Joint Legislative Public Hearing on 2016-2017 Executive Budget Proposal: Topic "Local Government Officials/ General Government" - Testimonies
January 27, 2016
-
COMMITTEE:
- Finance
Hearing Event Notice:
http://www.nysenate.gov/newsroom/articles/catharine-young/joint-legislative-public-hearing-2016-2017-executive-budget-1
Archived Video:
https://www.youtube.com/watch?v=kwTpiO6zMWI
_______________________
Hearing Transcript:
1
BEFORE THE NEW YORK STATE SENATE FINANCE
AND ASSEMBLY WAYS AND MEANS COMMITTEES
----------------------------------------------------
JOINT LEGISLATIVE HEARING
In the Matter of the
2016-2017 EXECUTIVE BUDGET
ON LOCAL GOVERNMENT OFFICIALS/
GENERAL GOVERNMENT
----------------------------------------------------
Hearing Room B
Legislative Office Building
Albany, New York
January 26, 2016
10:10 a.m.
PRESIDING:
Senator Catharine M. Young
Chair, Senate Finance Committee
Assemblyman Herman D. Farrell, Jr.
Chair, Assembly Ways & Means Committee
PRESENT:
Senator Liz Krueger
Senate Finance Committee (RM)
Assemblyman Robert Oaks
Assembly Ways & Means Committee (RM)
Assemblyman Michael Benedetto
Chair, Assembly Cities Committee
Senator Kathleen A. Marchione
Chair, Senate Committee on Local Government
Assemblyman William Magnarelli
Chair, Assembly Local Governments Committee
2
1 2016-2017 Executive Budget
Local Government Officials/
2 General Government
1-26-16
3
4 PRESENT: (Continued)
5 Assemblyman Michael J. Cusick
6 Senator Andrew J. Lanza
7 Senator Tony Avella
8 Senator Diane Savino
9 Assemblyman David Weprin
10 Assemblywoman Catherine T. Nolan
11 Assemblyman Jeffrion L. Aubry
12 Senator Gustavo Rivera
13 Senator Martin Golden
14 Assemblyman James F. Brennan
15 Senator Adriano Espaillat
16 Assemblywoman Rebecca Seawright
17 Assemblywoman Latrice Walker
18 Senator Ruben Diaz
19 Assemblywoman Nily Rozic
20 Assemblyman Felix Ortiz
21 Senator Brad Hoylman
22 Assemblyman Luis Sepulveda
23 Senator Timothy Kennedy
24 Assemblywoman Rodneyse Bichotte
3
1 2016-2017 Executive Budget
Local Government Officials/
2 General Government
1-26-16
3
4 PRESENT: (Continued)
5 Senator Andrea Stewart-Cousins
6 Assemblyman Keith L. Wright
7 Assemblyman David F. Gantt
8 Senator Bill Perkins
9 Senator Daniel Squadron
10 Assemblyman Christopher S. Friend
11 Assemblyman John T. McDonald, III
12 Senator Roxanne J. Persaud
13 Assemblywoman Shelley Mayer
14 Assemblywoman Patricia Fahy
15 Assemblyman Joseph D. Morelle
16 Senator Jesse Hamilton
17 Assemblyman Steven Otis
18 Assemblyman William Colton
19 Assemblywoman Jo Anne Simon
20 Senator Phil Boyle
21 Assemblywoman Nicole Malliotakis
22 Assemblywoman Diana C. Richardson
23 Assemblyman Joseph S. Saladino
24 Assemblywoman Annette Robinson
4
1 2016-2017 Executive Budget
Local Government Officials/
2 General Government
1-26-16
3
4 PRESENT: (Continued)
5 Senator John A. DeFrancisco
6 Assemblywoman Jane L. Corwin
7 Assemblyman David Buchwald
8 Assemblyman J. Gary Pretlow
9 Assemblyman Matthew Titone
10 Assemblyman Charles Barron
11 Assemblyman James Skoufis
12 Assemblyman Mark Gjonaj
13 Assemblywoman Crystal D. Peoples-Stokes
14
15
16 LIST OF SPEAKERS
17 STATEMENT QUESTIONS
18 Honorable Bill de Blasio
Mayor
19 City of New York 9 40
20 Scott M. Stringer
Comptroller
21 City of New York 284 299
22 Honorable Byron W. Brown
Mayor
23 City of Buffalo 351 363
24
5
1 2016-2017 Executive Budget
Local Government Officials/
2 General Government
1-26-16
3
4 LIST OF SPEAKERS, Cont.
5 STATEMENT QUESTIONS
6
Honorable Kathy M. Sheehan
7 Mayor
City of Albany 394 408
8
Honorable Lovely A. Warren
9 Mayor
City of Rochester 437 443
10
Honorable Mike Spano
11 Mayor
City of Yonkers 463 473
12
Honorable Stephanie A. Miner
13 Mayor
City of Syracuse 493 502
14
Honorable Patrick Madden
15 Mayor
City of Troy 511 518
16
Stephen J. Acquario
17 Executive Director
New York State Association
18 of Counties 525 539
19 Peter A. Baynes
Executive Director
20 NYS Conference of Mayors
and Municipal Officials 554 564
21
Gerry Geist
22 Executive Director
Andrea Nilon, President
23 Bill Moehle, Exec. Committee
Association of Towns of
24 the State of New York 574
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 the fiscal
6 year 2016-2017. The hearings are conducted
7 pursuant to Article 7, Section 3 of the
8 Constitution, and Article 2, Section 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 I will now introduce members from the
16 Assembly. Senator Young, chair of Senate
17 Finance, will introduce members from the
18 Senate.
19 We've been joined by Assemblyman
20 Weprin, Assemblywoman Bichotte, Assemblyman
21 Aubry, Assemblyman Cusick, Assemblywoman
22 Nolan, Assemblyman Colton, Assemblyman Otis,
23 Assemblyman McDonald, Assemblyman Wright,
24 Assemblywoman Richardson, Assemblywoman
7
1 Robinson, Assemblyman Brennan, Assemblyman
2 Magnarelli, Assemblyman Benedetto, and
3 Assemblyman Sepulveda.
4 Senator?
5 CHAIRWOMAN YOUNG: Thank you, and good
6 morning. And I appreciate your comments,
7 Assemblyman.
8 I'd like to introduce our members from
9 the New York State Senate who have joined us
10 today, and it's great to see so many
11 colleagues interested in the topic area.
12 First I'd like to introduce -- we're
13 joined by Senator Liz Krueger, ranking member
14 on Senate Finance, and also joined by Andrew
15 Lanza, Kathy Marchione, Senator Marty Golden,
16 Senator Tony Avella, Senator Adriano
17 Espaillat, Senator Diane Savino. And did I
18 miss anyone? Oh, okay. Sorry. Senator
19 Ruben Diaz -- how could I forget about
20 Senator Ruben Diaz -- Senator Gustavo Rivera.
21 Oh, I'm sorry -- oh, he's hiding down there,
22 Senator Brad Hoylman.
23 So welcome. Thank you.
24 CHAIRMAN FARRELL: And I also have
8
1 with us Assemblyman Oaks.
2 ASSEMBLYMAN OAKS: And we have
3 Assemblywomen Corwin and Malliotakis.
4 CHAIRMAN FARRELL: Before we introduce
5 the first witness, I would like to remind all
6 of the witnesses testifying today to keep
7 your statement within your allotted time
8 limit so that everyone can afford the
9 opportunity to speak. Last night we finished
10 at 7:30.
11 I will now call our first witness.
12 City of New York, the Honorable Bill de
13 Blasio, mayor.
14 MAYOR DE BLASIO: Thank you,
15 Mr. Chair. Chair Farrell, I want to thank
16 you, Chair Young, thank you as well, and the
17 ranking minority members, Senator Krueger,
18 Assemblyman Oaks, thank you so much for
19 giving me this opportunity to appear before
20 you.
21 I also want to thank our legislative
22 leaders, Assembly Speaker Heastie; Majority
23 Leader Flanagan; Senate Democratic Conference
24 Leader Stewart-Cousins; IDC Leader Jeff
9
1 Klein; and Assembly Minority Leader Brian
2 Kolb. Thanks to all, and to all of the
3 members of the Legislature here today.
4 I'm joined by two key members of my
5 team well known to you, our director of OMB,
6 Dean Fuleihan, and the city's director of
7 state legislative affairs, Sherif Soliman.
8 I want to thank everyone here and all
9 the members of the Legislature for your hard
10 work and for your support for the people of
11 New York City and all the work that we do in
12 New York City together. We have accomplished
13 a great deal over the last few years, and I'm
14 very grateful for your support as we move
15 forward on education, on affordable housing,
16 and on a number of other issues.
17 We come here today looking forward to
18 building on that partnership. I look forward
19 to discussing the building of that spirit.
20 After two years, we're proud to say that
21 New York City is seeing real results from our
22 disciplined fiscal stewardship, our strategic
23 vision, and all that we have done to support
24 the success and hard work of New Yorkers.
10
1 It's our task this year to deepen
2 those efforts and to extend that work through
3 a budget that is progressive, that is
4 fiscally responsible, and that is honest.
5 And we recognize at the same time that
6 despite some very good results and despite
7 our devotion to continued fiscal discipline,
8 New York City faces some major challenges
9 that did not exist the last time I was here
10 before you, and those include challenges
11 within our pension system, our public
12 hospital system, and in the proposed state
13 budget.
14 We're also watching with great
15 concern, and I know everyone here today is,
16 both the national and the global economic
17 landscape. And that landscape looks in many
18 ways increasingly uncertain, and could
19 significantly negatively affect our city and
20 state economy going forward.
21 We also know within that economic
22 landscape is not only uncertainty, but
23 unfortunately a continuing trend towards
24 deepening inequality and a growing chasm
11
1 between those with wealth and those who are
2 working hard just to get by.
3 I'd like to call your attention to an
4 absolutely striking report that got worldwide
5 attention released last week by Oxfam, which
6 found that 1 percent of the globe's
7 population have as much wealth as the other
8 99 percent, specifically also finding that
9 the richest 62 people worldwide have as much
10 wealth as the poorest half of the worldís
11 population, 3.5 billion people.
12 We feel this inequality reality deeply
13 in New York City, where for every
14 multi-million-dollar condo that hits the
15 market, hundreds of hardworking families are
16 struggling to afford their rent. And we
17 simply cannot be the city we are meant to be
18 unless we confront this challenge.
19 Our work in fiscal year 2017 will
20 build on the investments we've made in the
21 past two years, focused on our goal of
22 creating One City, Rising Together. These
23 investments include:
24 Nearly 2,000 new cops on the beat,
12
1 between the addition of new officers to the
2 force and our civilianization effort to bring
3 officers from desk jobs to the beat. So
4 patrol strength will increase by nearly 2,000
5 officers by the end of this year, the highest
6 patrol strength we will have in New York City
7 since 2001;
8 We're funding our plan for 200,000
9 units of affordable housing, enough to house
10 a half-million people;
11 We're developing a pioneering,
12 comprehensive plan to address the mental
13 health needs of New Yorkers;
14 We're implementing our Equity and
15 Excellence agenda to lift up all of our
16 public schools, and launching an aggressive
17 new effort to tackle homelessness.
18 As we make these key investments, we
19 never lose sight of the vital importance of
20 fiscal responsibility. Itís part of
21 everything we do. New Yorkers have seen just
22 how quickly and painfully the economy can
23 turn, wiping out government budgets, forcing
24 cuts to vital services, and even at times
13
1 necessitating tax hikes. That's something we
2 want to work hard to avoid. Thatís why when
3 we took office, my administration immediately
4 began the work of prudent budgeting so that
5 we can be prepared for potential economic
6 downturns.
7 We are, one, building substantial
8 reserves into our budget, just as the state
9 does; two, removing uncertainty in our budget
10 by securing agreements with our workforce.
11 I'm proud to say just in the last 24 hours
12 we've reached another important labor
13 agreement; we now have agreements with 95
14 percent of the city workforce, compared to
15 literally zero percent at this point two
16 years ago.
17 And this is a good moment just to
18 pause and say I'm so appreciative to all of
19 our city workers for the extraordinary job
20 they did over the last few days confronting
21 what was the second largest snowstorm in New
22 York City history, going back 150 years since
23 those storms have been tracked. As I
24 mentioned to some of our colleagues here, if
14
1 it had been .2 inches bigger, it would have
2 literally been the biggest snowfall in New
3 York City history. Our city workers, led by
4 our sanitation workers, but all our first
5 responders, all our departments, responded I
6 thought with great ability and energy and
7 helped get the city back and running.
8 I also want to thank the state. I
9 worked closely with Governor Cuomo and his
10 team during the course of the storm. I think
11 the state and the MTA responded very, very
12 well. I think a great team effort all
13 around.
14 The third point I want to make in
15 terms of fiscal prudence, we're making
16 targeted investments. And this is because we
17 believe fundamentally that we have to keep
18 building our economy. I'm very proud of the
19 fact that we have 4.2 million jobs now in New
20 York City, the highest number of jobs that
21 have ever been in New York City, in all our
22 history. In the last two years we've added
23 213,000 jobs. That is the most ever gained
24 in a two-year period in the history of the
15
1 city.
2 But we have to keep investing to
3 assure that economic growth, because that's
4 the only way we can ensure that it is
5 dependable despite what will obviously be
6 economic tough times up ahead. So we're
7 making targeted investments, of course, in
8 public safety, first and foremost, affordable
9 housing, education -- all of the things that
10 we know allow for the fiscal vitality of the
11 city and our ability to weather the storms.
12 I want to turn now to the proposed
13 state budget unveiled last week. The budget
14 presented us with some very positive news,
15 which I'll discuss first, and some real
16 uncertainties, which I'll also outline. The
17 good news here is very good; I want to
18 emphasize that. We are very pleased,
19 especially by two of the policies the
20 Governor proposed, the $15 minimum wage and
21 the paid family leave policy. We believe
22 these would be profoundly important to the
23 people of New York. We strongly agree with
24 so many here today that no New Yorker should
16
1 have to choose between their family and their
2 paycheck, and that is why a paid leave policy
3 is so important.
4 In New York City we've taken every
5 action we can to relieve our hardworking
6 families of having to make these difficult
7 choices. We've extended paid sick leave to
8 half a million more New Yorkers, and paid
9 parental leave to more than 20,000 city
10 employees. And we look forward, with our
11 labor union partners, to extending paid
12 parental leave to more and more of the city
13 workforce in the coming months.
14 And I'm heartened to see paid family
15 leave in the state budget because it means
16 healthier and more financially stable
17 households, more effective workplaces, and a
18 stronger and more just city and state. I
19 particularly want to acknowledge and thank
20 the champions and prime sponsors of paid
21 family leave in the Legislature:
22 Assemblymember Cathy Nolan, thank you;
23 Senators Jeff Klein and Joe Addabbo, thank
24 you; and to so many of the cosponsors here,
17
1 thank you for focusing on this crucial issue.
2 Now, I've said before when it comes to
3 the wage issue, nothing does more to lift up
4 working families and move our economy forward
5 than raising wages. I've been a proud
6 participant in the Fight for $15 for many
7 years. And I can safely say that if we're
8 going to fundamentally change the trajectory
9 of families and lift people out of poverty,
10 one of the things we're focused on in the
11 city, our goal and our One NYC plan of
12 lifting 800,000 New Yorkers out of poverty
13 over the next 10 years, that hinges, first
14 and foremost, on the $15 minimum wage.
15 Now, we are acting on our own to reach
16 our own city employees and human services
17 contracted workers. We're investing $115
18 million in our budget to extend the $15
19 minimum wage to 50,000 workers -- again, city
20 employees and contracted workers alike.
21 Fifty thousand more people will get to that
22 $15 minimum wage, and so many thousands of
23 their family members will benefit.
24 We look forward to the passage and
18
1 signing of a state law that will change the
2 lives of an estimated 1 million workers in
3 our city by guaranteeing $15 an hour to every
4 New Yorker.
5 Another very positive aspect of the
6 Governor's proposed budget is the commitment
7 to build 20,000 units of supportive housing.
8 And this will complement perfectly the cityís
9 announcement in November of our intentions to
10 secure 15,000 units over the next 15 years.
11 These two actions together will have a
12 profound impact on addressing homelessness
13 and mental health issues and will
14 fundamentally change the reality for the
15 better in our city.
16 Supportive housing is a proven method
17 of bringing safety, stability and a renewed
18 sense of hope to some of our most vulnerable
19 neighbors. These are people dealing with
20 seemingly intractable problems, but that
21 means they need much more than a roof over
22 their heads. They need specific services,
23 like substance abuse programs, to help them
24 address underlying problems and ultimately to
19
1 build healthier and happier lives.
2 I want to thank Senator Marty Golden
3 and Assemblyman Andrew Hevesi for galvanizing
4 the support for this critical progress. I
5 really appreciate deeply your efforts.
6 Let me also mention two additional
7 positives in the budget that would make
8 New York a fairer and more just state.
9 First, we're very gratified to see
10 continued support for the DREAM Act. Passage
11 of the DREAM Act is a simple statement of
12 morality and compassion. I must acknowledge
13 the billís prime sponsors, who are leading
14 the charge here for fairness: Assemblyman
15 Francisco Moya and Senator JosÈ Peralta. We
16 thank them.
17 Second, another important and
18 meaningful step towards justice in our city
19 and our state would be raising the age. And
20 we supported Raise the Age last year, and we
21 support it again this year. In New York
22 City, we've already reduced unnecessary
23 arrests and incarcerations. We've ended
24 punitive solitary confinement for 16- and
20
1 17-year-olds. And we've applied resources to
2 help young people out of the criminal justice
3 system and onto the right path in life.
4 New York State should not be one of
5 just two states in this country that
6 prosecute 16- and 17-year-old kids as adults.
7 I'd like to particularly thank Speaker
8 Heastie for his leadership on this issue, as
9 well as the members of the Assembly
10 Democratic Conference.
11 Now, those are a number of very good
12 things in this budget for which we are
13 profoundly grateful, but it is also my
14 obligation to talk about some of the
15 challenges in this budget that we think could
16 have a negative impact.
17 The state initially proposed budget
18 cuts that would have cost the City of
19 New York nearly $1 billion in fiscal 2017,
20 with the costs growing in each succeeding
21 year. These proposed cuts included
22 $485 million tied to CUNY in fiscal 2017, and
23 having the city take on $209 million in state
24 Medicaid payments in 2017, a figure which
21
1 alone would grow close to $1 billion per year
2 by fiscal 2021.
3 Later, the Governor clarified that the
4 CUNY and Medicaid proposals would be achieved
5 through reforms and efficiencies done in a
6 collaborative process, and ultimately would
7 not cost the city a penny. I very much
8 appreciate the Governor's pledge and I've
9 made clear, on behalf of my constituents,
10 that I will hold him to it.
11 We look forward to working with the
12 Governor and the Legislature to find reforms
13 and efficiencies that are workable for the
14 long run, and we also will work energetically
15 to make certain that these cuts do not appear
16 in the final budget in April.
17 The Governor has also proposed to take
18 the cityís sales tax revenue for three years
19 in order to offset refinancing savings on
20 debt the state agreed to assume. There is no
21 justification for this action, which would do
22 a real disservice to city taxpayers, costing
23 them $600 million over three years, starting
24 in the current fiscal year.
22
1 I want to note that these cuts are
2 particularly onerous because New York City is
3 the only municipality in New York State that
4 doesn't receive direct municipal aid. Our
5 entire allocation of $302 million a year was
6 cut beginning in 2010.
7 Now I would like to outline some of
8 the ways the proposed state budget affects
9 New Yorkers' lives across four important
10 areas: housing, homelessness, education, and
11 transportation. I'll begin with housing,
12 which is certainly the number-one issue that
13 I hear about from my constituents all over
14 the five boroughs.
15 New Yorkers from all walks of life are
16 tremendously concerned about the cost of
17 housing and about whether they're going to be
18 able to continue to be able to afford our
19 city. Their concerns are justified, because
20 the city is clearly confronting a crisis when
21 it comes to affordable housing. And to
22 contend with this crisis, we've created and
23 launched the most ambitious municipal
24 affordable housing program in the nationís
23
1 history: building or preserving 200,000
2 affordable units over 10 years.
3 Now, we certainly commend the Governor
4 for the inclusion of an affordable housing
5 plan in the state budget, and we'll be
6 working to make sure the city receives a fair
7 and proportionate share of the funding under
8 that affordable housing initiative. When the
9 Governor releases the details of his housing
10 plan, they should include a continued
11 commitment of federal tax credits and
12 tax-exempt private activity bonds at levels
13 that are at least commensurate with those
14 that have been historically received by the
15 city.
16 We also have serious concerns about
17 two important procedural changes the Governor
18 has proposed to the rules for the allocation
19 of tax-exempt private activity bonds. This
20 bond cap allocation is a vital resource for
21 the city. Over the last two years, the city
22 has financed more than 16,700 affordable
23 apartments across all five boroughs using our
24 bond cap allocations. These projects have
24
1 ranged from a 60-unit building in Upper
2 Manhattan serving formerly homeless families
3 and youths aging out of foster care, to a
4 256-unit mixed-income development in the
5 Tremont neighborhood of the Bronx.
6 The stateís proposal would add two
7 layers of bureaucracy to the process of
8 receiving and using these allocations. Two
9 more layers of bureaucracy would be very
10 costly to the people of New York City. The
11 first layer is a required approval by the
12 Empire State Development Corporation for New
13 York City to be able to use the bond cap for
14 housing. The second layer is a different
15 required approval by the Public Authorities
16 Control Board for each individual project
17 that the city seeks to build with these
18 dollars.
19 Last year, the cityís Housing
20 Development Corporation efficiently used all
21 of its state bond cap allocation to fund its
22 projects. And HDC couldn't even get started
23 on almost 1,200 affordable apartments across
24 the five boroughs simply because it did not
25
1 receive enough in bond cap allocations from
2 the state.
3 Imagine the situation if these
4 additional regulatory obstacles were to go
5 into effect. They would produce uncertainty
6 in financing and unnecessarily add difficulty
7 and delay to the process of building the
8 affordable housing struggling New Yorkers
9 need.
10 Another essential component of
11 affordable housing in the five boroughs is
12 the New York City Housing Authority, or
13 NYCHA, which is home to 400,000-plus
14 New Yorkers. Today, we need NYCHA more than
15 ever, but the authority has suffered decades
16 of neglect and disinvestment, resulting in a
17 dangerous financial situation and an
18 unacceptable quality of life for too many of
19 its residents.
20 Last year we unveiled NextGeneration
21 NYCHA, our plan to get NYCHA back on solid
22 fiscal ground and to reinvent itself for the
23 21st century. As part of that process, we
24 are honoring our commitment to add
26
1 $100 million in capital funding each year for
2 the next three years. We ask the state to
3 fully come through on its commitment of $100
4 million in capital funding for the current
5 fiscal year and another $100 million in
6 capital funding for each of the next two
7 fiscal years. That's how to do right by
8 NYCHAís hundreds of thousands of residents.
9 Now I want to turn to homelessness,
10 which is a deep and persistent challenge that
11 the city has been struggling with for
12 decades. Today we're using every tool,
13 committing every resource, and summoning
14 every ally to confront that challenge. To
15 maximize our efforts, the City of New York
16 needs a serious, consistent, lasting
17 partnership with the state government, and
18 added funds for prevention and rental
19 assistance programs. Our work begins with
20 prevention -- keeping families off the street
21 in the first place, keeping families in their
22 apartments and not in shelter.
23 To that end, we ask that the state
24 modify the criteria it uses to determine the
27
1 Family Eviction Prevention Supplement, or
2 FEPS. FEPS can be a life-changer for
3 families who are facing the immediate threat
4 of being thrown out of their homes. But today
5 the levels of financial support under FEPS
6 are simply too low to be as effective as they
7 could be. We urge you to raise the state
8 level of assistance to what the U.S.
9 Department of Housing and Urban Development
10 has determined is appropriate for the New
11 York City rental market. That would increase
12 rental assistance by 50 percent, giving the
13 typical family approximately $1,500 a month.
14 Thatís fundamental in a city where an average
15 one-bedroom apartment now rents for $3,100 a
16 month.
17 In addition, we must make FEPS
18 available to victims of domestic violence,
19 who often are effectively evicted from their
20 homes when they flee to safety. Let's think
21 about that for a moment. Often a woman doing
22 what she must do to protect herself and her
23 children, fleeing the only home she has for
24 someplace safe -- we need to make sure that
28
1 these victims have support to get into other
2 forms of available housing and not end up in
3 shelter. And that's what we can do if we
4 increase this FEPS allotment and make it
5 available to those who have already suffered
6 so much because of domestic violence.
7 If we raised the FEPS levels as I
8 described and made it available to victims of
9 domestic violence, it would cost
10 $63.5 million this year, of which
11 $19.7 million is city funding and
12 $35.6 million is federal funding. We urge
13 the state to contribute its portion of this
14 funding, estimated to be $8.3 million. I
15 would also ask you to revisit the underlying
16 shelter allowance, which FEPS is added on top
17 of and which hasn't been increased since
18 2003.
19 Another aspect of the cityís
20 homelessness challenge has to do with people
21 struggling with health issues like AIDS. As
22 part of the cityís plan to end the epidemic
23 of AIDS, we have committed to extending
24 HIV/AIDS Services Administration benefits, or
29
1 HASA, to people who have the HIV virus but
2 are not showing symptoms. We've budgeted $41
3 million for the cityís share, when fully
4 phased in, to extend HASA. We believe that
5 New Yorkers living with HIV or AIDS should
6 not have to choose between medicine and rent,
7 or medicine and food.
8 We understand the state has made a
9 multiyear commitment to ending the AIDS
10 epidemic -- and we commend the Governor for
11 that -- and we look forward to seeing the
12 details of their plan.
13 At this point, I want to turn to
14 several education issues. We all remember
15 what the situation was in New York City
16 before mayoral control of education: the
17 school system was fragmented and inefficient,
18 and there was much too much corruption. The
19 city did not have the authority it needed to
20 ensure that schools were functioning properly
21 and to bring about needed reforms.
22 The Legislature recognized the
23 benefits of extended periods of mayoral
24 control, both in 2002 and again in 2009. And
30
1 over time, we've all seen that mayoral
2 control works. Look at our administrationís
3 implementation of universal pre-K. And thank
4 you again to all the members here for your
5 support of that initiative which made it
6 possible. Within a matter of months, we
7 marshaled multiple agencies and the necessary
8 funds to launch hundreds of programs across
9 the five boroughs. Today, two years after we
10 started, more than 68,500 of our 4-year-olds
11 are enrolled in full-day pre-K and are on the
12 path to lifelong learning. Again, thank you
13 to the Legislature, thank you to the Governor
14 for that support. But we would never have
15 been able to implement such a crucial program
16 in two years' time if it were not for mayoral
17 control of education.
18 I'd also like to draw your attention
19 to the fact that for the first time ever, New
20 York City's high school graduation rate is
21 now over 70 percent, while our dropout rates
22 have hit an all-time low of 9 percent.
23 Successes like these occur when thereís
24 bipartisan consensus on mayoral control, and
31
1 that is why educators, business leaders, and
2 civic leaders alike want it renewed. It
3 would build predictability into the system,
4 which is important for the deep, long-range
5 change that is needed for our schools.
6 As you know, I believe fundamentally,
7 as a matter of philosophy, that mayoral
8 control should be made permanent. I don't
9 believe there is another system that works.
10 Short of that, it should be renewed for seven
11 years, the same amount of time as its
12 original authorization.
13 And to return for just a moment to
14 pre-K, the success of pre-K should also be
15 evidence enough that we don't need to change
16 how we administer it by creating a pre-K
17 grant board that would supplant the State
18 Education Department. We were able to
19 achieve this huge progress on pre-K under the
20 existing system. We think it works and
21 should be continued.
22 Now, our schools certainly need
23 additional aid and we are in favor, of
24 course, of funding all schools fairly. Which
32
1 is why we must get to a proposal that
2 actually supports all of our schools in an
3 equitable way. It is imperative that the
4 state add more money for Foundation Aid so
5 the state can close its $2 billion shortfall
6 for New York City pursuant to the Campaign
7 for Fiscal Equity decision by the Court of
8 Appeals.
9 We're pleased thereís support for
10 Community Schools in the budget. The
11 students of New York Cityís 130 Community
12 Schools deserve a proportionate and fair
13 share of those state funds. The Community
14 Schools in New York City include all of our
15 94 Renewal Schools -- the cityís
16 lowest-performing schools, which have
17 historically suffered from both a lack of
18 attention and resources. We are investing
19 $187 million a year in their turnaround.
20 We've moved ineffective teachers and
21 principals out over the past year and moved
22 talented and hardworking educators in as part
23 of the changes needed in our Renewal Schools.
24 And support for that initiative and for the
33
1 Community Schools is crucial to our continued
2 success.
3 Now, we hold a basic belief that every
4 single child in our city and every child in
5 our state is equally important, and we
6 certainly can't support initiatives that take
7 from one group of children to give to another
8 group. So we're concerned about the
9 Governorís proposal to raise the per-pupil
10 tuition rate for charter schools, which would
11 cost New York City and only New York City
12 $30.3 million in fiscal 2017 alone. No other
13 municipality in the state is being asked to
14 shoulder this particular cost.
15 If the state wants to provide
16 additional aid for charter school tuition, we
17 would certainly welcome it. But the state
18 should not take away from other urgent needs
19 to fund it.
20 Finally, I'd like to talk to you about
21 critical infrastructure and transportation
22 issues. Breaking with decades of tradition,
23 New York City made a contribution of $2.5
24 billion in capital funds last year to allow
34
1 the MTA to invest in a more reliable,
2 effective and safe mass transportation system
3 for our future. We request the approval of a
4 fully funded capital plan by the Capital
5 Program Review Board, and adding it to the
6 adoption of the state budget to solidify
7 financial support for MTA capital
8 investments. This will help grow the economy
9 of our entire region and the state as a
10 whole.
11 We're also pleased to see that the
12 State Budget has committed $22 billion to
13 roads and bridges. Take just two examples of
14 why these funds are so necessary: The
15 Brooklyn Queens Expressway Triple Cantilever
16 Bridge and the Belt Parkway Bridge are facing
17 shortfalls of $646 million and $297 million
18 respectively. Thatís almost $1 billion in
19 total just for those two projects. Together,
20 these shortfalls represent 38 percent of the
21 two projects' costs, the historical state
22 share that has gone unfunded in recent years.
23 We obviously look forward to fair and
24 proportional funding as part of these new
35
1 resources.
2 Before I conclude, I want to raise two
3 new fiscal challenges that New York City is
4 confronting ourselves this year. And again,
5 these are two challenges that we did not face
6 when I sat before you just a year ago. As
7 part of a regular review process, the city
8 actuary is adjusting life expectancy
9 assumptions for our retirees, and this will
10 increase the cityís pension costs by $600
11 million annually. I should note that that
12 charge was incurred starting in the current
13 fiscal year -- so there's $600 million in
14 this fiscal of the budget that we did not
15 anticipate and there was no way to anticipate
16 at the beginning of the building process for
17 this fiscal year -- $600 million for next
18 fiscal year, 2017, and every fiscal year
19 thereafter added to the budget.
20 In addition, our public hospital
21 system is facing new challenges. New York
22 City Health and Hospitals is the largest
23 municipal hospital system in the nation. In
24 2014, its 11 hospitals, 70-plus
36
1 community-based clinics, and other facilities
2 were visited nearly 5 million times. Almost
3 1 in 6 New Yorkers was treated.
4 But today, the patients who go to
5 Health and Hospitals are mostly covered by
6 Medicaid or are entirely uninsured. At the
7 same time, the federal government is cutting
8 reimbursements for the care of these
9 uninsured patients, and Medicaid doesn't
10 cover the costs of care even for those who
11 have Medicaid, leaving Health and Hospitals
12 to pick up millions of dollars in costs.
13 This is forcing Health and Hospitals
14 to transform how they do business, because
15 this current operating model is no longer
16 fiscally sustainable, given the changes that
17 have occurred in federal and state rules and
18 laws and the changing healthcare economy.
19 We're working to reform this system
20 immediately, and as a first step I have
21 provided $337 million in immediate relief for
22 Health and Hospitals for this fiscal year
23 that we are in now.
24 Within the next three weeks, the city
37
1 will be coming to you to identify areas where
2 the state can provide assistance and help us
3 address this growing problem.
4 To conclude, as the Governor rightly
5 said in his State of the State speech, "We
6 are upstate and we are downstate, but we are
7 one state." I couldn't agree more. We are
8 ALL New York, and we are all New Yorkers. It
9 is my privilege and honor to represent 43
10 percent of the citizens of this wonderful
11 state, 8.5 million people -- by the way, our
12 highest population ever in the City of New
13 York, and moving rapidly towards 9 million
14 people in the coming years -- 8.5 million
15 people who are hardworking, who are
16 innovative, who are creative, who represent
17 every corner of the earth but come together
18 to make our city and state great. The
19 overwhelming majority of them are doing
20 everything right. They're raising their
21 families, they're paying their fair share in
22 taxes, they're getting up each day, and
23 they're working hard. The choices that you
24 will make in this legislative session will
38
1 have a great effect on their lives.
2 Thank you for inviting me to speak
3 with you today. And I look forward to
4 working with you, and my entire
5 administration looks forward to working with
6 you, in the days ahead on a budget that will
7 meet the needs of every New Yorker, wherever
8 they may live.
9 Thank you very much.
10 CHAIRMAN FARRELL: Thank you,
11 Mr. Mayor.
12 First to question will be
13 Mr. Benedetto. But before that, I would like
14 to introduce with us Assemblyman Ortiz,
15 Assemblywoman Rozic, Assemblywoman Seawright,
16 Assemblywoman Simon, and Assemblywoman
17 Walker.
18 CHAIRWOMAN YOUNG: Also, Assemblyman,
19 we have other Senators who have joined us who
20 Senator Liz Krueger will introduce.
21 SENATOR KRUEGER: Thank you. We are
22 joined by Senator Dan Squadron, Senator
23 Roxanne Persuad, Senator Bill Perkins, and
24 Senator Tim Kennedy.
39
1 CHAIRWOMAN YOUNG: Thank you.
2 ASSEMBLYMAN BENEDETTO: Thank you,
3 Mr. Farrell.
4 And Mr. Mayor, welcome. We always
5 like to see you here up in Albany and
6 appreciate you taking the time to come up,
7 especially when there's so much going on in
8 the city. And my congratulations to all that
9 you did, and I know there are still some
10 problems out there. But for the size of that
11 snow, you guys did a tremendous job. And the
12 city workers in New York, they're the best,
13 they really are.
14 MAYOR DE BLASIO: Amen. Thank you.
15 ASSEMBLYMAN BENEDETTO: Listen, you
16 have identified over the years housing,
17 affordable housing, as a major priority.
18 Where do we stand on that? How many units to
19 date have we produced?
20 MAYOR DE BLASIO: Assemblyman, we're
21 very proud to say our plan, because it's
22 200,000 units preserved or built over 10
23 years, basically the average we hope for each
24 year is 20,000 per year. We now have
40
1 41,000-plus units that have either been
2 already preserved or built, or at least the
3 financing has been secured formally and those
4 are under contract. So 41,000 units now
5 having been achieved over the first two
6 years.
7 ASSEMBLYMAN BENEDETTO: We had the
8 expiration of the 421a, okay. Any views on
9 how that is going to affect your housing
10 plan?
11 MAYOR DE BLASIO: Well, first I want
12 to say we believe fundamentally that 421a
13 needed change. It had to be a program that
14 was more fair to the taxpayers, it had to be
15 a program that did not focus so many
16 resources on luxury housing. In fact the
17 reason for 421a, in my view, now has to be
18 the creation of affordable housing on a much
19 greater level. So it was profoundly
20 important to get a different approach.
21 Obviously I'm very disappointed that a
22 plan was not agreed upon in recent days. I
23 think we have to get to work, all of us
24 together, in finding a way to move forward
41
1 quickly that recognizes these key criteria.
2 Whatever is done going forward must do more
3 to support the creation of affordable
4 housing, must be more fair to the taxpayers,
5 and should not reward luxury housing in the
6 way the previous plan did.
7 ASSEMBLYMAN BENEDETTO: Thank you.
8 Design/build has been used for several
9 projects throughout the State of New York --
10 the Tappan Zee Bridge, I know the MTA has
11 been using it for their projects in Penn
12 Station and Javits Center. I've been
13 speaking over the past year and a half or so
14 with Commissioner Trottenberg, who is an
15 ardent advocate of the design/build in some
16 of the projects that the Department of
17 Transportation is producing.
18 Where are we standing with that, and
19 how are we -- how are we going to come to an
20 agreement with maybe some of the union sector
21 here to make them, you know, jump on board
22 with this?
