          a reasonable and fair distribution of AIM.  

16                 But I have a question.  In the 

17          Governor's proposal, if you don't somehow do 

18          some kind of coordination with the county and 

19          move it through to consolidate and get a vote 

20          of the public, you're not even getting that 

21          AIM.  What's your plan for the consolidation 

22          proposal?

23                 MAYOR SHEEHAN:  We will find a 

24          consolidation proposal and we will put it 


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 1          before the voters.  But we do have 

 2          opportunity in the City and County of Albany.  

 3          And as I said, we're actually already down a 

 4          path.  So, you know, I know a lot of my 

 5          fellow mayors have already done a tremendous 

 6          amount of consolidation.  And so the number 

 7          of opportunities that exist remains small.  

 8                 In the City of Albany, in the County 

 9          of Albany, both myself and the county 

10          executive have a great working relationship.  

11          That wasn't always the case in the past.  And 

12          so we've been able to identify a number of 

13          cost-saving opportunities and are working -- 

14          actually, as we speak, our staffs are working 

15          on a consolidation proposal to move forward.

16                 So, you know, I think that that is an 

17          area where -- you know, we remain ready, 

18          willing, and able.  I would have loved 

19          nothing more than for the FRB, and then for 

20          the second set of consultants, to come in and 

21          hit me upside the head and say "Why don't you 

22          just do this, and you can save all this money 

23          or raise all this revenue."  That has not 

24          occurred.  


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 1                 Our numbers have been scrubbed, we've 

 2          opened our books, we've done anything and 

 3          everything to determine ways for us to bridge 

 4          this gap and to reduce this gap.  It exists 

 5          for a reason.  And I think if you look at the 

 6          history, and the lack of AIM -- I know there 

 7          was a report that was written in 2010 called 

 8          "Capital Punishment" that really outlined 

 9          how, as the state capital, it does, to our 

10          residents, sometimes feel as though we're 

11          being punished for being the state capital 

12          because of the way this formula works.  

13                 So it's very challenging.  My hair is 

14          red, but I have considered setting it on fire 

15          to demonstrate the urgency.  And, you know, I 

16          think that the numbers are so compelling.  

17          And I don't want my smile to in any way 

18          detract from the fact that we are in a 

19          crisis.  We are in a complete crisis.  

20                 And this gap is a gap that we should 

21          be able to fill.  We're not asking for more 

22          than any of the other upstate cities that 

23          have similar challenges that we have, with 

24          vacancies and poverty and challenges with our 


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 1          schools.  All we're asking for is not even 

 2          parity -- again, as I'm saying, give us half, 

 3          and we can do a lot with it.  Because we've 

 4          demonstrated that we can be effective and 

 5          efficient and that we are very good stewards 

 6          of taxpayer money.

 7                 SENATOR KRUEGER:  And there are some 

 8          cities around the country that have actually 

 9          started to charge nontaxable properties for 

10          the city services -- police, fire, garbage 

11          collection.  

12                 Obviously that wouldn't be a very 

13          popular thing for me to propose as the state.  

14          But since we're here and we're not talking to 

15          the public, have you explored that option for 

16          yourselves?

17                 MAYOR SHEEHAN:  So we have looked at a 

18          number of models.  And, you know, it's 

19          incredibly challenging.  Right?  The 

20          not-for-profits here are providing -- so the 

21          state, we can't do anything to.  You're the 

22          state.  So you can't tax or fee up.  

23                 So then that means we've got to look 

24          at who we could provide or ask for fee 


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 1          revenue from, and you're talking about our 

 2          healthcare institutions.  You're talking 

 3          about hospitals that would then be coming to 

 4          the state and saying, Wait a minute, our 

 5          Medicare and Medicaid reimbursements are now 

 6          going to have to cover these additional fees.  

 7                 You know, we're part of a broader 

 8          system, and so when we -- if you look at 

 9          UAlbany, for example, and SUNY Poly, we know 

10          there's a huge affordability issue with 

11          respect to higher education.  And so while it 

12          may be easy to sit back and say, Well, let's 

13          just put a fee on every student who comes 

14          here, we know that that can really impact a 

15          person's ability to be able to attend college 

16          and get a degree.  

17                 So again, I think that it's -- nothing 

18          is off the table, but as we reviewed revenue 

19          opportunities with consultants from the state 

20          and with the FRB, it was decided not to go 

21          down that path.

22                 SENATOR KRUEGER:  Thank you.

23                 CHAIRMAN FARRELL:  Thank you.

24                 Further questions?  Thank you very 


                                                                 346

 1          much.

 2                 MAYOR SHEEHAN:  Thank you.

 3                 CHAIRWOMAN YOUNG:  Thank you.

 4                 MAYOR SHEEHAN:  Thank you very much.

 5                 CHAIRMAN FARRELL:  We've been joined 

 6          by Shelley Mayer.

 7                 Next, the Honorable Lovely Warren, 

 8          mayor of the City of Rochester.  1:30.

 9                 MAYOR WARREN:  Good afternoon, sir.

10                 CHAIRMAN FARRELL:  Good afternoon.

11                 MAYOR WARREN:  I am joined here with 

12          my budget director, Chris Wagner.

13                 Good afternoon again, Chairman 

14          Farrell, Chairwoman Young, members of the 

15          Assembly Ways and Means and Finance 

16          Committees, members of the Senate and 

17          Assembly.  Thank you for the opportunity to 

18          address this panel on behalf of the residents 

19          of the City of Rochester.

20                 This is my fourth time appearing 

21          before this committee, and like always, I 

22          will spare you a long testimony and get right 

23          to the point.

24                 As mayor, my goals are simple -- to 


                                                                 347

 1          provide each of our citizens access to jobs, 

 2          safe and vibrant neighborhoods, and quality 

 3          educational opportunities.  While Rochester 

 4          faces significant challenges, I am proud of 

 5          the progress we've made over the past three 

 6          years.  We are a city built on the premise 

 7          that if you are willing to work hard, you can 

 8          rise above your circumstances and be 

 9          successful in all areas of life.

10                 And to this, we have certainly had 

11          some great success, and much of that success 

12          has been accomplished with the partnership 

13          with the State Legislature and 

14          Governor Cuomo.

15                 Most recently, we have been able to 

16          move forward with our job creating and 

17          nationally recognized Inner Loop 

18          Redevelopment Project, in which we have 

19          provided the gap funding that we needed to 

20          complete this project.  We also had great 

21          success moving ahead with something very near 

22          and dear to my heart, my 3-to-3 Initiative to 

23          get 3- and 4-year-olds enrolled in quality 

24          pre-K programs.  It currently stands at over 


                                                                 348

 1          90 percent of eligible kids enrolled, and 

 2          that fantastic accomplishment would not have 

 3          been possible without state assistance.  

 4                 Your support has allowed us to 

 5          transform programming at our recreation 

 6          centers and libraries to be more than just 

 7          about play or checking out books.  We provide 

 8          quality STEM and STEAM programs at our 

 9          libraries and recreation centers year round, 

10          and other learning programs over the summer 

11          to prevent the learning loss that often 

12          occurs during recess.  

13                 As we continue to move forward with 

14          the Rochester/Monroe County Anti-Poverty 

15          Initiative, our undoubted success would never 

16          have happened without the leadership and 

17          strong partnership with Albany.  Whether it's 

18          additional investment in quality housing, or 

19          needed repairs or infrastructure like roads 

20          and bridges, Albany's ongoing partnership has 

21          been the key to our success and I'm grateful 

22          for your support through our Restore NY and  

23          other similar programs.  

24                 As I have pushed to reorganize the 


                                                                 349

 1          Rochester Police Department, to bring it back 

 2          to a more community-based police model, your 

 3          assistance has helped us to implement the 

 4          important body-worn camera program, which 

 5          continues to go exceedingly well and will be 

 6          fully operational department-wide within a 

 7          few more months.

 8                 As I have mentioned, your assistance 

 9          in investment in job-creating programs has 

10          been significant and important, and nowhere 

11          has that been more evident than in our 

12          ongoing Photonics Initiative.  

13                 Senators, Assemblymembers, clearly our 

14          past and ongoing partnership has been the key 

15          to our success, and these in so many other 

16          areas of the city government.  And that is 

17          why I am asking the state this year to 

18          continue your investment in Rochester and to 

19          provide us with $30.9 million in education 

20          funding to fill the gap between the AIM aid 

21          we receive and the state-mandated amount we 

22          pay to our school district.

