MARCH 15, 2011

Good morning. Thank you for the opportunity to discuss the Mayor's Preliminary Budget for the 2012 Fiscal Year.

Before [ present the budget highlights, I want to discuss the Police Department's work to drive crime down last year and so far in 2011. I also want to discuss the terrorist threat to New York City and our plans to secure the World Trade Center site.

As we were reminded again recently, the gains made in the public's safety haven't been achieved without significant risks to our police officers. Last Sunday morning, Police Officer Alain Schaberger was pushed to his death while attempting to arrest a man with an extensive criminal history including domestic violence. Our thoughts and prayers continue to go out to Officer Schaberger's family at this time.

I also want to acknowledge the combined response of our police and fire rescuers on Sunday to the terrible bus crash on the Bronx border. They worked expertly under horrific circumstances to save the living and to extricate the dead in a dignified way.

Despite a tough economy and constant pressure on our resources, the members of the Department drove crime down again in 2010 by 2%, led by sharp decreases in burglaries, grand larcenies, and auto thefts. These crimes fell to levels not seen in the City in at least 50 years.

Compared to 2009, we did see an increase in several categories of violent crime, including homicides and rapes. We've taken a number of actions to address these increases. However, viewed in context these crimes are still low by historical standards. Last year's total of 536 murders was the fourth lowest the city has recorded since reliable data was kept on this crime in 1963. Homicides were down by 17% compared to 2001 and rapes were down by 29%.

Crime is down again this year by 4% and by 41 % since 2001, before we took on the responsibility of counterterrorism.

A recent study by one of the nation's foremost scholars of criminal justice helps to put the historic accomplishments of our police officers into perspective. Dr. Franklin Zimring of the University of California, Berkeley School of Law writes that "over the last 20 years after 1990, New Yorkers were the beneficiaries of the largest and longest sustained drop in street crime ever experienced by a big city in the developed world."


He calls the 80% reduction in crime achieved during that time "a Guinness Book of World Records crime drop." One factor Zimring identifies as helping to sustain this trend during the past decade is "hot spot policing," otherwise known as Operation Impact, which we implemented in 2003.

Thankfully, we've been able to keep this initiative going strong with the graduation of more than 1100 new officers from the Police Academy last December, our largest class since 200S. All of its members were assigned to Operation Impact.

As I said, we're also very hopeful about some new community partnerships we've established.

Last summer, we were approached by a group of ministers from prominent African American churches in Brooklyn about what we could do together to address violent crime in their community. We know from the data that black and Hispanic New Yorkers are disproportionately the victims of such crime. Last year, these groups made up 92% of all murder victims and 9S% of all shooting victims. As was widely reported in the media last week, a Police Department analysis of homicide victims in 2010 showed a 31 % increase in the number of African Americans murdered last year.

Working with the members of the Brooklyn Clergy initiative, we developed an action plan to engage neighborhood youth, reduce gang involvement, and stop violence in the community. Women in our executive corps are teaming up with grandmothers who are primary care-givers to engage at-risk youth and keep them out of harm's way.

We've also expanded some of our most effective community programs, including our Church Gun Buy-Back initiative. Since 200S, we've held these events in 50 churches across the city. We offer members of the public bank cards they can redeem for $200 cash for any operable handgun they turn in and $20 for any rifles and shotguns, no questions asked.

Our latest Gun Buy-Back was held in December in partnership with the Reverend AI Sharpton and his National Action Network. In just six hours more than 350 firearms were surrendered at two churches in Harlem, bringing the total number of weapons recovered through this program to more than 6,500 in two years. That number is also stark evidence of how many illegal guns are out there.

Taking weapons otT the streets results in safer communities and far fewer violent encounters between the police and the public. It's one of the reasons why, last year, police officers were engaged in the fewest shooting incidents since 1972, a year after the department first began tracking this data.

In 1971, 93 people were shot and killed in confrontations with the police. In 2010, eight people were shot and killed in confrontations with the police, the fewest in 40 years.


When it comes to the restrained use of firearms, we've made a lot of progress over time and in comparison to other major police departments, which have twice to eight times our rate of fatal police shootings.