23 MAYOR DE BLASIO: Well, Assemblyman,
24 first of all, I appreciate your focus on it.
42
1 It's not what we'd call a sexy issue, but it
2 is an issue that really matters in terms of
3 what we do every day in the city. You're
4 right that Commissioner Trottenberg is an
5 ardent advocate for this improvement. She is
6 matched in that ardent feeling by Sherif
7 Soliman, so I'm going to ask him to speak to
8 the specifics of this issue.
9 DIRECTOR SOLIMAN: Sure. Thank you
10 for your leadership on that issue, of course;
11 we've worked closely on that. We would like
12 to have that procurement method extended to
13 New York City, as you know.
14 The mayor mentioned two major projects
15 in New York City that could really benefit
16 from design/build: We have the BQE project,
17 and we have the Belt Parkway, just to give
18 two examples.
19 In the city we've done great work to
20 get the building trades on board and also to
21 get DC-37 on board. So we have labor support
22 in New York City. We look forward to working
23 with you and your colleagues to have it
24 adopted this year.
43
1 ASSEMBLYMAN BENEDETTO: It would be
2 quite helpful if we would get some memos of
3 support from the unions you mention. I have
4 never seen them. I would like to see them
5 and to show my colleagues that we do have
6 union support for this; right now many of
7 them are doubtful. And I really would be
8 remiss if I didn't mention my colleague
9 Robert Rodriguez, who's very interested in
10 this and chairs our subcommittee on
11 infrastructure. Okay? So we can join in and
12 maybe move ahead on this.
13 DIRECTOR SOLIMAN: Be happy to get you
14 those.
15 ASSEMBLYMAN BENEDETTO: Good. Thank
16 you very much. Thank you, Mr. Mayor.
17 Mr. Chairman.
18 MAYOR DE BLASIO: Thank you.
19 CHAIRMAN FARRELL: Thank you.
20 Senator?
21 CHAIRWOMAN YOUNG: Thank you very
22 much.
23 And I'd like to welcome the mayor to
24 Albany. It's good to see you. And I do have
44
1 a series of information and questions for
2 you.
3 So you went through your testimony and
4 I listened to it very carefully. And you did
5 point out there's some good things in the
6 budget that you agreed with, but you also
7 brought in a litany of complaints -- things
8 like Medicaid, CUNY, charter schools,
9 transportation, capital, and the list goes
10 on. And basically what you're saying is that
11 you're demanding more money from the state's
12 taxpayers, that you want more money.
13 This year's budget proposal is a $322
14 million net positive for New York City,
15 including $364 million in growth for school
16 aid, and other investments also being made
17 under this proposal, including in the areas
18 of housing -- which you know I have
19 particular interest in -- homeless programs,
20 economic development and transportation.
21 So I'd like to go through some of the
22 areas that you covered in your testimony, and
23 I'd like to start with Medicaid. The state
24 actually spends, total, $18.5 billion on the
45
1 Medicaid program, and almost $12 billion of
2 those funds go to New York City. We, as the
3 Legislature, and the Governor have capped the
4 growth of Medicaid to help local governments
5 around the state, and they have to live
6 within the constraints of the property tax
7 cap, but the property tax cap does not apply
8 to New York City. That's correct, right?
9 So this year New York City is
10 collecting $3.5 billion more in property
11 taxes than if it had the 2 percent property
12 tax cap. So the mandate relief is going, I
13 believe, in the wrong place, and the city
14 clearly has the resources to pay a share of
15 Medicaid annual growth. And here are the
16 numbers over the long term. Medicaid is
17 expected to grow about 4.5 percent. We take
18 actions to control costs and get the growth
19 down to within our own Medicaid spending
20 cap -- this year it's about 3.5 percent. And
21 I think what the budget is asking is for the
22 city to share in a little bit of the growth,
23 but still not as much as what we pay in our
24 counties around the state. The state is
46
1 capping New York City's growth at 2 percent,
2 and the state will continue to pay any growth
3 above 2 percent. And, by the way, not
4 coincidentally, 2 percent is the limit of the
5 property tax cap.
6 So we're living under the constraint
7 of the property tax cap upstate. You don't
8 have that constraint. As a result, some of
9 the poorest counties would be subsidizing
10 people on Medicaid in New York City. And we
11 have very poor counties upstate. So that's
12 just wrong.
13 So even after these proposals, the
14 budget will still provide $631 million in
15 mandate relief from the Medicaid program to
16 New York City, and that, I may point out, is
17 still more than last year. So I assume that
18 you would prefer this year's budget over last
19 year's budget because of $631 million in
20 mandate relief.
21 MAYOR DE BLASIO: Well, first of all,
22 Chair, I want to thank you for that. We've
23 obviously been in a close working partnership
24 with you on housing issues. I know it is
47
1 your passion, and want to thank you for the
2 work we've done together.
3 CHAIRWOMAN YOUNG: Thank you.
4 MAYOR DE BLASIO: On the questions
5 you're raising now, I think it's important to
6 start by saying I've had perhaps a different
7 experience than some people who have held
8 this particular role, in that I spent a part
9 of my career working on the concerns of
10 upstate as well, and different parts of the
11 state, when I was the HUD regional director.
12 And all of New York State was part of the
13 area that I worked on during the Clinton
14 administration, so I spent a lot of time in
15 big cities and smaller cities and towns all
16 over this state. And I absolutely understand
17 that many parts of our state are struggling
18 economically, just like the other 46 percent
19 of New York City residents who are at or near
20 the poverty level. So we have challenges all
21 around.
22 I would argue that it would be very
23 good, in all of our discussion about this
24 state, of course to think like one state, to
48
1 think about the needs of every type of New
2 Yorker, and what we can do to maximize
3 economic growth for all of us, for the good
4 of all. I do think it's fair to say that New
5 York City right now is providing a very
6 positive impact on the rest of the state,
7 economically and in terms of revenue. We're
8 proud of that fact. What I'm trying to do in
9 my budget is keep that going for all of us,
10 to keep building our economy for the good of
11 all residents of New York State.
12 To do that, we have to have fiscal
13 stability. The investments we're making --
14 in more police, for example, in improving our
15 schools, and in keeping the housing
16 affordable -- is also about our economic
17 viability for the long haul.
18 So I do think we're all interrelated
19 deeply, and our ability to succeed affects
20 everyone else and everyone else's reality
21 affects us.
22 Now, what I would argue here is
23 because of what's happened in recent decades,
24 we all know that if there is a downturn, God
49
1 forbid -- but we all know enough about
2 economics to say it's not a question of if,
3 it's a question of when -- in the context of
4 any downturn, there will be a very severe
5 impact on our budgetary impact because it
6 will start above us at the federal and state
7 level. In a downturn, your revenues will be
8 reduced, federal revenues will be reduced,
9 and of course there will be less for New York
10 City, and then our own revenues go down.
11 The reason I say this: In these
12 scenarios there is no safety net for us,
13 there is no ability to turn to you and say,
14 Can you help us out of a jam? We'll know
15 that you're not in a position to do that. So
16 we have to have reserves, and we have to have
17 fiscal stability. What I mentioned to you
18 just between the change from our actuary and
19 the immediate cost that we have to pay
20 directly to address the problem of Health and
21 Hospitals, that's a billion dollars more in
22 the current fiscal year's budget that was
23 absolutely unforeseen a year ago.
24 So I would argue to you that fairness
50
1 from our point of view is to continue the
2 state taking on responsibility as it has
3 vis-a-vis Medicaid, to help us ensure our
4 fiscal stability, for the good of all, but
5 also with the recognition that in the event
6 that there is major financial challenge
7 ahead, that we are in a position to handle
8 it.
9 CHAIRWOMAN YOUNG: Thank you, Mayor,
10 for that answer. But as I pointed out,
11 there's still $631 million in mandate relief
12 savings under Medicaid for New York City, and
13 that's more than last year.
14 I'd like to switch to CUNY, because as
15 we know, CUNY stands for the City University
16 of New York. And 71 percent of the students
17 who go to CUNY are from the city, but the
18 entire bill for the CUNY system is picked up
19 by the taxpayers of New York State. That was
20 a temporary arrangement and dates back to a
21 time when New York City was in fiscal crisis
22 and they could not afford CUNY, the state
23 stepped in and saved the CUNY system. Now
24 the city has the resources -- and we'll go
51
1 over that in a few minutes, about what your
2 surplus is -- to resume the support of CUNY,
3 and the real question is at what level.
4 So under the current structure, the
5 city appoints 30 percent of the CUNY Board of
6 Trustees, and under the budget, 30 percent of
7 the cost, we believe, would be reasonable.
8 So even though 70 percent of the CUNY
9 students are from the city, state taxpayers
10 will continue to pay for 70 percent of the
11 operating costs. And in addition, the state
12 expects to spend about $2.5 billion over the
13 next five years on CUNY capital projects,
14 which I think is very good. CUNY's capital
15 program represents about 20 percent of all
16 New York City construction today, so the
17 state investment is huge for the New York
18 City economy. So, you know, under the CUNY
19 part of the proposal, you still are making
20 out.
21 Last year the city had such a big
22 surplus that you prepaid $3.6 billion of this
23 year's expenses and puts billions in
24 reserves. And you just talked about why you
52
1 want to do that. Each year the city
2 recognizes billions in additional revenue
3 over its four-year financial plan that you
4 did not include when the budget was first
5 adopted. And last year, that number was $11
6 billion. Right now the city's fiscal
7 watchdogs are predicting upwards of
8 $2.5 billion in additional revenues for the
9 city's upcoming budget.
10 So you talked about the need to be
11 fiscally prudent and squirrel away money, but
12 the question is you have this enormous
13 surplus. And do you have a PEG program in
14 place, which is a Program to Eliminate the
15 Gap, where New York City agencies look for
16 savings, look for cuts? Do you have that in
17 place?
18 MAYOR DE BLASIO: Okay. Let me speak
19 to you -- you raised several points. If I
20 may, I'll try and speak to each of them
21 quickly.
22 First of all, we do contribute
23 substantially to CUNY, and we have. And I
24 want, in a moment, Dean Fuleihan to outline
53
1 that to you. Second, we believe that our
2 contribution is consistent with what is our
3 obligation in terms of the history. And
4 certainly it compares favorably to what's
5 being done in other parts of the state.
6 The fact is that we know -- and I'll
7 use a fact from the last economic downturn.
8 When the Great Recession hit, the combined
9 impact of lost federal and state aid and the
10 cuts that were necessary in New York City and
11 the tax increases that were necessary in New
12 York City, totaled about $12 billion over two
13 years. Against that backdrop, we have laid
14 in very heavy reserves -- again, knowing,
15 with absolute respect, that neither the state
16 nor federal government will be in a position
17 to come to our aid in that kind of scenario.
18 I think it's a fair statement to say
19 that New York City's ability to continue
20 being an economic engine is of paramount
21 strategic importance to the whole state, so
22 we must maintain that stability. I don't
23 think anyone here wants to see New York City
24 slip backwards economically. And that's why
54
1 we are so focused on these reserves.
2 Dean Fuleihan will give you a little
3 more of our view of why we think what we're
4 already contributing to CUNY is both
5 substantial and fair.
6 DIRECTOR FULEIHAN: So the takeover by
7 the state of CUNY was actually a permanent
8 takeover. It was similar to the senior
9 college operations of the State University.
10 The community colleges, we do contribute a
11 third of everything that goes into the
12 operations, and half of the capital budget of
13 the community colleges, which is actually the
14 exact same model that is used throughout the
15 state.
16 As a matter of fact, we are the only
17 municipality that actually doesn't have a
18 majority of the Board of Trustees of their
19 local community college. We have a third --
20 CHAIRWOMAN YOUNG: So that's community
21 colleges versus the CUNY system; right?
22 DIRECTOR FULEIHAN: That's correct.
23 The community college is the model that's
24 used throughout the state. It is the model
55
1 that was adopted during the fiscal crisis in
2 1976, when the CUNY senior colleges were
3 taken over, and the Board of Trustees also,
4 the --
5 CHAIRWOMAN YOUNG: Right.
6 DIRECTOR FULEIHAN: -- of the Board of
7 Trustees also --
8 CHAIRWOMAN YOUNG: And as you point
9 out, that's the same system that's across the
10 entire state for community colleges.
11 DIRECTOR FULEIHAN: -- also controlled
12 the community colleges, which does not exist
13 in your county, where the majority is
14 actually of the local part, even though they
15 also pay the one-third part.
16 I would just also like to go back
17 quickly on the Medicaid part, just worth
18 noting one more additional thing that the
19 mayor pointed out, to emphasize that we
20 actually have no -- between the 2005 reform
21 on Medicaid and the 2012 action on Medicaid,
22 the state has completely taken over the
23 entire administration and rate setting of
24 Medicaid, including, including additional
56
1 powers to actually set and control the very
2 percentages that you are talking about.
3 So we have no role in this, other than
4 the $5 billion to $6 billion that you're
5 talking about that we contribute in.
6 CHAIRWOMAN YOUNG: But you're still
7 getting substantial savings under this budget
8 in mandate relief, and you don't have the
9 constraints of the 2 percent property tax cap
10 that all the other counties in the state have
11 to live under; correct?
12 ASSEMBLYWOMAN NOLAN: We pay income
13 tax too, though.
14 CHAIRWOMAN YOUNG: Right.
15 So STAR-C MAC bonds, the state is
16 committed to paying a hundred percent of the
17 debt service related to the STAR-C bonds, and
18 that's going forward. And when the bonds
19 were refinanced, there were savings. And
20 also I want to point out state taxpayers will
21 pay 100 percent of the $4.8 billion for the
22 city's MAC bonds. And state taxpayers
23 deserve every dollar of the savings, that
24 should be obvious. It's like if your uncle
57
1 pays the mortgage on your house, when you
2 refinance your house, who deserves the
3 savings?
4 I do want to go back, though, because
5 we talked about you have nearly $5 billion in
6 reserves, including $3.4 billion in retiree
7 health benefits trust, $1 billion annually in
8 your general reserve, which is an
9 historically high level, $500 million new
10 capital stabilization reserve. You're
11 benefiting from not having the property tax
12 cap, you have upwards of $2.5 billion in
13 potential additional revenues for the city's
14 upcoming budget, so you're in a very, very
15 good spot.
16 But I did want to point out with your
17 spending, because you are outpacing the
18 state's fiscal restraint. As you know, we
19 are under a voluntary 2 percent spending cap
20 through the state budget. However, the
21 city's expenditures at an average annual rate
22 of more than 6 percent. And from 2011-2016,
23 city-funded expenditures, adjusted for
24 surplus transfers, have grown at an average
58
1 annual rate of 6.33 percent, as a matter of
2 fact -- and you compare that to the state
3 spending of less than 2 percent.
4 So you're in a great spot financially
5 because you have all these surplus dollars,
6 you're increasing spending over 6 percent.
7 And again, I wanted to ask -- because I asked
8 it previously, I'm not sure I got the answer
9 to it -- but are you looking at your
10 spending? Are you doing anything with the
11 Program to Eliminate the Gap, called the PEG
12 program, with your city agencies to try to
13 restrain some of this spending and find some
14 savings for the taxpayer of New York City?
15 MAYOR DE BLASIO: Okay, Senator, let
16 me go over several points that you raise, if
17 I may.
18 First, on that point -- Mr. Fuleihan
19 can outline the details -- we had over a
20 billion dollars of savings that we identified
21 in our preliminary budget proposal. We also
22 have said very clearly we are looking
23 seriously at a specific PEG strategy for the
24 executive budget proposal in May. But it's
59
1 not a minor matter that we've found a
2 billion dollars in savings already.
3 Second, some of the growth -- a
4 substantial amount of the growth in the
5 budget is related to Hurricane Sandy matters,
6 meaning we are passing through federal
7 dollars from FEMA, from HUD, for Hurricane
8 Sandy relief efforts. That is a temporary
9 condition. When those federal dollars drop
10 off, we anticipate that our budget will
11 actually contract.
12 We also, as you heard earlier, have
13 brand-new obligations that came on very
14 suddenly that we, by law, must abide by,
15 obviously, in the case of the city actuary
16 adding a $600 million charge for this year
17 and every year thereafter. We have an
18 immediate challenge related to Health and
19 Hospitals.
20 So that budgetary growth is in large
21 measure because of federal funds that are
22 short term and because of new obligations
23 that we have no choice but to meet.
24 On the other points you made, on the
60
1 way our tax system is oriented in the city,
2 obviously one of the few places in the state
3 with a personal income tax at the city level.
4 I would say my colleagues here from the city
5 would agree that our property tax rate plus
6 our city income tax is certainly substantial
7 for our taxpayers to have to handle.
8 Finally, on the question of the
9 $600 million on the MAC refinancing, this
10 issue we believe fundamentally was settled in
11 2004 by the New York State Court of Appeals,
12 which made clear that the state had an
13 obligation through 2034, I believe it was, to
14 continue a regular payment of $170 million
15 per year to the City of New York. It was an
16 agreement struck between the two levels of
17 government; it was confirmed by the Court of
18 Appeals. So we believe that has to be
19 honored for the long term.
20 CHAIRWOMAN YOUNG: Thank you, Mayor,
21 for those answers.
22 You know, the bottom line is that the
23 city is awash in money right now, and
24 localities around the state -- counties,
61
1 cities, small cities, villages, towns --
2 would only dream of having surpluses and have
3 to live under the property tax cap.
4 So I want to thank you for your
5 answers --
6 MAYOR DE BLASIO: I'm sorry, Senator,
7 could we just do a quick response to that
8 last point, please?
9 CHAIRWOMAN YOUNG: Sure.
10 MAYOR DE BLASIO: Thank you.
11 DIRECTOR FULEIHAN: I just want to
12 quickly add, the mayor talked about over a
13 billion dollars in the preliminary budget,
14 with more savings to be found in the
15 executive budget, and last year we did over a
16 billion-four, also in savings.
17 PEG really is a Plan to Eliminate the
18 Gap, which the city has. And it's worth
19 noting that in 2018 we are projecting a $2.2
20 billion gap, and in 2019 a $2.9 billion gap,
21 and in 2020 a $2.7 billion gap. So we --
22 CHAIRWOMAN YOUNG: Thank you very
23 much.
24 DIRECTOR FULEIHAN: -- also, and the
62
1 prepayments happens to be under the
2 accounting methods that the city uses.
3 That's how we actually balanced. And those
4 prepayments you talked about are exactly how
5 we proposed, in the preliminary budget, a
6 balanced budget for fiscal 2017.
7 MAYOR DE BLASIO: And finally, the
8 Medicaid challenges that you raise, let's be
9 clear, our situation with our Health and
10 Hospitals Corporation is only going to get
11 more difficult because of larger things
12 happening in federal and state policy. We
13 would very much like to work with the state
14 and join with the state in going to
15 Washington for some of the fundamental
16 changes we'll need. But in the meantime, the
17 financial impact on the city will grow
18 intensely. And again, we don't have a safety
19 net to turn to; we will simply have to take
20 on those costs. So I would just suggest that
21 that's another challenge that will grow for
22 us.
23 CHAIRWOMAN YOUNG: Thank you, Mayor.
24 CHAIRMAN FARRELL: Thank you very
63
1 much.
2 We've been joined by Assemblyman
3 Buchwald and Assemblyman Skoufis.
4 ASSEMBLYMAN OAKS: And Assemblyman
5 Friend.
6 CHAIRMAN FARRELL: Next to question is
7 Assemblyman Cusick.
8 ASSEMBLYMAN CUSICK: Thank you,
9 Mr. Chairman.
10 Thank you, Mr. Mayor, for being up
11 here in Albany. It's always good to see you.
12 And it's good that you brought the guy --
13 both guys next to you, Dean Fuleihan and
14 Sherif Soliman, both alums of the State
15 Assembly. It's good to see all of you.
16 Mr. Mayor, I just wanted to follow up
17 on some of the discussions that were
18 happening before. There was talk about the
19 property tax cap and the reference that
20 New York City does not have the property tax
21 cap. What is the feeling of the
22 administration on that? I know there is
23 legislation out there to have a property tax
24 cap. We talked about affordable housing. I
64
1 come from an area that a majority of the
2 folks are homeowners, and taxes in general
3 are an issue.
4 I know this topic has come up many
5 times. Could you just give us --
6 MAYOR DE BLASIO: Yes. I'm a
7 homeowner myself, in Brooklyn, and the
8 district I represented in the City Council
9 was overwhelmingly an outer borough,
10 homeowner district. So I certainly can
11 relate to the concerns that so many of my
12 constituents have.
13 We do not believe in a property tax
14 cap. And it gets right back to the point
15 that there are three levels of government.
16 And maybe in the 1970s when the sense of the
17 relationship between those levels of
18 government was different -- certainly when
19 the federal government had a very different
20 sense of its own obligations and its role --
21 we could assume that in any time of danger we
22 could turn elsewhere. We have no such
23 illusion at this point in history. So we
24 can't put any artificial barrier in place
65
1 that might undermine our ability to serve our
2 people and protect our economy and protect
3 the safety of our people.
4 I look at this in a very cold-eyed
5 way. We have to protect the day-to-day life
6 of everyday New Yorkers, the quality of life,
7 the safety, and the investments we're making
8 are about protecting our long-term economic
9 health. We certainly saw what happened in
10 the 1960s and '70s when the city was not
11 fiscally disciplined and did not make the
12 right investments and became less
13 economically viable; we saw the huge domino
14 effect that occurred. We're not going to let
15 that happen. And part of that revolves
16 around making sure that we have the revenue
17 we need to make the investments that will
18 protect everyone's best interests. So we do
19 not believe in a cap.
20 We also know, as I mentioned, the
21 latest figures, again -- very sadly --
22 46 percent of New Yorkers at or near the
23 poverty level. It's an astounding figure.
24 For us to be able to help people be viable
66
1 and sustainable, we have to make sure that we
2 have resources available.
3 So in the end, I think this is the
4 prudent, long-term path for our city.
5 ASSEMBLYMAN CUSICK: Well, again --
6 and I appreciate what you have to go through
7 in balancing a budget as large as New York
8 City's. But I know in the outer boroughs,
9 particularly in Staten Island, taxes are a
10 very big part of people's lives, and it's
11 probably the number-one complaint that we get
12 as elected officials. And we need to address
13 something when it comes to the property
14 taxes.
15 On the tax cap, my only suggestion is
16 that the issue with a lot of residents is the
17 predictability, and they know that there is
18 not going to be an increase or anything like
19 that, whereas right now there's no
20 predictability, people have to wonder if
21 there's going to be an increase. And these
22 are things that I think are very important to
23 all residents of New York City.
24 MAYOR DE BLASIO: Well, I would argue
67
1 -- I certainly understand the point. I would
2 argue that we're doing even better for
3 homeowners by not only avoiding the cap,
4 which I think would be ultimately
5 counterproductive, but by not having property
6 tax increases. Now, I understand what you
7 say in terms of predictability, whether we're
8 talking about five or 10 years ahead. But
9 what I've said since I came in the door is
10 we're going to avoid property tax increases.
11 I think the number-one concern homeowners
12 would have is no new increases. We
13 understand there are real challenges around;
14 the assessed value and other considerations.
15 But I think job one is to avoid a property
16 tax increase.
17 We have done that by making a series
18 of decisions that both are fiscally
19 disciplined, like our labor contracts, like
20 the healthcare savings that we're achieving,
21 which are unprecedented, but also by laying
22 in the reserves so, God forbid, when we do
23 have a downturn -- and we know, again, it's
24 not if but when -- that we can sustain a core
68
1 level of services and be able to protect, in
2 particular, public safety while not resorting
3 to a property tax increase.
4 So that is why I fully understand
5 anyone on this panel saying, Well, it looks
6 like you have substantial available reserves.
7 We argue those are necessary reserves because
8 they will sadly be eaten up very quickly when
9 the day comes that there's a downturn. Some
10 of them are being eaten up right now because
11 of these new costs we talked about before.
12 But I am adamant about guarding
13 against any further property tax increases.
14 And I don't want to do that via a fixed rule,
15 I want to do that by smart budgeting and
16 using our resources wisely.
17 ASSEMBLYMAN CUSICK: It's definitely a
18 discussion I would love to continue with
19 you --
20 MAYOR DE BLASIO: Please.
21 ASSEMBLYMAN CUSICK: -- because it
22 certainly is the number-one topic in my area
23 and most of the outer boroughs.
24 But I'll move on. Also I want to
69
1 thank you and the administration for the
2 work -- another topic that is big all
3 throughout the state is the -- and
4 particularly in Staten Island -- is the
5 heroin and opioid epidemic.
6 MAYOR DE BLASIO: Yes.
7 ASSEMBLYMAN CUSICK: I know that you
8 have been out there working with us. But
9 could you give us just an overview of what
10 the city is budgeting this fiscal year to
11 combat the heroin and opioid epidemic?
12 MAYOR DE BLASIO: I'll see if Dean
13 Fuleihan or Sherif Soliman have the exact
14 dollar figure, but I'll give you the
15 overview. We're very focused on this issue.
16 It's a growing problem and -- you may have
17 seen the map in one of the papers the other
18 day of what's happening around the country --
19 even worse in many parts of the country.
20 Which is astounding, because I know Staten
21 Island in particular, very hard-hit, and many
22 other parts of the five boroughs.
23 We are making this a priority in terms
24 of NYPD, we're making it a priority in terms
70
1 of Department of Education and efforts to get
2 young people to understand what these
3 challenges are before they end up in a
4 dangerous situation. We are doing a lot to
5 work with grassroots organizations to reach
6 parents and help them. We certainly have
7 done a lot working with pharmacies to make
8 the antidote drug available to avoid a fatal
9 overdose. And there's a lot more that will
10 be part of our package. It very much
11 connects with our overall new initiative,
12 Thrive NYC, which is a comprehensive citywide
13 mental health initiative. But we consider
14 the challenges of substance abuse to be
15 absolutely interrelated to mental health
16 challenges in many cases, so we have both of
17 these strategies working together.
18 But what we can say is, particularly
19 as we've applied more and more focus and more
20 and more energy, we are seeing an impact.
21 And I think NYPD has been a crucial partner.
22 But much more to do, because we understand
23 how pervasive this problem is.
24 DIRECTOR FULEIHAN: We'll get the
71
1 exact number.
2 MAYOR DE BLASIO: We'll come back to
3 you on those specific numbers.
4 ASSEMBLYMAN CUSICK: Thank you. Thank
5 you, Mr. Mayor.
6 Just one more issue is you had
7 mentioned that in the city budget you're
8 providing $337 million in relief for New York
9 City Hospitals. Just to be a little local
10 and parochial here, Staten Island is the only
11 borough that does not have a New York City
12 hospital, full-service. When you are going
13 through the budgeting for New York City
14 Hospitals, I would just request that we can
15 have a conversation about money provided to
16 the existing hospitals, to make up for the
17 loss that we don't have a hospital.
18 Particularly after Sandy, we have
19 found that there are certain hospitals that
20 are in flood zones and some that are not.
21 And if another disaster hits, the money is
22 truly needed not only in Staten Island, but
23 in other areas in New York City.
24 MAYOR DE BLASIO: Yes, thank you,
72
1 Assemblyman. And as you know, we've tried to
2 provide some additional support in terms of
3 preparing for any kind of natural disaster,
4 and that's been one of our focal points, on
5 Staten Island.
6 Second, look, we're going to have to
7 make some very tough choices going forward on
8 Health and Hospitals. We're going to have to
9 make a series of reforms. To be optimistic
10 in that process, we can also look at how we
11 can address some of the long-standing equity
12 issues. There's no question that Staten
13 Island has not been given what it deserves,
14 and we want to see how we can fix that issue.
15 But it will, unfortunately, be against a
16 backdrop of some major changes and reforms
17 that will be very tough to achieve.
18 ASSEMBLYMAN CUSICK: Thank you,
19 Mr. Chairman. Thank you, Mr. Mayor.
20 MAYOR DE BLASIO: Thank you.
21 CHAIRMAN FARRELL: Thank you very
22 much.
23 We've been joined by Assemblywoman
24 Mayer and Assemblyman Barron.
73
1 Senator?
2 CHAIRWOMAN YOUNG: Yes. Next will be
3 Senator Liz Krueger, who is the ranking
4 member on the Finance Committee.
5 SENATOR KRUEGER: Thank you,
6 Mr. Mayor. There are so many of us with so
7 many questions. I'm going to try to do a
8 little lightning round, if it's okay with
9 you.
10 MAYOR DE BLASIO: All right. Ready.
11 SENATOR KRUEGER: So Senator Young
12 brought up the amount of Medicaid money
13 New York City gets compared to the rest of
14 the state. Do we get special rules for
15 New York City, or is it just a ratio of the
16 number of poor people drawing down Medicaid
17 throughout the state and the New York City
18 share?
19 MAYOR DE BLASIO: I'd like to ask Dean
20 Fuleihan to answer.
21 DIRECTOR FULEIHAN: Exactly. That's
22 the correct answer, we have no -- and we have
23 no administrative or rate-setting powers over
24 Medicaid.
74
1 SENATOR KRUEGER: Thank you.
2 And there was also reference to the
3 mandate relief available within this year's
4 budget based on changes in Medicaid law over
5 the last several years. Again, is New York
6 City getting a disproportionate share of
7 mandate relief for Medicaid compared to the
8 rest of the state?
9 DIRECTOR FULEIHAN: No.
10 SENATOR KRUEGER: Thank you.
11 You raised in your testimony that New
12 York City would be obligated to contribute
13 more per student in charter schools out of
14 your education budget under the Governor's
15 proposal. Is that across the board for all
16 localities, or only New York City would be
17 obligated to put more of its education money
18 into the charter formula?
19 DIRECTOR FULEIHAN: Only New York
20 City.
21 SENATOR KRUEGER: Only New York City,
22 thank you.
23 So yes, there's a CUNY system and a
24 SUNY system. But is it the City of
75
1 New York's position that we should have one
2 higher education system for students who
3 aren't in the City of New York and a
4 different system with less funding for
5 students who happen to be from the City of
6 New York to go to higher education?
7 DIRECTOR FULEIHAN: No.
8 SENATOR KRUEGER: And in fact this
9 proposal that the Governor's making, what it
10 does is shift a greater burden to the
11 locality for CUNY students than for SUNY
12 students?
13 DIRECTOR FULEIHAN: That's correct.
14 SENATOR KRUEGER: And is it true that
15 CUNY students are already lower-income on
16 average than SUNY students throughout the
17 state?
18 DIRECTOR FULEIHAN: Correct.
19 SENATOR KRUEGER: So would it be an
20 equity model to require every county to
21 contribute the same ratio to its SUNY system
22 if this is required of the City of New York
23 for CUNY?
24 DIRECTOR FULEIHAN: As you know, we're
76
1 asking that that proposal not go forward.
2 And as the mayor pointed out, we are taking
3 the Governor at his commitment, and we're
4 working through that.
5 SENATOR KRUEGER: And in your
6 testimony you talked about increased costs
7 for the City of New York on Medicaid because
8 the Governor doesn't -- it lifts the state
9 cap on localities having to pick up growth in
10 costs. Is that being applied anywhere else
11 in the state, or just in the City of New
12 York?
13 DIRECTOR FULEIHAN: Just in the City
14 of New York if it were to occur.
15 SENATOR KRUEGER: And then there was
16 discussion about the fact that there's the
17 $170 million per year from the old MAC bond
18 deals, and the mayor discussed the fact that
19 there was a court decision on this. And it
20 was raised that why should the state continue
21 to pay this money even though the courts
22 apparently decided we're obligated to and we
23 should.
24 How does that number compare to what
77
1 New York City no longer gets in AIM funding?
2 DIRECTOR FULEIHAN: It is below what
3 New York City normally gets. It was a
4 commitment in 2005 for 30 years at
5 $170 million a year. We used to receive over
6 $300 million in AIM funding every year, which
7 we are no longer getting.
8 SENATOR KRUEGER: And do you happen to
9 remember what the state's argument was when
10 it cut New York City's AIM or revenue-sharing
11 and left every other locality whole, if even
12 still too low?
13 DIRECTOR FULEIHAN: No. Actually I
14 remember the city opposing it at that time as
15 being the only municipality that would not be
16 receiving municipal aid.
17 SENATOR KRUEGER: And did we put that
18 money back this year?
19 DIRECTOR FULEIHAN: You did not.
20 SENATOR KRUEGER: We did not, thank
21 you.
22 There's also a proposal to change the
23 formula of who pays for expanded or continued
24 services for the homeless through TANF and
78
1 safety net. Can you project, one, is that
2 only for New York City or other localities?
3 And, two, what that will mean for New York
4 City going forward?
5 DIRECTOR FULEIHAN: Well, we actually
6 need more detail on this and more detail on
7 exactly what the homeless plan is, and we're
8 looking forward to those details.
9 The provision you're talking about is
10 a "may," and it allows that state actions in
11 the city can be offset with other safety-net
12 payments that the state makes, basically to
13 single shelters. So there could be an
14 offset. We have asked and we're waiting for
15 the details on that, so I can't give you
16 specific numbers at this point.
17 SENATOR KRUEGER: But there's reason
18 for us to be concerned until we have those
19 details?
20 DIRECTOR FULEIHAN: Yes.
21 SENATOR KRUEGER: Yes.
22 There was a discussion about the city
23 not being under a 2 percent property tax cap
24 and the rest of the state doing so.
79
1 Ironically, perhaps just since we're sitting
2 here in this conference room, I don't know
3 where the Senate is today on schedule with
4 its session, but a bill is being voted on in
5 the Senate today that would require a 2
6 percent cap in the New York City property
7 tax. I, for the record, am voting no on that
8 -- yes, Senator Lanza is the sponsor, but
9 he's here with us. But I think the bill is
10 going forward in his absence. Sometimes we
11 get to debate his bill.
12 But just for the record, if the Senate
13 law were to go into effect, it would
14 radically impact the budget projections for
15 the City of New York; is that correct?
16 DIRECTOR FULEIHAN: Yes. You're on a
17 roll.
18 SENATOR KRUEGER: Yes, to have to be
19 under a 2 percent cap.
20 And just finally, do you know how much
21 money the City of New York taxpayers send to
22 Albany in comparison to what they get back
23 from the state budget?
24 DIRECTOR FULEIHAN: The city
80
1 contributes much more -- we'll get you the
2 exact figures, but the city contributes much
3 more than we receive back.
4 SENATOR KRUEGER: There's a woman with
5 a piece of paper behind you that she's trying
6 to hand you.
7 DIRECTOR FULEIHAN: Yes, we will get
8 it for you in a moment.
9 (Laughter.)
10 SENATOR KRUEGER: I'm sorry, it wasn't
11 a trick, but it looked like --
12 MAYOR DE BLASIO: Senator, this
13 lightning round is so fast we're trying to
14 keep up with it.
15 (Laughter.)
16 SENATOR KRUEGER: So, Mr. Mayor, you
17 went through --
18 DIRECTOR FULEIHAN: Yes, I didn't want
19 to give you the wrong number. I started to
20 say 60 percent; it's 57 percent.
21 SENATOR KRUEGER: Aha.
22 MAYOR DE BLASIO: Clarify it. Clarify
23 it.
24 DIRECTOR FULEIHAN: It's 57 percent
81
1 that the taxpayers of New York City --
2 (Cross-talk.)
3 MAYOR DE BLASIO: Could you say the
4 whole sentence for everyone's edification?
5 DIRECTOR FULEIHAN: So we're going to
6 make sure I get it to you.
7 SENATOR KRUEGER: Okay.
8 MAYOR DE BLASIO: We're experiencing
9 technical difficulties, Senator.
10 SENATOR KRUEGER: I appreciate your
11 ability to respond so quickly. I knew that
12 we had so many questioners, I was trying to
13 be fast here.
14 MAYOR DE BLASIO: Very good. We'll
15 get that clarified in just one second here.
16 SENATOR KRUEGER: We're going to get
17 clarified. Okay, I appreciate that.
18 And there was one other section of the
19 budget I believe you talked about in the
20 context of housing. It would require two
21 additional steps that the City of New York
22 would have to go through before it could
23 approve city affordable housing projects.
24 MAYOR DE BLASIO: Correct.
82
1 SENATOR KRUEGER: Is there any basis
2 to make the argument that the City of
3 New York hasn't been able to handle this
4 effectively up until now --
5 MAYOR DE BLASIO: No, Senator.
6 SENATOR KRUEGER: -- and needs two new
7 levels of oversight?
8 MAYOR DE BLASIO: No. This recalls
9 the famous phrase "If it ain't broke, don't
10 fix it." We've been producing an immense
11 amount of affordable housing using the bond
12 cap authority. As I said, we had 1200 more
13 units that could have been produced had the
14 additional authority been extended to us.