23                 The state mandate requires Rochester 

24          to provide $119.1 million to our school 


                                                                 350

 1          district, but we only receive $88.2 million 

 2          in AIM aid.  This $30.9 million shortfall 

 3          places Rochester at a significant 

 4          disadvantage.  Unlike our sister upstate 

 5          cities, Rochester must allocate more funding 

 6          to our school district than we receive from 

 7          the state in AIM aid.  AIM aid from the state 

 8          exceeds the school funding mandate of our 

 9          neighbors to the east and west.

10                 While ensuring all of our city's 

11          children receive a quality education is a top 

12          priority, this disparity forces us to 

13          consider cuts to other critical services to 

14          balance our budget.  You can correct this 

15          inequity simply by providing us with 

16          municipal education funding in the amount of 

17          $30.9 million to supplement our AIM aid and 

18          make up the difference that we are required 

19          to give our schools.

20                 Without this amount, Rochester will 

21          give 68 percent of our tax levy to the school 

22          district and have only 32 percent remaining 

23          for critical city services.

24                 We will certainly continue to manage 


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 1          the city's finances as prudently as possible. 

 2          While we have a strong credit rating, we have 

 3          significant needs.  By funding this mandate, 

 4          the state will free up city tax levy dollars 

 5          for improving life outside of the classroom 

 6          including investing in public safety, 

 7          libraries, recreation centers, job training 

 8          programs, youth intervention services and 

 9          many more programs and services that some of 

10          our poorest residents rely on to gain access 

11          to jobs and better opportunities.

12                 Another important matter that I can 

13          call on you to assist Rochester and other 

14          municipalities in is the utility gross 

15          receipts tax, the GRT.  Rochester has seen a 

16          56 percent decline in its annual revenue from 

17          over $11 million to $5 million because energy 

18          service companies, ESCOs, are not paying what 

19          the city is owed from their gross receipts 

20          taxes.  Gas and electric are commodities and 

21          should be subject to the GRT tax.  

22                 Even though the New York State 

23          Department of Taxation and Finance agrees 

24          that such revenues are subject to the tax, 


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 1          many ESCOs refuse to pay it.  The state can 

 2          fix this situation once and for all by 

 3          enacting legislation to clarify that ESCO 

 4          revenues associated with the sale of gas and 

 5          electric commodities fall within the scope of 

 6          the GRT.

 7                 In addition, I ask that you include 

 8          cellular or wireless services within the 

 9          scope of this tax.  The use of wireless 

10          communications has exploded.  Many, many 

11          households no longer have landline 

12          telephones.  To reflect modern-day realities, 

13          the revenue from wireless telephone service 

14          should no longer be exempt from this tax 

15          outside of New York City.  

16                 Both New York State, in its excise 

17          tax, and New York City, in its gross receipts 

18          tax, have changed their respective statutes 

19          to deem cellular services as taxable.  I am 

20          here today asking the state to give other 

21          New York municipalities the opportunity to 

22          benefit from this much-needed revenue stream.

23                 With regard to the AIM aid, let me say 

24          how much we appreciate the Governor's and 


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 1          your continued support in our maintaining AIM 

 2          aid in the Executive Budget.  

 3                 Thank you for listening to this 

 4          testimony, and I look forward to answering 

 5          the questions that you may have. 

 6                 CHAIRMAN FARRELL:  Thank you.  

 7                 Questions?  

 8                 ASSEMBLYMAN GANTT:  Denny, I have 

 9          questions.

10                 CHAIRMAN FARRELL:  Yes.

11                 ASSEMBLYMAN GANTT:  Will you explain 

12          to us how it is that in the maintenance of 

13          effort you're $30 million -- $31 million 

14          down?

15                 ASSEMBLYMAN OAKS:  They can't hear 

16          you.

17                 CHAIRWOMAN YOUNG:  Your mic isn't on.

18                 ASSEMBLYMAN GANTT:  Can you explain to 

19          us how you are $30 million down while -- and 

20          this is not an effort to try and attack 

21          anybody else, it's simply -- would you 

22          explain how this happened to Rochester versus 

23          other cities?

24                 MAYOR WARREN:  When the maintenance of 


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 1          effort was passed in 2010, what it did was 

 2          lock in that moment of time.  

 3                 At that point in time, the City of 

 4          Rochester was providing $119.1 million to its 

 5          school district, and the maintenance of 

 6          effort said that you cannot give one dollar 

 7          less than what you were giving at that point 

 8          in time.  So for us, we have to provide that 

 9          $119.1 million year after year to our school 

10          district, while only receiving about 

11          $88.9 million in AIM aid.  

12                 For our sister cities, those cities 

13          are receiving more AIM aid than they are 

14          contributing to their school district.  And 

15          so for us, we have to provide $30.9 million 

16          more than we receive in AIM aid to our school 

17          district, which cuts into the essential 

18          services that we're able to provide to our 

19          residents.

20                 ASSEMBLYMAN GANTT:  Can you explain 

21          why that happened?

22                 MAYOR WARREN:  I was not the mayor at 

23          the time, but I did work for you.

24                 (Laughter.)


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 1                 MAYOR WARREN:  So I think that what 

 2          happened was that at the time, the State 

 3          Legislature did not want to reduce funding to 

 4          education, and they wanted the cities to 

 5          continue to provide the same amount to the 

 6          school districts that they were providing in 

 7          that year instead of -- when times got tough, 

 8          the first thing that people might have 

 9          decided to do was cut the aid to schools.  

10                 For us, that locked us in at that 

11          amount of $119.1 million, and we have been in 

12          compliance with the MOE since it has been 

13          instituted.  However, as I said before, it 

14          cuts into our ability to provide for 

15          essential services, because actually it's 

16          taking 68 percent of the amount that we 

17          charge for taxes, and that automatically goes 

18          to our school district, not allowing us to 

19          utilize those dollars for our police 

20          department, our fire department, or our other 

21          essential services.

22                 ASSEMBLYMAN GANTT:  Mr. Chairman and 

23          Madam Chairman, a lot of us are not quite old 

24          enough to understand what went on probably 


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 1          prior to her getting there.  But I happen to 

 2          know that there was a deal made between the 

 3          county and the city that, in order to not 

 4          have a -- we talked about a county or city 

 5          tax on boys who worked in the city at the 

 6          time.  

 7                 Rather than have that, Lucien Morin 

 8          and Tom Ryan agreed that we would get more of 

 9          the county tax dollars, and therefore our 

10          concern about education would be on the top 

11          of the list.  So we provided more money for 

12          them than is provided from these other areas, 

13          I can guarantee you, as you can see from the 

14          pamphlet here.  

15                 The problem we have, though, is when 

16          this maintenance of effort came forward, none 

17          of us realized what was coming until the 

18          night that it happened, and I think that's 

19          how we got hung up in this.

20                 Somehow I think the state has to try 

21          and help this city out.  I mean, it's a city 

22          that obviously I represent, but it's also 

23          somebody who's concerned about what happens 

24          to those kids who go to school there.  No one 


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 1          is trying to say that we ought not give the 

 2          schools that, because that's what we were 

 3          doing when we got caught in what I considered 

 4          a trick.  

 5                 But now that we understand and know 

 6          what's happening, I think what must happen is 

 7          somehow we -- either more AIM aid or, if 

 8          that's not the case, necessarily, at least 

 9          understand the amount of money that's being 

10          paid by the city.  

11                 And I would hope that I could talk my 

12          colleagues into putting forth that which is 

13          fair.  Not to take away from anybody else.  

14          But when you look at Buffalo, for instance, 

15          there's $161 million; the MOE is only 

16          $70 million.  A $119 million from us, with 

17          AIM aid at 88, it's just not fair.  And we 

18          need to do something about it, find a 

19          solution to it.  

20                 So I thank you for your patience.  And 

21          thank you, Mayor, for coming.

22                 MAYOR WARREN:  Thank you.

23                 CHAIRWOMAN YOUNG:  Thank you, 

24          Assemblyman.


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 1                 Okay, Senator Marchione.

 2                 SENATOR MARCHIONE:  Mayor, thank you 

 3          for being here.  Just a few questions.