We've also worked very hard to improve the tone of police-community relations, in part by having a police department that is more reflective of the city. Since 2002 we've had to hire and train nearly half of the department. This has afforded us the opportunity to recruit widely. The result is a department more diverse than it has ever been.

In 2006 for the first time ever the rank of police officer became majority minority.

Our most recent Academy class included officers born in 53 countries who speak 48 different languages. That's typical of recent classes. The last six of them have included officers born in a total of 88 countries.

We don't pursue diversity for the sake of it. We do it because it makes us a better, stronger, fairer organization, one that works etTectively with the community to fight crime and terrorism.

Not only are our police officers doing an exceptional job fighting crime under tough circumstances, they are also doing everything they can to protect the City from another terrorist attack. When it comes to defending the City against this threat we have to face the facts. New York remains the number one target of radical Islamic terrorism. We've been the subject of twelve plots since September 11th, more than any other U.S. city.

The latest one involves a college student in Texas who exploited our federal immigration process to obtain a student visa, travel to the United States, and gather the materials to make a bomb. Khalid Al-Dawsari, a native of Saudi Arabia, was arrested by federal agents two weeks ago when he tried to purchase 10 bottles of phenol, one of three ingredients in the explosive TNP. He had already amassed large quantities of the other two ingredients, nitric and sulfuric acid.

Two items in this case are of particular relevance to New York: a link on AIDawsari's computer to video feeds from the city's traffic cameras, and a plan to spend a week here. These appeared on a list of things to do in preparation for setting off car bombs somewhere during rush hour.

As I've said before, the City has no shortage of high value targets. So we focus our efforts on the areas the terrorists are most likely to attack. By now the members of the Council are very familiar with our Lower and Midtown Manhattan Security Initiatives. We currently have about 1,400 cameras feeding into our Lower Manhattan Security Coordination Center from these sensitive areas. We're planning to add another 1,600.

I also want to say a few words about our plans to secure the World Trade Center complex. This area has been struck by terrorists twice, in 1993 and 2001. In 2006, we disrupted an al Qaeda plot to bomb the PATH train tunnel and retaining wall at Ground


Zero. We cannot dismiss the level of threat against this site, which remains squarely in the terrorists' crosshairs.

In 2004, the Police Department approached the Port Authority and Silverstein Properties to address security gaps in the original design of One World Trade Center. We convened a world class panel of experts in bomb-blast effects and structural engineering to provide consultation. The work culminated in a new design that promises to create the safest, most secure high-rise building in the world.

Rather than redesign towers 2, 3, and 4, the Port Authority and Silverstein Properties agreed to adopt a campus security approach, thereby lowering engineering and construction costs. Over the last three years, we've worked with them to develop a plan that balances accessibility and security.

The plan, which will be completed in phases, calls for a system of managed streets with unfettered access for pedestrians and bicyclists. We will also expedite vehicle entry for employees and visitors through a "Trusted Access Program." And we will plan for efficient, scheduled truck deliveries with the help of a central inspection area and an underground network of roads designed for this purpose. As part of the Environmental Impact Study funded by the Department of Homeland Security, the Police Department recently selected a contractor to do the necessary traffic modeling in consultation with the City Department of Transportation, the Law Department, and the office of the Deputy Mayor for Economic Development.

The tirst part of the site to open will be the 9/11 Memorial Plaza, which will open on September 11th. Visitors will get free tickets and then pass through a security check before walking out onto the plaza. To provide security for the memorial and, ultimately, the entire site, the Police Department has established a World Trade Center command and assigned a Deputy Inspector to oversee it.

We'll increase staffing as construction on the site progresses. We are moving forward with the security plan and striving to do so in a way that satisfies the needs of all stakeholders, including the principal need to prevent another attack.

Turning to the Mayor's Preliminary Budget for Fiscal Year 2012, the Department continues to apply for and obtain federal assistance to protect members of the public and vital assets including the Financial District, the transit system, bridges, tunnels, and ports. From Federal Fiscal Years 2003 through 2010, $2.8 billion in Department of Homeland Security grant funding was received by New York State, of which approximately $1.5 billion or 53% was allocated to New York City. Of that amount, $865.6 million, or nearly 57% of the funds received by the City, was allocated to the NYPD. To date, including grant funds that were allocated directly to the City and the NYPD, the Department has received a combined total of $917.3 million in counterterrorism funding from the Department of Homeland Security and the Department of Justice.