15 I think everyone here wants to see
16 affordable housing built as quickly as
17 possible, and anything that can be done by
18 government done efficiently, and we think
19 adding this additional layers will only slow
20 down the process at a point where thousands
21 and thousands of people are waiting for
22 housing that will allow them and their
23 families to be able to make ends meet.
24 SENATOR KRUEGER: Thank you very much.
83
1 MAYOR DE BLASIO: Thank you.
2 SENATOR KRUEGER: And if there's
3 not -- yes.
4 DIRECTOR FULEIHAN: I will answer. It
5 is what I thought, I apologize.
6 approximately 60 percent of the revenues of
7 the state are generated within New York City.
8 SENATOR KRUEGER: Thank you very much.
9 Thank you, Senator.
10 CHAIRWOMAN YOUNG: Thank you, Senator.
11 CHAIRMAN FARRELL: Thank you.
12 Assemblyman Weprin.
13 ASSEMBLYMAN WEPRIN: Thank you,
14 Mr. Chairman.
15 And thank you, Mr. Mayor, for coming
16 up here in the midst of cleanup, which I know
17 is still taking place. And we're very --
18 considering it was the second-largest storm
19 in the history of the City of New York, you
20 know, I don't think you did so badly,
21 although I know there's still some issues
22 outstanding.
23 On another subject, I chair the
24 Assembly Task Force on People with
84
1 Disabilities, and I was very proud to march
2 with you and former Senator Tom Harkin last
3 summer, with your commitment to ADA and the
4 25th anniversary, with Disability Pride
5 Month.
6 And your commissioner, Victor Calise,
7 does a great job, and I work very closely
8 with his office. And I know you are very
9 committed personally to ADA compliance and to
10 making New York City accessible to all.
11 Having said that, though, as you know,
12 the U.S. Attorney, Preet Bharara, came out
13 with the results of a two-year investigation
14 and released that on December 21st, saying
15 that 83 percent of New York City schools are
16 not ADA-compliant. And I know there was
17 supposed to be some response from the city, I
18 believe it was just last week, January 20th.
19 Can you give us what the result of that is
20 and what the fiscal cost might be to bring
21 New York City schools to be ADA-compliant.
22 MAYOR DE BLASIO: Well, I'll start and
23 Dean Fuleihan may want to join in on the cost
24 issue.
85
1 First of all, the U.S. Attorney
2 raised, obviously, an important issue. We
3 all care deeply about maximizing
4 accessibility in every way, and we've tried
5 to do that in a host of ways in the city,
6 including, for example, ensuring that more of
7 our taxis are accessible and any number of
8 other areas where we're trying to focus on
9 making the city accessible for all.
10 In terms of the city schools, since
11 approximately 1992, as schools have been
12 built or substantially rehabilitated, that
13 has been done with accessibility standards.
14 In terms of our ongoing efforts to upgrade
15 older schools, we have $100 million in the
16 current budget focused on additional
17 accessibility efforts.
18 Eight hundred fifty-five of our 1582
19 school buildings -- so again, 855 out of
20 1,582 school buildings -- are either fully or
21 partially accessible. So that's a 54 percent
22 level. And with only one exception, every
23 one of our 32 districts has at least eight
24 accessible buildings.
86
1 So considering we have a school
2 system, many of which the buildings were
3 built 50, 60, 70, 80 years ago, we've managed
4 to make real progress on accessibility.
5 We're absolutely committed to it for the long
6 haul and will certainly work closely with the
7 U.S. Attorney.
8 Just by way of reference, walking
9 distance from my home in Brooklyn is a school
10 -- it's certainly typical, but it makes the
11 point -- a school that was built in 1875, PS
12 39. So we're dealing with schools of all
13 different configurations.
14 But it's an ongoing commitment of the
15 city to continue to increase accessibility in
16 our schools.
17 ASSEMBLYMAN WEPRIN: Okay. And the
18 cost?
19 MAYOR DE BLASIO: The cost of, again,
20 ADA compliance per se, we're in the many
21 billions of dollars. But I don't think we
22 have a --
23 DIRECTOR FULEIHAN: Right, we don't
24 have a specific cost at this time.
87
1 MAYOR DE BLASIO: We can try and give
2 you a better reading on that, but certainly
3 many, many billions of dollars.
4 ASSEMBLYMAN WEPRIN: Okay. Yeah, I
5 know you are personally committed and I would
6 like to work closely with your Office of
7 People with Disabilities and Commissioner
8 Calise on anything we can do at the state
9 level to make sure that accessibility occurs.
10 In answer to Senator Krueger's
11 question, my own personal recollection is
12 that AIM was eliminated for the first time
13 for New York City in Governor Paterson's last
14 year, which was my first year up here, in
15 2010, and it was supposed to be for one year
16 only and restored the following year. But
17 when Governor Cuomo came in in 2011, he
18 stated that there was no cut because it was
19 already zero from last year. So I think
20 they've kind of forgot about what we thought
21 was a commitment between the state in
22 providing AIM the following year.
23 So, you know, I continue to argue that
24 New York City should still continue to get
88
1 that AIM and we shouldn't give up on it, that
2 our understanding as legislators was it was
3 only going to be a one-year, one-time cut and
4 it would be restored the following year.
5 MAYOR DE BLASIO: Well, we agree with
6 your interpretation, it's certainly never
7 something we're going to give up on. I think
8 your recollection of history is exactly
9 right.
10 ASSEMBLYMAN WEPRIN: Thank you,
11 Mr. Chairman.
12 CHAIRMAN FARRELL: Thank you.
13 Mr. Mayor, one of the problems we have
14 is we're going to have elections and people
15 are being moved out of the schools. And
16 Manhattan, the northern end is hills, so what
17 looks like three blocks apart can actually be
18 a hundred-foot drop and walking 10 blocks and
19 then back. And we've had a lot of problems
20 getting the school secure, the reason why we
21 don't have the voting there.
22 I'd appreciate it if you could look
23 into that so that we don't have a problem
24 where people will be going 10 blocks and
89
1 20 blocks when they didn't have to because a
2 railing is loose on the entrance which could
3 be fixed for $10.
4 MAYOR DE BLASIO: I couldn't agree
5 more. We will follow up with the Board of
6 Elections. And obviously we're deeply
7 concerned about people being able to vote and
8 not finding any hindrance to vote. So I
9 appreciate you raising this, and we'll follow
10 up right away.
11 CHAIRMAN FARRELL: Yeah, because I
12 thought they had problems in Brooklyn, too,
13 with the same thing, losing the schools.
14 Thank you. Senator?
15 CHAIRWOMAN YOUNG: Thank you very
16 much.
17 Our next speaker will be Senator Tony
18 Avella.
19 SENATOR AVELLA: Thank you, Madam
20 Chair.
21 Good morning, Mr. Mayor -- I think
22 we're still in the morning.
23 MAYOR DE BLASIO: Good morning. Yes.
24 SENATOR AVELLA: I'd like to go back
90
1 to the property tax cap, the 2 percent cap
2 that the rest of New York State has.
3 You made a comment earlier, in
4 reference to a question from one of the
5 Assemblymembers about this, that the city
6 hasn't raised its tax rate in a number of
7 years. But I can assure you, everybody
8 watching your comments on TV is probably
9 having the same reaction that I did, is that
10 everybody's assessment goes up every year.
11 And that is a tremendous burden on many
12 homeowners, many seniors, disabled
13 individuals who we want to keep in their
14 homes.
15 And I know at the same time you've
16 been asking for the state to restore the
17 Medicaid cuts.
18 So I and the IDC, the Independent
19 Democratic Conference, will make this
20 recommendation to you and to the Governor,
21 that if you would institute the property tax
22 cap, including assessments, in New York City,
23 then we would urge the Governor and the
24 Legislature to restore the Medicaid funding.
91
1 Your thoughts?
2 MAYOR DE BLASIO: With real respect,
3 Senator, I think that would be a very
4 dangerous path for New York City. We have to
5 be clear about the fact that, again, we have
6 only ourselves to depend on in a moment of
7 difficulty.
8 And I do understand fully how many of
9 my constituents are facing a burden which is
10 related to, obviously, strangely enough the
11 success of New York City, the growth and
12 strength of New York City, our property
13 values have gone up. And with that have gone
14 up the assessments. And that has created a
15 challenge and a burden.
16 But I do -- I have to disagree, first
17 of all, that I think -- again, as a homeowner
18 myself -- there's a big difference between
19 growth of an assessment based on value versus
20 a property tax increase. A property tax
21 increase is another form of negative for a
22 homeowner, another hit on the homeowner, and
23 we're working very, very conscientiously to
24 avoid any scenario where a property tax
92
1 increase would be necessary.
2 Anything that would artificially limit
3 our ability to put together resources would
4 undermine all of our efforts, whether it be
5 at public safety, affordable housing,
6 education, etc, which are necessary for the
7 city's future.
8 And I would argue -- again, with real
9 respect -- that that tradeoff is an unfair
10 tradeoff on its face, because the state has
11 an obligation to cover these Medicaid
12 expenses. And we're certainly going to
13 remind people the city has that obligation
14 and should consistently hold to that
15 obligation.
16 Anything -- look, when this proposal
17 first came out -- and again, I want to
18 emphasize the Governor quickly said it would
19 not cost the city a penny, and I appreciate
20 that deeply. But when it came out, what was
21 so interesting was it was criticized by many
22 members of the Senate and Assembly, it was
23 criticized by CUNY students, it was
24 criticized by people in the healthcare field,
93
1 it was criticized by the Citizens Budget
2 Commission and the Manhattan Institute. Now,
3 you don't usually see that particular
4 coalition. But everyone had the same
5 message: That would be the state supplanting
6 its obligations and putting them on the City
7 of New York.
8 And the City of New York, in the
9 end -- again, we do not have a safety net, we
10 have to take care of our own -- no matter
11 what happens levels of government above us,
12 no matter what happens in the global economy,
13 we have to take care of our own people.
14 So I would not agree that that's a
15 fair deal for New York City.
16 SENATOR AVELLA: Well, with all due
17 respect, I'm going to disagree, and I think
18 Senator Young sort of outlined the situation
19 by which the cap was imposed on other
20 municipalities upstate. In return, the state
21 assumed the Medicaid funding. So I think if
22 -- we should apply the same logic to New York
23 City.
24 And, Mr. Mayor, you know, I represent
94
1 a middle-class district. And if we don't
2 help the middle class of this city, we're
3 going to have an exodus like we had years
4 ago. And as property values go up, even
5 though the tax rate is not going up, their
6 assessments are going up dramatically. I
7 heard from a couple of people who got their
8 tax bill just the other day, and they're
9 talking $800 and $900 for a one-family home.
10 For a lot of seniors, they cannot afford
11 that.
12 And if you had the 2 percent cap as
13 the rest of the state does, you'd be eligible
14 for a lot of the state relief programs for
15 homeowners.
16 And I would just add -- and I'll
17 finish with this, because we can obviously
18 follow this up later. But I believe at the
19 end of your statement you said we're all New
20 Yorkers. And I think it's unfair that New
21 York City homeowners, property owners, don't
22 benefit from the same property tax cap that
23 everybody else in the state does.
24 MAYOR DE BLASIO: Senator -- Senator,
95
1 you yourself pay city income tax and you know
2 that that is not the norm in the rest of the
3 state. So I would urge you to recognize the
4 fact that we have a set of challenges in our
5 city that are different, a set of needs that
6 are different. You know that we cover a lot
7 of things in the city ourselves that are very
8 costly and very challenging. And that in
9 fact the notion -- I just can't agree with
10 you on any notion of an exodus of the middle
11 class when in fact we're seeing the opposite
12 phenomenon: The city is gentrifying. And
13 that comes with some good elements and some
14 really problematic elements. Property values
15 are increasing intensely. There's no flight
16 of the middle class in New York City. We're
17 dealing with, in fact, the reverse
18 phenomenon, trying to figure out how best to
19 navigate it.
20 But I'll tell you one thing, what
21 would start to threaten the existence of the
22 middle class in New York City is if we did
23 not invest in public safety, if we did not
24 invest in a better education system.
96
1 Everyone knows we have sustained public
2 safety gains, but that will only continue if
3 we make the right investments protecting both
4 our communities and our officers. Everyone
5 knows our school system is still not where it
6 needs to be for the 21st-century economy, we
7 must make those investments. Our
8 infrastructure, I'm sure you would agree, is
9 far beyond where it needs to be for a major
10 global economic capital. We're far, far
11 behind some of our competitors that made
12 massive infrastructure investments because
13 their federal governments, their national
14 governments believe in that as a priority.
15 Ours doesn't. So we end up having to do it.
16 So I just have to remind you that if
17 we don't have the resources to protect the
18 quality of life in our city, the safety of
19 our city, the infrastructure of our city,
20 that's what will actually threaten the middle
21 class.
22 SENATOR AVELLA: Well, Mr. Mayor,
23 again, I'm not going to debate you on this.
24 I would disagree -- all those things you
97
1 mentioned, of course we want to do that. But
2 as you well know, balancing the budget is
3 taking issues and rectifying what are the
4 needs. And I would just think that -- and
5 again, I disagree with you because I hear
6 from people in my district every day that
7 they're going to leave the City of New York
8 because of the taxes, and the property tax is
9 one of them.
10 Thank you, Mr. Mayor.
11 CHAIRMAN FARRELL: Thank you.
12 Senator?
13 ASSEMBLYMAN OAKS: We've been joined
14 by Assemblyman Walter.
15 CHAIRMAN FARRELL: Assemblyman
16 Brennan.
17 ASSEMBLYMAN BRENNAN: Good morning,
18 Mr. Mayor.
19 MAYOR DE BLASIO: Good morning.
20 ASSEMBLYMAN BRENNAN: You identified
21 as a concern the proposal by the Governor
22 that the city be required to pick up 30
23 percent of the CUNY senior college budget,
24 and you indicated you had learned that the
98
1 Governor was clarifying this proposal to
2 assure that reforms and efficiencies would
3 achieve those savings, and therefore there
4 wouldn't be imposed this burden on the city
5 government.
6 Can you imagine how reforms and
7 efficiencies could cover 30 percent of the
8 budget of the City University?
9 MAYOR DE BLASIO: Let me separate two
10 points within this, if I may.
11 The Governor put forward the proposal,
12 and then the Governor clarified the proposal.
13 So obviously I would urge the Legislature to
14 get clarity from the Governor on how he
15 intends to proceed.
16 In terms of the question of looking
17 for reforms and efficiencies, we think that's
18 a smart thing to do in government. And we
19 look forward to sitting down, hopefully as
20 early as next week, city and state officials,
21 to talk about these two areas, Medicaid and
22 CUNY, and see if there are some available
23 options. But that process has not begun, so
24 I can't tell you at this moment what it will
99
1 yield on what kind of timeline. We take the
2 Governor at his word on the statement that
3 for this budget, it will not cost the city a
4 penny, and that's what I think we should all
5 hold to and hold him to.
6 But those conversations on the details
7 have not begun.
8 ASSEMBLYMAN BRENNAN: I guess also, by
9 the same token, forcing the city government
10 to once again cover the full increased cost
11 of the Medicaid program, which you indicated
12 would cost a billion dollars a year by 2021,
13 approximately -- you know, given the fact
14 that, you know, the Medicaid managed care
15 system now underpays our hospitals, both HHC
16 and the voluntaries, by very substantial
17 amounts, does not cover their cost of care, I
18 think it would be very dangerous to force the
19 city to find another billion dollars worth of
20 savings in the Medicaid program just inside
21 the City of New York itself.
22 MAYOR DE BLASIO: I think there's
23 again two areas here that collide: In
24 effect, the proposed cuts, which again we
100
1 look forward to being handled in a way that
2 does not affect the city directly, and the
3 challenge we're having with Health and
4 Hospitals. Which absolutely, as you say, is
5 related to a series of policy changes, some
6 that are part of the Affordable Care Act --
7 which is I think a fundamental step forward
8 for this country, was the Affordable Care
9 Act. But there were some elements of it that
10 had, I think, unintended consequences for our
11 public health systems. Some of the Medicaid
12 reform that the state achieved -- again, in
13 many ways a very good policy -- had some real
14 unintended consequences for our public health
15 system.
16 We're seeing a number of factors
17 collide. They're making the economics of
18 public health systems not only here, but all
19 over the state and all over the country, less
20 and less viable. So we're going to have to
21 come up with some different solutions,
22 because a huge number of our citizens rely on
23 those public hospitals.
24 ASSEMBLYMAN BRENNAN: Thank you. I
101
1 just also wanted to mention that I share your
2 view that the state should restore the AIM
3 funding to the City of New York, once known
4 as revenue sharing. Just as an aside, New
5 York City's revenue sharing from the state in
6 1990 was $500 million. And it was Governor
7 Spitzer who actually started trying to cut
8 revenue sharing. We had restored about half
9 of it when the recession hit, and that's how
10 the remainder got wiped out.
11 MAYOR DE BLASIO: Thank you.
12 CHAIRMAN FARRELL: Thank you.
13 Senator?
14 CHAIRWOMAN YOUNG: Thank you,
15 Assemblyman.
16 Next it would be Senator Kathy
17 Marchione.
18 SENATOR MARCHIONE: Thank you, Madam
19 Chair.
20 Thank you, Mayor, for being here.
21 MAYOR DE BLASIO: Thank you, Senator.
22 SENATOR MARCHIONE: I serve as the
23 chairman for Local Government for the Senate.
24 And I hear it all the time, how we're one
102
1 state, we need to be one state. I watch the
2 remainder of the state outside of New York
3 City struggling, coming in and appearing
4 before Local Government about how difficult
5 it is to live within the 2 percent tax cap --
6 which isn't even 2 percent. This year it's
7 much less.
8 But I listened to you tell me that we
9 are one state, but I see your spending at 6
10 percent. I have difficulties stating at one
11 point that we're one state and then in the
12 next mouthful saying it's okay because I have
13 needs. Every single municipality that has
14 come before us has a unique set of
15 circumstances that requires them to do the
16 best they can for their residents, but
17 they're doing their best to live under the 2
18 percent tax cap.
19 I wonder, and I'm asking your opinion,
20 if the Executive didn't actually require you
21 to pay a portion of your Medicaid -- even
22 though I know you're saving like $145
23 million, because it's only 2 percent this
24 year -- because you're not adhering to a 2
103
1 percent tax cap that we self-impose and that
2 we have imposed upon every other municipality
3 and government in New York State except for
4 New York City.
5 MAYOR DE BLASIO: Well, again,
6 Senator, I appreciate the point. And I think
7 everyone is struggling in different ways.
8 SENATOR MARCHIONE: They are.
9 MAYOR DE BLASIO: And I don't --
10 again, I would never for a moment belittle
11 the challenges being faced by municipalities
12 all over the state.
13 We have an unusual reality because we
14 have an income tax. So that means for the
15 average taxpayer, they are paying both a city
16 property tax and a city income tax, and
17 probably it would be healthy for all of us to
18 look at the overall impact, what that means,
19 and to compare across localities.
20 But I think the bigger point here is
21 we have a host of challenges that I think are
22 particularly large and complicated in our
23 city -- again, that aging infrastructure. I
24 know it's a problem all over the state. Ours
104
1 is just extraordinary in its size. For
2 example, bridges over a hundred years old in
3 the City of New York, I believe there's 160
4 such bridges. So we just have the sheer
5 weight of so many years of expenses that were
6 deferred.
7 I mentioned our public housing
8 authority, home for 400,000 people. That
9 public housing authority alone has a
10 $17 billion unmet capital need level.
11 So I'm not trying to, if you will,
12 compare scars. Everyone's got problems and
13 challenges. What I would say is that our
14 taxpayers -- and it's a long-standing
15 tradition -- pay two types of taxes. Our
16 challenges are particular and in many ways
17 growing. Some of the new obligations we're
18 being hit with are different than what's
19 happening in some other places. We're also
20 trying to be honest about the fact that --
21 and we say this almost in a spirit of
22 collegiality -- we know when trouble hits,
23 and it will, we can't come up here and
24 pretend to say to you, as the state is
105
1 dealing its own problems and other
2 municipalities are dealing with theirs, we're
3 not going to be able to say to you: Bail us
4 out. We're going to have to do that, to the
5 maximum extent possible, ourselves.
6 So that's why we consider ourselves,
7 in a sense, to have to meet our own
8 obligations in times of trouble, that's one
9 reason why a cap would be counterproductive.
10 But I think the point that Dean
11 Fuleihan made earlier, and I say this in a
12 positive vein, because we're all
13 interconnected -- if we're paying upwards of
14 60 percent of the revenue that goes into
15 state coffers, I don't begrudge that, I think
16 that is something it's my obligation to keep
17 doing, in the sense of having a strong
18 economy that creates jobs, that grows, that
19 creates more revenue for all. I'm trying to
20 do the things that will allow that to happen.
21 And what I hear from business leaders
22 all the time, number-one concern, public
23 safety, where we're continuing to invest;
24 second concern, education; third concern,
106
1 affordable housing. We get those pieces
2 right, we will continue to build the New York
3 City economy for the good of the whole state.
4 As I said, we're on our way, I think quite
5 soon in the scheme of things, to a
6 9-million-person population, which is also
7 going to create a whole series of strains,
8 but with many benefits for the entire
9 metropolitan area and the entire state.
10 That's my argument about why I think
11 we should avoid a strategy that actually
12 could limit that growth and undermine our
13 ability to handle the downturns when they do
14 come.
15 SENATOR MARCHIONE: Thank you. And I
16 appreciate what you're saying, and I do agree
17 that New York City is critically important to
18 all of us in New York State. And I
19 understand that you have a different set of
20 circumstances. I myself come from a district
21 this week, last week that a water line broke,
22 it was a main line, it was 110 years old.
23 The size and the magnitude of what you have
24 is different, but the problems are pretty
107
1 much the same.
2 MAYOR DE BLASIO: Exactly. I agree
3 with that.
4 SENATOR MARCHIONE: And they're living
5 under a 2 percent tax cap.
6 So I understand what you're saying,
7 but the rest of us are doing our very best to
8 make sure we can save billions of dollars for
9 people who live here in New York State. And
10 I believe that New York City, although
11 larger, although having your unique set of
12 circumstances, if we're one state, then we're
13 one state, and we should be under the same
14 guidelines to save our taxpayers' dollars.
15 My next question came from something
16 you said about rent control, that we need to
17 have more rent control, a one-bedroom
18 apartment is $3100 and the state is providing
19 $1500. When you increase your budget by
20 6 percent, aren't those additional monies
21 being passed on to your taxpayers so that,
22 although we want more rent control paid for
23 by the state, when you're adding to your tax
24 burden then you are adding to the amount that
108
1 those owners of those properties have to
2 charge to pay the additional tax? Am I
3 missing something here?
4 MAYOR DE BLASIO: Well, I would just
5 say I think there's a couple of additional
6 pieces to the puzzle. First of all, a lot of
7 that growth over the last few years is a
8 result of Hurricane Sandy, and that's very
9 specific. Remember, our representatives in
10 Washington fought very hard for the kind of
11 relief that New York City, New York State,
12 and New Jersey deserved as a result of Sandy,
13 the kind of relief that other areas of the
14 country had gotten when they experienced such
15 disasters.
16 There's no question Sandy was the
17 biggest natural disaster in the history of
18 New York City. Massive amount of damage
19 caused. So when those resources came in from
20 FEMA, came in from HUD, they went into our
21 city budget, they positively inflated our
22 city budget. They will be spent on
23 resiliency efforts and recovery efforts, and
24 then that will be gone from the budget. So
109
1 again, that budget will contract when this
2 immediate cycle of federal funding is over.
3 The other fact, again, major new
4 obligations -- which for us are very
5 striking, the fact that we had a one-two
6 punch of the actuary change and the specific
7 needs of our Health and Hospitals Corporation
8 that meant a billion-dollar additional charge
9 in this fiscal year alone. These situations
10 I think are specific challenges -- again, I
11 agree with you a hundred percent, every place
12 has a challenge, each one is different.
13 These are some of ours, both the negative of
14 the billion dollars that we were suddenly hit
15 with, the positive of the federal aid, but
16 knowing that that federal aid will then be
17 used and no longer appear in the budget. So
18 that I think modifies a little bit some of
19 the points that you're making.
20 But look, overall, we're simply trying
21 to put the pieces together in a way that is
22 sustainable for this city and for the good of
23 our city economy. I think we'd both agree if
24 we failed to take the right steps and New
110
1 York City started to falter, everyone would
2 be hurt by that. And that's what happened in
3 the '60s and '70s. Let's face it, we saw it
4 with our own eyes: Government made the wrong
5 choices, government was not fiscally
6 disciplined, did not put reserves in place --
7 when the bad times came, there was nothing to
8 fall back on -- and didn't make the kind of
9 investments that kept the city economically
10 viable.
11 We're trying to learn, unfortunately,
12 the lessons of the past and make the
13 adjustments that will allow us to be strong
14 for the good of all going forward. So that's
15 our core strategy. And it is a
16 different approach. Every place has to
17 tailor the approach to their own needs. This
18 is the one that we think is working. And I
19 hope we can all agree that some of these
20 numbers are really encouraging for all of us.
21 We've got 213,000 new jobs in New York
22 City -- that's a blessing for this whole
23 state. And it's our job to keep that going.
24 SENATOR MARCHIONE: Thank you, Mayor.
111
1 And I think I just want to end on this point,
2 to say that you're not on your own as you've
3 been saying you're on your own. Not one of
4 us sitting up here are on our own. When you
5 had problems with Hurricane Sandy, the state
6 came in, the federal government came in.
7 When I had problems with my water line, I
8 went to the Governor's office to ask for some
9 assistance. We're not on our own. We're one
10 state. And when we're in need, as -- I
11 believe you've got a lot of money in the
12 budget this year, going into transportation,
13 to fix major, important things in the state
14 budget. We're not on our own.
15 MAYOR DE BLASIO: Senator, if I may, I
16 appreciate -- and I agree with you there are
17 certainly areas where there's been
18 extraordinary commonality. This recent storm
19 is a great example. Tremendously good
20 coordination between the city and the state,
21 the MTA, et cetera, and everyone working in
22 common cause.
23 I would differentiate in an economic
24 downturn, I really would, and I say this with
112
1 absolute respect for your point. I think
2 Sandy and other natural disasters are one
3 type of category -- and you'll remember that
4 the federal government was rather slow to
5 respond in terms of the financial support,
6 and it took a real fight in Washington to get
7 there, different than it would have been 10
8 or 20 years ago. So I think there was a lot
9 of concern about whether the standards were
10 changing in terms of federal obligation in a
11 disaster.
12 But what I was referring to is in an
13 economic downturn where the revenues of the
14 state will be deeply affected, the revenues
15 of the federal government will be affected.
16 When I say we're on our own, it's an
17 acknowledgment of the fact that everyone will
18 be hurting and we won't be in a position to
19 ask for additional help. Even if we're
20 hurting, even if we're cutting vital
21 services, we know we can't turn to people who
22 already have had their own revenue cut to ask
23 for help. That's where we believe the
24 prudent thing to do is to save for that rainy
113
1 day. That's the way we look at it.
2 SENATOR MARCHIONE: And those in
3 upstate New York, we are in a downturn
4 economically. We're not as vibrant as you
5 are in New York City. And even though they
6 are in an economic downturn, they're still
7 staying within the 2 percent tax cap.
8 They're doing the very, very best that they
9 can.
10 My last question, I've listened to you
11 talk about police protection, and I guess I'm
12 looking for an update on where police
13 relations stand in the city, specifically do
14 the courageous men and women of law
15 enforcement have the support, financially,
16 materially, personnel, personally, they need
17 to continue doing the important jobs that
18 they do?
19 MAYOR DE BLASIO: Thank you for the
20 question. Absolutely.
21 First of all, I'm very proud to say I
22 gave them the finest police leader in the
23 United States of America in Bill Bratton. He
24 and his leadership team have done an
114
1 extraordinary job. Two years running now, we
2 have driven down major crime across the seven
3 major crime categories. We have a 5.8
4 percent decrease in crime over two years.
5 We are adding resources for the latest
6 police vests for every one of our officers to
7 protect them. We're adding resources for
8 technology, like the shot protection system
9 that's in our current city budget, so that
10 our officers have immediate alerts when a
11 shot is fired in key areas of the city -- and
12 it also helps them tremendously in the
13 investigation efforts.
14 We're adding resources so that every
15 single one of our officers has the most
16 up-to-date technology so they can get, for
17 example, a suspect description and even a
18 photo or a sketch of a suspect in their hand
19 on an iPhone instantly. Something that
20 wasn't true just a year ago now is becoming
21 common for every single officer. That's
22 going to greatly intensify their ability to
23 protect both communities and themselves when
24 they have that kind of information.
115
1 The most training our officers have
2 ever received, including tactical training
3 that helps to keep them safe, every single
4 member of our force being trained.
5 A 500-plus-person critical response
6 command. I'm very proud of this change we
7 made in June. It is an anti-terror unit, a
8 stand-alone, dedicated anti-terror unit, well
9 armed, well trained, that we can use --
10 obviously, given that we are, sadly, one of
11 the number-one global terror targets. This
12 unit used to be drawn off -- a similar unit
13 was drawn off of individual police precincts
14 on a temporary basis. We're now going to
15 have 500-plus officers who do only
16 anti-terror operations. We think that's
17 going to help them be ever more effective at
18 preventing terror in the city.
19 An overall increase of 2,000 officers
20 on patrol strength -- again, the first
21 increase since 2001 to help us sustain our
22 safety. And obviously I think police
23 officers would be the first to say one of the
24 best ways to keep them safe is to add to the
116
1 ranks and give them the backup they deserve,
2 and we're doing that.
3 SENATOR MARCHIONE: Thank you very
4 much.
5 MAYOR DE BLASIO: Thank you.
6 SENATOR MARCHIONE: Thank you for your
7 answers.
8 CHAIRMAN FARRELL: Thank you.
9 Assemblywoman Malliotakis.
10 ASSEMBLYWOMAN MALLIOTAKIS: Thank you,
11 Mr. Mayor, and thank you to your staff for
12 keeping me informed during the snowstorm. We
13 appreciate the open communication.
14 I just wanted to talk also about this
15 property tax cap. Last year we supported
16 rent-control legislation for the City of New
17 York as well as we saw the Rent Control
18 Board, of which you appoint all nine members,
19 implement a rent freeze. We really don't see
20 the same type of empathy for the property
21 taxpayers in the City of New York. Or, aside
22 from property taxes, we could even say like a
23 water bill freeze, which puts many landlords
24 in a jam here if you're going to freeze the
117
1 rents.
2 But my homeowners I think are in a
3 situation now where if this budget goes
4 through as is, we're going to see them be
5 doubly hit; one, because their property taxes
6 will not be capped, and two, then they also
7 have to take on the burden of the $650
8 million over the next three years for
9 Medicaid.
10 So I'm very disappointed that you
11 don't support the cap. I'll continue to
12 advocate that with my colleagues. But I hope
13 you really reconsider, because I think that
14 the property taxpayers in the City of New
15 York deserve the same type of relief that
16 you've put forth for the rent payers in the
17 city.
18 MAYOR DE BLASIO: Well,
19 Assemblymember, may I speak to that?
20 ASSEMBLYWOMAN MALLIOTAKIS: Sure.
21 MAYOR DE BLASIO: First of all, I want
22 to emphasize with the Rent Guidelines Board,
23 the charge that I've given them is to look at
24 the real expenses each year and to adjust the
118
1 increases in rent according to the real
2 expenses that landlords have. You will
3 remember that the first year was one number,
4 the second year was a different number.
5 Every year you're going to see a different
6 number according to the facts.
7 Now, one thing that did change in the
8 last couple of years, it's well known, is the
9 price of fuel went way down. In the past,
10 honestly, when such a change occurred in
11 favor of the landlord's bottom line, it was
12 not necessarily reflected in the rent
13 increase of tenants. In fact, the rent
14 increase of tenants stayed fairly substantial
15 regardless of whether the cost for landlords
16 went up or down.
17 We have a different view. We believe
18 it should be a very clear process to reflect
19 what those costs are. When costs of
20 landlords go down, tenants should have that
21 savings reflected in their rent situation.
22 When it goes up, we should also pass that
23 along --
24 ASSEMBLYWOMAN MALLIOTAKIS: But the
119
1 water bills and the property taxes have
2 continued to rise.
3 But more specifically, instead of the
4 landlords, I want to focus on my
5 constituents, who are the homeowners and
6 residential homeowners on Staten Island and
7 Bay Ridge, Brooklyn.
8 I also just -- maybe you can answer
9 this question, because no one seems to be
10 able to give me a straight answer of why
11 those individuals who paid their property
12 taxes in full last year were hit with a
13 notice in September saying that they owed
14 more money.
15 MAYOR DE BLASIO: Could you be
16 specific about that?
17 ASSEMBLYWOMAN MALLIOTAKIS: Okay. So
18 for instance, I'm a property owner and I paid
19 my taxes in full, and then in September I
20 received a notice saying, oh, by the way, you
21 owe another hundred or $200 -- I think it was
22 a percentage, a point -- I'm not sure of the
23 exact percentage that increased. But I found
24 that to be very odd, that someone who had
120
1 paid their property taxes in full received
2 another a bill later on saying that they owed
3 more money. And then I found out that many
4 other constituents in my community were hit
5 with the same type of notice.
6 MAYOR DE BLASIO: I'll get a
7 clarification to you. Again, as I said,
8 we're adamant about not increasing the rate.
9 We know a number of people's assessment has
10 gone up and that's affected them. But I'll
11 get back to you on the specific point you're
12 raising.
13 I just want to make one other point on
14 your previous point on the water bills. One
15 of the things I talked about when I was
16 public advocate was ending the practice of
17 the city using water bills as a general
18 revenue source. We've incrementally moved on
19 that, and we're going to be at a point soon
20 when we end that practice entirely. And from
21 that point on, the water bill will only
22 reflect the costs of maintaining the water
23 system.
24 Now, I do want to emphasize, Lord
121
1 knows there's nothing more important than
2 water to human life, and our system is
3 extraordinary and it has been -- it's one of
4 the great virtues of New York City is having
5 such a great water system. It is costly to
6 maintain. But what I feel adamantly, and I'm
7 a homeowner too, is that we should only pay
8 for a water bill for water and nothing else.
9 So we're making those adjustments rapidly.
10 Second, we've added in protections for
11 senior citizens, low-income homeowners to try
12 to lessen the impact of water bill increases
13 on them, and those are available to
14 constituents. So I want you to be aware of
15 that.
16 ASSEMBLYWOMAN MALLIOTAKIS: Okay, I
17 appreciate that. Because I remember when you
18 were the public advocate and you called for
19 water bills to be frozen. And now that
20 you're mayor, it seems that there's been a
21 charge of heart.
22 So I appreciate that, and I look
23 forward to working with you on that front.
24 Regarding the $337 million for the
122
1 HHC, I want to also add my voice to that of
2 Assemblyman Cusick, who said that we would
3 really like Staten Island to be considered.
4 You mentioned in your remarks, you used the
5 term "fair and proportional." Staten Island
6 would like to receive their funds fair and
7 proportionally as well when it comes to the
8 HHC, because there are 11 public hospitals
9 throughout the City of New York, and none of
10 them are in the borough of Staten Island.
11 And so not that we are advocating for
12 a public hospital, but we would like to have
13 our proportional funds supporting those two
14 hospitals that we do have and are certainly
15 at capacity. So we appreciate if you would
16 consider that.
17 MAYOR DE BLASIO: Yes.
18 ASSEMBLYWOMAN MALLIOTAKIS: Also, with
19 regard to the city putting forth an $868
20 million capital plan to add 11,800 seats in
21 schools throughout the city, I can't stress
22 to you enough how the schools in my district,
23 as I'm sure many others' here, are at
24 capacity, whether it's 100 percent over
123
1 capacity, 150 percent over capacity.
2 One school in particular, PS 13 in my
3 district in Rosebank, which I share with
4 Senator Savino, they have been advocating for
5 a K-8. With the new development of Mount
6 Manresa and your affordable housing plan to
7 add 200,000 affordable housing units, we
8 really need to address this issue of
9 overcapacity, and we hope you'll be looking
10 at those schools in my district.
11 And I'd like to talk to you further
12 another time about the particular issues that
13 we have in Staten Island and Bay Ridge.
14 MAYOR DE BLASIO: Absolutely. I look
15 forward to that.
16 And I would say, you know, as you
17 indicate, in the capital budget we have
18 announced an additional 11,800 seats,
19 bringing us to a grand total of 44,000, I
20 believe it is, for this capital plan. There
21 will be more in the next capital plan, which
22 is after fiscal 2020.