 4                 You say that your city was asked to 

 5          offset the cost of schools in your area -- 

 6          110 million, I think you said.  Was every 

 7          city in New York at that time asked to give 

 8          money to their schools?  I wasn't here at 

 9          that time myself, okay.  

10                 MAYOR WARREN:  So every city in 

11          New York State at the time was locked into an 

12          amount that they were currently giving their 

13          school district.  Nothing forbid any city 

14          from giving more.  But what it said was, when 

15          this legislation passed in 2010, that what 

16          you are contributing to your school district, 

17          no matter every dependent -- well, 

18          non-dependent, so that means the larger 

19          cities, Buffalo, Syracuse, Rochester, Albany, 

20          and I believe Yonkers -- what you're 

21          contributing to your school at that moment in 

22          time, you have to continue to contribute in 

23          perpetuity.  So until the Legislature decides 

24          that you don't have to do that.  


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 1                 At that point in time, we were giving 

 2          our school district $119.1 million.  

 3          Rochester has always been very generous with 

 4          the amount of money that it was giving the 

 5          school district.  And therefore at that point 

 6          in time, our sister cities were giving, I 

 7          believe, like 80 -- I think it's -- Buffalo 

 8          was giving $50 million, and then Syracuse was 

 9          giving $64 million at that point in time.  So 

10          we got locked in at this $119.1 million.

11                 SENATOR MARCHIONE:  So before 2010 --  

12          I'm just trying to understand -- cities were 

13          giving to their schools, it was an ongoing 

14          process, you'd give it to your schools --

15                 MAYOR WARREN:  Yes.

16                 SENATOR MARCHIONE:  -- always?

17                 MAYOR WARREN:  The amount that we 

18          determined.

19                 SENATOR MARCHIONE:  The amount that 

20          you determined.  So beyond --

21                 MAYOR WARREN:  Yeah, the amount that 

22          we determined, we were giving to our --

23                 SENATOR MARCHIONE:  So beyond giving 

24          the school aid in the taxes that you raised 


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 1          in the city, the schools do, you also 

 2          contributed to the schools?

 3                 MAYOR WARREN:  Yes.

 4                 SENATOR MARCHIONE:  Okay.  

 5                 You talk about you having to cut 

 6          services.  Have you had to cut employees, and 

 7          how many do you have?

 8                 MAYOR WARREN:  Well, a number of years 

 9          ago we consolidated our neighborhood and 

10          business development.  Well, we consolidated 

11          our neighborhood development and our 

12          community development into neighborhood and 

13          business development, which was a significant 

14          reduction in staff.  That was about five 

15          years ago?  About six years ago.  And we 

16          continued to reduce that through attrition, 

17          our people retiring and things like that.  

18                 But we're at a point where we are, you 

19          know, sort of at our bare minimum to be able 

20          to provide the services that we need to 

21          provide to our constituents.  You know, when 

22          people call 911, they expect for a police 

23          officer or a firefighter or, you know, 

24          someone to come to their aid.  


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 1                 Right now, as you all know, cities are 

 2          being asked to give a lot more or to do a lot 

 3          more with a lot less, and we just don't have 

 4          the finances to continue to provide the 

 5          essential services to our residents.  We 

 6          provide recreational services, libraries, we 

 7          also have other employment programs that we 

 8          try to help because we recognize that 

 9          Rochester is in a situation where we have a 

10          significant amount of poverty and our 

11          residents need the support and the help, and 

12          we want to be able to provide that.  But we 

13          have to be able to get the support from the 

14          state in order to do that.

15                 SENATOR MARCHIONE:  You talked about 

16          your utilities and your gross receipts, and 

17          the utility companies aren't escrowing money 

18          that they owe you.  How can that be?

19                 MAYOR WARREN:  So I'm going to let my 

20          budget director explain this, because he can 

21          explain it a lot better than I can.

22                 SENATOR MARCHIONE:  Thank you.

23                 BUDGET DIRECTOR WAGNER:  Good 

24          afternoon.


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 1                 SENATOR MARCHIONE:  Good afternoon.

 2                 BUDGET DIRECTOR WAGNER:  So back about 

 3          five, six years ago, the city was getting a 

 4          little over $11 million a year in annual 

 5          revenue from a utility gross receipts tax.  

 6          So Rochester is authorized to tax 3 percent 

 7          of gross receipts for utilities for 

 8          transactions within the City of Rochester.

 9                 So with deregulation and the rise of 

10          energy service companies, the energy service 

11          companies -- the way the statute is written, 

12          it says that the transaction has to occur 

13          wholly within the jurisdictional limits of 

14          the city.  And they argue that because 

15          they're buying the commodity off the grid, 

16          that the transaction doesn't occur wholly 

17          within the city limits, therefore the tax 

18          shouldn't apply.  So we've gone and seen, you 

19          know, $11 million a year shrink down to 

20          $5 million a year.  

21                 And as technologies change and we've 

22          gone from landlines to cellphone services, 

23          we've lost that revenue as well.  So we don't 

24          get any tax on cell companies.  And as the 


                                                                 363

 1          mayor mentioned, you know, New York City 

 2          does, and the state captures that through the 

 3          excise tax.

 4                 SENATOR MARCHIONE:  Are you in court 

 5          over this?

 6                 MAYOR WARREN:  I'm sorry?

 7                 SENATOR MARCHIONE:  Are you in court 

 8          over this?

 9                 MAYOR WARREN:  No, we are not in 

10          court.  This is something that -- I know that 

11          the Taxation and Finance Department released 

12          an opinion on it, and they said that they 

13          should pay for it.  But we are asking the 

14          Legislature to do something legislatively to 

15          ensure that the city -- and this is not just 

16          the City of Rochester, it's all the cities in 

17          upstate New York have this issue.

18                 SENATOR MARCHIONE:  Thank you.

19                 ASSEMBLYMAN OAKS:  Assemblyman Otis.

20                 ASSEMBLYMAN OTIS:  Thank you, 

21          Mayor Warren.  Nice to see you.

22                 Just a question about water 

23          infrastructure.  Do you have any sense -- and 

24          if you don't have numbers with you today, 


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 1          after the hearing is fine.  Your short-term 

 2          and long-term water infrastructure costs that 

 3          you anticipate the city will have to incur, 

 4          where does that fit in terms of your 

 5          capital-projects burden going forward?

 6                 BUDGET DIRECTOR WAGNER:  So the city 

 7          has a five-year capital program, and our 

 8          water department actually has a much longer 

 9          25-year capital program.  

10                 So, you know, we -- I don't have exact 

11          numbers here, but our cash capital allocation 

12          is generally in the $4 million to $5 million 

13          a year, and then we issue a fair amount of 

14          debt as well for water infrastructure.  

15                 One of the things that's coming up, 

16          about five or six years out, is LT2 

17          compliance requirements.  So we're going to 

18          have to make investments in our reservoir, 

19          and that will be a significant investment.  

20          So I can get you exact numbers, but we've got 

21          a significant nut to crack there.

22                 ASSEMBLYMAN OTIS:  That's great.  You 

23          know, after you go home to Rochester, if you 

24          could get us some just sort of real numbers 


                                                                 365

 1          or types of projects that you have to do, 

 2          that would be great.  Thank you.

 3                 MAYOR WARREN:  We definitely will, 

 4          Assemblyman.  Thank you.

 5                 ASSEMBLYMAN OAKS:  Hi, Mayor.

 6                 Just one question.  In your handout 

 7          you laid out a number of things that you are 

 8          doing, have put together along with 

 9          Monroe County on shared services or 

10          consolidating different things.  But along 

11          with that, you raise a concern about the 

12          Governor's proposal this year that would 

13          tie further type of things.  Do you think 

14          that you've already gone as far as you can 

15          go?  Or just the fact, the way the Governor 

16          has put that together, that would make it 

17          very difficult for you to fit within that?

18                 MAYOR WARREN:  I think that we have, 

19          as the City of Rochester and the County of 

20          Monroe, have gone as far as we can go with 

21          big-ticket items and there would not be a 

22          significant amount of savings with the 

23          smaller-ticket items.  