Of the total funds received through these programs, $507 million in expenditures have been billed, $407 million is currently available, and the remaining $3 million is awaiting approval for release of funds by FEMA.

Regarding the latest round of funding, we were notified by OlVm in late December that the Department has been allocated $99.4 million of the total $176 million received by the City under the Federal Fiscal Year 2010 Homeland Security Grant Program. These funds will be used for a variety of critical equipment and personnel needs related to counterterrorism and disaster preparedness.

Other funding awarded to the NYPD for Federal Fiscal Year 2010 includes $18.5 million under the Securing the Cities Program. Funding is also anticipated in the amount of $9.6 million under the Transit Security Grant Program and approximately $10 million under the Port Security Grant Program.

Lastly, FEMA had re-opened the submission for additional surplus funds of approximately $19 million under the Federal Fiscal Year '08 and '09 Port Grants. The Department applied for and is expected to receive $5.2 million of supplemental funding. This will provide for the purchase of a high speed, ballistic-protected vessel to respond to a suicide or live shooter attack in a port area. It will also provide for the officer training necessary to deter such threats.

As of today, under the Federal Fiscal Year 2010 appropriations, the NYPD has been awarded $117.9 million and an additional $19.6 million is anticipated for a total of $137.5 million. This compares to a total of $133.9 million awarded under Federal Fiscal Year 2009 appropriations, not including the $35.9 million of "stimulus" funds provided through the Transit Security Grant Program for 104 transit police officers hired in January 2010.

For Federal Fiscal Year 2011, the Department is finalizing its funding request under the Homeland Security Grant Program to be submitted to City OMB for its review. These funds will allow for the continued build-out of the Lower and Midtown Manhattan Security Initiative; the purchase of a variety of critical explosive detection and response equipment; personnel protective equipment; personal costs for Intelligence Research Analysts; overtime for counterterrorism training and the Joint Terrorist Task Force; and continued maintenance and support costs of projects and equipment previously funded with Homeland Security Grant Program grants.

In addition, the Department has submitted a funding request for $19.5 million to the Port of New York and New Jersey Area Maritime Security Committee under the Port Security Grant Program. We are also in the process of preparing a funding request to the New York Regional Transit Security Working Group under the Transit Security Grant Program. After review by these two regional groups, these applications will be forwarded with recommendations to FEMA.


However, since the Federal Government has not yet approved a budget for Federal Fiscal Year 2011, the timing and the amount of grant funds that will be made available for .. ngoing counterterrorism programs is uncertain.

\-Ve will continue to advocate with the Congress and the Department of Homeland Security for the funding necessary to defend New York City and its surrounding areas against ongoing terrorist threats.

Regarding the February Financial Plan and its impact on the Police Department:

The Department's FY'12 budget is $4.45 billion, of which 93.7% is allocated for Personal Services and 6.3% for OTPS. The FY'12 budget is $426 million lower than this year's budget of $4.S8 billion. This decrease reflects the latest gap-closing program as well as an amount for non-City funds not yet added to the FY'12 budget.

During the November Plan process, all City Uniformed Agencies were required to submit new budget reduction proposals of 2.7% in FY'll and 4% in FY'12 with annual recurring savings. The PEG amounts included in this plan total $43.1 million in FY'll, $67.1 million in FY' 12, and $37.3 million in FY'13 and annually thereafter.

A summary of the expense reductions and revenue increases included in this plan are as follows:

• 320 of the 400 civilian positions previously funded under the civilianization program to replace 400 uniformed personnel in administrative and support commands were eliminated. The civilian reduction will save $12.4 million in salary and other City benetit costs in FY'll, $26.9 million in FY'12, and $27.2 million beginning in


• An additional 30 full-time civilian positlons were eliminated beginning in January 2011.

This will save $1.4 million in salary and other City benefit costs in FY'll and $2.8 million in the out-years.

• The funded headcount for the Cadet Program was further reduced by 15 positions for a total reduction of 160 positions in FY'l1 and annually thereafter. As a result of these reductions, the Cadet funded headcount decreased from 277 to 117 positions. The budget for Cadet salaries and related tuition reimbursement was reduced by $761,000 in FY'll and $3.1 million beginning in FY'12.