23 We have a profound problem with
24 overcrowding. This number we've reached by
124
1 adding the 11,800 is the number we believe
2 not only that we can afford but that is
3 physically reachable in the time frame of the
4 next three years of the capital plan. So our
5 charge to the School Construction Authority
6 was to tell us what was the maximum you could
7 actually build, practically, in that time
8 frame, and this is what they've come back
9 with.
10 No surprise to you that as this city
11 continues growing, finding the space and
12 putting together the lots for a new school
13 and construction of a new school is more
14 difficult all the time. We're committed to
15 the numbers and the ones after, but this is
16 what we think is the outer limit for the next
17 few years.
18 ASSEMBLYWOMAN MALLIOTAKIS: Okay.
19 With some of the parochial schools closing, I
20 think we may have opportunities on
21 Staten Island to expand, so I would like to
22 speak with you at a later time.
23 MAYOR DE BLASIO: Absolutely. We're
24 very -- and we have a running dialog with the
125
1 Archdiocese and also with the Diocese of
2 Brooklyn and Queens that we have an interest
3 in any and all properties that come online,
4 whether for schools or other uses.
5 ASSEMBLYWOMAN MALLIOTAKIS: Great.
6 Great.
7 With regards to the 41,000 units that
8 you have achieved in affordable housing and
9 the 200,000 that you have planned for, how
10 much of that is senior housing? We have a
11 terrible crisis in my community of a
12 tremendous amount of seniors without housing
13 that's affordable for them. Can you give me
14 any specifics?
15 MAYOR DE BLASIO: The overall plan
16 calls for a minimum of 10,000 units of senior
17 housing. Now, obviously some of the housing
18 that is being created that will not be
19 phrased as "senior housing" will still go to
20 the seniors. But the minimum that we're
21 allotting specifically to reach seniors is
22 10,000, and we're looking for ways to add
23 upon that.
24 ASSEMBLYWOMAN MALLIOTAKIS: Ten
126
1 thousand out of the 200,000?
2 MAYOR DE BLASIO: Correct.
3 ASSEMBLYWOMAN MALLIOTAKIS: That seems
4 like a very low number. But also what about
5 out of the 41,000 that has already been
6 achieved?
7 MAYOR DE BLASIO: Again?
8 ASSEMBLYWOMAN MALLIOTAKIS: The 41,000
9 that has already been achieved, is that
10 included in the 200,000 or is that separate?
11 MAYOR DE BLASIO: Yes, the 41,000 out
12 of the 200,000.
13 ASSEMBLYWOMAN MALLIOTAKIS: Okay.
14 Well, I hope, you know, if we could look more
15 at the senior population here, especially --
16 I happen to represent one of the largest
17 populations of senior citizens in my
18 district, and so I think that this is
19 something that has come to me time and again
20 out in the community.
21 I have one last question regarding
22 Hurricane Sandy and the Build It Back
23 program. Are we still on schedule to
24 complete the Build It Back construction by
127
1 the end of this year?
2 MAYOR DE BLASIO: Yes. I asked this
3 question of Amy Peterson, who's the director
4 of that program and I think has done an
5 outstanding job, I ask her every few weeks.
6 We are adamant, for the single-family
7 homes -- we know for some of the
8 multi-families it's a little more
9 complicated -- for the single-family homes,
10 by December 31st of this year.
11 ASSEMBLYWOMAN MALLIOTAKIS: I've also
12 been speaking with Amy Peterson, and I agree
13 that she has been very responsive to my
14 office and has taken our recommendations into
15 consideration, has helped us accomplish some
16 of these goals.
17 With regards to the abandoned
18 properties on Staten Island, myself and
19 Senator Lanza and our councilman, Steve
20 Matteo, we have written to you and Amy
21 Peterson regarding having the city purchase
22 for acquisition for redevelopment those homes
23 that have been abandoned during Hurricane
24 Sandy. I understand that there's a favorable
128
1 outcome. I just wanted to -- if you could
2 share the details.
3 MAYOR DE BLASIO: For this question --
4 I appreciate very much the question and
5 appreciate that you and your colleagues have
6 really pushed us to look at this as another
7 good option. I would like to call in a
8 relief pitcher for this question and turn to
9 Sherif Soliman.
10 DIRECTOR SOLIMAN: We are interested
11 in finding a way to use this HUD funding, and
12 we hope to start developing the pilot this
13 February. And so we'll be in touch with you
14 and your colleagues on that.
15 ASSEMBLYWOMAN MALLIOTAKIS: Okay,
16 excellent.
17 The last question, because I ran out
18 of time, is do you anticipate -- because
19 we've received some constituents in my office
20 that would like to --
21 MAYOR DE BLASIO: I'm sorry, say
22 again?
23 ASSEMBLYWOMAN MALLIOTAKIS: We
24 received some constituents over the last few
129
1 years that have missed the Build It Back
2 deadline and would like to be in the program.
3 Do you anticipate opening up the program
4 again for applicants should you have money
5 left over?
6 MAYOR DE BLASIO: I do not anticipate
7 that. We don't see a scenario at this moment
8 where there will be money left over. But
9 most importantly, we've set this deadline
10 after a very extensive process to -- many
11 opportunities were given to people to
12 participate. A lot of people chose not to.
13 Some people who thought they were eligible
14 were not. But we feel fundamentally the door
15 was open for a long time. It's time to put
16 Sandy behind us, get this job done and move
17 on.
18 ASSEMBLYWOMAN MALLIOTAKIS: Okay. And
19 please let my office know how we can be
20 helpful in achieving this goal, making sure
21 we do finish, indeed, the construction by the
22 end of the year. Thank you.
23 MAYOR DE BLASIO: Thank you very much.
24 CHAIRMAN FARRELL: Thank you.
130
1 Senator?
2 CHAIRWOMAN YOUNG: Thank you very
3 much. Our next speaker would be Senator
4 Ruben Diaz.
5 SENATOR DIAZ: Thank you. Thank you.
6 Good morning, good morning --
7 MAYOR DE BLASIO: Good morning.
8 SENATOR DIAZ: Good afternoon,
9 Mr. Mayor.
10 MAYOR DE BLASIO: Good afternoon,
11 whatever it is.
12 SENATOR DIAZ: Mr. Mayor, yesterday I
13 wrote in my column, "What You Should Know,"
14 and I gave you praise.
15 MAYOR DE BLASIO: I saw that, Senator.
16 I was very appreciative. We monitor your
17 statements closely, Senator.
18 SENATOR DIAZ: Yeah, but today we're
19 going to change. Today we're changing.
20 (Laughter.)
21 MAYOR DE BLASIO: Senator, it was fun
22 while it lasted.
23 SENATOR DIAZ: Today we go back to
24 normal.
131
1 MAYOR DE BLASIO: It was fun while it
2 was lasted.
3 SENATOR DIAZ: Okay. I want to talk
4 about the homeless situation with the City of
5 New York. We have 40,000 families who are in
6 shelters. There are community-based
7 organizations sponsoring these programs, some
8 of them, and they're {inaudible}. So
9 Mr. Scott Stringer, the comptroller of the
10 City of New York, has decided to stop payment
11 and not to sign the contracts. That has
12 forced some organizations to borrow money,
13 community-based organizations to borrow money
14 from the banks to pay interest that the city
15 will not pay them, they will not reimburse
16 them.
17 And also families that need services
18 are being -- are paying the price and are
19 being discriminated. I think that what
20 Comptroller Stringer is doing is very
21 damaging to the families and to the
22 community-based organizations. Because if a
23 landlord has some kind of violation, they
24 hold the landlord's money but the community
132
1 organization continues providing the good
2 services.
3 My question to you, how come -- why
4 have you not sued Scott Stringer, the
5 New York City comptroller, to compel him to
6 register the contracts as the law requires?
7 MAYOR DE BLASIO: Well, Senator, the
8 goal always in government is to see if we can
9 work things out. And we're in the process of
10 we think productive conversations with the
11 comptroller on that issue. And right now we
12 are not being hindered from doing the work we
13 have to do or making sure that providers who
14 are doing their job get the resources they
15 need.
16 Look, at the same time we have a lot
17 we have to address in terms of the
18 homelessness crisis. We look forward to
19 working, for example, with the state
20 comptroller, Tom DiNapoli, and with
21 Comptroller Stringer, auditing the shelters,
22 together making sure the repairs happen that
23 are needed. We're doing a host of reforms in
24 terms of homelessness -- our new HomeStat
133
1 outreach effort, obviously the 15,000 units
2 of supportive housing that we've committed
3 to. We're very, very happy the Governor has
4 committed to additional units. What we're
5 doing all the time to prevent homelessness in
6 the first instance, which has been more and
7 more successful. And the 22,000 people who
8 were in shelter who we got out of shelter and
9 got to better housing. We're going to deepen
10 all those efforts.
11 When it comes to the question with the
12 city comptroller, we think we're moving
13 productively to resolve that issue and to
14 make sure that the providers who are doing
15 their work the right way do continue to get
16 the resources they need.
17 SENATOR DIAZ: Because I'm afraid that
18 now with the new power that the Governor gave
19 to the comptroller, the families are going to
20 continue suffering. We have to protect the
21 families.
22 MAYOR DE BLASIO: Of course.
23 SENATOR DIAZ: We have to be sure that
24 those people in the shelters get the right
134
1 services, good services.
2 Even though, even though -- I'm going
3 to repeat myself again -- some landlords
4 might have some violations, hold the
5 landlords money but don't punish the
6 community-based organizations and the
7 recipients.
8 MAYOR DE BLASIO: Well, Senator, what
9 I'd say is, first of all, the way the
10 Governor structured his policy, it is an
11 audit process led by the state comptroller.
12 And I've talked to the Governor about this
13 and I've talked to the state comptroller
14 about it. It is led statewide by the state
15 comptroller working with the local
16 comptroller in New York City and in Buffalo.
17 They are not controlling the shelters. The
18 shelters continue to be operated by our
19 nonprofit partners or in some cases by the
20 city directly. That will continue. The
21 audit will provide us information about
22 things that need to be improved.
23 So we continue to have the same
24 oversight of shelters we've had, the same
135
1 operations we've had. I agree with you
2 entirely, if we find a shelter with a problem
3 we're not going to penalize the people who
4 are being sheltered. We're going to make
5 sure that shelter continues to be fixed.
6 And I agree with the formulation the
7 Governor put forward in the State of the
8 State: If we find a shelter operator who
9 needs to do better, we'll make sure they do
10 better. If we find one that just isn't up to
11 it and we can replace them with another good
12 operator, we'll do that. In a very small
13 number of cases I think we're going to find a
14 few shelters that need to be closed wholesale
15 and we'll use a different location.
16 But most importantly, we're not going
17 to penalize the people who are already
18 suffering. We're going to make sure --
19 SENATOR DIAZ: That's what we're doing
20 now. That's what we are --
21 MAYOR DE BLASIO: And there's nothing
22 -- there's nothing -- just to clarify,
23 there's nothing in what the Governor has said
24 or that either comptroller has said or done
136
1 that stops us from continuing to make sure
2 that the shelters operate and that providers
3 get the resources they need.
4 SENATOR DIAZ: I appreciate you agree
5 with me on that, because I believe that
6 that's what the comptroller is doing, he's
7 punishing, he's penalizing the wrong people.
8 And that sounds like discrimination to me.
9 But let me ask you one more question
10 and then I'll finish, because we have to make
11 a long line here to get our 15 minutes of
12 fame. So let me get another question. How
13 come we have so big discrepancies in payment?
14 Some homeless organizations are getting --
15 for doing the same kind of work, some are
16 getting paid at a higher rate than others.
17 And that's doesn't sound right. It sounds --
18 why?
19 MAYOR DE BLASIO: Senator, I think you
20 raise an important point. Look --
21 SENATOR DIAZ: Oh, man, I'm hitting
22 good today.
23 MAYOR DE BLASIO: Yeah, I think the
24 simple -- I talked about this at length a
137
1 couple of weeks back. The status quo that's
2 existed in our shelter system is not
3 acceptable to me, nor is the overall status
4 quo of homelessness in the city. It's gone
5 on for decades, it's grown over decades.
6 Between 2011, when the Advantage Program was
7 cut in that budget that year, that state
8 budget and the city budget, and the end of
9 the previous administration -- that was just
10 a 2-1/2-year time frame -- the shelter
11 population went up by 13,000 people in just 2
12 1/2 years in the previous administration.
13 So -- and I've been dealing with additional
14 challenges as well.
15 So my bottom line message to everyone
16 in New York City is that we are not going to
17 accept the status quo on homelessness, which
18 is why we're changing so many of the
19 strategies. But as part of our 90-day review
20 of the operations of the Department of
21 Homeless Services, we're going to look at the
22 contracting process and make sure that there
23 is parity in the way contracts are handled.
24 SENATOR DIAZ: Thank you. Thank you.
138
1 Because we're talking about raising the
2 minimum wage of people, that people cannot
3 suffer, but then you have throughout the City
4 of New York so many community-based
5 organizations trying to provide services to
6 the needy and then some of them are
7 struggling and another is getting a higher
8 rate, another is getting a low rate. I mean,
9 I have an organization in the Bronx that's
10 getting $60 per night per person, where
11 others are getting $143.
12 MAYOR DE BLASIO: No, that is part of
13 the review for sure. And I appreciate it.
14 SENATOR DIAZ: Thank you, Mr. Mayor.
15 And congratulations for the good job on the
16 snow.
17 MAYOR DE BLASIO: You're a good man.
18 Thank you.
19 SENATOR DIAZ: Luis Sepulveda told me
20 to say that.
21 (Laughter.)
22 CHAIRWOMAN YOUNG: Always lively with
23 Senator Diaz.
24 I do want to point out that we have
139
1 been joined by Senator Jesse Hamilton and
2 Senator Phil Boyle.
3 Assemblyman?
4 CHAIRMAN FARRELL: Thank you, Senator.
5 Assemblywoman Nolan.
6 ASSEMBLYWOMAN NOLAN: Thank you,
7 Mr. Chair. Thank you.
8 First, just quickly, a personal note.
9 I want to congratulate Senator Young on
10 really a wonderful achievement for women here
11 in the Legislature, which is to be the lead
12 member, the chair of such an important
13 committee.
14 When I got here, the only woman who
15 served on this committee was the late
16 Assemblywoman from Brooklyn, Eileen Dugan,
17 and she was here all alone. It was her first
18 year on these committees.
19 So though I philosophically don't
20 agree with anything you said, and I certainly
21 share -- and I completely agree with Liz's
22 comments, I just had to make that personal
23 note to congratulate you and wish you well on
24 such a really important achievement for
140
1 women --
2 CHAIRWOMAN YOUNG: Thank you, Cathy,
3 you're a good friend. Thank you.
4 ASSEMBLYWOMAN NOLAN: And you did a
5 great job for the issues that you represent,
6 we just don't agree.
7 But let me ask the mayor quickly about
8 the Smart Schools Bond Act. We have a lot of
9 education questions, but we'll save some of
10 them for the chancellor tomorrow. But the
11 city was promised $700 million -- you know,
12 because I've asked you, this is the third
13 time now, and I certainly asked Mayor
14 Bloomberg and his predecessors, I
15 represent -- and many of us in Queens have
16 trailers. When we talk about things like
17 overcrowding in our schools or disability
18 accessibility, we're really -- trailers
19 really crystallize that, because we still
20 have 10,000, 10,000 and more children --
21 though I think the number may finally be down
22 to eight -- that attend classes in a
23 substandard trailer in the City of New York.
24 That amount is larger than most of the other
141
1 600-plus school districts.
2 So how are we doing on trailers?
3 That's I guess our first thing.
4 And generally, I thought the Governor
5 promised you $700 million, and I thought we
6 promised you $700 million in that bond act.
7 I'm wondering if you've seen any of it yet.
8 MAYOR DE BLASIO: Let me speak to the
9 first question and then ask Dean and Sherif
10 to speak to what we've overall seen from the
11 bond act.
12 Specifically on the question of
13 trailers, so just a recap of recent history.
14 At the end of the previous administration in
15 the city, 352 trailers at 120 sites. And
16 overwhelmingly, as you know, in overcrowded
17 districts, particularly in Queens.
18 We have now eliminated 70, with an
19 additional 100 slated for elimination in the
20 near term. So as this plan proceeds,
21 basically 170 out of the 350 we inherited,
22 we're talking about half of them now that we
23 will have removed quickly.
24 And in terms of the funding, our
142
1 capital plan provides $450 million for
2 trailer removal and for the alternatives
3 needed, $100 million of which comes from the
4 Smart Schools Bond Act.
5 ASSEMBLYWOMAN NOLAN: Has any Smart
6 Schools Bond Act money been released or
7 authorized or --
8 DIRECTOR FULEIHAN: No. Our
9 understanding is that the plan will be
10 finalized over the next month -- I want to
11 make sure of that. Yeah, over the next
12 month. So we have not received that yet.
13 ASSEMBLYWOMAN NOLAN: Okay, thank you.
14 And then just generally on education,
15 the Regents -- as you know, the Regents'
16 submission is for a 2.9, I think it was,
17 billion dollar increase to finally begin to
18 move forward on the Campaign for Fiscal
19 Equity settlement. The governor came in with
20 a number he feels is reasonable,
21 understandably. He has to balance the
22 budget. But having said that, it's in my
23 opinion not enough. Many of us in the
24 Assembly would like to see more on Foundation
143
1 Aid, and I wondered if you would care to
2 comment on the city's position on what it
3 needs to run its schools. Not a share, not
4 some formula that goes back into the mists of
5 time, but what do you need from the state to
6 assist our city's schoolchildren.
7 MAYOR DE BLASIO: I appreciate the
8 question deeply. When you think about the
9 history of this city and what it's led us to,
10 we're now -- only about a third of our
11 kids are reading at third-grade level. And
12 unfortunately, well under half of our kids
13 who graduate are actually college-ready by
14 the state's own standards.
15 We have a long way to go in bringing
16 our schools up to the level they need to be
17 at, both for the good of our children but
18 also to have a viable workforce for the
19 21st-century economy.
20 The commitment made by the Court of
21 Appeals in the Campaign for Fiscal Equity
22 suit is as pertinent today as ever because
23 the demands are greater than ever. We have
24 made a series of major new investments in our
144
1 schools, but we know we cannot go as far as
2 we need to until we see that kind of
3 fundamental change.
4 That kind of funding would allow us,
5 once and for all, to address the equity
6 issues that you know better than anyone have
7 gone unaddressed for many, many years. To
8 really once and for all address the fair
9 school funding formula properly would require
10 that the $2 billion or so that we would get
11 additionally under Campaign for Fiscal Equity
12 were provided to the city. So we have a lot
13 we could do and a lot of wrongs we could
14 right, but we can't do it on the level
15 necessary for our kids until we see that kind
16 of budgetary fairness.
17 ASSEMBLYWOMAN NOLAN: And then just
18 one quick question with the remaining
19 minutes; I thank the chairman.
20 As you know, I represent Long Island
21 City, and we are a growing community. The
22 number of residential units has skyrocketed.
23 We still don't really feel the city planning
24 people have really come up with an adequate
145
1 plan for, for example, fire service. We've
2 talked to you about trying to get the
3 reopening of a firehouse. We have all kinds
4 of needs down there, both schools -- which I
5 know your budget proposes building some
6 there, because we have nothing to offer
7 people -- but even as basic as the issues
8 with snowplowing or residential pickup. It's
9 still a commercial sanitation pickup zone,
10 for example.
11 And I would just ask that you consider
12 having some kind of response to us about Long
13 Island City as it grows in all the city
14 services, whether it's EMS, fire -- the
15 precinct down there has got to be over a
16 110-year-old building in the midst of all
17 these giant high rises. I don't even know if
18 it has adequate bathroom service for the men
19 and women that work there. So we really need
20 somebody to take a look at that. It's a
21 local question, but I have to ask it.
22 And then just if either your wonderful
23 tablemates there want to respond on the Smart
24 Schools Bond Act, the trailers, or any of
146
1 these education issues, we're happy to get
2 some more follow-up. We still have a long
3 way to go on the trailers, particularly in
4 the high school level, which I understand has
5 never been properly counted. When you talk
6 about 120 sites, I'm not sure, I think that
7 may just be elementary and middle school.
8 Maybe someone can clarify that for me,
9 because apparently since high school kids
10 only go to trailers for a single class, like
11 a science class, that's not counted. And
12 it's just wrong. So we really need to get a
13 handle on the trailer issue still, moving
14 forward, but it is progress that's 70 of them
15 are gone, and we hope to see more progress,
16 more progress, and get that Smart Schools
17 Bond Act money there.
18 MAYOR DE BLASIO: I appreciate it.
19 And yes, we are hard at work on removing the
20 next hundred. I want to do that as quickly
21 as possible. We'll keep you updated on that.
22 I think we can get you the 120 sites to
23 confirm how high schools are treated. So
24 we'll get you that list.
147
1 On the Long Island City issue, I
2 agree. Again, a good challenge on one level
3 to have areas that are growing and doing so
4 well, but the infrastructure has to be there.
5 This is an area where, as a council member,
6 as public advocate, I was very critical of
7 the city government not adequately
8 recognizing the infrastructure needs.
9 We have put more and more money into
10 infrastructure. One of the ways we did it
11 was with that capital stabilization reserve,
12 which allowed us to make sure we could keep
13 up our debt service payments. But I said the
14 other day when I did one of my presentations,
15 I think our constituents want infrastructure
16 spending, more than ever in the past, on
17 exactly what you described. As areas are
18 growing, we need to support them with all the
19 different pieces that people expect. We'll
20 keep making that investment on a capital
21 level because we know it's such a priority
22 for our neighborhoods.
23 ASSEMBLYWOMAN NOLAN: But we do want
24 to see down the road whether the city will
148
1 reopen that firehouse or do some other
2 responses to the explosion of population in
3 what was once a factory area. So we're going
4 to continue to follow up with you on that.
5 And on that same line, there are a
6 number of new housing developments -- you and
7 I attended the groundbreaking for one, and
8 much to both of our mutual surprise, there
9 was an issue there that we were under the
10 assumption when we passed a bill here in
11 Albany, that that was going to be a labor
12 union project, and that seems to have broken
13 down. It's not design/build, it's not a
14 union job. That's just unacceptable, I know,
15 to both of us. And I would ask for some
16 follow-up on that.
17 When we were there that day, we spoke
18 with people from the building trades who were
19 extremely unhappy about that, as they should
20 be, because that was never what was intended.
21 So just generally, as we grow Long Island
22 City and we grow the waterfront, we need to
23 have a more comprehensive approach, whether
24 it's through city planning or your office, to
149
1 come up with fire service, make sure that
2 these buildings are being built properly,
3 that these high rises are being built with
4 the right labor force and not just a
5 fly-by-night group, and just generally come
6 up with the schools and the services that
7 people will need in the future.
8 MAYOR DE BLASIO: Thank you.
9 ASSEMBLYWOMAN NOLAN: And thank you,
10 and congratulations again, Senator. Thank
11 you. And thank you, Chairman Farrell.
12 CHAIRWOMAN YOUNG: Thank you very
13 much. Our next speaker is Senator Andrew
14 Lanza.
15 SENATOR LANZA: Thank you, Madam
16 Chair.
17 Good afternoon, Mayor de Blasio.
18 MAYOR DE BLASIO: Good afternoon.
19 SENATOR LANZA: It's great to see you.
20 I was not going to speak because I
21 enjoy the opportunity of speaking to you and
22 your staff and your administration on a
23 regular basis concerning the needs of our
24 shared constituents. However, this afternoon
150
1 much discussion has centered around my
2 legislation concerning the property tax cap
3 for New York City, and I thought it important
4 that I speak publicly to some of the comments
5 that have been made and also hopefully
6 clarify some of the aspects of that
7 legislation.
8 In your statement you talked about the
9 affordable housing crisis that exists in New
10 York City and the fact that New Yorkers are
11 concerned about the cost of housing and
12 whether they're going to be able to live in
13 the City of New York. And that is a concern
14 that I share with you, Mayor.
15 The middle class feel that concern as
16 well. In your opening statement you
17 discussed the chasm between the very, very
18 wealthy -- I think you said for every
19 multi-million-dollar condo that is built in
20 New York City, there are more and more people
21 who don't have a place to live which they can
22 afford. In between that are the middle
23 class, who are being squeezed.
24 And in response to Senator Avella you
151
1 talked about the middle class growing in New
2 York City, and I'm not sure that is correct.
3 I think your first statement is correct, that
4 we have more wealthy and more poor. And the
5 middle class I see leaving in leaps and
6 bounds. I see that on Staten Island. And
7 this has been going on long before you became
8 mayor. People are leaving, people I grew up
9 with are leaving to places like Delaware and
10 Maryland and North Carolina and South
11 Carolina and other places.
12 And when you talk to them about why it
13 is they've decided to leave, with their
14 families, the place that they were either
15 born or have called home, they universally
16 tell me and will say that it is because the
17 cost of living in New York City is too high
18 for a family. And when you look at the
19 components of the cost of living, especially
20 of homeownership -- because as Senator
21 Marchione pointed out, if you are a renter
22 you pay that increase as well, it's passed
23 down to you. But the components that factor
24 into that cost of living are the property tax
152
1 in New York City, the income tax, the water
2 bill that has been mentioned, the taxes on
3 everything associated with homeownership,
4 like the tax on heating and cooling your
5 home, the electricity, the natural gas, the
6 heating oil, the telephone bill, and it goes
7 on and on. And it's one big basket that a
8 family needs to pay if they are going to be
9 able to afford to live in New York City.
10 Senator Krueger and I enjoy a healthy
11 debate, usually on the floor of the Senate,
12 over this legislation. I think we missed it
13 today, Senator Krueger. I believe the bill
14 has passed.
15 Let me tell you why I proposed and
16 authored this legislation a few years ago.
17 It was at that time that Senator Krueger
18 joined me in passing a 2 percent property tax
19 cap for the rest of the state. And I just
20 thought that fairness dictates that the folks
21 in New York City that we serve also enjoy
22 that same protection. And so that's the
23 genesis for this legislation, that New York
24 City should live within its means and that
153
1 the homeowners and renters in New York City
2 should be protected by the same cap that the
3 rest of the state enjoys. I think -- not to
4 get him in trouble -- but Assemblyman Cusick
5 is the sponsor of this legislation in the
6 Assembly.
7 You pointed out that we need to be
8 able to address emergencies as they arise.
9 In the wake of September 11th, the single
10 largest increase in New York City property
11 taxes -- I think was 18.5 percent, followed
12 by another 7 percent -- in the history of the
13 City of New York was enacted. I thought that
14 went too far, and so do most of my
15 constituents.
16 But nevertheless, Mayor, I want you to
17 know that in this legislation there is an
18 emergency pressure release valve, if you
19 will. During an emergency, it can be
20 overridden by a supermajority of the City
21 Council and with the mayor's signature. So
22 this legislation takes into consideration any
23 eventual emergency.
24 Beyond that, you've talked about the
154
1 years in which the city did not spend within
2 its means, and that is precisely what this
3 legislation seeks to protect against. I
4 commend you, Mayor, because you have acted to
5 spend within the means that you have
6 available right now. I don't know who the
7 mayor is going to be in the future. We know
8 it has happened in the past. And I think, as
9 you say, and in your memorandum in opposition
10 -- for folks who don't know, when you propose
11 legislation around here you are inundated by
12 pieces of paper. They are either pink, which
13 means the people who wrote them oppose your
14 legislation, or yellow, meaning they support
15 your legislation. I received a pink piece of
16 paper from the City of New York. And I only
17 tease the mayor because I know we disagree on
18 this point, because the city opposes this
19 legislation.
20 But within that very memorandum it
21 says that over the last 20 years since 1997,
22 the city has requested that the state enact
23 an even lower increase into law, generally 2
24 percent. And you have touted the way in
155
1 which you have constrained city spending
2 during your administration, and I commend
3 you. All I am saying is that we need to
4 codify that. We need to codify the
5 responsible policy that you espouse and that
6 you have employed so that future generations
7 of people, homeowners and renters in New York
8 City, can have that sense of security to know
9 that in the same way that they need to live
10 within their means, the city will.
11 To Assemblyman Cusick's point, the
12 certainty of knowing that you won't wake up
13 in the City of New York one day to find out
14 that property taxes are once again raised by
15 25 percent. I think we can all agree that
16 the specter of that possibility is something
17 that provides uncertainty to homeowners and
18 new families, and more and more of them are
19 deciding to take their families or start
20 their families outside of New York City,
21 outside of New York State, and we've got to
22 prevent that from happening.
23 Because I think when you talk about
24 the gentrification, I think yes, we have more
156
1 million and $2 million and $3 million homes,
2 and we have more people who can't afford any
3 home. And in the middle, what that tells
4 you -- because it's in many respects a
5 zero-sum equation -- is that the middle class
6 are being squeezed.
7 MAYOR DE BLASIO: So, Senator, just a
8 couple of responses.
9 I mean, first of all, it's always
10 difficult to argue with you even when I
11 disagree because of our long-standing
12 friendship and because you were a member in
13 the City Council. We were two of the fiscal
14 watchdogs in the process there, coming from
15 different parties and different ideologies,
16 but we shared a common belief that we had to
17 be responsible. And I appreciate what's
18 motivating your legislation.
19 I would argue that, again, we -- first
20 of all, we are seeing a number of people come
21 into our city who I would certainly not
22 define as rich. I don't think it's quite as
23 black and white as that. Yes, there is a
24 fundamental problem of income inequality. We
157
1 both recognize that. There are a lot of
2 people who can afford the very expensive
3 coops; that most of us can't relate to in
4 terms of our personal finances. But we also
5 have a lot of people coming into the city who
6 I would define as middle class who are
7 seeking opportunity in the city in a lot of
8 the areas -- technology and film and TV and a
9 lot of the healthcare, a lot of the areas
10 that are booming. Which is why we have
11 213,000 new jobs. Which is why our
12 population is growing. We're at the
13 all-time-highest population we've ever had,
14 and it's growing.
15 So I don't think it's fair to say
16 every net new resident is just a wealthy
17 person. I think it's fair to say a lot of
18 people coming in certainly are also
19 middle-class folks. But that doesn't for a
20 moment negate your point. There's a real
21 squeeze on the middle-class residents we
22 have, and we're trying to figure out how to
23 help them in a lot of different ways.
24 The affordable housing plan has a very
158
1 substantial element to it that is
2 moderate-income and middle-income housing.
3 The classic scenario we often talk about, a
4 family that is -- let's say two public
5 servants, one's a cop, one's a teacher. A
6 big portion of the affordable housing plan
7 literally focuses on people with that kind of
8 combined income, to give them opportunity for
9 affordable housing as well.
10 Everything we're doing in terms of
11 public safety, infrastructure, everything
12 that grows the economy also grows opportunity
13 for better-paying jobs for middle-class
14 people. The tech sector, 300,000-plus jobs
15 now in the larger tech sector, much more
16 likely to be the higher-paying middle-class
17 jobs. So I think it's a mixed bag on that
18 front.
19 But I do get your underlying point. I
20 would argue that you would expect of me not
21 only balanced budgets but to protect the
22 public safety, to improve the schools. I
23 know how passionately you feel about public
24 education. That's what these investments are
159
1 going towards.
2 And I do appreciate that there's in
3 effect a circuit-breaker in the event of
4 problematic times in your bill. But I also
5 would say you and I have served in the
6 City Council of New York City; a
7 supermajority is not easy to come by. And no
8 one likes to increase property taxes.
9 So what I'm trying to work with,
10 practically speaking, is a responsible budget
11 wherein I'm telling the people up front, I'm
12 working every day to avoid a property tax
13 increase. I don't belittle the effect of
14 assessments. I know it's hitting people hard
15 and we should all work together to think
16 about different ways to address that. But
17 one thing I'm adamant about is I will keep
18 present budgets that do not involve a
19 property tax increase, and that's one of the
20 ways we're trying to help the middle class in
21 New York City.
22 SENATOR LANZA: Quickly, two points,
23 the first picking up on what Assemblyman
24 Cusick brought up, and that is the
160
1 prescription drug/opioid addiction crisis in
2 America and certainly here at home in New
3 York City. I thank you for coming to Staten
4 Island a short while ago to discuss some of
5 the measures New York City is now going to
6 put in place to combat this issue.
7 I can tell you, and I think we agree,
8 we are not doing enough as a city, as a
9 state, as a nation. Whenever there is a loss
10 of life due to gun violence, for instance, we
11 see press conferences from the most local of
12 governments all the way to the White House
13 and calls for change in policy. I'm not
14 saying that's not appropriate; we should
15 always look for ways to prevent the loss of
16 life.
17 I tell you, Mayor, and these are the
18 facts, drug addiction overdose is the
19 number-one preventable cause of death in
20 America right now, and I would like to see
21 the same fervor, I would like to see the same
22 attention. We need to do this. We need to
23 come together. And one of the most noble
24 things we can do as a society is to save
161
1 lives, and this is an opportunity for us to
2 do that. So I look forward to working with
3 you to build upon some of the measures that
4 you've put in place already. We really need
5 to do more if we're going to turn back the
6 tide of this crisis.
7 And the last point, and I'll just
8 leave it, I'll speak to you privately
9 about -- I have some legislation I'd like to
10 talk to you about. I know it's a very
11 difficult decision, you've put a lot of
12 thought into it, but the school closure
13 decision on Staten Island, I think we could
14 have used another day for cleanup. I think
15 we should have erred to more caution in terms
16 of whether or not we were ready to put
17 second-graders and third-graders out into
18 that storm. But I will talk to you privately
19 about that. And I do have some ideas about
20 some legislation.
21 But on the opioid addiction issue, if
22 you would.
23 MAYOR DE BLASIO: Well, I certainly
24 look forward to talking to you on the school
162
1 closure idea. I believe the way we're going
2 about it is sound and does protect our kids'
3 safety. And obviously we were blessed
4 yesterday to have, thank God, a nice sunny
5 day as part of the cleanup continued. But
6 certainly look forward to talking to you
7 about that.
8 On the opioid question, you know,
9 we've only just begun to fight. I know you
10 feel the same way; there's a lot more we have
11 to do. Outside of your own family, one of
12 your biggest fans in New York City is the
13 First Lady of New York City, Chirlane McCray,
14 my wife, who believes fundamentally in what
15 you're doing and wants to partner with you on
16 Staten Island and beyond. So we're going to
17 be doing a lot more together.
18 SENATOR LANZA: Thank you, Mayor.
19 CHAIRMAN FARRELL: Thank you, Senator.
20 Assemblyman Ortiz.
21 ASSEMBLYMAN ORTIZ: Thank you,
22 Mr. Chairman.
23 Good afternoon, Mr. Mayor.
24 MAYOR DE BLASIO: Good afternoon.
163
1 ASSEMBLYMAN ORTIZ: First of all, let
2 me just thank your staff during the weekend
3 of the -- during the heavy snowstorm that we
4 were facing, due to the fact that we had
5 numerous phone calls in my office. My office
6 was open Saturday and Sunday, just for the
7 record.
8 MAYOR DE BLASIO: Good for you. We
9 appreciate that.
10 ASSEMBLYMAN ORTIZ: As a result that
11 we were getting so many phone calls of people
12 who have no heat and no hot water. And I
13 would like to thank your staff, HPD as well
14 as your staff from the government affairs,
15 Daniel Abramson and Brian Honan, for their
16 persistent and continued talking back and
17 forth with me during the weekend until we
18 solved the problems in Red Hook. We had two
19 buildings in Red Hook completely without
20 heat; they came back in less than two hours.
21 We have people in my district whose landlords
22 was not giving the heat; they managed to talk
23 to NYCHA and agreed, as well as to the
24 landlords themselves, because I have the
164
1 phone number of the landlords. So we used
2 your agency and your power to scare them and
3 get it done.
4 So I guess I want to put that on the
5 record for the job well done during this
6 storm.
7 I do have a few questions; I'm going
8 back to education. As you probably know,
9 there was a study that was conducted by CDC
10 back in 2013 where it stated that suicide is
11 the third leading cause of death for
12 Hispanics aged 15 to 24, and this includes
13 females and males. In New York City,
14 Hispanic teens attempt suicide at more than
15 twice the rate of white youth.
16 My question to you is whether or
17 not -- what is the plan that you have in
18 place in order to address the issues of
19 mental health, especially suicide, among
20 teenagers in the school system?
21 MAYOR DE BLASIO: Well, I appreciate
22 the question, Assemblyman. It's a real
23 challenge, and one of the things we believe
24 is that till now we have not had a holistic
165
1 mental health strategy for the city. The
2 effort my wife has been working on, Thrive
3 NYC, is at least a strong beginning towards a
4 comprehensive mental health system and
5 approach for the city.