24                 We went through the first process a 


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 1          number of years ago, about three years, where 

 2          they evaluated the City of Rochester finances 

 3          and looked at ways in which we could 

 4          consolidate.  And what they determined is 

 5          that the big-ticket items we have already 

 6          consolidated with the County of Monroe.  When 

 7          we look at our parks, when we look at 911, 

 8          our library system, our water infrastructure, 

 9          we have already made those consolidations.  

10          So it wouldn't be a significant savings for 

11          us to do any more consolidation with the 

12          county.

13                 ASSEMBLYMAN OAKS:  Thank you. 

14                 CHAIRWOMAN YOUNG:  Thank you, Mayor, 

15          for joining us today.  We appreciate it, and 

16          safe travels back to Rochester.

17                 MAYOR WARREN:  Thank you, Senator.  

18                 CHAIRWOMAN YOUNG:  Our next speaker is 

19          the Honorable Mike Spano, mayor of the City 

20          of Yonkers.

21                 Welcome, Mayor.

22                 MAYOR SPANO:  Chairwoman, Senator, how 

23          are you?

24                 CHAIRWOMAN YOUNG:  Very well.


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 1                 MAYOR SPANO:  Our budget director, 

 2          Andrew Lenney, and our finance commissioner, 

 3          John Liszewski.  

 4                 And what I'm going to try to do is 

 5          spare you the read that you all can do.

 6                 CHAIRWOMAN YOUNG:  Thank you.  We 

 7          appreciate it.

 8                 MAYOR SPANO:  I'm giving you our 

 9          testimony, and I'm just going to basically 

10          speak about the issues.  

11                 So let me just say good afternoon, 

12          Chairwoman Young -- I know that the chairman 

13          will be back, Assemblyman Farrell -- members 

14          of the Senate and Assembly, particularly my 

15          friends and former colleagues that are here 

16          today.  Good to see you, Assemblyman Gantt.  

17          And my Assemblywoman, Shelley Mayer here, 

18          and -- to talk about the issues.

19                 Basically, this is what it boils down 

20          to, three major issues at least for us and I 

21          think for most of the other cities:  

22          education aid, capital projects in terms of 

23          rebuilding schools and rebuilding our 

24          infrastructure, and of course the perennial 


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 1          conversation we usually have, which is about 

 2          AIM aid.

 3                 I applaud the Governor and his efforts 

 4          to look for an avenue from which to provide 

 5          free tuition for the young people of our 

 6          state, and that's a very good direction to 

 7          head in.  But as the mayor of a city, we need 

 8          a little more help in bridging the gap, 

 9          bridging the gap between education.  

10                 In Yonkers some of our students, once 

11          they move off to college, are double- and 

12          triple-remediated.  So they're not 

13          college-ready yet, and we need to do more in 

14          terms of providing for college readiness for 

15          the people in our community, especially in 

16          the two big areas.  The big areas for us are 

17          obviously students with disabilities and 

18          English proficiency.  

19                 Poverty continues to be a major reason 

20          why young people are not performing the way 

21          they should be in our schools, and that is 

22          certainly punctuated in our big cities all 

23          across New York State.  Yonkers is not exempt 

24          from that.


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 1                 We'd like to have enough dollars so 

 2          that we can provide all the things that 

 3          frankly the kids in our suburbs are getting.  

 4          In other words, the suburbs to our cities.  

 5          You know, if you're in Yonkers, New York, and 

 6          we're graduating close to 80 percent of our 

 7          kids, that's very good in terms of the Big 

 8          Five, but when you're saddled next to 

 9          Scarsdale and Hastings and Pelham, you know, 

10          they're graduating 99 percent.  

11                 Our kids suffer from perennial budgets 

12          that show shortfalls and don't allow for us 

13          to have a full music program, a full arts 

14          program, a full intramural and full sports 

15          program.  These are very important components 

16          to a young person's education that allows 

17          them -- gives them the tools they need for 

18          them to succeed.  

19                 You know, librarians are 2,500 to 1 in 

20          Yonkers, guidance counselors are 700 to 1.  

21          Pupil support services have taken a big hit.  

22          School psychiatrists are now 1,000 to 1, and 

23          the social worker ratio is 2,000 to 1.  So 

24          these are just some of the issues that we 


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 1          continue to deal with as a big city in 

 2          New York.  But, you know, despite that, we've 

 3          been able to get some great things done.

 4                 The Governor's $1 billion increase in 

 5          overall aid to education is a great start.  

 6          We appreciate that.  It doesn't -- in terms 

 7          of formula, it doesn't do a lot for Yonkers, 

 8          about $5 million.  And again, that formula 

 9          continues to hurt our city, because we look 

10          like a wealthy Westchester community but in 

11          fact we are a city just like basically the 

12          other four.  

13                 So we have some issues that we'd like 

14          to revisit, and you know that -- you've heard 

15          about the formula over and over again, so I'm 

16          not going to bore you.  But again, it would 

17          be certainly helpful for us if we can really 

18          figure out a way to get additional dollars to 

19          the city.

20                 In capital needs, all of our schools 

21          are in need of repair.  Right now, Yonkers 

22          schools have a capital need of over a half a 

23          billion dollars just to bring ourselves up to 

24          state standards.  We have 4,500 students -- 


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 1          we are over capacity by 4,500 students.  We 

 2          need to build three new schools immediately.  

 3                 And last year we came to you in an 

 4          effort to get you to pass a Rebuild Our 

 5          Schools program.  You've been very helpful in 

 6          putting together the structure that will 

 7          allow us to do that, but we will continue to 

 8          ask for additional capital support to offset 

 9          the local share which frankly is going to be 

10          very difficult to the taxpayers of Yonkers to 

11          afford.  

12                 We're very close to our constitutional 

13          taxing limit, so even if we can get the 

14          political will to raise those dollars, you 

15          hit the cap and so you can't exceed those 

16          numbers which would allow us to rebuild our 

17          schools.  And again, our kids continue to be 

18          educated in standards that we'd like to 

19          change.

20                 We have to rebuild a firehouse this 

21          year.  Our firehouse was condemned, the main 

22          firehouse, but that is for sure all across 

23          the board with all the cities.  Firehouses, 

24          you know, police precincts, highways, 


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 1          bridges, our parks -- again, it's the city 

 2          and the city's taxpayers that have been 

 3          squeezed to the point where trying to find 

 4          the funding that's needed to provide for 

 5          safety, quality of life, and community at the 

 6          same time, to provide for the rebuilding of 

 7          the infrastructure needs, has been very 

 8          difficult for us.  And any type of support 

 9          that New York State can put into their 

10          capital budget in terms of schools and 

11          capital needs for the municipal side would be 

12          very appreciated for us.  

13                 AIM aid, you've heard it from 

14          everybody.  Our maintenance of effort, as you 

15          know, is 257, and the AIM aid is 108.  So 

16          we're on the flip side of what everyone's 

17          been talking about.  As a matter of fact, if 

18          we could switch that, we would.  So while we 

19          get more AIM aid, you see the numbers we're 

20          working against.  

21                 So since I've been here, five years, 

22          the personal income tax has gone up -- to 

23          New York State -- by close to 60 percent.  

24          That's what we give New York State.  


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 1                 We have not seen an increase in AIM 

 2          aid for now six years.  And that is a really 

 3          important number, because that's the 

 4          recognition that we get from New York that, 

 5          you know, we're partners.  We're partners in 

 6          providing for the quality of life of the 

 7          people that we all represent, we're providing 

 8          for the police, fire, sanitation.  It helps.  

 9          It helps significantly.  

10                 And over the past five years since 

11          I've been mayor, not only has AIM aid not 

12          gone up, but we also inherited many of our 

13          municipal contracts with many years overdue.  

14          So we had some contracts that were nine years 

15          out.  We have done and renegotiated all but 

16          one contract.  But at the same time, you have 

17          to be able to afford to pay for these 

18          contracts in the context of a 2 percent tax 

19          cap.  

20                 It's difficult.  We've been able to do 

21          it for the most part, but it's been a real 

22          tough row for us to hoe.  So we really would 

23          appreciate, again -- I'm trying to make the 

24          case, this AIM aid is critically important 


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 1          for the survival of our city, and it's a 

 2          recognition of that partnership.  And we 

 3          really could use your help in that.