As a result of these and prior year reductions, the number of full-time civilian positions has been reduced by 1,282 in FY'l1 and 1,351 in the out-years since FY'08. The number of funded authorized full-time civilian positions is 14,549 in FY'11 and 14,172 beginning in FY'12.

The civilian part-time staffing, which has also been affected by budget cuts, has been reduced by 494 positions including 470 Cadet positions since FY'OS. The part-time budget


currently funds 2,592 positions consisting of School Crossing Guards, Cadets, Custodial Assistants, and College Aides.

• Other PS reductions included a $24 million overtime cut in FY'll and the elimination of the Voluntary Work Vacation budget beginning in FY'I1. These cuts will save $1.1 million this year and the total annual funding of $4.2 million beginning in FY'12. This budget funded the salary of officers who would work one week of their vacation each year, which allowed for the deployment of officers to details as necessary.

• OTPS reductions included a cut to the vehicle budget of $10.6 million in FY'12, which is one-third of the Department's vehicle purchasing plan, or 392 vehicles, for which Iifecycles will be extended by one year. These extensions will not affect patrol services.

• The Recruitment Advertisement budget was decreased by $2.5 million in FY' 11 and by $4 million in FY'12, leaving a balance of $2.1 million in FY'11 and $2.5 million in FY'12. The FY'13 and out-year budget remains at $6.5 million.

• Our revenue plan was increased in anticipation of an additional $12 million in federal reimbursement in City Fiscal Year 2012 for costs incurred by the NYPD in protecting the United Nations and for providing security to foreign dignitaries and properties. Although the Federal Fiscal Year 2011 bill has not been enacted at this time and the federal government is currently operating under a short-term Continuing Resolution we anticipate receiving the same amount as was appropriated in FFY 2010 for the Extraordinary Protection of Foreign Mission and Officials. Similar to last year, approximately $25.6 million of the $28 million should be designated for the New York City area.

• The Financial Plan also reflects the Department's proposal to charge organizers of "Non-Charitable Athletic Parades" a fee equal to the Police Department's actual costs for providing traffic control services. It had been projected that the implementation of this fee would generate additional revenue of $600,000 in FY'll and $3.5 million in FY'12. However, the Mayor's Office has determined that this change will take effect for all events scheduled to occur on or after January 1, 2012. Therefore, the additional revenue will be delayed a full year.

Additional funding was also provided in the February Plan as follows:

• $79.1 million in FY'll to cover anticipated overtime and longevity deficits.

• $68.5 million was restored in FY'l1 to the PS budget to alleviate the PS structural deficit. This PS deficit is primarily due to the decrease in attrition rates for both uniformed and civilian personnel, as well as variances from other assumptions used by OMB in previous budgetary actions to meet PEG targets.



• $6.5 million was restored for continued equipment maintenance and support costs for the E911 system for the period of January to June 2011. Funding was restored due to the delay in the operational transfer of the Emergency Communications Transformation Program to Do ITT at which point the contract will be assigned to

Do ITT. '

• $2.4 million for 69 civilian positions were restored in FY' 11 due to the delay in implementation of the new e-arraignment system.

• $2.4 million was provided for collective bargaining increases previously implemented for Radio Repair Mechanics.

There were no changes to the Department's uniformed staffing levels. The uniformed authorized headcount and projected classes are as follows:

• The July 2010 budgeted peak headcount was 35,767 and the July 2010 Police Officer class size was 1,251 recruits, of which 1,147 graduated in December.

• The April 2011 projected class size is 540 recruits to reach a peak headcount of 35,088.

• The FY' 11 average headcount is estimated to be 34,982, a decrease of 180 from the FY'10 average headcount of 35,162.

• Our current hiring plan is for 900 police recruits in July 2011, 630 in January 2012, and 1,310 in July 2012 to reach a peak headcount of 35,367.

• The projected attrition is approximately 1,900 in FY'll and 1,940 in FY'12. The size of police classes is based on the funded peak headcount and the replacement of attrition that has occurred since the previous class.