6 One of the things we're doing is
7 focusing on children early. That means
8 everything from making more resources
9 available for mental health supports for the
10 youngest children to focusing on the way we
11 teach our teachers to approach mental health
12 issues, straight on through to our community
13 school approach, which puts mental health
14 professionals in the schools directly so we
15 can identify problems and act on them.
16 We all know and there's many tragic
17 examples of young people identified early on
18 -- I sadly point out the example in Newtown,
19 Connecticut, the young man who ended up
20 killing so many schoolchildren and had
21 evident mental health problems for years and
22 years that went untreated. We have a chance
23 to reach young people early, and that could
24 be about stopping suicide or other types of
166
1 negative outcomes. So we believe the
2 investments we're making are going to lead to
3 a lot more young people being identified
4 early and actually having the services they
5 need.
6 We're also creating something called
7 NYC Support, which will come online over the
8 next year, which is literally a service
9 through which people can call and get
10 connected to healthcare services, and then
11 there's an ongoing monitoring effort to
12 support them in that, to make sure they
13 actually get what they need on a timely basis
14 and follow through.
15 That hasn't existed in the past,
16 because we all know it's very hard for anyone
17 to navigate the mental health opportunities
18 that exist, especially for parents with
19 children. The system is almost set up in a
20 way that even if you heard about where
21 services are, they're very, very hard to
22 access. So we're trying to break through
23 that fundamentally, and that I think will be
24 one of the ways we start to address this
167
1 tragic reality of teen suicide.
2 ASSEMBLYMAN ORTIZ: Well, one of the
3 things that I -- I have introduced a piece of
4 legislation about mandating that we should do
5 early assessment of mental health in the
6 school system. I do believe, like you, and I
7 do believe strongly that prevention, once we
8 identify the problems that maybe some child
9 might have, that that problem probably was
10 not created by the child, was created by the
11 parents. And we also have to realize that
12 sometimes the parents have been stuck at the
13 age of 6 or 7 or 10 years old.
14 So I do have a bill mandating that we
15 should have a social worker, mental social
16 worker in every school in the State of New
17 York, a psychologist in the schools of
18 New York as well, as well as define what the
19 role of the psychologist and the guidance
20 counselor is all about.
21 I would like for you and your staff to
22 look at it and give me your recommendation.
23 I think that -- again, I do believe in early
24 intervention. I believe that if we can catch
168
1 the problem early enough, we will be able to
2 have less of our youth to go to through the
3 criminal justice path. And I hope that I can
4 encourage you to do so.
5 Now, last year I was invited by
6 default to be part of your announcement at
7 the South Brooklyn Marine Terminal to be
8 built, the port, in Sunset Park. One of the
9 major issues that we are facing is the lack
10 of communication with EDC. And the way that
11 they conducted, the way that they conducted
12 these two hearings to include people -- I was
13 very happy to hear from them to ask for my
14 recommendation, but then my recommendation
15 was not really taken into consideration.
16 And my recommendation was very simple:
17 Reach out to the community, talk to the
18 community, make sure the community gets
19 engaged. I even offered my office to make
20 sure that we can do outreach together, the
21 fact that I have a list of community groups
22 and community organizations and constituents
23 that can participate and be part of the
24 process.
169
1 So, you know, the lack
2 of communication regarding embracing more
3 people to participate in the process was
4 lacking.
5 One of the biggest questions I have
6 is -- this is a rumor that is going out in
7 Sunset Park more and more often now and
8 coming more close to my office -- is that
9 there's a belief that this project and this
10 development will bring about 55,000 more
11 trucks into Sunset Park every year.
12 As you know, I have the BQE that
13 everybody can cross through Sunset Park.
14 They pay the toll in Staten Island and they
15 pay the toll in Manhattan at the end of
16 the -- at the other side. We don't get no
17 money as a result of that, we just get the
18 environmental impact of the emission that is
19 coming out of the fumes of the cars.
20 So my question is -- and if you don't
21 have the answer, you know, we can follow up
22 later. But my question is, is there going to
23 be any kind of environmental impact study and
24 also a trucking study, a vehicle study, about
170
1 how many trucks are going to be coming in and
2 out of this facility once the facility is
3 built?
4 And the last question is regarding the
5 jobs opportunity where the unions,
6 longshoremen, feel that they've been left out
7 of the process. And I've been trying to
8 encourage them to be in the process, because
9 I hope that the people of Sunset Park will
10 benefit from these good-paying jobs that are
11 coming as a result of this development that I
12 will continue to support, I've been a
13 supporter of that. I have no problem with
14 the backlash that I'm getting. But I think
15 it is very critical for me to assure the
16 people in my community that these 5,000
17 trucks that are coming through, it is true,
18 it is not true, and what the city is doing to
19 address that.
20 And thank you, Mr. Mayor, for being
21 here today.
22 MAYOR DE BLASIO: Thank you. Thank
23 you for raising the concerns, Assemblyman.
24 First of all, I'd say I share your
171
1 enthusiasm for the potential of what we can
2 do in terms of creating jobs in your
3 district. And these in many cases, again,
4 would be solid middle-class jobs in terms of
5 the pay levels and the benefit levels.
6 There's a lot that has to be worked
7 out till we get to that point. So by the
8 time we get to the jobs being created and
9 whatever trucks running, there's a lot of
10 time to make the adjustments and to create
11 the kind of balance we need. We all want the
12 jobs. We all want high-quality jobs, we want
13 them to maximally benefit Sunset Park and Red
14 Hook and the surrounding communities that
15 have a lot of economic need.
16 If that involves a certain amount of
17 truck traffic, we obviously have to make sure
18 it's a fair amount and it's managed properly
19 and we look at any health or safety issues
20 related. But there is time to do that.
21 I'll certainly -- I want to make sure
22 you feel that you're being consulted, your
23 community is being consulted. We certainly
24 want to work with our labor partners. So
172
1 we'll double back with EDC to make sure that
2 that process is consultative going forward.
3 But I think the goal here is one that will
4 greatly benefit your district.
5 ASSEMBLYMAN ORTIZ: Thank you.
6 MAYOR DE BLASIO: Thank you.
7 CHAIRMAN FARRELL: Thank you very
8 much.
9 We're going to take a 10-minute break,
10 and we will come back and continue.
11 MAYOR DE BLASIO: Thank you,
12 Mr. Chair.
13 (A brief recess was taken.)
14 CHAIRWOMAN YOUNG: We're back after a
15 break, and the next to question is Senator
16 Diane Savino.
17 SENATOR SAVINO: Thank you, Senator
18 Young.
19 Good afternoon, Mayor de Blasio.
20 First I want to thank you for the
21 coordination of your office with my office
22 and others on Staten Island and Brooklyn with
23 respect to the response to the storm. And I
24 for once can say that I think we on
173
1 Staten Island overall were quite happy. So
2 thank you for that.
3 MAYOR DE BLASIO: Music to my ears,
4 Senator.
5 SENATOR SAVINO: I know, it's amazing.
6 Not to belabor the point on the
7 property tax issue, I would be remiss if I
8 did not at least chime in on it. And while
9 it is an undisputed fact that the city has
10 not taken steps to raise the property tax
11 rate, property taxes have gone up
12 nevertheless. And homeowners are feeling it,
13 and I just want you to understand the
14 concerns that they have. And also it's the
15 unfair way in which we assess properties in
16 New York. It's a byzantine method.
17 So while we may disagree on the issue
18 of a property tax cap, I think the discussion
19 has to continue so that we can provide some
20 sort of relief for our middle class
21 homeowners. We want them to stay and thrive
22 in New York City. I just wanted to get that
23 on the record. So you don't have to respond;
24 I know your position on it.
174
1 I want to go to a couple of issues in
2 your presentation, one on your housing plan.
3 I know you have an ambitious housing plan to
4 create 200,000 units of affordable housing,
5 but with the collapse of the 421a and the
6 tremendous opposition you're getting from
7 community groups across the city, how are you
8 going to achieve that goal of 200,000 units?
9 MAYOR DE BLASIO: Well, I would say a
10 couple of things. First of all, we believe
11 that the 421a reform we put forward made
12 sense, actually represented an extraordinary
13 consensus between City Hall, the real estate
14 community, housing advocates. There was a
15 real sense that this was the kind of balanced
16 reform that was in the taxpayers' interest,
17 would create more affordable housing, would
18 stop subsidizing luxury housing, et cetera.
19 We believe that idea is alive and well
20 and should be handled here in the Legislature
21 as quickly as possible so we can have the
22 kind of program that's actually fair and will
23 help us to create a substantial amount of
24 affordable housing.
175
1 But in the meantime, we have a number
2 of efforts already underway that certainly
3 throughout calendar year 2016 will yield a
4 tremendous amount of affordable housing. So
5 a lot of the development that was already
6 moving and a lot of our preservation efforts,
7 which have nothing to do with the 421a
8 program, those will continue and in fact
9 we'll intensify them as we work with the
10 Legislature to find a way forward on a tax
11 incentive program.
12 In terms of the response to mandatory
13 inclusionary zoning, we believe mandatory
14 inclusionary zoning is more pertinent than
15 ever, given that 421a is now not on the
16 table. And it's one of the best tools we
17 have to get more affordable housing and
18 demand fairness from developers, who
19 obviously want the opportunity to build, and
20 often build higher, in the city.
21 Yes, community boards have expressed
22 real concern. I say, as a former City
23 Council member, it never surprises me when a
24 community board, in perfectly good faith,
176
1 expresses concern about any form of
2 development. I think it's, you know, the
3 assumption. But when you look at the City
4 Council members, when you look at the views
5 of other elected officials and major
6 organizations in our city like AARP, which
7 has a huge membership and fully supports our
8 plan, I think the debate is more and more
9 balanced in favor of the plan and I think we
10 will be able to move forward.
11 SENATOR SAVINO: Hopefully so.
12 I want to turn to another issue. As
13 you know, earlier this year Senator Klein and
14 myself, joined by Councilmember Ritchie
15 Torres and Councilman Mark Treyger -- who is
16 somewhere in the room here, or he's stepped
17 out -- we released a report on the New York
18 City Housing Authority detailing what we
19 called the worst slumlord in the state. And
20 you know the conditions of NYCHA, the NYCHA
21 developments. And we all know that they have
22 suffered from years of neglect, there's no
23 doubt about that.
24 So last year the city put up
177
1 $100 million towards NYCHA. This year you're
2 proposing the same thing, you're asking the
3 state to match it. We did that last year.
4 But the concern we have is that if we just
5 give the money over the NYCHA, we're going to
6 get the same result we've gotten not just --
7 it's not your problem, it's happening with
8 every administration. NYCHA seems to be the
9 giant black hole that money goes to to
10 disappear, and we never see actual
11 improvements in the facilities, in the
12 properties.
13 So how can we make sure that the money
14 is spent appropriately and goes towards the
15 things that we know we need, whether it's
16 mold remediation or, you know, safety and
17 lighting and security and door locks and, you
18 know, improvements in kitchens and bathrooms?
19 MAYOR DE BLASIO: I would say that I
20 understand why you feel what you feel about
21 the history of the housing authority. I
22 think you're right about the history of
23 disinvestment. I think you were in the past
24 too often right that money was not used well
178
1 enough.
2 We have been very clear that I am
3 taking personal responsibility for the
4 situation at the housing authority. I talk
5 regularly with the leadership. We have
6 provided unprecedented financial support for
7 the housing authority. We literally canceled
8 a city tax on the housing authority, it was a
9 pilot, going back to 1947. We canceled that
10 so the housing authority could take those
11 resources and put them towards repairs.
12 As you know, for many years the
13 housing authority was forced to pay
14 separately for police coverage of its
15 developments. We canceled that, put that
16 money back towards repairs. Consequently,
17 the amount of repairs has increased
18 intensely.
19 We changed the policy in terms of the
20 scaffolding in many of the developments that
21 were being left for no apparent reason for
22 months or years on end; we ended that policy.
23 We ensured that projects are moved on rapidly
24 and then the scaffolding comes down. We're
179
1 changing a lot of things.
2 But the biggest thing is the
3 NextGeneration NYCHA plan. Given the
4 $17 billion in capital needs that have gone
5 unmet, we had to come up with a plan for the
6 long term that would deal with the capital
7 challenges, and we had to come up with a
8 financial restructuring in terms of the
9 expense side of the budget. We have that now
10 with the NextGeneration NYCHA plan.
11 And we will keep doing everything we
12 have to do, including the right kind of
13 development on NYCHA land that focuses on
14 affordable housing and also resources that
15 actually go back to NYCHA for changes. And
16 then we're putting our own city capital
17 dollars in to address the roof issues. And
18 again, a lot of the resources that come out
19 of the other approaches within NextGen NYCHA
20 will go to issues like fixing roofs, fixing
21 mold, safety systems, et cetera.
22 So I think NYCHA is changing rapidly,
23 and this plan, with each passing year, will
24 have more and more impact. That being said,
180
1 we need help from the state. That first
2 $100 million has still not arrived. We're in
3 the fiscal year still; we have not seen the
4 money. We need your support and your
5 colleagues' support in ensuring that money
6 arrives. It will help, obviously, hundreds
7 of thousands of people. And then I think
8 there's a big question, when we look forward
9 to next year, what will be the status of the
10 federal government on the question of
11 housing. And there could be some big changes
12 next year in the composition of the federal
13 government that might lead to a reopening of
14 the housing discussion and, we'd like to
15 believe, a chance to get some of the support
16 that would actually relieve some of this
17 pressure.
18 SENATOR SAVINO: We live in hope on
19 that.
20 I want to move to homeless policy.
21 You and I have been around long enough by now
22 that we remember when the Department of
23 Homeless Services was created, back in 1993
24 by the City Council in response to the
181
1 lawsuit and also, if I remember, Muzzy
2 Rosenblatt. Do you remember Muzzy
3 Rosenblatt?
4 MAYOR DE BLASIO: Yes. Memorable
5 name.
6 SENATOR SAVINO: Right. He convinced
7 Mayor Dinkins that if we had a separate,
8 free-standing agency to focus on homeless
9 policy, that that would be the best way to
10 deal with the homeless crisis. Which is very
11 similar to the crisis we're seeing now,
12 thousands of people undomiciled, living in
13 the streets, you know, the city not getting
14 the best value from the shelters that they
15 were using or putting people up in hotels.
16 Very similar situation.
17 I would say after 22 years of this
18 experiment, I actually believe that we'd be
19 better off if we put DHS back into HRA, under
20 the auspices of, you know, the commissioner
21 of HRA, Steve Banks. What's your opinion on
22 that?
23 MAYOR DE BLASIO: We have a 90-day
24 review that's well underway now, Commissioner
182
1 Banks, working with First Deputy Mayor
2 Shorris and our new deputy mayor,
3 Dr. Palacio, and we're going to look at a
4 number of options of how to improve the work
5 of DHS and the coordination between DHS and
6 HRA.
7 I've certainly heard some -- and, you
8 know, you and others suggest a potential
9 re-merging. All options will be on the
10 table. I don't want to bias the discussion
11 by saying we have a preference, because we're
12 going through a careful operational review.
13 But one thing I can guarantee is at the end
14 of this process, we are going to have a
15 better operation, a different operation.
16 And I agree with you that Commissioner
17 Banks has done an outstanding job, as part of
18 this review and before, in addressing these
19 very difficult issues.
20 The changes now, I would say -- and
21 you're an expert, you've paid a lot of
22 attention to this issue for a long time. We
23 needed a whole different level of supportive
24 housing. For the first time, only in the
183
1 last few months, with the city's announcement
2 of 15,000 units and now the Governor coming
3 forward with 20,000 units, this is the first
4 time literally in our history we've talked
5 about the real numbers we need. That's a
6 great blessing, and I commend the Governor
7 for that. We look forward to following
8 through on that.
9 We never had the right kind of
10 preventative programs -- or we had them only,
11 maybe more accurately, for a very brief
12 period of time. We never had the right kind
13 of rental subsidy programs for a sustained
14 period of time. We rarely had the right kind
15 of anti-eviction programs.
16 We've now taken all of those tools and
17 put them on the playing field simultaneously,
18 well resourced and for the long haul. And
19 we've told landlords all over the city that
20 these subsidy programs are -- we're going to
21 keep them for the long haul because we need
22 to do it right.
23 The preventative programs have reached
24 91,000 people -- not all of them would end up
184
1 in shelters, but some of them for sure would
2 have, and that's helped 22,000 folks who have
3 been moved out of shelter into housing. That
4 shows that the subsidy efforts are working.
5 And for the first time ever, we're going to
6 have HomeStat doing consistent outreach,
7 working individual by individual to get
8 people off the streets, 500 new Safe Haven
9 beds, more homeless and runaway youth beds
10 than ever before, growing as needed each
11 year.
12 So I'd like to believe that despite
13 the fact this is a historic problem, for the
14 first time the city is arraying the tools
15 necessary to actually turn this problem
16 around.
17 SENATOR SAVINO: Hopefully. And, you
18 know, I'm also a big supporter of the
19 Governor's intervention here and his
20 willingness to partner with the city to
21 create what I believe that both of you know
22 very well, it's that continuum of care for
23 the homeless. As you and I know,
24 homelessness doesn't happen overnight to
185
1 people. It's usually a slow, steady descent
2 into it. It's not just income insecurity,
3 it's a combination of things. There are
4 addiction issues and domestic violence and,
5 you know, mental illness, and all of those
6 things lead to further income insecurity and
7 housing insecurity.
8 So hopefully there will be real
9 coordination between the city and the state
10 to address those issues. And I'm just going
11 to say this again, I think HRA is the agency
12 that really should oversee this, because many
13 of these clients are cross-systemized.
14 They're already being serviced by HRA
15 caseworkers as well. So to the extent that
16 you have broad case management, you're able
17 to really service a family.
18 MAYOR DE BLASIO: Appreciate it.
19 SENATOR SAVINO: Thank you.
20 CHAIRMAN FARRELL: Thank you.
21 CHAIRWOMAN YOUNG: Thank you, Senator.
22 CHAIRMAN FARRELL: Assemblyman Colton.
23 ASSEMBLYMAN COLTON: Thank you,
24 Mr. Chair.
186
1 Good afternoon, Mayor.
2 MAYOR DE BLASIO: Good afternoon.
3 ASSEMBLYMAN COLTON: I would like to
4 ask you a few questions on a topic which is a
5 very high priority to me, and I'd like to go
6 from the earliest to the highest levels of
7 it.
8 I believe that CUNY is an institution
9 which is very important to New York as an
10 economic engine, both to the city and to the
11 state. Up to 1976, the history was that
12 there was a 50/50 split in terms of the
13 operating expenses of this great institution.
14 And then during the city's fiscal crisis at
15 that point, the state stepped up to the plate
16 and the city's share was reduced to what now
17 I understand is a token of 1 or 2 percent of
18 the operating costs.
19 I believe that CUNY -- very
20 passionately -- is extremely important,
21 especially to all of our young adults in
22 terms of giving them what they need in order
23 to be able to overcome economic difficulties.
24 Now, in this particular time we have
187
1 the city and the state, both their economic
2 climates are a lot better. Obviously we need
3 to reserve money and we need to make sure
4 that they stay in good condition. But would
5 it not be reasonable for the city to show its
6 willingness to step up to the plate and to
7 increase their share as a symbol of the
8 importance of this institution to young
9 people throughout the city and the state, and
10 as a way, you know, to show its willingness
11 and its priority to making sure that young
12 people continue to have all the benefits of
13 CUNY? Would it not be unreasonable {sic} to
14 raise it more than the 1 or 2 percent of the
15 operating expenses?
16 MAYOR DE BLASIO: I'm going to let --
17 Assemblyman, Dean Fuleihan will go over the
18 overall financial reality and the
19 contributions we make.
20 The City of New York contributes in
21 substantial ways to CUNY. In fact, in the
22 last two budgets we've added resources to
23 CUNY in a strategic manner. We believed
24 fundamentally in the ASAP program as a tool
188
1 to make sure that young people who went into
2 CUNY succeeded, and we thought that was a
3 good investment on top of any other
4 obligations that we had. We believed
5 fundamentally that STEM programs should be
6 supported, so we put a growing amount of
7 resources into supporting two-year STEM
8 programs because we knew that would help a
9 lot of our young people go right into
10 technology jobs that are now growing in the
11 city, even with a two-year degree.
12 So we have certainly made targeted
13 investments in CUNY. We have already made
14 clear to the state that we will pay our
15 proportionate share in terms of the labor
16 agreement that we hope will be struck. We
17 believe that folks who work, members of PSC
18 CUNY deserve a new labor deal. We obviously,
19 in terms of the city workforce, are very
20 proud of the fact we have 95 percent of our
21 union members now in either a ratified
22 contract or an agreement. We think the PSC
23 CUNY members should be covered by a new
24 contract; we've already made very clear we
189
1 will pay our appropriate share of that.
2 So there's many ways in which we
3 contribute to CUNY. I think, given the other
4 needs that I've outlined, the challenges we
5 face -- pension costs, Health and Hospitals
6 costs, everything we're trying to invest in
7 in terms of public safety, education,
8 et cetera -- and the fact that our reserves
9 could easily be wiped out by an economic
10 downturn, I don't think it's right to take
11 state obligations and increasingly put them
12 on the City of New York.
13 But I'd like Dean just to summarize
14 the city's ongoing contributions to CUNY.
15 DIRECTOR FULEIHAN: Right. When the
16 takeover occurred, CUNY's senior colleges
17 were put on the exact same footing as SUNY
18 senior colleges. The community college piece
19 was divided so that the city would pay a
20 third, tuition would do a third, the state
21 would do a third. And that's the exact same
22 arrangement as all community colleges across
23 the state, except in all local community
24 colleges in SUNY, actually the local
190
1 government controls the local board of
2 trustees, where we have one-third
3 representation on the whole piece.
4 So we do pay actually 34 percent,
5 tuition pays about 40 percent, and the state
6 pays the remainder of the difference. So we
7 do make more than the actual statutory
8 commitment to the community colleges. And
9 then we pay half of the capital on the
10 community colleges.
11 ASSEMBLYMAN COLTON: All right. I
12 just think that in the sense of partnership,
13 and in making it clear the priority that CUNY
14 has to New York City and to New York State,
15 that it would be not unreasonable to think
16 about increasing the percentage, when of the
17 operating costs it's so -- 1 or 2 percent
18 is -- you know, it seems very low.
19 MAYOR DE BLASIO: Again -- I'm sorry
20 to interrupt, Assemblymember, I just want to
21 make sure -- because I think Dean kind of ran
22 through that. We're paying half the capital
23 costs of the community colleges, and repeat
24 again --
191
1 DIRECTOR FULEIHAN: -- 34 percent of
2 the operating cost of the community colleges,
3 the biggest governmental contribution.
4 Tuition pays 40, and the remainder is paid by
5 the state.
6 MAYOR DE BLASIO: And please just
7 reiterate how that compares to what other
8 localities do around the state with their
9 community colleges.
10 DIRECTOR FULEIHAN: We're at the high
11 end of what most localities do around the
12 state in their community college
13 contribution.
14 ASSEMBLYMAN COLTON: I think one of
15 the reasons why New York City does generate
16 so much revenue to the state is because of
17 the importance of CUNY. And, you know, I
18 think -- but that also means it's important
19 to New York City. So I think as a gesture it
20 is not unreasonable. There has to be
21 negotiation, there has to be discussion. For
22 example, the Governor has said we need to
23 find administrative efficiencies with CUNY
24 and SUNY. You know, is it reasonable that
192
1 the state funds CUNY 36 million and funds
2 SUNY 14 million? So there's room here for
3 maneuvering. And I just think that, you
4 know, the city has to, you know, engage in
5 that.
6 On another topic which is also very
7 important, the area of pre-K. Last year the
8 Governor stepped up and he made a commitment
9 to provide state funding to New York City for
10 over $300 million. And that has continued,
11 he's proposing that be continued again this
12 year.
13 Also, under the Smart Bonds issue,
14 which the Governor proposed and the
15 Legislature passed and the voters approved, I
16 believe we're going to have -- New York City
17 will be eligible for some $783 million in
18 funding.
19 One of the things that I think I want
20 to emphasize, in association with
21 Assemblymember Cathy Nolan, is the importance
22 of the transportable units, those units
23 being, you know, replaced. But also a very
24 big issue in my district is pre-K seating.
193
1 We have serious problems with that. There
2 isn't enough, for example. And even where
3 it's found, there are problems. In
4 District 20 a location was found for pre-K
5 seating, and it's in the middle of a heavy
6 truck zone and there's a lot of community
7 opposition with parents on that.
8 So what efforts, what plans has the
9 city made to try to get more pre-K seats in
10 the public schools? And how do we do that?
11 MAYOR DE BLASIO: A couple of
12 different things, Assemblyman. So the effort
13 to reach the level that we are at now,
14 68,500-plus young people in pre-K -- and
15 again, that was 20,000 when I started my
16 administration. So we've added almost 50,000
17 kids per year now.
18 That happened -- an extraordinary
19 effort, and I commend all of my colleagues
20 who pulled that off, and I thank again
21 everyone here and everyone in the Legislature
22 for providing the funding. That required a
23 heavy emphasis on existing community-based
24 organizations, existing schools of various
194
1 types, including religious schools, and it's
2 been a very, very effective effort.
3 At the same time, we want to develop
4 more capacity. So, for example, in our
5 capital plan there are additional pre-K
6 centers, stand-alone pre-K centers in some
7 neighborhoods. We continue to work closely
8 with the archdiocese and the diocese in terms
9 of buildings that they have available coming
10 into our domain, either by lease or by
11 purchase. And we also make adjustments
12 constantly.
13 The locations we had this year were
14 the ones that we thought were the best able
15 to provide the best-quality pre-K for our
16 kids. But if we find that a location ended
17 up to not be as good as we want it to be, we
18 can make adjustments for next year because we
19 actually had additional locations being
20 offered. Not always geographically exactly
21 where we wanted them, but we still have
22 choices to work with.
23 We would love to work with you and
24 your office, if we think there's a location
195
1 that should be better, to see if there's
2 another site in the community that would be a
3 better alternative.
4 ASSEMBLYMAN COLTON: Yeah, because
5 this is a very important priority, I think
6 from the pre-K level all the way up to higher
7 education. And I really think the city has
8 to put a big effort into that.
9 There are a couple of other areas I
10 had, but I'm going to leave that for now
11 because my time is just about up. So thank
12 you, Mr. Mayor.
13 MAYOR DE BLASIO: Thank you.
14 CHAIRMAN FARRELL: Senator.
15 CHAIRWOMAN YOUNG: Thank you,
16 Assemblyman.
17 Our next speaker is Assemblyman
18 Espaillat.
19 SENATOR ESPAILLAT: Good afternoon,
20 Mr. Mayor.
21 MAYOR DE BLASIO: Good afternoon.
22 SENATOR ESPAILLAT: Well, first let me
23 start out by trying to dispel something that
24 has been really alluded to here with regards
196
1 to CUNY and what seems to be a perception
2 that the rest of the state is going to be
3 saddled disproportionately with the
4 operational costs of CUNY. When in fact, you
5 know, traditionally -- and I've been here 20
6 years -- it's the other way around. The city
7 produces far more revenue for the state than
8 it gets back in the budget. That was the
9 basis for the Campaign for Fiscal Equity
10 lawsuit, that many felt that the city was
11 giving more in revenue, that the windfall of
12 revenue from the city, coming from the city,
13 was so much more than we got back for
14 schools.
15 And just recently, when we had the
16 settlement on -- the Attorney General's
17 office had settlement money distributed here
18 to the state, although the offenses may have
19 been committed in the city, it was really
20 more upstate and outside of the city that
21 benefited from the investment in these close
22 to maybe 5-point-something billions of
23 dollars.
24 So I want to dispel the notion that
197
1 the city is saddling the rest of the state.
2 First of all, it perpetuates this
3 upstate-versus-downstate scenario which I
4 think is damaging to all of us.
5 But let me also just begin with the
6 CUNY piece and say that in traditional
7 Shakespearean Albany logic, a cut is a cut by
8 any other name. And so every time we see
9 mergers, we know that at the end of the day
10 it may mean a cut. When we see downsizing,
11 we know that at the end of the day, when the
12 rubber meets the road, that may be a cut.
13 When we see administrative efficiencies and
14 reform, we know that at the end of the day
15 this could very well be a cut.
16 So I am concerned and I want to ask
17 you, what in fact will be hurt? Let's say
18 those $485 million were cut right now. What
19 kind of services, operations will be
20 compromised and hurt within the CUNY system
21 right now if this were to happen today?
22 MAYOR DE BLASIO: Well, let me start
23 by saying, again, let's acknowledge an
24 unusual situation here. This item appeared
198
1 in the budget, was not, you know, part of any
2 previous discussion, and then the next day
3 the Governor offered a clarification, which
4 again I very much appreciate. The
5 clarification said that it would not cost the
6 city a penny, and alternative means would be
7 worked on -- which again will start hopefully
8 as early as next week. And we'll see what
9 that yields.
10 So what I can say to you is I believe,
11 based on what we are hearing now, that there
12 will not be a cut. But let's take your
13 theoretical question. Clearly we have a CUNY
14 system that is trying to reach a lot of young
15 people and give them opportunity and
16 straining to do that. And if you were to
17 take half billion dollars out, it would mean,
18 you know, any number of potentially negative
19 scenarios. Obviously a lot fewer kids being
20 served in one way or another. And let's face
21 it, the kinds of things we're trying to do,
22 like the investment in STEM education so kids
23 can get, young people can get the education
24 and go straight in the workforce, that would
199
1 be undercut fundamentally.
2 Or, you know, if you think about other
3 areas of the city budget, if you tried to
4 move those cuts elsewhere, where would you
5 cut? Would you cut from education? Would
6 you cut from police? So I think it's fair to
7 say that this would be a very, very major
8 impact.
9 But again, we're going to take the
10 Governor on his word and follow through in a
11 very transparent fashion on that so that
12 these cuts will not be seen and will not have
13 an impact on our young people.
14 SENATOR ESPAILLAT: Well, let me just
15 share with you, Mr. Mayor, that I will be
16 looking forward to monitor the situation to
17 ensure that these efficiencies or
18 administrative reforms don't actually turn
19 into a cut, because I think that would be
20 very damaging to the CUNY system if that is
21 the case.
22 And so I will monitor the situation,
23 and if we talk about trimming the fat, as
24 it's often called, or some minor
200
1 administrative changes, that's acceptable.
2 But I know that I've been here long enough to
3 know that a cut is a cut. And so I am deeply
4 concerned that that will impact, dramatically
5 impact CUNY, which continues to be a beacon
6 of hope and opportunities. CUNY is the
7 Harvard, the Yale, the Cornell of our
8 working-class and middle-class communities.
9 And so to potentially absorb a cut of this
10 magnitude puts a hit on the future of the
11 city and the State of New York.
12 On another matter, Mr. Mayor, let me
13 commend you for your interest in tackling the
14 affordability problem in the city,
15 particularly when it comes to affordable
16 housing. And your administration has
17 proposed mandatory inclusionary zoning as the
18 model to address the issue of affordability
19 in housing in the City of New York. And
20 whereas that may yield some affordable units,
21 many people across the city -- community
22 boards, myself and others -- are concerned
23 that this particular model, whereas it may
24 yield some affordable units, it could also
201
1 unleash market forces and gentrification to a
2 level that many working-class and
3 middle-class families will be hurt.
4 In my particular district we have
5 already begun to see speculation.
6 Yesterday's New York Times published an
7 article that highlighted the Rockaways and
8 East Harlem as two neighborhoods that have
9 seen how affordable housing can be built.
10 You yourself were at a ribbon-cutting
11 ceremony in my district where Broadway
12 Housing opened up a full 100 percent
13 affordable housing community.
14 Why not build affordable housing? Why
15 can we not build 100 percent affordable
16 housing that guarantees poor people, working
17 people, that are really the ones hurting in
18 the housing crunch? Because I think by
19 engaging in the 70/30, 80/20 model, we are
20 exposing communities like the one that I
21 serve that have 90 percent of the housing
22 stock, rent-stabilized, privately owned
23 buildings, subject to the market. And
24 landlords and owners who come in and buy off
202
1 tenants, it would unleash a whole series of
2 practices that eventually result in losing
3 more affordable housing that you have
4 produced.
5 And so this is the essence of the
6 fear. I don't think it's just like a frenzy
7 in the community boards that, you know, we
8 see maybe regularly on a host of issues.
9 This is a deep-seated concern that
10 communities have across the City of New York.
11 It has manifested itself in the Bronx,
12 unanimously in Queens, and even in Manhattan.
13 God knows we never agree on anything in
14 Manhattan.
15 But it's deep-seated, and I am
16 concerned that the mandatory inclusionary
17 zone, although well-intended to produce X
18 amount of affordable housing units, that it
19 will in fact result in the displacement of
20 hundreds and thousands of families that are
21 living in working-class communities around
22 these developments that will witness a
23 dramatic shift in the values of those
24 properties, and subsequently there goes the
203
1 rent.
2 So I am concerned about this. I would
3 like to see from the city good faith and that
4 you come to these neighborhoods and you build
5 affordable housing. It's been done in the
6 past. The New York Times said yesterday that
7 it was done successfully in the Rockaways and
8 East Harlem. And it's been done in my
9 district. Why not start that way and not
10 with the mandatory inclusionary zoning?
11 MAYOR DE BLASIO: Well, I appreciate
12 the question, Senator, because you're getting
13 to the heart of the matter on many levels.
14 First of all, I want to be clear on my
15 view of the community boards' response. I'm
16 not trying to in any way stereotype it. I'm
17 saying I do think community boards have a
18 history of being dubious of all types of
19 development. I don't think that's an unfair
20 statement; I think everyone who's worked with
21 community boards -- I spent eight years
22 working closely with the community boards in
23 my district when I was a councilman -- we
24 know that's a pretty consistent reality.
204
1 At the same time, I agree with you,
2 whether it's community boards or community
3 activists or clergypeople, they're speaking
4 up out of deep concern and fear about
5 displacement. And I've tried to speak
6 bluntly to it, and I started that process a
7 year ago in my State of the City speech
8 because, honestly, here's what I think is the
9 bigger picture. I don't think the issue of
10 gentrification has been honestly discussed in
11 this city over 10 or 20 years as it has been
12 growing as a phenomenon. I don't think there
13 was a honest debate about what it meant,
14 about the impact it was having, about what we
15 could do about it, what was the role of
16 public policy, what should we do differently.
17 None of that happened.
18 And in the previous administration,
19 with all due respect to them, there was I
20 think a kind of laissez-faire approach
21 wherein market forces dominated the entire
22 playing field. As you know, a lot of this
23 city is in an as-of-right status where
24 developers have the right to work within the
205
1 existing zoning and can do a lot with it.
2 The areas that are now being discussed for
3 rezoning are relatively few in the scheme of
4 things. A lot of rezoning happened in the
5 previous administration already.
6 And what we found in the previous
7 approach was that there were not particularly
8 stringent demands put on developers in terms
9 of affordable housing, and even some of the
10 plans that were agreed to with communities
11 were not honored. So that has bred a lot of
12 cynicism, rightfully, in communities about
13 any affordable housing plan.
14 I think it's fair to say I have a very
15 different approach. I think I've proven that
16 on many levels. What I saw -- and maybe it
17 has to do with personal experience -- what I
18 saw happen in my neighborhood in Brooklyn and
19 in surround neighborhoods, I can certainly
20 say this about Bed-Stuy, I can say this about
21 Bushwick, I can say this about a lot of
22 places -- is in the absence of a policy, the
23 market forces simply created displacement.
24 They didn't need rezonings, it just kept
206
1 happening and happening -- with no
2 compensating impact in favor of the
3 community. So if you literally say if we
4 just walked away now, we said let the market
5 determine all of this, you would see more and
6 more people displaced, you would not see new
7 affordable housing built in appreciable
8 numbers. Because if we just took the part
9 out of our plan that did not benefit from
10 some type of private-sector activity, it
11 would be a much, much smaller number. We'd
12 never get to 200,000 units.
13 So we would have a lot less affordable
14 housing being built, we'd still have a lot of
15 people being displaced, we wouldn't have the
16 opportunity to do a lot of good things in
17 communities through rezonings. And, you
18 know, you know as well as I do, rezoning is
19 an opportunity to do a lot of the capital
20 improvements to a community, a lot of the
21 things that have been unaddressed previously
22 can be addressed, and we're very committed to
23 it.
24 We've put a very substantial allotment
207
1 in our capital budget to address
2 infrastructure needs with rezonings, and that
3 was not true in the past. We've tried to be
4 up-front about the fact. If communities need
5 new schools, parks, whatever it happens to
6 be, that's going to be factored into the
7 rezoning process. We obviously have a heavy
8 emphasis on creating local jobs.