 4                 And just to give you a couple of other 

 5          numbers -- I know you've heard it before -- 

 6          you know, healthcare, just in five years, 

 7          health, life, and dental insurance is up 

 8          54 percent.  Employee retirement system is up 

 9          100 percent.  And police and fire retirement 

10          system is up 54 percent.  You take those 

11          numbers, you take new contracts that were 

12          nine years out, you add it together, and it 

13          makes it very difficult for us to make ends 

14          meet.  

15                 We can continue to do more with less.  

16          We continue to make our budget work.  Our 

17          bond rating has gone up, and we appreciate 

18          all the help -- and you have been, I mean 

19          this, New York State has been very helpful to 

20          Yonkers in terms of dealing with issues with 

21          the Board of Education, in terms of helping 

22          us with our economic development program.  So 

23          I want to say thank you publicly to our great 

24          Governor and to the State Legislature.  


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 1                 We have over $100 billion -- I'm 

 2          sorry, $1 billion in -- I wish we had 

 3          $100 billion -- $1 billion in new economic 

 4          development happening in the city.  There's 

 5          4,000 new units of housing being built on our 

 6          city's waterfront.  We're becoming a 

 7          destination, a true regional destination.  

 8          Places like iFLY, obviously Empire City is in 

 9          Yonkers, Legoland.  There's a hotel boom, 

10          there's six different hotels that have been 

11          built.  So there's a lot of positive things.  

12                 But if you look at the expense line of 

13          the ledger and you look at how we're growing 

14          in terms of revenues, we're still being 

15          outpaced.  Our school district grew when most 

16          school districts in New York State outside of 

17          New York City were in decline.  Our school 

18          district grew.  As you know, when things were 

19          held harmless, they weren't really held 

20          harmless for us.  Because all the numbers 

21          were going up while our numbers were going 

22          down, so really what that meant was the 

23          overall aid per pupil went down.  

24                 So we need some help and support to 


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 1          help us help ourselves.  We realize we can't 

 2          come to you hat in hand every year, and we 

 3          realize that there are years that you can do 

 4          better things for us than others.  But we 

 5          know that in terms of education aid, to 

 6          continue to drive more dollars to education 

 7          is always helpful to us.  To continue to 

 8          increase the AIM aid, which we haven't been 

 9          able to do, but that's important to us.  And 

10          to provide for some capital investments that 

11          localities can use to help us.  

12                 When we rebuild this waterfront -- and 

13          that's a great thing that we're doing -- we 

14          still have, you know, old infrastructure that 

15          needs to be addressed.  Because if not, 

16          people are going to be living in that 

17          waterfront, but they're not going to be able 

18          to go anywhere.  And so we need to make sure 

19          that we have the help.  

20                 So with that, again, I tried to do a 

21          quick runaround.  What I wanted was -- 

22          Chairman Farrell didn't want me to speak too 

23          long, and then see if you have any questions.

24                 CHAIRMAN FARRELL:  Questions?


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 1                 Yes.

 2                 ASSEMBLYWOMAN MAYER:  Thank you, 

 3          Mr. Mayor, and thank you all for being here.  

 4                 And I know my Yonkers colleagues don't 

 5          seem to be here, so -- I know Senator Latimer 

 6          didn't feel well.  And I think if they could 

 7          be here, they would.

 8                 So, one, thank you for working so 

 9          collaboratively with us to try to drive more 

10          money, at least every year since I've been 

11          here and you've been mayor, particularly to 

12          our schools as we've had some challenges.  

13          And I understand your point about the need 

14          for additional funding for education, and 

15          obviously we will try.  

16                 One thing I just want to bring to your 

17          attention.  You know, the Governor proposed 

18          that after this year the Foundation Aid would 

19          end, which I believe is not consistent with 

20          the requirements of the CFE lawsuit.  But 

21          obviously, as we push for additional funding, 

22          we're going to want to have the partnership 

23          to work for long-term improvements in the way 

24          funding is driven to the Yonkers public 


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 1          schools.  And I hope we can have your 

 2          commitment to work with us, because I think 

 3          the end of Foundation Aid would be very 

 4          damaging for the City of Yonkers public 

 5          schools.

 6                 MAYOR SPANO:  We -- listen, I think 

 7          that's the only hope we actually had was in 

 8          terms of trying to deal with that with the 

 9          funding formula.  And so yeah, we'll be 

10          willing to work with you any way in which we 

11          can.  

12                 The hard-core reality is that while 

13          we -- our budget -- and a lot of people look 

14          at our budget and say, Well, you know, what 

15          is really Yonkers spending its money on?  Our 

16          budget is about 50 percent right now 

17          funded -- funding goes through the Board of 

18          Education.

19                 ASSEMBLYWOMAN MAYER:  Yeah.

20                 MAYOR SPANO:  And these are coming 

21          from you.  All the cities outside of -- as 

22          you know, all the cities are not even hitting 

23          20 percent on their budget, the rest is going 

24          to the municipal side.  


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 1                 So we -- you know, we get banged on 

 2          both sides.  So we get banged on the 

 3          education side, because we're Westchester 

 4          County -- that's a rich community -- but yet 

 5          over 70 percent of our kids live at the rate 

 6          of poverty.  And we have to deal with the 

 7          high cost of living in Westchester.  The 

 8          workforce, as you know, is at a different 

 9          type of pay scale.  And we have, as a result, 

10          over 50 years, have pretty much hit our 

11          constitutional taxing authority.  

12                 So even, like I said before, if we 

13          wanted to drive additional dollars back the 

14          other direction to try and maybe increase 

15          those numbers for our kids, which we want to 

16          do -- and we have done it other ways in terms 

17          of increases in the sales tax and what have 

18          you -- we can't, because we're running 

19          against a cap that says, okay, well, we think 

20          taxpayers in Yonkers have had enough.  And so 

21          we hit that constitutional cap, so -- yes, 

22          the causes are different, but the effect is 

23          still the same.  Kids suffer in the end.

24                 ASSEMBLYWOMAN MAYER:  Right.  But we 


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 1          will need to push back against this effort to 

 2          end Foundation Aid, and I hope we can work 

 3          together on that.

 4                 On the finding additional money for 

 5          capital -- and I'm pleased to see you've 

 6          expanded it beyond just the schools, because 

 7          I think we all agree we need capital 

 8          financing.  In your testimony on page 4 you 

 9          show, you know, Yonkers is disproportionately 

10          lower in building aid expenditures and 

11          reimbursement.  And I just want to clarify 

12          that in addition to having a lower 

13          reimbursement formula, which we all 

14          acknowledge we do, and it is a disadvantage 

15          for us, one of the reasons we haven't been 

16          able to even get more is because we don't 

17          have the financing to spend more.  

18                 So because we have a 70 percent 

19          reimbursement, I take it that Yonkers doesn't 

20          have the money to spend the 30 percent on the 

21          absolutely essential repairs for our schools 

22          that have been left in disrepair before you 

23          became mayor, and now we're paying the price.  

24                 So this $10 million, which looks like 


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 1          we're getting cheated -- which maybe some 

 2          could say we are, but it's just so -- we 

 3          don't have the money to put in.

 4                 MAYOR SPANO:  By my estimates, that's 

 5          right.

 6                 ASSEMBLYWOMAN MAYER:  Yeah -- am I 

 7          correct about that?

 8                 MAYOR SPANO:  That's a very good 

 9          point, Assemblywoman.  

10                 And, you know, I wasn't trying to be 

11          misleading there.  It's I guess a symptom of 

12          the overall problem, which is we don't have 

13          the taxable authority on one end to raise 

14          those dollars to pay our share of rebuilding 

15          those schools, even at the 70 percent rate 

16          that the state is coming through with the 

17          money, which is a good -- it's a good place 

18          to start.  And that's been why we've been 

19          asking for additional support in terms of 

20          capital funding, so that we can maybe lower 

21          that threshold down a little bit and be able 

22          to afford to build new schools.  

23                 I want to address -- the first thing 

24          we need to address is the overcrowding in the 


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 1          schools.  We need to build two more schools, 

 2          we need to rebuild Gorton, and that's some of 

 3          the things that we're working at now.  But 

 4          there are also infrastructure needs that need 

 5          to happen right now in terms of buildings 

 6          that are just inadequate and need the support 

 7          to bring them up to standards where they 

 8          should be.