• The budgeted peak headcount in FY'12 and FY'13 remains at 35,367 and decreases in FY'14 to 35,263 because of 104 positions funded through the Transit Security Grant Program.

Overtime costs in FY'll are projected to total $531 million, which is $7 million less than the FY'10 actual expenditures of $538 million. However, labor contract increases account for $10.5 million of the current year cost. Therefore, in constant dollars, the FY'U projected spending is actually $17.5 million less than FY'10.

The current FY'll overtime budget, which includes the additional $53 million funded in the February Plan and expected revenues, will total approximately $500 million, which leaves an unfunded balance of $31 million. In prior fiscal years, the overtime deficit was funded by surplus funds. However, our present ability to do this has been limited by prior budget reductions that removed turnover savings from the PS budget.


The FY'12 overtime budget of $370 million is $130 million lower than the current FY'll budget of $500 million. The decrease is due mainly to non-City overtime funds not yet included in the FY'12 budget.

As always, we will work to achieve overtime savings wherever possible. Since 2002, our uniformed deployment to Planned Events has been reduced thanks to careful management efforts, As a result, overtime costs for this expense decreased by a cumulative total of $184 million through Calendar Year 2010. We expect to continue to save approximately $23 million each year compared to the amount spent in 2002 for these same events.

As you know, the Mayor also released a new ten-year capital plan last month that added two more fiscal years - 2020 and 2021. After identifying cuts totaling 20% in each of the two new years, OMB instructed the Police Department to do the same for the

remaining years of the plan. Total cuts amount to $189 million, including the o~m cuts. Of this amount, $123.9 million in cuts have been implemented.

The major changes to the capital budget and plan are as follows:

• Construction funding for the planned new 40th, 66th, 70th, and Both precincts has been eliminated to save $119.5 million. All funding for new construction or the complete rehabilitations of precincts has been eliminated. In this plan, to ensure sufficient funding is available to maintain our facility infrastructure, o~m allocated $46.3 million in the Building Maintenance Section's lump sum line, across Fiscal Years 2013 through 2021.

• A reduction of $10.5 million to the New Police Academy's uncommitted budgeted amount in Fiscal Year 2011. The total budget for the New Police Academy is now $751.1 million, which includes $709.2 million registered in Fiscal Years 2008 - 2010.

• A reduction of $17.2 million for the replacement of various vehicles, boats, and other miscellaneous equipment.

Other changes approved in the Capital Plan include additional funding in the two new out-years of the Ten- Year Plan, totaling $44.5 million in Fiscal Year 2020 and $46.1 million in Fiscal Year 2021. This funding is allocated for the lifecycle replacement of computer equipment, miscellaneous equipment, and facility repairs.

Also, OMB's instruction for the Capital Plan required that any new needs be funded internally within the Department's budget. After reevaluating our capital budget priorities, approximately $13.3 million was reallocated from various projects to fund other critical facility projects and equipment purchases.

The FY'2011 to FY'2021 capital plan maintains funding for the following major facility projects:


• Design and Construction of the new Police Academy is hudgeted at $41.9 million in [;'Y 2011 and FY 2012 which supplements $709.2 million hudgeted in prior fiscal years. Construction of the new facility has begun and is scheduled to he completed in December of 2013.

• Construction of a new Tow Pound in Queens is budgeted at $26.2 million in FY 2011 which supplements $2.4 million budgeted in prior fiscal years. Construction started in September 2009, with an estimated completion date of Octoher 2011.

• Design and Construction of the new 121st Precinct is hudgeted at $2.8 million in FY 2011 which supplements $59.8 million budgeted in prior fiscal years. Construction of the new facility has begun and project completion is scheduled for May of 2012.

• The restoration and renovation of the landmark Central Park Precinct is moving ahead. The current budget includes $5 million in addition to the $52.4 million budgeted in prior fiscal years. Construction started in September 2007, with an estimated completion date of August 2011.

The Expense, Revenue and Capital changes detailed above were included in the City's Financial Plans released in November and February. As you're aware, last week we received new reduction targets from Ol\tm. We are currently working on another list of cuts that will total $101.4 million, or 2% of the Police Department's budget in FY' 12 and the out years. These will be considered for the Executive Plan.

At this time, I will be pleased to answer any questions you might have.