9 So I would say it this way. I think
10 it's a pretty stark contrast. Let the market
11 decide, period. You'll get most of the same
12 unfortunate outcomes from our community
13 residents without any of the compensating
14 positive factors. Under our plan, you will
15 get an unprecedented amount of affordable
16 housing, you'll get job creation which will
17 be as much as possible targeted to local
18 residents, you'll get community improvements
19 and capital improvements.
20 The other part of the equation, which
21 you know very well -- and we all grapple
22 with -- is the units that are going out of
23 rent regulation. And I know and all your
24 colleagues have fought to strengthen rent
208
1 regulation. I know you've found a certain
2 amount of resistance in that process. But we
3 still lose a lot of units even with the
4 recent improvements, which we appreciate. We
5 lose a lot of units out of rent regulation,
6 we lose a lot of units out of Mitchell-Lama.
7 If we had not stepped in with our housing
8 plan to stop 5,000 units at Stuy Town and
9 Peter Cooper from being privatized, we would
10 have lost 5,000 more -- almost a thousand
11 units at the Riverton in Harlem we would have
12 lost had we not stepped in.
13 So I argue that there has to be an
14 interventionist approach by the city
15 government to the maximum extent possible,
16 and that's the best, the best strategy we
17 have at this moment to preserve affordable
18 housing.
19 SENATOR ESPAILLAT: You know, I
20 commend your model. I'm not saying that we
21 should not have an intervention of some kind
22 of regulatory practices to get more for the
23 development that's going on in New York City.
24 What I'm saying to you is that in many
209
1 neighborhoods that may be a blessing, because
2 in East Harlem, where you have the highest
3 concentration of NYCHA buildings, people that
4 are protected for two, three, four
5 generations, maybe that's not so bad -- they
6 have the ability to cushion the blow. But in
7 a neighborhood with 90 percent plus
8 apartments that are rent-stabilized,
9 privately owned, where 25 percent of the
10 leases are preferential rent leases, that
11 means that the landlord has not been able to
12 get the rent that they want, therefore they
13 issue a lease for less rent that doesn't
14 guarantee any rent stabilization rights or
15 privileges to the tenant. That landlord is
16 going to go out there -- once you've built
17 those towers through mandatory inclusionary
18 zoning, that landlord is going to go out
19 there and try to get that market rate, and
20 that tenant is out. That's one out of four
21 in that immediate area where you're proposing
22 that in our district.
23 So what I'm saying is city government
24 and state government -- which proposes
210
1 $20 billion for housing, $10 billion for
2 affordable housing, $10 billion to deal with
3 the homeless issue -- should not get out of
4 the affordable housing business as we knew it
5 that really helped communities in the past.
6 You know, Mayor Koch rebuilt the Bronx, you
7 know, when it burnt. You know, Freddie
8 Ferrer, the borough president, did a
9 fantastic job at ushering that in. You know,
10 we need that kind of energy again to save
11 neighborhoods.
12 I think that you're well intended,
13 this is a well -- I'm not saying that you --
14 I think it's better than what we had in the
15 past. But it doesn't cut the mustard, not
16 for neighborhoods where people are having a
17 tough time making ends meet. And I propose
18 that you get back into the affordable housing
19 business as well.
20 MAYOR DE BLASIO: Just a final
21 comment.
22 I believe, again, that a lot of
23 neighborhoods -- I would not underestimate,
24 if you look at the neighborhoods that have no
211
1 rezoning activity but are seeing those
2 preferential rents you point to, that in many
3 neighborhoods it is already being swept away
4 just by market activity alone.
5 If it was a zero-sum, if you were --
6 for example, if all those preferential rents,
7 you know, being kept low, if that was all
8 there was to it, don't do rezoning and
9 they're all going to stay low, that would be
10 an interesting discussion. I don't believe
11 that's what's happening. I think the market
12 dynamics are already sweeping past that, and
13 if we don't intervene there'll be nothing
14 left in terms of affordability. And we have
15 to use every tool we have to create it.
16 So I respect deeply your position, I
17 just want you to hear that we believe that,
18 you know, that cow's out of the barn already.
19 SENATOR ESPAILLAT: Well, I thank you,
20 Mr. Mayor. And I hope that we can continue
21 to have this discussion in regards to
22 affordability.
23 MAYOR DE BLASIO: Absolutely.
24 SENATOR ESPAILLAT: Thank you.
212
1 MAYOR DE BLASIO: Thank you.
2 CHAIRWOMAN YOUNG: Thank you.
3 SENATOR KRUEGER: Assembly?
4 CHAIRMAN FARRELL: Thank you.
5 Assemblyman McDonald. Is he there?
6 Oh, very good. Oh.
7 (Laughter.)
8 CHAIRMAN FARRELL: In his place,
9 Mr. Titone will make a very quick speech.
10 (Laughter.)
11 CHAIRMAN FARRELL: He's not really
12 doing this.
13 ASSEMBLYMAN TITONE: I know I'm not
14 really permitted to speak, but I just wanted
15 to really thank you publicly for increasing
16 the ferry service on Staten Island. Very
17 much appreciate it, Mayor. Thank you.
18 MAYOR DE BLASIO: Thank you very much.
19 It was the right thing to do.
20 CHAIRMAN FARRELL: All right. We
21 close on this, then.
22 MAYOR DE BLASIO: And ferry service
23 kept going all through the storm. We're
24 proud of that fact.
213
1 ASSEMBLYMAN TITONE: Well, we still
2 have some parking to do there.
3 MAYOR DE BLASIO: We will. We will.
4 CHAIRWOMAN YOUNG: Assemblyman Farrell
5 was quite accurate about the briefness of
6 Assemblyman Titone's --
7 CHAIRMAN FARRELL: I wish the other
8 side would understand that.
9 CHAIRWOMAN YOUNG: We have a lot of
10 questions.
11 Next it would be Senator Squadron.
12 SENATOR SQUADRON: Thank you. I will
13 take a lesson from Assemblyman Titone, but
14 not the one you'd like me to.
15 I would like to join him on thanking
16 you for ferry service expansions throughout
17 the city and the investment the city is doing
18 in that.
19 By the way -- actually a good segue
20 into my questions -- is the state budget
21 helping with the ferry expansions throughout
22 New York City? No? Zero dollars from the
23 state for ferry expansions?
24 MAYOR DE BLASIO: That's all us.
214
1 SENATOR SQUADRON: And last year the
2 state put in, as Senator Savino mentioned,
3 $100 million for NYCHA. This year how much
4 is the city expecting to get from the state
5 for public housing capital?
6 MAYOR DE BLASIO: So again, with the
7 $100 million that was in the last budget of
8 the state, in the current fiscal year for
9 NYCHA we still have not seen a dime. We
10 would very much like that money to come in so
11 we can do more to fix public housing
12 developments. We welcome a plan from the
13 state. We're ready to get to work doing this
14 work, and we have --
15 SENATOR SQUADRON: Once -- sorry to
16 cut you off. But once you get the hundred
17 million, is NYCHA's fiscal need satisfied
18 then or is it --
19 MAYOR DE BLASIO: No, no. Not at all.
20 Not at all.
21 But the point being we made a
22 commitment last year when I was here with you
23 that we would do a hundred million each year,
24 current fiscal year, next two as well. We
215
1 have that in our new budget. We asked that
2 the state match that, because the need -- as
3 I said, there's a $17 billion capital need at
4 NYCHA for the buildings that cover 400,000
5 people. But that first hundred million still
6 has not arrived. And we believe -- you know,
7 we have some strong views on the best use of
8 that money, but we also obviously respect the
9 Legislature's prerogatives. Whatever the
10 ultimate decision of the state on how best to
11 use it, we're ready to implement it. We're
12 ready to put that money to work immediately.
13 But we'd ask your help in making sure it
14 shows up as soon as possible.
15 SENATOR SQUADRON: Great. And again,
16 the city made a three-year, $100 million a
17 year commitment --
18 MAYOR DE BLASIO: Yes.
19 SENATOR SQUADRON: -- and so far the
20 state has not this year proposed a hundred
21 million equal.
22 MAYOR DE BLASIO: That's right.
23 SENATOR SQUADRON: At its high-water
24 mark, the Advantage, Work Advantage
216
1 anti-homelessness program, the state was
2 giving the city I think $35 million in
3 operating funds for that program?
4 MAYOR DE BLASIO: We'll check that.
5 And again, while Sherif and Dean check
6 that question, let me emphasize I appreciate
7 your sense of history, because not only was
8 the state contribution to Advantage
9 substantial, but Advantage was working.
10 And about the time Advantage ended, we
11 went from approximately 37,000 people in our
12 shelter system just in the following two and
13 a half years to 50,000 plus. So really one
14 of the biggest factors in the increase in our
15 shelter population was the absence of
16 Advantage. And, you know, it's going to take
17 a long time to recapture that ground and
18 reverse that trend. This is why we're
19 concerned now to make sure that homelessness
20 funding for the city is equitable and does
21 address some of the things that were cut in
22 the past so we can actually turn this corner.
23 Do you have an answer on the --
24 DIRECTOR FULEIHAN: We'll get it.
217
1 MAYOR DE BLASIO: We're checking that
2 dollar figure.
3 SENATOR SQUADRON: And I think it's an
4 important one. The Advantage Program needed
5 to be fixed, but -- and the supportive
6 housing capital dollars are absolutely
7 wonderful that are being proposed by the
8 state, by the Governor.
9 But, you know, the total statewide
10 Homeless Prevention Program now I think is
11 less than $35 million, which means that's a
12 cut for the city.
13 Earlier you mentioned the BQE triple
14 cantilever, which is in my district. So far
15 is there any state capital funding allocated
16 for the fixing of the BQE cantilever so that
17 it doesn't fall into Brooklyn Bridge Park and
18 bounce into the harbor?
19 DIRECTOR FULEIHAN: Not that we know
20 of at this point.
21 SENATOR SQUADRON: Okay, none. Thank
22 you.
23 Resiliency, I want to really thank the
24 administration again for the commitment
218
1 you've made, Mr. Mayor, and the
2 administration more broadly, $115 million,
3 almost, from the city alone, support on the
4 federal application that got us $176 million
5 from HUD because of the leadership of the
6 city to get a barrier that protects Lower
7 Manhattan, I think the third or fourth
8 largest business district in America, Lower
9 Manhattan. We talk about having tax dollars
10 and having revenue; we need Lower Manhattan
11 to be working to have revenue in every corner
12 of the state from Chautauqua County to
13 Suffolk County.
14 So I would just ask, of the
15 $301 million we now have to protect from
16 Montgomery Street around to Battery Park
17 City, how much of that has the state
18 allocated?
19 MAYOR DE BLASIO: We'll have to check
20 that one too for you. We'll get that for
21 you.
22 SENATOR SQUADRON: I believe it's
23 8 million.
24 MAYOR DE BLASIO: Okay, we'll
219
1 double-check -- well, you seem to be ahead of
2 us.
3 SENATOR SQUADRON: Great. The Rikers
4 Island population, obviously Rikers is rife
5 with problems and I urge the administration
6 to continue aggressive reform there, not rest
7 on its laurels. But one of the drivers of
8 that is a broken speedy trial law in New York
9 State that essentially strips the accused --
10 not the convicted, but the accused -- of
11 their constitutional speedy trial rights.
12 If we reformed the speedy trial laws,
13 we believe the Rikers population could come
14 down significantly. Just as an example, what
15 would the city save if the state fixed speedy
16 trials and the Rikers population, for
17 example, went down 25 percent?
18 MAYOR DE BLASIO: Well, you may have
19 the exact estimate yourself; I can see that
20 you're well prepared.
21 There's no question -- look, I think
22 you're exactly right that that reform would
23 make a big difference both in terms of
24 justice and in terms of the cost at Rikers.
220
1 We've tried in many ways -- you know, our way
2 of addressing the mass incarceration crisis
3 has been to try to get at the root of the
4 matter with Rikers to work on efforts to
5 ensure that people don't end up in Rikers who
6 don't need to. That's some of the bail
7 reform efforts that we're working on, for
8 example. And obviously appropriate
9 diversionary programs for folks who have
10 committed low-level, nonviolent offenses. We
11 believe fundamentally in that. And working
12 with the court system to improve the timing
13 of trials so people are not there any longer
14 than they have to be.
15 Unquestionably, everything that will
16 help us drive down the population not only
17 saves costs, it will reduce violence, it will
18 allow us to focus on a deepening of the
19 reforms we've made. So we can get you exact
20 dollar figures that could be projected, but
21 there's no question that's exactly in the
22 direction we need to go to break the back of
23 what's been, you know, many, many years of a
24 cycle of violence at Rikers that's
221
1 unacceptable.
2 SENATOR SQUADRON: Look, just in
3 summary, like each of these issues are
4 critical issues that impact New York City
5 uniquely in the state. They also speak to
6 this idea that because New York City is as
7 fiscally healthy as it is right now, the
8 state doesn't need to worry about it and in
9 fact should start trying to figure out how
10 to, you know, damage it even further.
11 There have been cuts to the state
12 support over a number of years. We talked
13 about AIM funding earlier; we just talked
14 about these on critical, really city-specific
15 issues -- not unique, but city-specific
16 issues. And so I would just urge that you do
17 continue to be responsible with your budget,
18 you do shore dollars away for a rainy day
19 fund. Goodness knows in the history of
20 New York City we've seen that; we saw that
21 eight years ago, we saw that through the
22 nineties off and on.
23 But also I want you to know that from
24 the state perspective, this idea that you're
222
1 a piggy bank can't work. What we need to be
2 doing is figuring out how to save you money
3 so that you can save more money, and also so
4 that the areas where we are providing state
5 aid, we can provide less so that we can send
6 it to other parts of the state that are in
7 desperate need of it and could use the
8 economic development and the support in other
9 ways.
10 Just briefly, one thing the state did
11 do last year is increase the funding for
12 Nurse-Family Partnership, one of the
13 evidence-based maternal home visiting
14 programs, in combination with Healthy
15 Families New York, the kind of -- a big
16 combination. This year the current proposal
17 is to reduce that funding again.
18 I just want to be very clear. If we
19 are able to produce the funding in the state,
20 because the city has been a long-time
21 supporter of this program, is the city
22 willing to match us dollar for dollar with
23 city dollars in any amount of money that we
24 increase the Nurse-Family Partnership
223
1 program?
2 MAYOR DE BLASIO: One, I want to do
3 two things. I want to give Dean and Sherif
4 an opportunity to gather themselves for that
5 answer; I want to go back a step on your
6 previous question.
7 You make a very powerful point. There
8 are actions that the state can take that will
9 save the city money, will be in everyone's
10 interests. We had a very, I think,
11 respectful and informed discussion earlier
12 about how the city and state interrelate and
13 what our relationship is. Well, one of the
14 things that is good for everyone, speeding up
15 trials, avoiding longer stays in Rikers, is
16 in everyone's interest. The same as having
17 effective preventative efforts in terms of
18 homelessness.
19 You know, long ago, when I was the
20 chairman of the General Welfare Committee in
21 the Council, I talked about the fact that
22 when you prevent a family from going into
23 shelter, for example, with a thousand-dollar
24 rental subsidy -- that's $12,000 a year -- if
224
1 that family goes into a shelter, it is 36,
2 37, $40,000 a year. From the taxpayer point
3 of view it's not even close. Nor of course,
4 on the human level, what it means for that
5 family.
6 So the points you raise are ways that
7 the state can help us to save a lot of money,
8 which is in both the state and the city's
9 interest.
10 On the Nurse-Family Partnership,
11 you're right, we believe in the value of that
12 program, to the question of that --
13 DIRECTOR FULEIHAN: We should continue
14 the conversation with you and see what kind
15 of dollars you're talking about. But you're
16 right, there's --
17 SENATOR SQUADRON: Well, it's a
18 minimum commitment. As, up here, Senator
19 Savino, Senator Gallivan and I, in a
20 tripartisan way, fight for more dollars for
21 this program, can we at least be clear that
22 the city will not reduce its own contribution
23 even if the state increases it?
24 DIRECTOR FULEIHAN: We're not reducing
225
1 the contribution.
2 SENATOR SQUADRON: You will not reduce
3 the contribution if the state -- I appreciate
4 that.
5 DIRECTOR FULEIHAN: And just on the
6 Advantage Program, the state contribution was
7 $75 million, the federal contribution, which
8 flows through the state, was also an
9 additional 75 million, and the city
10 contribution was 75 million.
11 SENATOR SQUADRON: Thank you very
12 much.
13 And the mayor's point, to the budget
14 director I would point out that a proposal I
15 long ago made called Prevention-Based
16 Budgeting would make it a lot easier to
17 balance the budget while also funding
18 evidence-based proven programs to prevent
19 homelessness, to prevent incarceration,
20 through home visiting and other programs. So
21 I would urge you take a look at that as well.
22 Thank you very much.
23 MAYOR DE BLASIO: Thank you.
24 CHAIRWOMAN YOUNG: Thank you, Senator.
226
1 The next speaker is Senator Perkins.
2 SENATOR PERKINS: Thank you very much.
3 So I want to first express my
4 appreciation for your presence and your
5 indulgence with us, and also for what you've
6 been doing so far in representing us as the
7 mayor. And I think I did the right thing by
8 supporting you.
9 MAYOR DE BLASIO: Thank you.
10 SENATOR PERKINS: It's always a good
11 thing when you hit the number --
12 MAYOR DE BLASIO: You're a visionary.
13 SENATOR PERKINS: -- when you hit the
14 number, so to speak. I'm not a visionary,
15 but I think I got lucky with this one.
16 But I'm concerned, I'm very concerned,
17 because as a native New Yorker, you know, we
18 have a little extra pride about ourselves
19 because of this here great city. And it's
20 not simply because of the bridges, like the
21 Brooklyn Bridge or the statues, like the
22 Statue of Liberty or other iconic features
23 that are world-renowned, but actually, most
24 importantly, because of its public education
227
1 system.
2 MAYOR DE BLASIO: Amen.
3 SENATOR PERKINS: You know, this was
4 the opportunity that for many of us allowed
5 us to be where we are today, and even for
6 many others, other places are doing great.
7 But what's happening is that which was
8 sort of the crown jewel of all the jewels in
9 our New York City ego has sort of come under
10 hard times in terms of bragging rights, so to
11 speak. Ergo, charter schools -- you
12 understand? -- and the infiltration of those
13 schools overwhelming attention from the
14 public schools without even necessarily
15 measuring up in terms of what they're
16 actually providing; nevertheless, being
17 promoted and applauded, most importantly,
18 with more and more money.
19 And my concern is are we abandoning
20 our public education commitment and fooling
21 ourselves into saying that this other
22 arrangement, which is a privatized model, is
23 the way to go?
24 MAYOR DE BLASIO: No. I understand
228
1 the concern for sure. And maybe there's some
2 voices that believe in that, but not this
3 administration. We believe -- first of all,
4 look, we want to serve every child in the
5 city. They're all, you know, our collective
6 future. So I'm very proud of the efforts
7 that we've made, together with parochial
8 schools and charter schools, to reach all our
9 kids who need our help. And that's something
10 we believe in.
11 But I say that at the same time that
12 I'm very comfortable saying the future of
13 New York City will be determined by its
14 traditional public schools, because the
15 traditional public schools are where the vast
16 majority of our students are. And those
17 schools have to improve fundamentally. The
18 status quo that existed when I came into
19 office wasn't acceptable -- as I mentioned, a
20 third of our kids reading at third-grade
21 level, well under half of even our high
22 school graduates being college-ready. These
23 are not acceptable realities.
24 So what we believe in is really going
229
1 at the heart of the matter. To fix our
2 traditional public schools -- again, the
3 mother lode here of our education system --
4 we have to do a lot in the way of new
5 investments: Early childhood, particularly
6 in the vein of pre-K; a very focused effort
7 to bring kids to reading level by third
8 grade -- that's part of our Equity and
9 Excellence plan -- after-school programs for
10 every middle school child for free,
11 unlimited; algebra for all for middle school
12 kids; AP classes for all, every high school;
13 computer science for all throughout the
14 curriculum at all grade levels; 130 community
15 schools; renewal schools -- these are all
16 part of a fundamental change in our approach
17 to our public education system.
18 So I think the answer to your question
19 is in our city we are doubling down on our
20 commitment on our public schools, and we have
21 to transform them for the 21st century. And
22 I believe that model is going to be much more
23 effective than looking to other models which
24 so far have obviously been, one, limited in
230
1 terms of the number of people they reach, but
2 two, as you said, different models, some very
3 successful, some not so successful, some very
4 collaborative, some not so collaborative,
5 some that were very inclusive of English
6 language learners, special ed kids, et
7 cetera, some not so.
8 We like the traditional public school
9 model because it's always inclusive. That's
10 a statement of fact. It is always inclusive
11 of all children. And more and more we
12 believe our traditional public schools are a
13 place where a lot of innovation is occurring
14 and a lot of progress is occurring.
15 SENATOR PERKINS: So let me say this.
16 In the state budget for 2014-2015, at the
17 very last moment a number of changes were
18 added with respect to charter schools,
19 particularly as they operate in the city.
20 These changes, which were executed with
21 little or no public input or transparency,
22 weakened your mayoral control over decisions
23 concerning how to use and allocate precious
24 space in public school buildings; forbade the
231
1 city for charging rent to charters;
2 grandfathered in old collocations, thus
3 immunizing them from any changes; and
4 essentially forced the city to approve all
5 new collocations or pay for space elsewhere
6 out of pocket. To your credit, your office
7 strongly opposed these changes, as did I, but
8 they were nevertheless approved.
9 So two years later, I'm wondering what
10 has been the impact on the ground of these
11 policies.
12 MAYOR DE BLASIO: I'll start, and
13 maybe Dean or Sherif want to add.
14 Look, we did oppose that change. We
15 have been able to work with the rules to
16 maximize what we think is fair to make sure
17 that if there's a proposal that we think is
18 not going to work or isn't appropriate, that
19 we do have, in effect, due process rights
20 around it. And we certainly want to work,
21 going forward, to rationalize that.
22 But I think the bottom line is that we
23 continue with an overall reform agenda for
24 our public schools. That's where the vast
232
1 majority of our energy of course has to go.
2 That is moving forward. We ask the support
3 of the Legislature in continuing that
4 progress.
5 And obviously I believe -- and I think
6 you're right to say -- there's different
7 elements of the mayoral control equation, and
8 sometimes there is a discussion that's not
9 the literal question of mayoral control but
10 still can affect the level of control, like
11 that decision you refer to. I'm a bit of a
12 purist on this point. Mayoral control of
13 education is how we fix the school system.
14 My predecessor and I didn't agree on a lot of
15 things, but on that we fundamentally agree.
16 And it should not be diminished in any way,
17 shape or form; it should be reinforced so we
18 can actually get to the work of doing these
19 fundamental things -- getting our kids to
20 reading level, making sure high school
21 graduation actually means college-ready.
22 That's what we're trying to focus on right
23 now.
24 SENATOR PERKINS: So I know that you
233
1 opposed some of these changes. But how much
2 control do you have over charter schools,
3 particularly from a budgetary point of view?
4 MAYOR DE BLASIO: Look -- again, I'll
5 start and would ask Dean and Sherif to fill
6 in any blanks. There are obviously state
7 rules governing what kind of allotment
8 charter schools get, and we respect --
9 SENATOR PERKINS: Are any of those
10 rules undermining your control over your
11 schools?
12 MAYOR DE BLASIO: I think what I would
13 say is the basic rules per se are not my
14 central concern. The decision-making about
15 our buildings and the ability to make just
16 decisions about each application -- we
17 approved plenty of applications from charters
18 that we thought fit in a building
19 appropriately. There's others we thought did
20 not. That has to be the prerogative of the
21 City of New York under a mayoral-control
22 system. That should not be compromised.
23 Additional funding requirements, like
24 I mentioned, in the current budget proposal
234
1 by the Governor that would add to the
2 obligations of the City of New York and no
3 other locality in the state, clearly are not
4 fair, from our point of view.
5 So the point from my point of view is
6 not to add additional onerous costs or
7 regulations onto the city that would
8 undermine our ability to make the right
9 decisions for our schools.
10 SENATOR PERKINS: My concern is -- so
11 I guess -- I'm trying to understand that --
12 first, who pays the rent on these charter
13 schools, you or Eva Moskowitz or whoever the
14 operator is? How does --
15 DIRECTOR FULEIHAN: Under the
16 agreement two years ago, we pay -- there's a
17 collocation process. If the collocation
18 process fails and the charter is able to find
19 alternative space, then we pay the rent up to
20 I believe it's $40 million, at which point it
21 is a shared expense with the state. And so
22 far we're about $20 million -- so far we've
23 committed about $20 million.
24 SENATOR PERKINS: So how is that
235
1 $20 million commitment being used,
2 explicitly?
3 DIRECTOR FULEIHAN: We are paying at
4 this point about $20 million.
5 SENATOR PERKINS: Towards?
6 DIRECTOR FULEIHAN: Towards those
7 charters. We reimburse them for the rent,
8 and it's approximately $20 million.
9 SENATOR PERKINS: So we pay the rent?
10 DIRECTOR FULEIHAN: Yes.
11 MAYOR DE BLASIO: Under the agreement
12 from two years ago. Again, that was not our
13 choice, but that's what was --
14 SENATOR PERKINS: That's not your
15 choice.
16 MAYOR DE BLASIO: Yes.
17 SENATOR PERKINS: So it sounds more
18 like you -- it's not your choice. What would
19 you prefer?
20 MAYOR DE BLASIO: We would go back to
21 the system before that.
22 SENATOR PERKINS: To what?
23 MAYOR DE BLASIO: We would go to the
24 structure before that.
236
1 SENATOR PERKINS: Would you explain
2 that again so we can see, for the record,
3 what the difference is between what you'd
4 prefer and what's being imposed on you?
5 DIRECTOR FULEIHAN: Prior to that, the
6 city had the opportunity to make its own,
7 completely its own decision. This created a
8 process which had, as the mayor pointed out,
9 a due process stage in it where we could
10 negotiate with the charters and then there
11 were -- if that didn't work, there were other
12 options that could be used.
13 SENATOR PERKINS: So we're happy about
14 this arrangement? You think we should, as a
15 Legislature, reinforce this arrangement by
16 more opportunities for this --
17 MAYOR DE BLASIO: Again, we think the
18 previous arrangement, the arrangement before
19 two years ago, was better. I believe in
20 mayoral control --
21 SENATOR PERKINS: For the sake of the
22 record, when you say it was better, better
23 means what? Specifically.
24 MAYOR DE BLASIO: Okay, I'll start and
237
1 Dean will fill in the blanks.
2 Let me just put this in the larger
3 rubric. I, like I think any mayor, I would
4 imagine any county executive in this state,
5 believe that we have to have the freedom to
6 make local decisions effectively and use our
7 resources effectively. We are always
8 concerned about mandates that tie our hands.
9 The structure two years ago and
10 before, gave us the freedom to make these
11 decisions more effectively. The current
12 structure has added additional limitations.
13 Although again, as you heard, we've broadly
14 been able to find ways to work with it, we
15 don't think it's the right way to go. We
16 think things before were better.
17 Dean can define that.
18 DIRECTOR FULEIHAN: Right.
19 But I will just add, Senator, what the
20 mayor identified in his original testimony
21 was the piece that we are focused on in the
22 current budget was the additional obligation
23 that was only falling on New York City, on
24 charter school tuitions, and that's about
238
1 $30 million in the current budget. And
2 that's the piece we actually focused on in
3 the testimony.
4 MAYOR DE BLASIO: Right. That's the
5 new problem.
6 DIRECTOR FULEIHAN: And that is only
7 in New York City.
8 MAYOR DE BLASIO: Right. That is a
9 new problem that we're very concerned about
10 that's in this budget now.
11 SENATOR PERKINS: And how does the
12 Governor respond to this problem that's being
13 imposed on you?
14 MAYOR DE BLASIO: How has --
15 SENATOR PERKINS: The Governor.
16 MAYOR DE BLASIO: He proposed it.
17 SENATOR PERKINS: So he's not
18 cooperating with you, is that what you're
19 saying?
20 MAYOR DE BLASIO: I'm not going to
21 characterize it. It's a proposal --
22 SENATOR PERKINS: Forgive my language.
23 I didn't mean to put it that way.
24 MAYOR DE BLASIO: -- we don't agree
239
1 with. No, it's a proposal we don't agree
2 with.
3 SENATOR PERKINS: You don't agree with
4 it.
5 MAYOR DE BLASIO: Absolutely not. I
6 said that in my testimony.
7 SENATOR PERKINS: Well, I just want to
8 reiterate, you know, because I might not have
9 heard it. Was it like written?
10 MAYOR DE BLASIO: Yes, it's in the
11 budget proposal.
12 SENATOR PERKINS: Will you send my
13 office a copy of your concerns? And we'll
14 move on.
15 MAYOR DE BLASIO: Yes, absolutely.
16 SENATOR PERKINS: Again, have you as
17 the mayor and the superchancellor, so to
18 speak, had an opportunity to determine, as
19 per this experiment called charter schools --
20 MAYOR DE BLASIO: Say again?
21 SENATOR PERKINS: As per this
22 experiment that we've come to know as charter
23 schools, which was designed, intended and
24 proposed at the time to be not a second
240
1 department of education but laboratories, so
2 to speak, that would provide the opportunity
3 for us to learn how to teach our children
4 better, and those lessons would be replicated
5 throughout the district -- has any of that
6 part of the proposal that was originally been
7 brought forward been actually fulfilled in
8 terms of what did the charter school movement
9 teach you as the mayor, or other mayors, how
10 to better --
11 MAYOR DE BLASIO: I think it's a
12 decidedly mixed bag. I think it's a very
13 fair and important question. Yes, the
14 charter school movement started with the
15 promise of innovation and sharing of best
16 practices and creating good --
17 SENATOR PERKINS: Sharing with who, by
18 the way?
19 MAYOR DE BLASIO: With the traditional
20 public schools.
21 SENATOR PERKINS: Okay. Just so we
22 know.
23 MAYOR DE BLASIO: No, very fair point.
24 And so I think the fact is that
241
1 history has proven to be a real mixed bag.
2 One of the things Chancellor Farina
3 has done, and I agree with her entirely, is
4 she's reached out to a number of charter
5 schools that want to have a close working
6 relationship with our traditional public
7 schools, that want to share best practices
8 both ways -- because, by the way, we believe
9 in a lot of our traditional public schools
10 real innovation is happening that can help
11 charters, and vice versa.
12 I would say there is a mixed bag in
13 the charter movement: Some schools doing
14 great and important work that is yielding
15 innovations that the traditional public
16 schools can use and are being shared very
17 openly and productively with the traditional
18 public schools, often on a district basis.
19 Others where that's not happening, where the
20 innovation either is not occurring or it's
21 not being shared or the student body is not
22 representative, et cetera.
23 SENATOR PERKINS: Let me interrupt for
24 a second, because --
242
1 SENATOR KRUEGER: Senator Perkins --
2 Senator Perkins, I'm sorry, you're at zero,
3 so we just have to let the mayor close up and
4 go on to the next --
5 SENATOR PERKINS: Just if you don't
6 mind, Madam Chair, Senator Krueger, Senator
7 Krueger, let me finish what I'm saying,
8 because I did wait a while to be here. But
9 -- so I think --
10 SENATOR KRUEGER: No, I know, we've
11 all been here --
12 SENATOR PERKINS: I don't -- and I
13 don't think -- am I being irrelevant or out
14 of order --
15 SENATOR KRUEGER: Just close it up
16 here. Just close your sentence, okay?
17 SENATOR PERKINS: Okay, but don't --
18 but I just don't want to be rushed through
19 what I've waited so long to share, because
20 it's important. The heart of the movement is
21 in my district, as you know.
22 MAYOR DE BLASIO: Yes.
23 SENATOR PERKINS: So I'm not going
24 to -- just here to, you know, deal with this.
243
1 It's a big thing for me. It's the biggest
2 thing that one could imagine when you have a
3 district where the public schools are not
4 doing well and then you bring in another
5 whole entity that is not transparent and
6 accountable.
7 So I'm just trying to understand, have
8 you done a report or has anybody done a
9 report on the successes of the charter
10 schools that have been made available to you
11 or any other city entity that could be
12 replicated in our public schools so that our
13 children could get the benefit of those
14 particular lessons at all?
15 MAYOR DE BLASIO: I think you're
16 raising another important point, and I
17 certainly understand --
18 SENATOR PERKINS: Could you -- I
19 can't -- could you say that again, please?
20 MAYOR DE BLASIO: I'm sorry. I think
21 you're raising a very important point. And I
22 think, knowing your district well, your
23 district has gone through a particularly
24 tough experience during this last decade or
244
1 so.
2 There is not, to the best of my
3 knowledge, a coherent, consistent approach --
4 certainly not one that we inherited -- for
5 looking at what the innovations were coming
6 out of the charters and figuring out how they
7 can work with the traditional public schools.
8 Honestly, I believe in the previous
9 administration that was not the world view.
10 It was not that the traditional public
11 schools are going to be the great core of our
12 school system and where we're really going to
13 make a difference for our children, and that
14 the charters were providing obviously
15 important options for some kids but also
16 they're supposed to be that laboratory, that
17 innovative force that you talk about. I
18 certainly don't know of any effort to bring
19 that concept together and figure out how to
20 systematically help the traditional public
21 schools.
22 So what we're trying to now, in
23 effect, through the Equity and Excellence
24 plan, is find the charters that do want to be
245
1 those district partners with traditional
2 public schools and cross-fertilize
3 productively. As I said, some are very
4 willing to do that and are good partners in
5 that, some are more resistant or have a
6 different approach. But where we can work
7 together, we will.
8 So has it been made systematic ever?
9 I would say, from my experience, no.
10 SENATOR PERKINS: Okay.
11 SENATOR KRUEGER: Mr. Mayor, can we
12 ask you if you have a staff person who can
13 follow up with Senator Perkins after the
14 hearing?
15 MAYOR DE BLASIO: Absolutely. I'll
16 follow up personally -- given our
17 long-standing history, we will set a time to
18 follow up directly.
19 SENATOR PERKINS: I appreciate you
20 doing that. And I hope you will be --
21 CHAIRWOMAN YOUNG: Thank you, Senator
22 Perkins.
23 SENATOR PERKINS: -- as detailed as
24 possible. But this is a very, very big issue
246
1 for us in my district. And I understand,
2 Senator Krueger, how you may feel, and I
3 respect your chairmanship, but I have a right
4 to ask these questions about my district --
5 SENATOR KRUEGER: No, I know, Senator
6 Perkins, but unfortunately --
7 SENATOR PERKINS: -- and other people
8 have had more time than I have.
9 SENATOR KRUEGER: No, everybody's
10 stuck with the 10-minute clock. We've been
11 careful about that.
12 SENATOR PERKINS: Well, then I'd ask
13 one final question --
14 MAYOR DE BLASIO: We'll follow up.
15 SENATOR KRUEGER: We'll follow up
16 afterwards. Thank you.
17 CHAIRWOMAN YOUNG: Senator Persaud is
18 the next speaker, please.
19 SENATOR PERSAUD: Thank you very much.
20 Thank you, Mr. Mayor, for being here.
21 I just want to first commend your staff for
22 the open lines of communication during the
23 storm that we had.
24 MAYOR DE BLASIO: Thank you, Senator.
247
1 SENATOR PERSAUD: But looking forward,
2 what are your plans for -- because it seems
3 as though we're -- there's a climate change
4 and the -- more frequent occurrences of these
5 natural disasters are occurring, especially
6 in my community where it's -- you know, the
7 water is just coming in every time you look
8 around. What are your plans for upgrading
9 the equipment and what plans do you have,
10 long-term plans do you have in place?
11 MAYOR DE BLASIO: Well, Senator, I
12 know your district, obviously, and your
13 district has been vulnerable in the light of
14 climate change. So I'd say when it comes to
15 snow on the one hand versus flooding issues
16 or hurricane issues, I think we have two
17 different realities.
18 On snow, I feel the city's response,
19 of course, was very strong. We're going to
20 learn each time, we're going to make
21 adjustments each time. I think we learned a
22 lot even from the last few blizzards. We
23 certainly learned a lot from the 2010 storm,
24 where I think the city did not have its
248
1 assets properly in position. You know, I
2 think the MTA, again, I agree with and
3 appreciate the way they handled things,
4 getting the buses in at the right time,
5 et cetera. So in terms of snow response,
6 we're learning a lot and I think we have a
7 very strong capacity to address these kinds
8 of blizzards.