 9                 ASSEMBLYWOMAN MAYER:  Now, I know -- I 

10          don't think the council adopts a capital 

11          budget until later in the year, but I'm 

12          assuming you're preparing a capital budget 

13          that's going to show anticipated shortfalls, 

14          preparing your needs against what anticipated 

15          capital revenues you would have.  And I think 

16          that's something we'll want to see in the 

17          drafts, to the extent we can be helpful and 

18          try to find additional capital funds.

19                 MAYOR SPANO:  Okay.

20                 ASSEMBLYWOMAN MAYER:  Lastly, I just 

21          want to say on AIM, as you know, I think last 

22          year the Assembly one-house budget did 

23          increase AIM for cities statewide, and I'm 

24          hopeful that this year the Assembly one-house 


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 1          budget will continue to do that.  

 2                 One thing -- and I appreciate you 

 3          mentioned the consolidation activities that 

 4          Yonkers has undertaken.  But as you know, the 

 5          Governor's proposal is really contingent on a 

 6          very strict consolidation proposal that 

 7          actually has to go to the taxpayers, which, I 

 8          think we all know in the political reality, 

 9          could pose some real challenges.  

10                 So while I understand the need for 

11          more AIM and we certainly will fight for 

12          it -- and I'm not asking you to criticize the 

13          Governor's proposal, but I just would ask 

14          that you recognize that the contingency that 

15          he placed on AIM is very troublesome, in my 

16          opinion, for cities like Yonkers.

17                 MAYOR SPANO:  We will work with the 

18          legislation as passed.  We will -- if we have 

19          to work on a proposal to put it to the 

20          taxpayers for a vote, we'll do that.  

21                 But I will tell you that given my 

22          experience at the city level, where -- and 

23          I'm sure the commissioner of finance can tell 

24          you, we had a fun time in doing -- to a 


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 1          municipal agreement, shared services with the 

 2          Board of Education -- now, these are trustees 

 3          that I appointed, and they didn't want to 

 4          support the shared services that we wanted to 

 5          do.  And we took them kicking and screaming.  

 6          It saved a lot of money for the school 

 7          district, it provided for another $2 million 

 8          for teacher support services, but it was a 

 9          hard task.  

10                 I think -- the mission I like.  I 

11          think the fact that our tax -- the Governor's 

12          pushing us to do more in terms of shared 

13          services.  I get it, I support it, I 

14          understand what he's trying to do.  It is 

15          going to be a monumental lift.  

16                 In places like human resources, in 

17          places like legal, in places like maybe even 

18          trash pickup, you might be able to get other 

19          municipalities to go along with you and do 

20          some type of shared services.  

21                 In Westchester County, as you know, 

22          it's very hard to do that with the 

23          high-ticket items like the police department, 

24          the fire department, because everybody wants 


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 1          their own.

 2                 ASSEMBLYWOMAN MAYER:  Right.

 3                 MAYOR SPANO:  Police department, fire 

 4          department, and they obviously want their own 

 5          schools.  

 6                 So this is a tall order, there's no 

 7          doubt about it.  But I -- you know, whatever 

 8          you give to us to do, we're going to follow 

 9          through and work hard.

10                 ASSEMBLYWOMAN MAYER:  No, I appreciate 

11          that.  And I know you well.  I just would say 

12          that I believe it's the state's obligation to 

13          fund cities like Yonkers at a level that they 

14          need in order to provide essential services.  

15          And while the mission of shared services and 

16          reductions is a notable one, I'm concerned 

17          about tying these things together, and I 

18          think the Assembly will -- I suspect we'll 

19          find that a difficult path to hoe.

20                 Thank you very much.

21                 MAYOR SPANO:  Thank you, 

22          Assemblywoman.

23                 CHAIRMAN FARRELL:  Senator?

24                 SENATOR MARCHIONE:  I'd like to just 


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 1          recognize that the minority leader, Senator 

 2          Andrea Stewart-Cousins, has joined us.  

 3          Welcome.

 4                 And the only comment that I have -- I 

 5          don't know if the Senator has any further 

 6          questions -- is to tell you how much we enjoy 

 7          your Legoland.  

 8                 MAYOR SPANO:  Ah.

 9                 SENATOR MARCHIONE:  My family very 

10          much enjoys your Legoland.

11                 MAYOR SPANO:  Senator, thank you.  We 

12          are happy -- Yonkers has gone through kind of 

13          a rebirth, almost a lot like what you've seen 

14          in Brooklyn, but in a smaller way.  But 

15          there's a regional attraction to the city, 

16          and that's been helpful to us, it really has 

17          been.  And we're building on that.  

18                 And a lot of it has been made 

19          possible, frankly, because of the help that 

20          came from you, from the State Legislature, 

21          from Leader Stewart-Cousins and all, just 

22          making -- and Assemblywoman Shelley Mayer -- 

23          making it possible for us to attract some of 

24          these companies in.  And then it's kind of 


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 1          like the flood gates open a little bit, you 

 2          know.  When you bring somebody in, you can 

 3          attract maybe two or three others all by 

 4          themselves.

 5                 So we get it.  We're working hard.  

 6          But we also know we have a long ways to go.

 7                 SENATOR MARCHIONE:  Thank you.

 8                 CHAIRMAN FARRELL:  Questions?

 9                 Thank you, Mr. Mayor.

10                 MAYOR SPANO:  Thank you, Chairman 

11          Farrell, Leader Cousins. 

12                 SENATOR MARCHIONE:  Do you have a 

13          question?  

14                 SENATOR STEWART-COUSINS:  No, I 

15          didn't.  I did actually have a --

16                 STENOGRAPHER:  Mic?

17                 SENATOR STEWART-COUSINS:  Hello?  

18          Better?  Okay.  

19                 Again, I just wanted to, you know, 

20          lend my voice in support with so many of the 

21          things that are happening in Yonkers and the 

22          revitalization.  

23                 I know the Assemblywoman went through 

24          a lot of the things that I was certainly 


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 1          concerned about.  And definitely, as big 

 2          proponents of AIM, and certainly as it 

 3          relates to doing the things that we need to 

 4          do and a tax cap, I'm always trying to get 

 5          more AIM funding for municipalities.  And so 

 6          I'm glad that the question was raised as it 

 7          relates to how we will proceed forward if we 

 8          tie these two things together.  So, you know, 

 9          I'm always concerned about that.

10                 But as far as the schools, I'm sure 

11          you've got two bites at the apple because you 

12          came here on your Local Government Day to 

13          talk mostly about rebuilding schools.  I'm 

14          assuming that the superintendent will come 

15          and talk about the same thing.  

16                 MAYOR SPANO:  Yes, he'll talk about 

17          the schools too.

18                 SENATOR STEWART-COUSINS:  Which is 

19          good, because sometimes there are different 

20          messages, and people don't know where exactly 

21          to focus.  But clearly the future of the 

22          city's continued revitalization will really 

23          hinge on our ability to educate the young 

24          people who are coming into the city with 


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 1          their families.  And for that, you know, good 

 2          buildings and infrastructure, you know, will 

 3          really be required.  

 4                 So, you know, we will continue to work 

 5          with all of our colleagues, both sides of the 

 6          aisle, in both houses, to see what we can do 

 7          to make it happen.

 8                 MAYOR SPANO:  Thank you for your 

 9          comments.  I appreciate that.

10                 SENATOR STEWART-COUSINS:  You're 

11          welcome.

12                 MAYOR SPANO:  Thank you.

13                 CHAIRMAN FARRELL:  Thank you very 

14          much.  

15                 SENATOR MARCHIONE:  Thank you.

16                 CHAIRMAN FARRELL:  The Honorable 

17          Stephanie Miner, mayor of the City of 

18          Syracuse, 2:30.  

19                 Good afternoon.

20                 MAYOR MINER:  Good afternoon.  

21                 Thank you, Chairman Farrell --

22                 CHAIRMAN FARRELL:  Good evening.

23                 MAYOR MINER:  Yes, I guess soon to be 

24          evening.


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 1                 -- thank you, Senator Young, and all 

 2          the members of the Legislature who have 

 3          vigilantly stayed to listen to my testimony.

 4                 In keeping with the spirit of my 

 5          colleagues, I'm going to echo what they have 

 6          said about the tremendous financial 

 7          challenges that cities find themselves under 

 8          and the need to have more AIM funding.