9 In terms of hurricanes and coastal
10 issues, the resiliency work is increasing all
11 the time. It's been a very good working
12 relationship with the Army Corps of
13 Engineers, obviously our Parks Department and
14 others. That's of course going to happen
15 year by year. A lot of federal money coming
16 in, a lot of city and state efforts as well.
17 That will be ongoing work, meaning in the age
18 of climate change, resiliency work will
19 essentially never end. We will keep at it
20 all the time, improving resiliency.
21 And we want to figure out, obviously
22 working with you, what other things we can
23 do. I think there's some real DEP issues in
24 your neighborhood that we could work on
249
1 together. So I would look forward to
2 figuring out a plan with you and our
3 DEP commissioner, Emily Lloyd.
4 SENATOR PERSAUD: Okay. But you also
5 need to work with Sanitation to upgrade the
6 equipment that they have. You really need to
7 upgrade some of the equipment.
8 MAYOR DE BLASIO: Just for clarity,
9 what do you mean specifically?
10 SENATOR PERSAUD: The snow movers.
11 They're kind of ancient. You know, they've
12 passed their prime.
13 MAYOR DE BLASIO: Well, we're going to
14 keep investing in them, I assure you.
15 SENATOR PERSAUD: But they did a
16 better job being prepared this time.
17 Another thing, the state has decided
18 to not add additional funding for Summer
19 Youth, because we're looking at the minimum
20 wage increase. So the funding is just flat.
21 What is the city doing? Because we --
22 you look at many -- most of the kids who are
23 applying for Summer Youth are not receiving
24 jobs. And we have a situation in the city,
250
1 especially in the lower-income areas, where
2 there's a spike in violence. And you can
3 correlate the spike in violence with the kids
4 having nothing to do.
5 What is the city doing to help --
6 DYCD, some of the other agencies -- to fund
7 Summer Youth?
8 MAYOR DE BLASIO: We had an increase
9 in our local funding this last summer, so we
10 had a substantial increase in the number of
11 summer jobs. We just sat down with the
12 Council members when I announced my
13 preliminary budget. We're going to look to
14 the Executive Budget in May for further
15 determinations on summer jobs. Clearly
16 there's immense interest in the Council in
17 building on the number we had last year.
18 So I'm not going to make a formal
19 announcement, but I can simply say we're very
20 focused on it, the Council is very focused on
21 it. Everyone's interested in raising that
22 bar if we can find a way to do it. Obviously
23 as I -- I want to come back to where I
24 started the testimony: We're going to be
251
1 watching the overall economic indicators very
2 closely in the next few months because
3 there's a lot of warning signs that will
4 cause us to have to be very smart about how
5 we spend money. But it is certainly our goal
6 to go farther when it comes to summer jobs.
7 SENATOR PERSAUD: Thank you. I just
8 want to make sure that we understand it. We
9 have to be smart in the way we're spending
10 money, but spending money on our youth is
11 really important. That's the smartest thing
12 that we can --
13 MAYOR DE BLASIO: Well, with your
14 help, with your help, you're talking to the
15 guy who focused on pre-K and after-school for
16 middle school kids. So I'm there.
17 SENATOR PERSAUD: My last question is
18 about the rise in crime. What plans do you
19 have in place for this upcoming summer?
20 MAYOR DE BLASIO: Wait, say that
21 again, I'm sorry?
22 SENATOR PERSAUD: The increase in
23 violence, especially the increase in gun
24 violence within districts.
252
1 MAYOR DE BLASIO: Well, I'd like to
2 reframe that in my view. We always take very
3 seriously violence in any community, and we
4 know there is a scourge of gun availability
5 and gun violence. But I want to emphasize,
6 these numbers I'm about to indicate represent
7 human lives. When I say overall serious
8 crime is down 5.8 percent over two years,
9 shootings were down from 2014 to 2015, gun
10 arrests went up 10 percent, this is all
11 indicative of a city that's getting safer
12 even though there are serious challenges
13 still to be addressed.
14 In the course of this year, 2,000 more
15 officers will be on patrol, between the 1300
16 new that we are bringing on the force and the
17 700 or so that are being civilianized from
18 desk jobs to patrol.
19 All of these pieces are going to
20 increase our ability to get at the root of
21 the problem, which as Commissioner Bratton
22 and Chief O'Neill always say, is several
23 thousand particularly violent felons that are
24 still out there, many associated with gangs
253
1 and crews. The focus, more and more, is on
2 the real violence-doers, that core set of
3 violent criminals, and we're doing better at
4 getting at them -- you know, getting the
5 evidence, building cases about them, getting
6 the arrests, getting the guns off the
7 streets. That's going to intensify.
8 But I think the simplest way I can say
9 it is 2,000 more cops on the street is going
10 to make a huge difference.
11 SENATOR PERSAUD: Thank you very much.
12 MAYOR DE BLASIO: Thank you.
13 CHAIRWOMAN YOUNG: Thank you, Senator.
14 Senator Kennedy.
15 SENATOR KENNEDY: Thank you, Mayor,
16 very much for being here. Thank you for your
17 leadership.
18 MAYOR DE BLASIO: Thank you.
19 SENATOR KENNEDY: And for your
20 patience. I know it's been a long testimony
21 today --
22 MAYOR DE BLASIO: Patience is a
23 virtue, Senator.
24 SENATOR KENNEDY: It certainly is.
254
1 Over four hours, and I appreciate all of your
2 comments.
3 I just had a couple of different
4 thoughts, you know. Going way back several
5 hours in the testimony, there were a couple
6 of colleagues from upstate that touched upon
7 a couple of initiatives I want to ask you
8 about. The first has to do with the property
9 tax cap for New York City.
10 You know, there's been a lot of
11 positioning, a lot of rhetoric, a lot of
12 conjecture up here, and legislation proposed
13 and whatnot. I just want to hear again, you
14 know, your comments on the property tax cap
15 for the City of New York and, you know,
16 furthermore, if you believe -- because I have
17 a feeling I know what your answer may be --
18 if you feel that a study to get to the root
19 of this thing to back up our position on --
20 MAYOR DE BLASIO: The last part of the
21 question, I'm sorry? I believe --
22 SENATOR KENNEDY: Do you believe --
23 are you open to some sort of a study to that
24 effect on a property tax cap for New York
255
1 City if in fact that is necessary?
2 MAYOR DE BLASIO: I don't agree with
3 it philosophically. And practically as well.
4 I always want to --
5 SENATOR KENNEDY: What -- what is
6 that?
7 MAYOR DE BLASIO: I always want to
8 learn more, but I want to explain the "why"
9 in this.
10 SENATOR KENNEDY: On the property tax
11 cap itself? I'm sorry.
12 MAYOR DE BLASIO: Yes. I just don't
13 believe that it's a productive tool in terms
14 of what we're doing.
15 So again, when you combine the
16 particular challenges that the city faces --
17 which I don't think I have to document --
18 New York City has a whole host of very, very
19 intense challenges that have developed over
20 decades. That had a lot to do with the
21 quality of life in our city, the safety of
22 our city, fairness and decency in our city.
23 You know, these challenges didn't occur
24 overnight, but they're ours. Whether it is
256
1 the affordability crisis, the homelessness
2 crisis, the safety challenges -- which I'm
3 thrilled at how well NYPD has done on, but
4 there's more to come, obviously. The threat
5 of global terror that is aimed at New York
6 City in a way that's true of only a few
7 places in the United States of America. We
8 have a particular set of challenges.
9 We also know that in a downturn
10 scenario we're vulnerable in a way that's
11 overwhelming because, again, we know that the
12 federal and state partners will be
13 compromised in such a scenario and we know
14 that our fixed costs don't change. If we're
15 going to keep our streets safe, if we're
16 going to deal with a tremendous amount of
17 human need, we have to keep doing that,
18 downturn or no downturn.
19 So from my point of view, anything
20 that limits our capacity arbitrarily could
21 undermine the fundamentals of our city but
22 also undermine our ability to do the thing
23 which I think we're doing well now -- and I
24 want to give my predecessors credit and I
257
1 want to give the people in New York City
2 credit -- the fact that we're economically
3 stronger, after some decades where we were
4 really in decline, we are strong -- we have
5 to maintain that. For the good of our
6 people, for the good of the people of the
7 whole state, we have to keep that going.
8 So I don't want anything that inhibits
9 our ability to do that. I am sensitive to
10 the fact -- I am a homeowner in Brooklyn. I
11 understand people are going through some real
12 challenges in terms of the cost of living and
13 that property taxes are part of it. We're
14 certainly going to always look at ways that
15 we can address the challenges of our
16 homeowners. But a cap I think is a
17 problematic approach.
18 As I mentioned to Senator Lanza, I
19 know he's offering it in very good faith.
20 But even the circuit-breaker, or the override
21 capacity, is one that I think would be an
22 imperfect tool given the reluctance that
23 elected officials have, obviously, when it
24 comes to taxation.
258
1 So I think we're going to certainly
2 engage in fiscal discipline, we're going to
3 engage in ways of helping our homeowners, but
4 that would not be the one I'd choose.
5 SENATOR KENNEDY: Do you feel strong
6 enough in that, Mayor, to put a study forward
7 to back up that plan that you have put in
8 place?
9 MAYOR DE BLASIO: Again, I'm being
10 careful in my answer because I think that is
11 very much an eye-of-the-beholder question.
12 I'm always happy to have this conversation
13 with you. But there's no scenario that I can
14 envision where we would want to tie our hands
15 in terms of our ability to maintain the
16 standard of living of the people in New York
17 City and the safety of the people in New York
18 City.
19 If we had a different world, which
20 maybe was true 40 years ago, let's say,
21 50 years ago, where there was a federal
22 government ready, willing and able to come in
23 in the event of crisis -- and that was very
24 true in that time frame; not true today --
259
1 maybe I'd have a different world view. But I
2 have no illusion of that fundamental reality
3 changing any time soon, so I have to very
4 carefully protect the interests of my city,
5 and that's why I can't see any scenario where
6 I would agree with that.
7 SENATOR KENNEDY: Understood.
8 What about comparing, if you compare
9 property tax caps -- so if that's off the
10 table, the potential -- I know it's been
11 offered, and there's been talk about this --
12 the potential for a Medicaid cap. Your
13 thoughts on that as well.
14 MAYOR DE BLASIO: I think we've got
15 two dynamics happening simultaneously that
16 have to be addressed.
17 Again, I've spoken to the Governor's
18 proposal, and I have affirmed that I
19 appreciate the Governor's clarification that
20 it won't cost the city a penny. But we
21 understand there are real challenges in the
22 Medicaid system in general. As I said, I
23 appreciate that the Governor, when he first
24 came into office, focused on some of the
260
1 fundamental reforms needed.
2 And then we have -- so there's that
3 ongoing issue, but then we have a whole
4 different related issue of our Health and
5 Hospitals Corporation, which will need
6 substantial reform. So we'll absolutely
7 engage the Governor in ways that we can look
8 at reforms and efficiencies vis-a-vis
9 Medicaid in general in the city, but
10 specifically we have to engage in a process
11 very quickly of coming up with a reform plan
12 for our health and hospitals, our public
13 health and hospitals. That has to happen
14 under any event. The two to some extent
15 interrelate.
16 But what I can tell you is, having
17 just gone through the process with our
18 Housing Authority -- and remember, our
19 Housing Authority houses over 400,000 people.
20 And there was not a reform plan previously to
21 deal with its financial reality; we put that
22 in place -- we'll take the situation with
23 Medicaid, the situation with our Health and
24 Hospitals Corporation head-on. It's our
261
1 obligation to do so. We'll present a plan,
2 certainly I'm sure it will be part of the
3 conversation here, as with our City Council.
4 But we're dealing with a series of changes
5 that really represent a lot of history,
6 unfortunately, coming home and, you know,
7 having a very big impact now -- $17 billion,
8 in the case of the Housing Authority, that
9 should have spent over many years. It
10 wasn't. We have to deal with that problem
11 now. Medicaid issues that have only been
12 exacerbated by changes in state and federal
13 policy, no matter how well-intentioned.
14 That's what's happening, and it's happening
15 to public health systems all over the county.
16 So we've got to make a series of big changes.
17 They'll be tough, but it's our obligation to
18 do them.
19 SENATOR KENNEDY: Thanks, Mayor. One
20 other item, and I suppose that this has --
21 look, every initiative that comes out of New
22 York City, as you know, has a major impact
23 not just on this state but this country. And
24 one of the issues that I think has had an
262
1 impact on all of us for generations, and you
2 talk about, you know, where the city has come
3 from over the course of the last several
4 decades. And the city's a much different
5 place than it was back in '03 when the bonds
6 were refinanced.
7 But I want to go back to 1975, before
8 I was born. And we're going to be paying
9 these bonds off well into 2030 to 2034, as it
10 stands today. And as you had mentioned
11 earlier, we're going back hours in your
12 testimony, so forgive me for having --
13 MAYOR DE BLASIO: Ancient history.
14 SENATOR KENNEDY: Forgive me for
15 having waited so long to get back to this,
16 but I think it's important to talk about that
17 refinancing. That, you know, it was the
18 state, back again in '03, that picked up the
19 refinancing during a new crisis -- again,
20 before your administration -- and these
21 bonds, these STAR-C bonds were refinanced,
22 saving about $600 million. But as far as I'm
23 concerned, again, as an outsider of the
24 City of New York, as an upstater, these are
263
1 funds that the state, including us upstate,
2 helped to pay for.
3 And, you know, with a lot of these
4 cash-strapped cities, including my own and
5 other upstate cities, when it comes to AIM
6 funds -- and I know we've discussed that
7 before, and I heard your testimony about AIM
8 funding -- don't you feel that it would be
9 more appropriate to take that funding and
10 reinvest it into other cash-strapped cities
11 and municipalities like the ones in upstate
12 that are really in dire need right now?
13 MAYOR DE BLASIO: Again, Senator, I
14 know this is -- we're all providing, I hope,
15 a positive lesson here in a responsible,
16 positive public dialog between people who
17 happen to come from different regions,
18 different parties. You know, this is
19 actually what I think the people would like
20 to see more and more of all over the country.
21 You're raising a perfectly fair
22 question. What is fairness in this equation?
23 I again have spent a lot of time, I've been
24 very blessed to spend a lot of time in
264
1 Western New York, working in public service.
2 The profound needs -- profound hope, I
3 believe, great attributes to Western
4 New York, and profound needs. When we hear
5 about initiatives to help upstate, I applaud
6 them, I applaud them, because we're all in
7 this together.
8 So the question then becomes what's
9 fair in each and every one of the decisions
10 we look at. My point of view is, first of
11 all, when you talk about the AIM money -- so
12 $300 million-plus at the time it was cut; as
13 Dean reminds me, $500 million not long before
14 that. We can do the math any way we want.
15 If we take the $300 million, say it was cut
16 five years ago, that's $1.5 billion that
17 would have come to New York City. That's
18 gone. If you take the $500 million figure,
19 it obviously goes to $2 billion or more.
20 How about the money that was agreed to
21 by the Court of Appeals, the highest court in
22 the land, a decade ago that would have led to
23 many billions more for my public schools that
24 clearly are not where they need to be? And
265
1 no one's -- I know you feel the same about
2 your public schools -- no one's -- I don't
3 want to in a bad way compare scars. We're
4 all trying to fix problems that were handed
5 to us by history. We're all trying to serve
6 our people. But if I've got 30 percent of my
7 kids reading at third-grade level, I can't
8 say to you that I don't need the resources to
9 fix that problem fundamentally. By my
10 account, by the highest court in this state,
11 we should have had many billions more to deal
12 with that problem.
13 So we've lost a lot in these
14 transactions. On this one, we believe
15 fundamentally it is a ironclad understanding,
16 it was affirmed by the Court of Appeals on
17 the MAC bond issue. Once something is
18 written in stone like that and we are
19 depending on it, we need it, and then that
20 helps us make up for the sudden $600 million
21 that our actuary just put on our current
22 budget out of nowhere, which will go on every
23 year in the future. The problem with Health
24 and Hospitals -- which again, no matter how
266
1 well intentioned, did stem from, in part,
2 state and federal policy changes.
3 I could go on and on with all the
4 unanticipated problems or the infrastructure
5 challenges, et cetera. It doesn't make any
6 sense for me to say agreed-upon dollars we're
7 just going to give away when we have this
8 level of need.
9 SENATOR KENNEDY: Well, to your
10 point -- and I know I'm down to zero, so this
11 will be just the last comment, Mayor. Look,
12 there's much that I agree with you on. This
13 one, I disagree with you on. I believe if
14 we're going to focus on those education
15 funds, those AIM funds, those other areas,
16 that we should do so. But, you know, I think
17 a lot of folks get aggravated about the shell
18 game that's played. And, you know, there's
19 $600 million on the table. And just from my
20 perspective -- again, as an upstater, as a
21 Western New Yorker -- after this refinancing,
22 I believe that that funding could be utilized
23 in our area of the state as much as anywhere
24 else in the state, including the City of
267
1 New York.
2 MAYOR DE BLASIO: I know you're saying
3 that in good faith, and I just want to
4 respond in good faith.
5 The CFE decision, which was also aimed
6 at helping Buffalo, for example, and other
7 upstate cities, if I -- and I say this with
8 absolute respect, if we all could restart
9 that discussion productively, then it might
10 be possible to talk about different
11 trade-offs. But I have to say, over the last
12 couple of years I've been mayor, I've
13 presented the concern, I understand that
14 people have felt like it's something they
15 couldn't really entertain, for better or for
16 worse. But we're not having that
17 conversation, let's be straightforward about
18 that.
19 If we were having a conversation about
20 restoring the AIM money that was supposed to
21 be a one-year pause, and now it should come
22 back on the table, if that conversation were
23 going on, we would be having -- we could have
24 a more holistic conversation, perhaps. But
268
1 that's not what's happening.
2 I don't mean that to be negative; I'm
3 trying to be very constructive and positive.
4 Somehow, in all the back and forth, some
5 things come on the table, some things go off
6 the table. And I think when you tote it all
7 up, we certainly know some of those have hurt
8 us quite a bit.
9 On this one, again, we feel it's
10 straightforward. I understand your
11 frustration. I hope over the years we can
12 all find ways to rationalize some of these
13 things and make sense of them for the long
14 haul. But certainly just taking the narrow
15 question of the AIM money, what does it feel
16 like to, you know, the people of New York
17 City that we were supposed to have a one-year
18 pause and we've never seen it again? I'm
19 sure you can give your own parallel examples.
20 Until we're going to put all of that
21 on the table, it's hard for us to want to say
22 let's just give away something that we
23 believe is guaranteed to us.
24 CHAIRWOMAN YOUNG: Thank you, Senator.
269
1 Thank you, Mayor. I do have a couple
2 of additional questions, and then we'll
3 close.
4 So as you pointed out, I've been very
5 involved in housing issues, we worked
6 together on housing issues. And I agree with
7 you -- I want to go to page 6 of your
8 testimony, because I had a question there.
9 You talk about the bond cap allocation being
10 a vital resource for the city, and I fully
11 agree with your assessment regarding that.
12 And you also pointed out that last
13 year the city's Housing Development
14 Corporation efficiently used all of its state
15 bond cap allocation to fund its projects.
16 Which is true, but then you go on to say that
17 HDC couldn't even get started on almost 1200
18 affordable apartments across the five
19 boroughs simply because it did not receive
20 enough in bond cap allocations from the
21 state.
22 And so my question is, isn't the HDC
23 amount an amount that is determined and
24 requested by the city, and so if you ran out
270
1 of money, did you ask for too little?
2 MAYOR DE BLASIO: No. In fact, we
3 asked for more. I'll start, and my
4 colleagues may have more sense of the
5 details, but I'll give you the overview.
6 We certainly asked for more. And we
7 understand that there's a statutory amount
8 and then, beyond that, a pretty consistent
9 history of additional resources coming in in
10 terms of where the projects could be most
11 effectively achieved.
12 Look, that's -- again, this is not a
13 Democrat or Republican or upstate or
14 downstate thing. We all want the taxpayers'
15 money used well. So we would rather see
16 resources go to a project ready to go than be
17 held for something that's not ready to go, or
18 a project that is going to yield more
19 affordable housing versus less.
20 In this instance, those units were
21 ready to go, the state was quite aware of it.
22 We had requested the additional authority,
23 and we were told it was not going to be made
24 available. Even though we think it could
271
1 have been made available.
2 We were obviously working in good
3 faith to keep moving these efforts forward.
4 We don't want to add additional layers that
5 we think will only slow down a structure that
6 right now needs to move as quickly as
7 possible because of the desperate need for
8 affordable housing.
9 CHAIRWOMAN YOUNG: And I agree with
10 you, there's a desperate need for affordable
11 housing. And actually I'd like to applaud
12 you for your goal of developing 200,000 new
13 units of affordable housing.
14 MAYOR DE BLASIO: Thank you.
15 CHAIRWOMAN YOUNG: I think it's
16 absolutely necessary for the future of the
17 city.
18 But I do want to point out a couple of
19 things because as you know -- I think you
20 know this -- that it's extraordinarily
21 expensive to live and to work and to do
22 business in the city, and it's the result of
23 several dynamics, and you've pointed some of
24 them out today. One of them has to do with
272
1 the tax burden that we have in the city. And
2 I want to applaud -- Senator Lanza had to go
3 to another hearing, but I want to applaud
4 Senator Lanza for his focus on property tax
5 relief for the middle class in his district,
6 for seniors on fixed incomes.
7 And you've pointed out that you are
8 opposed to a property tax cap. You just made
9 that very clear to Senator Kennedy during
10 your remarks. But at the same time, when
11 you're saying you're not raising property
12 taxes, as Senator Avella pointed out, maybe
13 that's not happening, but assessments are
14 going up year after year. And as a result of
15 the assessments going up, then we have the
16 net effect of property taxes going up.
17 That's a real impediment in so many ways to
18 growth in the city.
19 And as a result, based on that, based
20 on, you know, exorbitant land costs, based on
21 the high cost of doing business, whether it's
22 regulatory, a lot of extra bureaucracy and so
23 on, all those things drive up costs in the
24 city. And so it has exacerbated the housing
273
1 shortage that we have in the city.
2 And so as a result of that, I would
3 suggest that there's a structural problem
4 that you're dealing with with regulatory
5 systems, with tax systems, with the cost of
6 land. And have you considered what you could
7 do as mayor to tackle that structural problem
8 that you have? Because that is actually
9 contributing in such a big way to the housing
10 shortage that you face right now.
11 MAYOR DE BLASIO: I appreciate the
12 question, and I think you're right, that
13 there are some really big factors at play
14 here.
15 Now, I would argue we have -- I used
16 to use the phrase "A tale of two cities." I
17 still use it sometimes, and I'll use it in
18 this case, because we have it in this sense.
19 One, there are some exceedingly
20 positive factors that are actually
21 complicating things. Right? The increased
22 value on our land and on our buildings, our
23 real estate values just continuing to grow,
24 is obviously a blessing on so many levels and
274
1 indicates economic strength. The fact that
2 the city is growing physically in terms of
3 population, growing in terms of job growth,
4 these are wonderful things. But they also
5 put immense pressure on the affordable
6 housing equation. So in that sense the
7 success you want creates some real unintended
8 consequences.
9 If the question is do we need to
10 rethink some of the elements of our tax
11 structure, I think that's a fair point,
12 because there's always been a certain amount
13 of inconsistency and lack of clarity in the
14 New York City property tax system. It's
15 something that will have to be done very
16 carefully, very intelligently. It's
17 something that would take a lot of work. But
18 I've said long ago I recognize there are
19 challenges and problems in our tax system
20 that have to be looked at.
21 At the same time, the thing I can do
22 right now -- and we're all, you know, here to
23 think about how we can practically help
24 people -- what I can do right now is make
275
1 sure there is not a property tax rate
2 increase, which is one thing I think would
3 unify all the homeowners of New York City, is
4 that that would be an added burden. We've
5 avoided that for now three budgets in a row,
6 and we're going to keep avoiding that.
7 But in terms of coming back at these
8 underlying issues -- you know, ways that we
9 can help our seniors, ways that we can create
10 more consistency in our tax system and more
11 consistency across the different parts of the
12 city -- these are real issues. I'm certainly
13 going to be looking at them. I've been
14 thinking about ways we could approach them.
15 The one thing you'll appreciate, that will
16 take a big, complicated structural fix, and
17 it will take time to sort that out, for sure.
18 CHAIRWOMAN YOUNG: I think you're
19 right for sure on that point, because every
20 time property taxes go up, there is an
21 impact, for example, on rental housing also.
22 And tenants in market-rate apartments, you
23 know, have their costs go up because the
24 property taxes go up because the assessments
276
1 go up. Tenants who live in rent-regulated
2 apartments, the costs go up for owners and
3 then the owners aren't able to fix their
4 buildings. So there is an impact on tenants,
5 there's an impact on homeowners, there's an
6 impact on businesses, there's an impact on
7 the ability to develop more affordable
8 housing. So I think that those are very,
9 very dire issues that need to be looked at.
10 And so as a result of the heavy costs
11 associated with doing business in New York
12 City, the only economic development tool that
13 we have is the 421-a program, which as you
14 know provides incentives and benefits to
15 develop affordable housing units. And so I'd
16 just say that we need to take a look at that
17 again because right now there's nothing to be
18 able to develop affordable housing, and that
19 is a critical issue that needs to be
20 addressed. And I'm sure you would agree with
21 that.
22 MAYOR DE BLASIO: I agree, and we
23 would appreciate -- and we know you've worked
24 closely with us, and we'd appreciate deeply
277
1 your help and your leadership, because we
2 think there is a solution available, given
3 the plan we put forward, which had widespread
4 support. We think there's a way to reach
5 that plan or something like it, and move
6 forward. But the bottom line is we have a
7 need to keep the right kind of development
8 forward so we can create that affordable
9 housing. There's no reason for it to stall
10 if by good decisions here in Albany we can
11 keep it moving.
12 CHAIRWOMAN YOUNG: Yup. So thank you
13 for that.
14 You also talked about, you know, rent
15 control, rent regulation and units going out
16 of the system. But the reason those units
17 are going out is that the people living in
18 them have actually hit a certain income
19 threshold. So these are people with higher
20 incomes that are going out of the system, and
21 I'm sure you would agree with me that those
22 kinds of assistance through rent regulation
23 really should go to people who truly need it.
24 And so we have programs like the Senior
278
1 Citizen Rent Increase Exemption program that
2 actually freezes the rent for people who are
3 seniors on fixed incomes who can't afford to
4 pay their rent because it's so much of their
5 income every year. And, you know, in 2014
6 the Legislature actually changed the amount
7 from $29,000 per year up to a threshold of
8 $50,000 a year, which actually has helped a
9 lot of seniors in New York City.
10 The same with the similar program for
11 people with disabilities with a freeze on
12 rent. And you probably know that I sponsor
13 legislation to do the same for all tenants
14 who make $50,000 a year or less and pay a
15 high amount of their income toward rent. And
16 I'd like to see that move forward, because I
17 think that's a much more positive solution
18 than the current system.
19 With that being said, I noticed after
20 we had passed that in 2014 there was an
21 article in the New York Times, I think it was
22 May 20th, that said that the city needs to do
23 a better job on getting the information out
24 to people who qualify for the SCRIE and the
279
1 DRIE programs. And then there was a
2 follow-up, I was very interested, right after
3 Christmas, on December 31st of 2015, there
4 was a follow-up article about a senior in a
5 rent-controlled apartment who was concerned
6 because her rent may be going up because she
7 wasn't under the same freeze as the Rent
8 Guidelines Board. But the point was is that
9 she qualified for SCRIE, and I noticed that
10 right away in that article.
11 And I guess the question is, what is
12 the city doing to help those people, and
13 should there be a better focus on making sure
14 the word gets out to those renters?
15 MAYOR DE BLASIO: Well, first of
16 all -- and I'll turn to Dean and Sherif in a
17 second, but let me first say thank you for
18 your leadership in adjusting that income
19 level. That was absolutely crucial for
20 people all over the state, and certainly in
21 the city as well. And we appreciate that
22 deeply because that reflected the reality of
23 people's lives, to have SCRIE and DRIE
24 adjusted that way.
280
1 We do engage in very energetic
2 outreach efforts. We're trying to improve
3 upon them and strengthen them. We know a lot
4 of our colleagues, local elected officials,
5 do as well, and they're key partners in that.
6 So I agree with you, the last thing I want to
7 see is anyone having that right and not
8 taking advantage of it. We've tried to on
9 many fronts do a better job, because I think
10 previously New York City government was not
11 sufficiently communicative with its people.
12 So we've tried to fix that on many, many
13 fronts.
14 In terms of SCRIE and DRIE directly,
15 Dean or Sherif?
16 DIRECTOR FULEIHAN: Right, we will
17 come back to you with specifics. We do
18 recognize that, and we are taking -- the
19 mayor's right, he has directed us to take
20 much more active outreach on SCRIE, on DRIE,
21 and actually on the EITC as well.
22 CHAIRWOMAN YOUNG: I think you'd be
23 helping a lot of very needy people as a
24 result of that.
281
1 And as you also know, we fundamentally
2 philosophically disagree about price controls
3 and rent control. And, you know, on our side
4 of the equation we believe that it has
5 exacerbated the housing shortage in New York
6 City. It was supposed to be temporary from
7 1943, and it's still in place. And, you
8 know, better solutions -- we all want more
9 affordable housing. Better solutions would
10 be a free market system, developing more
11 affordable housing, and actually having a
12 system that addresses the most needy people
13 who can't afford to live. So that's
14 something that we continue to work on --
15 MAYOR DE BLASIO: Senator, if I may,
16 just -- despite there may be some
17 philosophical differences, in addition to
18 thanking you for the partnership on many
19 fronts, I would say we also have put a very
20 clear focus in our affordable housing plan on
21 promoting the creation of market-rate rental
22 housing. We all know the reality of the new,
23 higher-priced condos that have become such a
24 big part of the housing landscape.
282
1 We think -- I think this may be a
2 point where there's some agreement -- that a
3 robust market-rate rental market is very good
4 for the overall availability of affordable
5 housing. So we have a series of actions that
6 are part of our overall plan to support and
7 encourage that development as well for the
8 good of all.
9 CHAIRWOMAN YOUNG: Okay, thank you for
10 that, Mayor.
11 And just one final question, going
12 back to the questioning at the beginning.
13 You know, so we have the budget in place for
14 New York City through the state right now for
15 this year. And when you compare the budget
16 for this year with the proposed budget from
17 the Governor for 2017, which one is better,
18 which one would you prefer to see, if you had
19 to compare the two?
20 MAYOR DE BLASIO: I have to honestly
21 say to you that there's so many unclear
22 points in the current budget, there's so many
23 unanswered questions, that I can't in good
24 faith give you a perfect comparison. Maybe
283
1 when we've gotten all the facts I can answer
2 that better.
3 Obviously almost a billion dollars
4 that at this moment we're assured will not be
5 manifested as a cut, we need that to be
6 ratified as we go forward. That's an area of
7 tremendous concern. But overall, there's
8 just a lot of elements of this budget that we
9 don't have the full facts on. We deeply
10 appreciate, as I said, the very first words
11 of my testimony, there's some elements of
12 this budget -- on the supportive housing, for
13 example -- that I am exceedingly appreciative
14 for. But there's a lot of other areas where
15 until we get answers, I can't give you an
16 honest comparison.
17 CHAIRWOMAN YOUNG: I appreciate that
18 answer. But I will say to you that in this
19 budget, from what I can see, there are
20 significant investments in the city across
21 the board -- you know, transportation,
22 supportive housing, all kinds of things that
23 are very beneficial to the city. So we'll
24 continue to go through the process, but I
284
1 believe that when we look at things side by
2 side, at the end of the day, you would prefer
3 this budget over last year's because of those
4 significant investments.
5 So thank you very much for your
6 testimony today.
7 MAYOR DE BLASIO: Thank you, Madam
8 Chair.
9 CHAIRWOMAN YOUNG: Really appreciate
10 it.
11 MAYOR DE BLASIO: Thank you very much.
12 SENATOR KRUEGER: Thank you,
13 Mr. Mayor.
14 CHAIRMAN FARRELL: Thank you.
15 (Pause.)
16 CHAIRMAN FARRELL: Next, New York City
17 Comptroller Scott Stringer.
18 COMPTROLLER STRINGER: How're you
19 doing? Thank you.
20 CHAIRMAN FARRELL: I just wanted you
21 to remember who you are.
22 COMPTROLLER STRINGER: Well, thank
23 you, Chairman Farrell and Senate Republican
24 colleagues, Democrats, Republicans -- first
285
1 of all, I want to lay aside my remarks and
2 just simply say, based on the mayor's
3 impressive performance today, a four-hour
4 marathon --
5 CHAIRMAN FARRELL: Five hours.
6 COMPTROLLER STRINGER: -- I think that
7 he gets everything he asks for, so --
8 (Laughter.)
9 COMPTROLLER STRINGER: So let me try
10 to fill in some of the mayor's talking points
11 and -- it really is great to be here, because
12 I really do welcome the chance to speak to
13 you today about the Governor's proposed
14 Executive Budget.
15 And as someone who has served in the
16 Legislature for 13 years, I understand that
17 this is not the beginning. This is actually
18 the beginning of a conversation that we're
19 going to have for many, many months, and I
20 want to thank everybody for sitting through
21 this very long hearing. And I look forward
22 to working with all of you to advance a
23 budget that is equitable and sound.
24 The Governorís proposed budget makes a
286
1 number of critical investments in both human
2 and physical infrastructure that will lay the
3 foundation for continued economic growth
4 across the State.
5 So first, I stand with the Governor in
6 supporting an increase in the minimum wage to
7 $15 an hour. Raising the minimum wage is one
8 of the most effective tools we have to attack
9 income inequality and will place our state
10 firmly back in a leadership role on this
11 vital issue.
12 As my office has found, a phased-in
13 $15 minimum wage would put an additional
14 $10.2 billion into the pockets of
15 1.46 million workers in New York City alone.
16 Thatís real money that can help provide
17 working families a pathway to the middle
18 class so they can pay for college, make a car
19 payment, or just put food on the table.
20 Likewise, I strongly support the
21 Governorís proposal for a permanent extension
22 of the Earned Income Tax Credit to
23 non-custodial parents. Since 2012, the EITC
24 has pulled 70,000 New York City households
287
1 out of poverty, and in 2014 it returned some
2 $4.1 billion to New Yorkers -- an average of
3 over $2,300 per tax filer. Thatís called
4 making work pay. And I would argue and urge
5 this Legislature to go even further by
6 doubling New York Cityís EITC, expanding
7 eligibility to childless workers, and
8 lowering the age floor to 21.
9 In addition to raising wages for
10 low-income New Yorkers, I support the
11 Governor's push for paid family leave.
12 According to a survey by my office,
13 80 percent of New Yorkers support a paid
14 family leave system funded by a small
15 employee payroll deduction, such as the Paid
16 Family Leave Insurance Act, which passed the
17 Assembly last year.
18 Governor Cuomo has also issued a
19 series of proposals that support New Yorkís
20 historic legacy as a land of immigrants.
21 From certifying UVisa applications for more
22 immigrant victims of crime, to making the
23 Task Force to Combat Worker Exploitation
24 permanent, we will continue to show that New
288
1 York is open to all.
2 Finally, the proposed budget makes key
3 investments to aid one of our most vulnerable
4 groups: our homeless population. Last night
5 58,000 city residents, including 23,000
6 children, slept in our homeless shelters,
7 with thousands more choosing to sleep on our
8 streets.
9 In December, my office completed an
10 audit that found more than half of shelter
11 units for children and families were plagued
12 by peeling paint, roaches, rats, and the
13 chill from broken windows. Earlier this
14 month, we analyzed every single building
15 housing homeless families with children, from
16 shelters and hotels to so-called "scatter
17 site" housing. We found that two-thirds of
18 sites had unaddressed violations that
19 threaten life, health, and the safety of
20 residents.
21 This is our invisible city, and we
22 will continue to shine a light on these
23 conditions and demand change. Thatís why we
24 welcome the Governor's increased support for
289
1 combating homelessness. And we look forward
2 to seeing improvements as we continue to
3 monitor shelters in New York City, just as
4 State Comptroller Tom DiNapoli and Buffalo
5 Comptroller Mark Schroeder do the same in
6 other parts of the State. We may not be able
7 to fix homelessness in a day, but we can
8 ensure that our shelters are safe, clean, and
9 livable, and thatís what we intend to do.
10 At the same time, we must also do more
11 to address the underlying causes of
12 homelessness, including the lack of
13 affordable housing in our communities.