 9                 I do want to take this time, though, 

10          to specifically thank the Assembly and the 

11          Senate for your continued steadfast advocacy, 

12          successful advocacy, for more funding for 

13          education and recently more funding for 

14          infrastructure.  Your success in those areas 

15          has been incredibly important to my city and 

16          other municipalities across New York State.  

17                 As you said, Chairman Farrell, I am 

18          the mayor of Syracuse, and we are the fifth 

19          most populous city in the State of New York.  

20          And while we have a terrific city that is 

21          growing, particularly with immigrants and 

22          people who are refugees, which has been in 

23          the news this week and last week, we also 

24          have tremendous struggles.  We are a poor 


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 1          city, and more than 45 percent of our 

 2          children are born into poverty.  And under 

 3          recent studies that have been released, we 

 4          have the highest concentration of black and 

 5          Hispanic poverty of any city in the nation.

 6                 These are challenges that we, like 

 7          Buffalo and Rochester, face every day and are 

 8          very conscious of providing what I like to 

 9          call the infrastructure of opportunity to 

10          people in our city so that they can grow and 

11          become successful citizens.

12                 It is customary on this day to plead 

13          for additional state aid, which I have just 

14          done.  But last year I broke somewhat with 

15          that tradition and talked about the desperate 

16          need for reform.  I spoke about corruption 

17          and its corrosive influence on our democracy 

18          in New York State.  And at the same time I 

19          also raised issues about how economic 

20          development resources were allocated in this 

21          state.  And unfortunately, since I appeared 

22          before you last year, the headlines have been 

23          dominated by the intersection of those two 

24          issues, corruption in our state's economic 


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 1          development programs and corruption in 

 2          general. 

 3                 Tough questions need to be asked, 

 4          answers need to be had, and people need to be 

 5          held accountable for performance or a lack of 

 6          performance.  In Central New York we have 

 7          acutely felt the impact of this corruption, 

 8          and yet at the same time we have showed a 

 9          contrast as to what can happen when you have 

10          principled economic development.

11                 Under my tenure, and this is my eighth 

12          year as mayor, our economic development has 

13          resulted in $1.5 billion of development.  And 

14          at the same time, we have had exciting new 

15          developments to make sure that we insured 

16          local hiring to put our most marginalized 

17          citizens to work when we gave away tax 

18          benefits.

19                 We have seen old classic assets in our 

20          city, like the Hotel Syracuse, be 

21          redeveloped, and another cornerstone of 

22          downtown be revitalized, with local jobs 

23          being created and people being put to work.  

24          Since becoming elected to office, I've been a 


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 1          consistent promoter of what has unfortunately 

 2          become a radical idea, that tax breaks for 

 3          developers must be balanced with a 

 4          commensurate public benefit.  

 5                 Unfortunately, as we have seen in our 

 6          headlines, corruption in our state's economic 

 7          development programs has become all too 

 8          common.  There is a systemic problem in that 

 9          government has increasingly become insulated 

10          from the will of the people.  That is being 

11          felt by the citizens of my city and our 

12          community and, indeed, I would say our entire 

13          state.  

14                 While we are limiting voting rights, 

15          we are protecting the right of LLCs to 

16          influence our laws.  We are forcing 

17          consolidation on local communities and at the 

18          same time refusing to provide promised 

19          mandate relief.  There is a government that 

20          promotes ribbon cuttings while neglecting a 

21          sustained investment in our shared 

22          infrastructure of opportunities -- our 

23          schools, our roads, our water mains.

24                 I say this to all of you to say that 


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 1          when we have the basic foundations of our 

 2          democracy undermined, to come and speak to 

 3          you and simply just ask for money seems to me 

 4          to do a disservice.  We need to show the 

 5          people of our state that government provides 

 6          the best public policy for everyone, not just 

 7          those who are wealthy enough to provide 

 8          campaign contributions.

 9                 A couple of weeks ago I joined 

10          Common Cause in supporting their agenda, and 

11          I would urge all of you to look closely at 

12          this agenda and adopt it.  It includes, among 

13          other things, closing the anonymous LLC 

14          loophole, engaging in comprehensive 

15          contracting oversight, and modernizing our 

16          elections.  I believe by doing all of this we 

17          can inject some energy and transparency into 

18          our government and show the people of our 

19          state that we really mean it when we say that 

20          we are doing the people's business.

21                 I would also like to take a moment to 

22          talk about the countywide shared services 

23          property tax plan initiative in the 

24          Governor's proposed budget, as well as the 


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 1          municipal consolidation and efficiency 

 2          competition enclosed in last year's budget.

 3                 The first point I'd like to make is 

 4          that most local governments in New York, 

 5          including the City of Syracuse, are already 

 6          sharing services.  And I don't say that just 

 7          as the mayor of the City of Syracuse, but I 

 8          say that by quoting a study by Dr. Mildred 

 9          Warner of Cornell University, who has shown 

10          that New York State is a leader in shared 

11          services.  

12                 We in the City of Syracuse have 

13          already taken concrete steps over the past 

14          seven years to consolidate purchasing, 

15          consolidate mail service, implement 

16          PeopleSoft for a shared financial management 

17          platform -- and in fact, all of these things 

18          led to a recognition by Governor Cuomo during 

19          his 2014 State of the State Address for the 

20          city's efforts in attempting consolidation.

21                 And he said:  "And there is a ray of 

22          hope, because there are local leaders who are 

23          stepping up to the plate.  And I would like 

24          to take a moment to recognize the great 


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 1          Onondaga County Executive, Joanie Mahoney, 

 2          and the Mayor of Syracuse, Stephanie Miner, 

 3          who are working together.  They are working 

 4          together to see if they can achieve 

 5          consolidation and shared services between 

 6          Onondaga County and the City of Syracuse.  We 

 7          wish them well and hope other leaders follow 

 8          that example, because that is exactly the 

 9          right course."  

10                 I share that with all of you to say 

11          that I have a track record, a successful 

12          track record, of doing shared services and 

13          consolidations.  And I have seen a number of 

14          my colleagues in suburban and rural towns and 

15          villages alike all struggle under the 

16          property tax cap to continue to provide 

17          effective services.

18                 At the same time, I must remind all of 

19          you that when the property tax cap was put 

20          into place, we were promised that there would 

21          be meaningful mandate relief, and there has 

22          not been.  

23                 Dr. Warner, from Cornell University, 

24          has also shown that New York State has the 


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 1          highest level of state decentralization of 

 2          fiscal responsibility of any state in the 

 3          nation.  And in fact, according to her study, 

 4          64 percent of all state and local 

 5          expenditures are handled at the local level 

 6          in New York State.  That's the second highest 

 7          in the nation.

 8                 The primary drivers of high local 

 9          property taxes in New York State are indeed 

10          mandates that come from the state, including 

11          pensions, binding interest arbitration, 

12          healthcare, and other things that we are 

13          ordered and indeed want to provide.  If the 

14          idea behind consolidation and shared services 

15          is to lower property taxes, then I think that 

16          that does a disservice to the public to say 

17          that that's going to do it.

18                 If we want to lower property taxes in 

19          the State of New York, then we have to look 

20          at issues like how we pay for Medicaid, how 

21          we pay for education, how we pay for pensions 

22          and other mandates that the state puts on the 

23          local governments.  If we want to talk about 

24          efficiencies and how we can more efficiently 


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 1          provide services, then I would tell you that 

 2          the way to do it, having done it, is to 

 3          incent local governments to cooperate, not to 

 4          bludgeon them over the head with these kinds 

 5          of mandates.

 6                 Again, I have been successful and I 

 7          have been unsuccessful in these efforts.  But 

 8          what I can tell you is that you are most 

 9          successful when you have a constituency that 

10          believes you, thinks you're acting in their 

11          best interest, and wants to see the end 

12          results.  

13                 Unfortunately, we are in a time and 

14          place where we've seen more and more people 

15          not believe what their elected officials are 

16          telling them, and they are doubtful when we 

17          go to them saying that we are going to give 

18          them better government at lower cost.  And so 

19          I would caution all of you, as you think 

20          about these proposals, to keep that in mind.

21                 I also want to take this opportunity 

22          to strongly endorse Assemblyman Hevesi's Home 

23          Stability Support program.  As I said, we are 

24          a poor city in New York State, and we have 


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 1          done tremendous work in providing housing to 

 2          people who are housing-vulnerable, but 

 3          Assemblyman Hevesi's program would help us 

 4          continue to do that and improve living 

 5          conditions and provide some stability across 

 6          the state.  And so I have publicly said this 

 7          before, but I would strongly urge the members 

 8          of the Legislature to support this proposal.

 9                 And lastly, I want to again add my 

10          voice to those who strongly support expanding 

11          ride-hailing services outside of New York 

12          City.  Doing so will help our economy in 

13          Syracuse grow and make all of our streets 

14          safer for all.

15                 So with that, I want to thank you for 

16          your time today, and I would welcome any 

17          questions that any of you have.  Thank you.

18                 CHAIRMAN FARRELL:  Thank you very 

19          much.  

20                 Questions?

21                 CHAIRMAN FARRELL:  Thank you.

22                 MAYOR MINER:  Thank you.

23                 CHAIRMAN FARRELL:  Julissa 

24          Ferreras-Copeland, chair of the Finance 


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 1          Committee, New York City Council.

 2                 Next will be the New York State 

 3          Association of Counties.  If you came down, 

 4          it would help a little when we start.

 5                 Good afternoon.

 6                 COUNCILMEMBER FERRERAS-COPELAND:  Good 

 7          afternoon.

 8                 CHAIRMAN FARRELL:  Did I mess up your 

 9          name?

10                 COUNCILMEMBER FERRERAS-COPELAND:  No, 

11          you said it perfectly.

12                 Good afternoon to Chairwoman Young and 

13          Chairman Farrell and the members of the 

14          Finance and Ways and Means Committees.  I 

15          will be testifying on behalf of the New York 

16          City Council and Speaker Melissa 

17          Mark-Viverito. 

18                 I am Julissa Ferreras-Copeland, and I 

19          am the chairwoman of the New York City 

20          Council's Finance Committee.  I represent the 

21          21st Council District, which includes 

22          Elmhurst, East Elmhurst, Corona and 

23          Jackson Heights, in the Borough of Queens.  

24          It is an honor to be in our state's capital 


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 1          to discuss Governor Cuomo's Executive Budget 

 2          for state fiscal year 2017-2018.  

 3                 I appear before you not only as an 

 4          elected representative, but also as the 

 5          daughter of immigrants who live the American 

 6          dream.  I represent some of the most 

 7          ethnically and racially diverse neighborhoods 

 8          within the most diverse county in the world.  

 9          My constituents, many of whom are immigrants, 

10          are hardworking and searching for the 

11          American dream just as my parents did.

12                 It is my sincere hope that we as a 

13          state pass a budget that provides all 

14          New Yorkers with the opportunity to achieve 

15          the American dream.  Let us remember that the 

16          American dream is the same for my 

17          constituents in Queens as it is for the 

18          residents of the North Country, Erie County, 

19          and all counties across our state.  We are 

20          one New York.

21                 This year's Executive Budget contains 

22          familiar proposals that the City Council 

23          strongly supports.  The budget again 

24          recommends the enactment of the DREAM Act to 


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 1          provide undocumented immigrants access to 

 2          state financial aid for higher education.  

 3          The DREAM Act offers all New York students 

 4          the same opportunity to pursue the American 

 5          dream.

 6                 Now to the issue of raising the age 

 7          for criminal liability.  New York is one of 

 8          only two states that prosecute teenagers as 

 9          adults.  The Governor proposes raising the 

10          age for juvenile jurisdiction from age 16 to 

11          18 by January 2020.  The budget also contains 

12          additional beneficial reforms such as 

13          diversion, probation, and programming 

14          services for 16- and 17-year olds involved in 

15          the juvenile justice system.  We urge the 

16          Legislature to raise the age of criminal 

17          responsibility.

18                 I want to express the New York City 

19          Council's support of extending the personal 

20          income tax top bracket.  The budget extends 

21          the personal income tax top bracket, 

22          otherwise known as the millionaire's tax, for 

23          three years.  This rate applies to taxpayers 

24          with taxable incomes over $2.1 million.  This 


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 1          action raises needed state revenue while 

 2          shifting the tax burden to those best able to 

 3          pay for it.

 4                 The Governor has also made new 

 5          proposals that the council commends.  The 

 6          budget permits New Yorkers with family 

 7          incomes under $100,000 to attend SUNY or CUNY 

 8          tuition-free beginning next school year.  The 

 9          income threshold increases to $125,000 by 

10          school year 2019-2020.  We applaud this 

11          proposal and urge the Legislature to consider 

12          enhancing financial aid available for 

13          expenses such as books, transportation, and 

14          housing to the lowest-income students.

15                 A new proposal creates a partial 

16          unemployment insurance benefit which allows 

17          an employee to earn $100 or 40 percent of 

18          their weekly benefits, whichever is greater, 

19          when a worker is partially unemployed.  

20                 While this year's Executive Budget 

21          excludes exceedingly problematic cost shifts 

22          like the ones we saw last year, there remain 

23          areas of serious concern.  The New York City 

24          Council is pleased that the Governor proposes 


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 1          to again increase school aid, including a 

 2          $428 million increase in Foundation Aid, and 

 3          we support the Governor's calls to fund 

 4          after-school programs, community schools, 

 5          pre-kindergarten, and early-college high 

 6          schools.  

 7                 However, we again urge the Legislature 

 8          to fully fund the Campaign for Fiscal Equity 

 9          decision, and eliminate funding set-asides 

10          proposed for Foundation Aid.  Fully funding 

11          the CFE decision will provide our public 

12          schools the necessary resources to provide 

13          all students with a sound, basic education.

14                 The budget recommends removing the 

15          regional cap on charter school growth in 

16          New York City, enhancing the reimbursement 

17          for charter school facilities costs, and 

18          boosting the charter school per-student 

19          payment rate.  The significant funding 

20          increases proposed for charter schools will 

21          leave less of the proposed Foundation Aid 

22          increase available for district schools, 

23          making compliance with the CFE ruling 

24          critical.  The council has concerns with 


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 1          lifting the charter cap without a further 

 2          increase in Foundation Aid and support for 

 3          charter school facility costs.

 4                 Additionally, the budget proposes to 

 5          restructure funding for residential 

 6          placements of children with special needs to 

 7          require New York City to pay tuition costs 

 8          associated with the New York City Foster Care 

 9          placements.  While the state anticipates that 

10          this proposal impacts New York City by 

11          $23 million, costs could exceed this amount 

12          as expenditures are dependent on the number 

13          of foster care placements and associated 

14          tuition costs.  We oppose this proposed cost 

15          shift to the New York City school system.

16                 Finally, the Executive Budget proposes 

17          to extend mayoral control of city schools for 

18          three years.  We are in full support of this 

19          proposal.

20                 While most of the budget continues 

21          existing policies with respect to Medicaid, 

22          such as adhering to the spending cap, there 

23          are two main programs that cause concern.  In 

24          an effort to lower state and New York City 


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 1          Medicaid costs, the budget requires the city 

 2          to improve the Medicaid claiming of School 

 3          Supportive Health Services and to identify 

 4          opportunities to enhance federal funding for 

 5          SSHS.  Should the plan fail to generate the 

 6          required savings, DOH will have the authority 

 7          to reduce Medicaid payments to the city by 

 8          $50 million.

 9                 We are also very concerned over the 

10          uncertainty at the federal level with the 

11          possible repeal of the Affordable Care Act 

12          and how that will impact the Medicaid 

13          program.  Most concerning is whether the 

14          federal government will impose a block grant 

15          program for Medicaid.  The New York City 

16          Council hopes that our partners in the state 

17          will continue to work with us to protect the 

18          people that utilize Medicaid in the event 

19          that the federal government repeals the 

20          Affordable Care Act to prevent any gaps in 

21          services.

22                 This budget also reduces the General 

23          Public Health Work Program reimbursement to 

24          New York City, which supports many public 


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 1          health services for vulnerable populations. 

 2          It reduces the reimbursement rate for the 

 3          non-emergency claims above the base grant 

 4          from 36 percent to 29 percent, resulting in a 

 5          loss of $32.5 million that supports Ending 

 6          the Epidemic, Nurse-Family Partnership, 

 7          Newborn Home Visiting Program, and other 

 8          essential services.

 9                 Few things are as important to the 

10         &nbs