14 For decades, the New York City Housing
15 Authority has been a bastion of affordability
16 throughout the five boroughs. But despite
17 the fact that NYCHA is home to over 400,000
18 New Yorkers, it has a capital shortfall of
19 $17 billion. Thatís why today I am renewing
20 a call I made two years ago to create a new,
21 dedicated revenue stream for NYCHA, using
22 surplus funds from the Battery Park City
23 Authority.
24 Battery Park City generates a surplus
290
1 every year. As part of a settlement
2 agreement between the city and the state, a
3 portion of those dollars have been directed
4 to affordable housing and other city capital
5 needs since 2010. We now have an opportunity
6 to direct those dollars explicitly toward
7 NYCHA, our largest source of affordable
8 housing.
9 I know there is support in the
10 Legislature for this idea. But we could do
11 this without legislation. Under the terms of
12 the existing settlement agreement, all that
13 is required is a unanimous vote by the mayor,
14 the governor, and the city comptroller -- and
15 I vote yes. I hope that you can help us,
16 talking to our mayor and governor, to get
17 this done.
18 NYCHA residents shouldn't have to wait
19 any longer for roofs to be fixed, mold to be
20 eradicated, and doors to be secured. We
21 should make this happen this year. This
22 excess money would total more than
23 $400 million over 10 years, and provide the
24 first new source of recurring revenue for
291
1 NYCHA in years. That is our way of saying we
2 can find new sources of revenue, we don't
3 only have to be reliant on what has always
4 been.
5 Now, recent discussions concerning
6 CUNY and Medicaid have raised the prospect of
7 efficiencies in each system. I am pleased
8 that Governor Cuomo and Mayor de Blasio have
9 been discussing these vital programs and have
10 committed to making no cuts. Funding CUNY is
11 essential. We should be investing more in
12 higher education if we truly want to keep New
13 York a global center of commerce and
14 innovation.
15 No place represents those aspirations
16 better than CUNY, where three quarters of
17 undergrads come out of New York City public
18 schools; 42 percent are the first generation
19 of their families to attend college; and
20 where a quarter of students are African
21 American, 29 percent are Latino, and 19
22 percent are Asian. These are the future
23 leaders of our city and our state, and they
24 deserve our support.
292
1 In recent years, CUNY has faced a
2 number of challenges from rapidly rising
3 enrollment to annual tuition increases. In
4 addition, their appropriation from Albany has
5 not kept pace with the stateís own operating
6 budget. An analysis by my office shows if
7 aid to CUNY had grown at the same rate as the
8 stateís operating budget over the last seven
9 years, the system would have an additional
10 $637 million on hand today. Colleges and
11 universities play a key role in making New
12 York City a vibrant place to live and work.
13 We should be doubling down on the economic
14 engine of CUNY.
15 We also need to recognize that CUNYís
16 staff are the lifeblood of these
17 institutions, and, unlike most other state
18 workers, have been without a contract for
19 five years.
20 We need to put CUNY on a solid,
21 sustainable path forward. Because when we
22 invest in higher education, we win. When we
23 invest in students, we win. And when we
24 invest in teachers, we definitely win. And I
293
1 think we should now work towards that issue
2 in this coming budget cycle.
3 Now, I recognize as a former
4 legislator that budgets are fluid, and I have
5 been assured that negotiations are
6 progressing between the city and the state
7 over Medicaid efficiencies. But I want to
8 make it clear: Our Medicaid system covers
9 one out of every three New Yorkers, many of
10 whom have no healthcare at all if not for
11 this system. Any shifting of costs has to be
12 examined through the prism of these patients.
13 If New York City had to pay for all
14 the growth in its Medicaid costs, it could
15 add up to $300 million to fiscal year 2017,
16 it would climb to $735 million by fiscal year
17 2020. These additional burdens come at a
18 time when the New York City Health and
19 Hospitals Corporation is already facing
20 significant financial challenges.
21 As my office found in our "Holes in
22 the Safety Net" report, New York City Health
23 and Hospitals treated over 430,000 uninsured
24 patients in 2014. That included many
294
1 undocumented residents who are ineligible for
2 Medicaid coverage or subsidies under the
3 Affordable Care Act.
4 Mayor de Blasio has acted fast. He
5 has recently announced plans for a broad
6 restructuring of HHC and in the meantime has
7 dedicated over $300 million in dedicated
8 funds to keep the systemís doors open to all.
9 Reducing state Medicaid support will make it
10 that much harder for the mayor to continue
11 his efforts to put Health and Hospitals on a
12 stable path. These hospitals are vital
13 pieces of our safety net and deserve to be
14 protected.
15 Finally, I want to address the STAR-C
16 bond financing. In 2003 the state helped the
17 city, then in the grips of the post 9/11
18 recession, by assuming the remaining
19 Municipal Assistance Corporation bonds, bonds
20 that helped New York City emerge from the
21 fiscal crisis. Ultimately the city issued
22 so-called STAR-C bonds to pay off the MAC
23 debt. In 2014, the mayorís Office of
24 Management and Budget and my office, the
295
1 comptrollerís office, worked together and
2 took the opportunity to refinance the STAR-C
3 credit with lower interest rates. That
4 allowed the city to achieve savings of over
5 $600 million, money that was reinvested to
6 support vital city services. This was one of
7 the many fiscally wise decisions made by the
8 city in the aftermath of the Great Recession
9 to refinance debt at lower interest rates.
10 Cities and localities should be
11 encouraged to refinance their debt when
12 opportunities arise. However, the proposed
13 budget does the opposite by diverting
14 $600 million of savings from the city to the
15 state over the next three state fiscal years.
16 It sends the wrong message to localities: If
17 you do the right thing, if you fix
18 strategically, if you come up with a plan and
19 you invest wisely, you work with the
20 comptroller, treasurer, city manager, mayor,
21 however your government structure is, the
22 first thing that's going to happen is you
23 become a victim of your own success. I urge
24 you to leave our funding alone in this
296
1 regard.
2 I look forward to the successful
3 resolution of these budgetary issues, as well
4 as other critical pieces of the Governorís
5 budget. That includes a extension of mayoral
6 control, which I support. Mayors need to be
7 held responsible for the performance of our
8 schools, so we need to give them the tools
9 required to get the job done. Itís all part
10 of rebuilding the foundation of New York
11 City.
12 Itís easy to forget that just 40 years
13 ago the City faced the prospect of a
14 crippling financial crisis, a burgeoning drug
15 epidemic, and a rapidly declining population.
16 Many believed that we were in a downward
17 spiral that would culminate in the death of
18 the Great American City. In the years that
19 followed, however, something truly amazing
20 happened. The public and private sectors
21 came together to invest in New Yorkís future,
22 pumping billions of dollars into
23 infrastructure. We laid the foundation for
24 the cityís economic revival, and today we've
297
1 got over 4 million private-sector jobs -- the
2 most ever -- record tourism and tax receipts,
3 and a diverse, growing population. And
4 thatís good for all of us, because as goes
5 the city, so goes the state.
6 But believing in the inevitability of
7 New Yorkís rise today is as foolhardy as
8 believing in our demise 40 years ago. In the
9 past few months alone, we've seen plenty of
10 storm clouds: A slowdown in Chinaís economy
11 that has sent oil and commodity prices
12 crashing down, while raising the risks of a
13 world-wide economic slump; a seven percent
14 drop in the S&P 500 index since the beginning
15 of the year, a fresh reminder that the cityís
16 finance industry generates approximately 15
17 percent of its tax revenue. Jobs have been
18 cut at the Bank of America, Morgan Stanley,
19 Citi, Barclays, and Deutsche Bank. We also
20 must continue to wrestle with some of our
21 most intractable problems: homelessness,
22 affordable housing, and true wage stagnation.
23 But that's the historic opportunity
24 before us today. Thanks to a brighter
298
1 economic outlook, we now have a chance to
2 attack those tougher, long-term challenges.
3 For years now, we've had to scramble from one
4 crisis to another: 9/11, the Great
5 Recession, Hurricane Sandy. New York always
6 comes back. But now we as a city and a state
7 have a chance to really pay down our
8 principal and get at the root of our
9 toughest, long-term challenges. We can house
10 the homeless. We can educate every child.
11 We can create good jobs at good salaries.
12 And we can make sure that New York City
13 continues to be the economic engine that
14 powers the Empire State.
15 To do that, we need to come together
16 as a city and a state and invest in our
17 futures. Because when we do that, we all
18 win. You see, it's not about upstate and
19 downstate -- you have yours, I want mine.
20 This is about a partnership. And for many of
21 us who represent the 8.5 million people in
22 the city, we are here today to tell you,
23 especially those of you not from New York
24 City, that we do respect our partnership, we
299
1 do respect the give-and-take, we do respect
2 your priorities. We just ask you to respect
3 ours as well.
4 Thank you for giving me this
5 opportunity, and it truly is great to be back
6 with many of you that I have known and, of
7 course, Chairman Farrell, with you always.
8 So thank you.
9 CHAIRMAN FARRELL: Thank you very
10 much.
11 Assemblyman Benedetto.
12 ASSEMBLYMAN BENEDETTO: Thank you,
13 Mr. Chairman.
14 And Mr. Comptroller, welcome to
15 Albany. Thank you for your patience as well.
16 COMPTROLLER STRINGER: I enjoyed every
17 minute of it.
18 ASSEMBLYMAN BENEDETTO: I'm sure you
19 did.
20 COMPTROLLER STRINGER: I know I have
21 issues.
22 (Laughter.)
23 ASSEMBLYMAN BENEDETTO: The Mayor,
24 throughout his comments here today,
300
1 continually stressed that yes, we're going to
2 have a surplus of money, we're going to put
3 them into reserves, reserves for the bad
4 times in the future. And that, towards the
5 end of your comments here, you kind of
6 recognized that the future is not always
7 bright.
8 Do you care to comment on the mayor's
9 proposal, the mayor's building up of some
10 reserves? And is the mayor putting aside
11 enough for the future?
12 COMPTROLLER STRINGER: You know, some
13 of you may think that we have too much of a
14 cushion. I would argue with the mayor that
15 we have to actually put more away. We should
16 put away -- we should look at putting away 12
17 to 18 percent in terms of our budget outlays.
18 We have to get the cushion up more. And I'll
19 tell you why. After 9/11, any cushion we had
20 was wiped out. Hurricane Sandy -- wiped out.
21 This is such a unique city and it's so
22 massive and big that it may seem like a lot
23 of cushion, but it's really not. So I think
24 that to protect our city and our state we
301
1 need more of a cushion. I think we're about
2 1.6 billion short.
3 Obviously, you know, as comptroller I
4 have a certain perspective on the fiscal end.
5 The mayor is grappling with a lot of what he
6 has to do budgetarily and has different
7 priorities, and so we also will have a give
8 and take between the City Council and the
9 mayor on some of these budget priorities.
10 ASSEMBLYMAN BENEDETTO: Thank you very
11 much for your honesty.
12 Thank you, Mr. Chairman. I'm fine.
13 CHAIRMAN FARRELL: Thank you very
14 much.
15 Senator?
16 CHAIRWOMAN YOUNG: Thank you very
17 much.
18 And welcome, Comptroller Stringer.
19 It's good to see you again.
20 As you may recall, because it was so
21 long ago, we did serve together in the
22 State Assembly. So it's always great to see
23 you.
24 COMPTROLLER STRINGER: We served
302
1 together on the Housing Committee.
2 CHAIRWOMAN YOUNG: That's true.
3 COMPTROLLER STRINGER: And I want to
4 congratulate you on your new role.
5 You were always great on the
6 committee, and I always knew that when you
7 voted yes, I had to vote no, and we'd both
8 keep coming back here. So that's great.
9 CHAIRWOMAN YOUNG: Some things never
10 change.
11 (Laughter.)
12 CHAIRWOMAN YOUNG: So I'd like to call
13 on my colleague, Senator Marchione, who has
14 some questions.
15 SENATOR MARCHIONE: Hi. Do you run,
16 in the City of New York, youth programs where
17 you hire youth in the summer?
18 COMPTROLLER STRINGER: Yes.
19 SENATOR MARCHIONE: And can you tell
20 me how many youth you hire?
21 COMPTROLLER STRINGER: I don't have
22 that available to me right now.
23 I don't do the hiring. You know, as
24 comptroller, I do the oversight. But the
303
1 city has many programs that hire young
2 people.
3 SENATOR MARCHIONE: So you have a
4 budget, then, for those youth?
5 COMPTROLLER STRINGER: Well, there
6 would be a budget line, yes.
7 SENATOR MARCHIONE: So you don't know
8 what that budget line is?
9 COMPTROLLER STRINGER: I didn't bring
10 that information with me.
11 SENATOR MARCHIONE: Okay. I'd like to
12 know that.
13 You're proposing a $15 an hour minimum
14 wage. Are you prepared to pay the youth in
15 the City of New York $15 an hour? Do you
16 have those monies in the budget to pay youth
17 $15 an hour? And do you have an age that you
18 hire throughout the city?
19 COMPTROLLER STRINGER: I don't think
20 we've gotten that far, you know. We're
21 phasing in the $15 minimum wage.
22 But it certainly would be a great goal
23 so that when young people, whatever their
24 age, spend time at a summer job that they can
304
1 actually get a real wage. Maybe they can put
2 some of that money away and buy schoolbooks
3 or pay for a lunch while they're going to
4 class.
5 SENATOR MARCHIONE: I'm not saying
6 that the money wouldn't be good for them.
7 What I'm asking is, have you prepared to put
8 those monies in? Because even though it's
9 going to be phased in, you're going to face
10 it if it gets passed this July. And you're
11 phasing in in New York City much faster than
12 what we're phasing in in our --
13 COMPTROLLER STRINGER: I believe that
14 we should ensure that people can earn a
15 livable wage, and $15 an hour is a reasonable
16 wage for the City of New York.
17 And we did a study, because I know
18 people last year asked me this question and
19 now you're asking me again, but I cannot tell
20 you how much a minimum wage increase to $15
21 would mean to the New York City economy.
22 We would pump $10 billion into
23 communities all over the city. The economic
24 engine that that would create, not just
305
1 benefiting individuals but benefiting our
2 local business community, making sure that
3 people have the extra dollars to go into
4 stores, go into restaurants, support local
5 businesses, I think would be a pretty
6 important aspect of our economic strategy.
7 SENATOR MARCHIONE: But you still have
8 to have it in the budget no matter how well
9 it's going to be spent throughout the city.
10 You still have to have it. I can't pay
11 something I don't have in my pocket, if I'm a
12 small business. You don't have it, you can't
13 pay it either.
14 Could you look into your budget and
15 let me know whether you have increased your
16 youth budget, how many youth you do have, and
17 whether you're preparing for a $15 an hour --
18 COMPTROLLER STRINGER: We'll certainly
19 get back to you.
20 SENATOR MARCHIONE: Thank you.
21 CHAIRWOMAN YOUNG: Thank you, Senator.
22 CHAIRMAN FARRELL: Thank you.
23 Assemblywoman Malliotakis. I have to
24 read it.
306
1 ASSEMBLYWOMAN MALLIOTAKIS: Every time
2 he says my name, it's different.
3 (Laughter.)
4 COMPTROLLER STRINGER: Hi, Nicole.
5 ASSEMBLYWOMAN MALLIOTAKIS: Thank you,
6 Mr. Comptroller, for being here and being
7 patient.
8 I just had two quick questions. You
9 recently came to my district to do a couple
10 of hearings, one on Sandy oversight. You had
11 initially, before the hearing, had issued a
12 report that about $17 million were paid to
13 consultants and that there was a lot of waste
14 in the system. There were also some double
15 billings to some of the contractors -- or
16 consultants, rather.
17 I just wanted to get an update on what
18 your findings were and what improvements have
19 been made at the city level to try to make
20 this more efficient and streamlined.
21 COMPTROLLER STRINGER: You know, we
22 did this audit two ways. We actually held
23 hearings -- I think you were there -- in each
24 of the impacted areas of Sandy, not just on
307
1 Staten Island but throughout the city. And
2 we took testimony from New Yorkers in every
3 part of the area -- South Brooklyn, Coney
4 Island.
5 And it was amazing to me that people
6 were coming to our hearings testifying to the
7 fact that their paperwork and financial
8 documents had been lost. And we heard this
9 over and over again, if you remember. And we
10 couldn't quite understand how you could come
11 to Build It Back and just have paperwork
12 lost, no intake person that followed your
13 case -- all the basic issues.
14 So we launched our audit while we were
15 having these hearings, and at the conclusion
16 we said Build It Back was an unmitigated
17 disaster. Thousands of people got hurt in
18 the process. The paperwork was lost because,
19 basically, at the first hint of trouble --
20 meaning a hurricane coming -- the city's
21 response was go hire the consultants: Go
22 hire PMG, go hire Solix, go hire URS, and
23 they will take care of everything. They will
24 set up the computer system, which they
308
1 didn't, they will set up a way for people to
2 engage Build It Back -- that never happened.
3 And so basically the only people who
4 benefited from setting this up were the
5 actual consultants. It was truly a scandal.
6 And I think it's a lesson to all big
7 cities that we have to build out -- the
8 lesson is we have to build out OEM and
9 emergency services for the disasters that
10 will definitely come our way. And we have
11 been too lax, because we think we can hire
12 consultants to get us out of the next big
13 storm or the next attack, and what our audit
14 showed was that can't happen.
15 I will tell you, while we haven't gone
16 back and audited, we are monitoring Sandy and
17 the Build It Back. And while you can look at
18 a better process, I still think we can't
19 account for thousands of people. And until
20 we can account for thousands of people --
21 Staten Island, Coney Island, throughout our
22 city -- Lower Manhattan -- then I think we
23 are not whole. And I will not say that we
24 are doing better.
309
1 The other thing that we also did, we
2 just finished an audit that you'd be
3 interested in -- I know, Diane, you'll be
4 interested in this -- that even though we
5 were told that NYCHA was coming up with a
6 plan so that the next disaster they would be
7 ready for, I went in and audited NYCHA.
8 There's no plan. If, God forbid,
9 something happened, it would be just like the
10 same.
11 And so -- I know you're shocked at
12 this -- but we should also look at our
13 different agencies and make sure that they're
14 actually creating emergency plans that are
15 realistic. I can tell you, and I'll send
16 this to you if you want, our NYCHA audit
17 showed that we're no better today with
18 NYCHA's planning process than we were on the
19 day the storm hit.
20 ASSEMBLYWOMAN MALLIOTAKIS: The other
21 question I had is regarding to your Red Tape
22 Commission. You also came to Staten Island
23 and also in Brooklyn -- in all the boroughs,
24 actually -- and listened to the concerns of
310
1 the small business community.
2 It seems that small businesses are
3 sort of being hit at every level, whether
4 it's the city, the state, or federal. Some
5 of the policies coming out of City Hall, I
6 believe, are hurting the small business
7 community in the city.
8 What were some of the results of that
9 Red Tape Commission, and what recommendations
10 have you made to the City Council and the
11 administration to make changes?
12 COMPTROLLER STRINGER: So we're
13 looking at -- so this commission, as you've
14 said, we've had hearings in all five
15 boroughs. And it's not just the
16 comptroller's staff doing this, we've
17 actually put together a very good blue-ribbon
18 commission of people with varied backgrounds
19 taking a look at many of the agencies'
20 relationships with small businesses -- fines
21 and fees and taxes and, you know, the
22 well-documented history of businesses
23 opening, politicians rushing to the
24 ribbon-cutting, and then the next day the
311
1 agencies start coming in: You know, you have
2 a fruit fly in the vodka bottle, and we're
3 going to shut you down for three days. You
4 know, there's an ant on the floor two blocks
5 away, it must have been you, and we're going
6 to fine you. I'm making light of this, but
7 everybody's talked to small business owners.
8 I think we've lost sight of the fact
9 that many small business owners open their
10 business with their life savings. They just
11 can't go to Citibank and say "I need a
12 million-dollar loan." Most people can't get
13 that. So they save and save, work three jobs
14 to have their entrepreneurial dream, and the
15 day they open, it's not market forces very
16 often that determine their economic success,
17 it's the sheer brunt of the agencies that
18 determine their future.
19 So the Red Tape Commission, we are
20 looking at all of these agencies, looking at
21 it in a critical way. I don't want to
22 announce the findings today, but I think this
23 is going be one of those bipartisan
24 moments -- Republican/Democrat,
312
1 liberal/conservative -- that I hope that we
2 can generate a real consensus that we need to
3 take a sledgehammer to the bureaucracy that
4 is just dragging down so many mom-and-pop
5 stores and killing the entrepreneurial spirit
6 of our millennials, the next generation. All
7 they want to do is create and, you know, they
8 have a whole set of problems in terms of
9 office space and dealing with connectivity
10 and those issues.
11 ASSEMBLYWOMAN MALLIOTAKIS: I
12 appreciate that, and I appreciate you doing
13 this commission. When are the findings going
14 to be announced?
15 COMPTROLLER STRINGER: I would like --
16 I'm hoping in the spring. We're working on
17 the report now, and it's a collaborative
18 effort, so we're working with all the
19 commission members.
20 We also have an online survey, so in
21 addition to the hearings we held, we actually
22 have reached out to hundreds of businesses
23 with an online survey which is gathering more
24 data and -- actually, I should make a pitch
313
1 to get you the link, because we certainly
2 would want to hear from more people on Staten
3 Island. So maybe I can set that up. And we
4 can also show you what we're asking, the
5 questions.
6 ASSEMBLYWOMAN MALLIOTAKIS:
7 Absolutely. Any way we can help in -- or
8 talk to the chambers of commerce locally, let
9 us know.
10 COMPTROLLER STRINGER: That'd be
11 great. Thank you.
12 ASSEMBLYWOMAN MALLIOTAKIS: Thank you.
13 COMPTROLLER STRINGER: Thank you.
14 CHAIRMAN FARRELL: Questions?
15 CHAIRWOMAN YOUNG: Thank you, yes.
16 Senator Krueger.
17 SENATOR KRUEGER: Hello,
18 Mr. Comptroller. It's nice to see you up
19 here instead of in our island of Manhattan.
20 COMPTROLLER STRINGER: And nice to see
21 you there.
22 SENATOR KRUEGER: Thank you.
23 So in your testimony, where I don't
24 really have any disagreements, just one
314
1 clarification --
2 COMPTROLLER STRINGER: Yeah.
3 SENATOR KRUEGER: -- you're proposing
4 the Battery Park City money be dedicated to
5 NYCHA, and you estimate $400 million over 10
6 years, so we'll say $40 million a year. I
7 agree NYCHA desperately needs the money. But
8 what won't we be spending it on instead?
9 Because what do we use it for now?
10 COMPTROLLER STRINGER: Well, it would
11 be for -- it would take away -- I shouldn't
12 say take away, but it would redirect money
13 from other housing programs and earmark it to
14 NYCHA. And basically, there's a big pot of
15 money for other housing subsidy programs and
16 capital monies, and they tend to do okay,
17 especially capital.
18 But everyone has talked about helping
19 NYCHA, but no one's willing to direct monies
20 to actually help NYCHA. And I think this
21 would be a way of us saying that we are going
22 to find a new revenue stream. We've never
23 had one in modern history that I'm aware of.
24 And I believe the city can certainly make up
315
1 the difference of any existing program.
2 I've come here to tell you our
3 finances are strong, I'm not afraid to say
4 that. This is our one shot where we could
5 take Battery Park City money and put a marker
6 down on NYCHA.
7 SENATOR KRUEGER: And last year when
8 you testified, you had just recently released
9 or were about to release something you called
10 the Fair Share report, and you went into some
11 details about the state's declining
12 commitment to New York City with its budget
13 monies.
14 Is there anything that has changed
15 since that time other than the new proposals
16 in the Governor's budget that would decline
17 monies even more?
18 COMPTROLLER STRINGER: We made the
19 point that when you lose AIM and you lose
20 other programs that we used to have in
21 New York City, whether it's the commuter tax
22 or AIM, that we're not doing well. And
23 considering that we're sending so much more
24 to the state than we're getting back -- I
316
1 think one of the things, when you stay at a
2 hearing for four hours and you listen much of
3 the time, the one takeaway I've had -- I did
4 do that -- the one takeaway I've had through
5 this is that someone asked a question and
6 said, Well, you know, New York City had the
7 benefit of a program in the 1970s or in the
8 1990s, say, and that program never expired.
9 And that's true. And I was listening, but
10 then I wanted to scream out: But there are
11 other programs that we did lose. And some
12 were more beneficial to the city economically
13 than others.
14 The commuter tax is a wonderful
15 example of the billions and billions of
16 dollars that we used to get, to rely on, that
17 simply disappeared in a midnight deal that we
18 never got back.
19 So yes, we certainly have gotten
20 funding from the state -- we thank you, we
21 know that this doesn't happen easily -- but
22 we've also lost money through the budget
23 process as well. And so I just ask you to
24 take that into consideration.
317
1 I'll resend you that report for your
2 deliberations, because it's something that I
3 should probably have brought back this year.
4 SENATOR KRUEGER: I found it online
5 while we were listening to the four and a
6 half hours with Mayor de Blasio.
7 So thank you, and --
8 COMPTROLLER STRINGER: We all had a
9 lot of time to --
10 SENATOR KRUEGER: We did. We had a
11 lot of time to do research and listen to each
12 other.
13 COMPTROLLER STRINGER: A very good
14 hearing, Senator. Yeah.
15 SENATOR KRUEGER: Because that report
16 shows that the city received $1.2 billion
17 less in state revenue in fiscal year 2014
18 compared to 2009. And the yearly decline
19 from $12.1 billion to $10.9 billion between
20 2009 and 2014 -- these are fiscal years --
21 the state's operating funds grew by almost 16
22 percent, but contributions to the city
23 continued to be reduced.
24 COMPTROLLER STRINGER: Right.
318
1 SENATOR KRUEGER: And so you show that
2 the city would have had an additional $3.1
3 billion to meet its expenses in fiscal year
4 2014 if we hadn't been reducing state funds
5 to the city so much.
6 So I appreciated having that on the
7 record, because I did want to go on the
8 record that some people seem to believe
9 New York City is taking more money than
10 historically it has, or is actually using
11 more state money than it's actually
12 contributing to the state, and I know that
13 your work has shown that is not true.
14 COMPTROLLER STRINGER: Nothing is
15 farther from the truth. We have always paid
16 a whole lot more. And, you know, I would
17 argue that we're actually happy to do it,
18 because we recognize a strong New York State
19 is also good for New York City. And so when
20 we can be helpful, we don't expect money in,
21 money back. When we come here, it's because
22 we have specific needs that you don't want to
23 -- you don't want to create a tipping point
24 in New York City, because it limits our
319
1 ability to help the state financially.
2 SENATOR KRUEGER: I agree with you.
3 And I do think, to repeat what I think
4 Senator Marchione said earlier, we are one
5 state and we all rise or fall together.
6 So I do agree that the city actually
7 has been a significant contributor to the
8 upstate economy, and I just didn't want today
9 to end without reflecting that fact.
10 COMPTROLLER STRINGER: And let's put
11 it on the record today -- and Senator
12 Moynihan rest in peace -- but you know what
13 we've given to Washington that we don't get
14 back. And maybe Congress will finally
15 recognize that, you know, we can't carry the
16 country and carry the state.
17 SENATOR KRUEGER: And you talked about
18 the CUNY issues within your testimony. Did I
19 miss your touching on education funding?
20 In the past we've spent so much time
21 talking about fair funding through the CFE
22 lawsuit decision, which of course would
23 affect the entire state. Where are we in
24 that realm at this point?
320
1 COMPTROLLER STRINGER: Well, obviously
2 we haven't gotten the full dollars from CFE.
3 We did not get -- CUNY did not keep
4 pace with state spending, as we revealed
5 today, a $637 million difference. That's
6 pretty significant. That's over a half a
7 billion dollars that CUNY did not get.
8 Despite the lack of funding, that is an
9 incredible institution. But you have to
10 invest capital money, you have to invest
11 programmatic money, you have to invest in the
12 professors, you have to invest in the
13 students. And when we do that, and I would
14 say that for SUNY and CUNY, we turn out some
15 of the best and the brightest, the most
16 diverse school population that go on to do
17 great things for the world, and I think that
18 we should make that a priority in the budget.
19 SENATOR KRUEGER: Thank you very much
20 for your testimony.
21 COMPTROLLER STRINGER: Thank you.
22 CHAIRWOMAN YOUNG: Thank you, Senator
23 Krueger.
24 CHAIRMAN FARRELL: Thank you.
321
1 CHAIRWOMAN YOUNG: Senator Savino.
2 CHAIRMAN FARRELL: Oh, no, I have one.
3 CHAIRWOMAN YOUNG: I'm sorry, do you
4 have one? Excuse me. I thought you were
5 done.
6 CHAIRMAN FARRELL: No. I thought so
7 too.
8 Mr. McDonald.
9 (Laughter.)
10 CHAIRWOMAN YOUNG: You told me you
11 were done.
12 COMPTROLLER STRINGER: We have three
13 and a half hours to go.
14 SENATOR SAVINO: I'll only take up
15 two.
16 (Laughter.)
17 CHAIRMAN FARRELL: Mr. McDonald.
18 CHAIRWOMAN YOUNG: I'm sorry, Senator
19 Savino, we have an Assemblymember who is up
20 who we were not aware of. So you're next,
21 after that.
22 ASSEMBLYMAN McDONALD: I'll be quick,
23 Comptroller.
24 And for reference, I replaced your
322
1 colleague Ron Canestrari, so I represent five
2 cities: Cohoes, Watervliet, Rensselaer,
3 Troy, and the City of Albany. And being a
4 former mayor, I think you'll understand some
5 of the context of my questions.
6 The mayor earlier, when you sat
7 through the five-hour presentation, had
8 referenced a $600 million increase in our
9 pension costs. And the one question I meant
10 to ask, but stepped out: Is the fund 90
11 percent, 100 percent funded? Where is the
12 pension fund in regards to its
13 responsibilities?
14 COMPTROLLER STRINGER: New York State?
15 New York City pension fund?
16 ASSEMBLYMAN McDONALD: New York City.
17 Yeah, not New York State.
18 COMPTROLLER STRINGER: So we're
19 roughly -- we're at $155 billion. We're the
20 fourth-largest pension fund in the United
21 States. We're actually the 14th largest in
22 the world. We protect the retirement
23 security of 710,000 people, so it really is
24 an incredible responsibility that we have.
323
1 We're about 71 percent funded.
2 ASSEMBLYMAN McDONALD: Okay.
3 COMPTROLLER STRINGER: We are in a
4 strong position.
5 There's a lot more that we have to do.
6 You know, our pension fund is made up of five
7 boards. We've better aligned our pension
8 fund. Thanks to the hard work of the
9 trustees, we are now going to have one
10 investment meeting -- people should know that
11 today we are releasing a report by an
12 independent consultant talking about the
13 Bureau of Asset Management, that I run, and
14 the wholesale reform that's needed to bring
15 the system into the 21st century. And we are
16 slowly but consistently working with the
17 trustees to create the opportunity so that
18 when the economy is good we can take
19 advantages, you know, take advantage of the
20 markets and all that we have to invest in,
21 and then when there are tough times we have
22 enough risk officers and a risk plan in place
23 to hedge against a tough economy. And that
24 is my goal as comptroller.
324
1 ASSEMBLYMAN McDONALD: You earlier --
2 and I agree with that -- when they were
3 talking about how much reserve should New
4 York City have --
5 COMPTROLLER STRINGER: How many what?
6 ASSEMBLYMAN McDONALD: How much
7 reserves New York City should have. And
8 every wise comptroller will say there's never
9 enough reserves, and you gave a very
10 appropriate answer.
11 What's your goal in regards to the
12 pension? Where do you want to be in three to
13 five years, percentage-wise? Or is that --
14 COMPTROLLER STRINGER: In terms of the
15 cushion for the city?
16 ASSEMBLYMAN McDONALD: In regards to
17 the pension fund. In regards -- you know,
18 you're at 71 percent right now; the state is
19 running at a little bit higher rate. What's
20 the goal of the city pension fund?
21 COMPTROLLER STRINGER: You know,
22 rather than get to the end game, which of
23 course is to be fully funded in a perfect
24 world, my goal is that we reduce the reliance
325
1 of taxpayer dollars going into the pension
2 fund to make up shortfalls.
3 I think it's critical that we hit our
4 actuarial target. It's very critical to us
5 that we get there, and we get there making
6 sure that our asset classes are -- you know,
7 our different asset classes are much more
8 moderate. I wouldn't quite -- I never want
9 to use the word "conservative," but actually
10 I find myself more conservative recognizing
11 that we don't have to hit it big, our goal is
12 to be responsible long-term investors, hit
13 our 7 percent, do it in the way that
14 safeguards these individuals' retirement.
15 You know pensions, the average pension
16 is under $40,000. This is people's total
17 retirement. That and Social Security in New
18 York City doesn't even pay the rent. So it's
19 a very crucial part, I think it's actually
20 the biggest of our job, is to think about
21 this every day.
22 ASSEMBLYMAN McDONALD: I agree, and I
23 appreciate what you're doing.
24 The other is more of a comment. I
326
1 know you went to great pains to put it in
2 your presentation; obviously the mayor was
3 asked questions about it several times with
4 the STAR-C bond refinancing. And, you know,
5 and I appreciate your comments, and probably
6 the first thing I did when I was the mayor
7 was went through and refinanced all my old
8 debt too -- all we could do -- and it brought
9 about appreciable savings.
10 By the same token, I think the
11 challenge here -- and it's just a comment,
12 and mostly I'm saying it for the people who
13 are taking notes, not you -- is that many of
14 our cities are struggling financially.
15 Fortunately, many of them have not gone to
16 that depth of debt that the city has seen.
17 And at the same token, they're all looking
18 for solutions. They're all looking for ways
19 to avoid going into debt. You know, you'll
20 be hearing from the mayor of Albany, the
21 mayor of Troy very soon, and they're very
22 much on that decline. And unfortunately
23 there's not a lot of resources being directed
24 to prevent that from happening.
327
1 So I think when Senator Kennedy was
2 grilling the mayor and a few others, they
3 were appropriate. I share that concern. We
4 need all of New York State to be successful.
5 I understand there's always going to be
6 friction between the city and the state -- we
7 won on this one, we lost on this one. It's a
8 very large scorecard. At the end of the day,
9 I just hope that everybody has an open mind
10 to recognize the fact that you need to make
11 sure that we're all strong financially.
12 COMPTROLLER STRINGER: You know, one
13 of the things I learned in my 13 years in
14 Albany is that the world does not only
15 revolve around your local district. Right?
16 There's a much bigger world out there. You
17 have Magnarelli in Syracuse and people who I
18 serve with who represented big cities with
19 just the same struggles and challenges New
20 York City faces.
21 I actually think these hearings,
22 though there's -- obviously there's a certain
23 ideology, there's a certain natural
24 upstate/downstate friction -- at the end of
328
1 the day, if the state is doing badly and only
2 New York does well, it's not good for New
3 York. People stay away from our state. The
4 tourists don't come. We are so linked
5 together, even though we don't always see it
6 right away -- and I would hope that in this
7 budget process -- I come here as comptroller
8 fighting for my city, but it is not at the
9 expense of Syracuse, of Rochester, the Big 5,
10 it's not against any city or town.
11 We've got to do this together, and I
12 think you heard that from the mayor today.
13 He came here today not talking only about us,
14 but making sure that we could figure out a
15 way to get everyone where we need to be.
16 Look, some years there will be a
17 crisis in your community that will allow us
18 to take away from our city. That has
19 happened time and time again. It's going to
20 happen again. We're here to tell you that we
21 do have some real issues in New York City
22 that we have got to deal with to keep the
23 engine going. It's education, it's
24 homelessness -- these are issues beyond the
329
1 glittering city. I just want to take you
2 back to our invisible city: 58,000 people,
3 23,000 children, and they're going to be
4 sleeping in shelters. No child should sleep
5 in those situations.
6 We're going to inspect, we're going to
7 blow the whistle, but we also need the
8 programmatic money and the strategy to clean
9 them up. And if we clean them up, we're
10 going to make taxpayers out of these
11 children, we're going to educate them,
12 they're going to have productive lives, and
13 then we can dismantle -- you know, the goal
14 is to dismantle our shelter system.
15 Wouldn't it be great if we only needed
16 one shelter? Right? Maybe one shelter per
17 borough, and that's just because we need to,
18 you know, keep -- bad things happen. Right
19 now we've got an absolute mess, years in the
20 making -- the mayor's right, it didn't happen
21 overnight -- and now's the time for us to
22 tackle it for the sake of the whole state.
23 ASSEMBLYMAN McDONALD: Thank you for
24 the good work that you're doing. I do have
330
1 to say, from an upstater perspective, all
2 your efforts, particularly the homeless
3 shelter, was very eye-opening and it really
4 brought the crisis to the forefront.
5 COMPTROLLER STRINGER: Thank you.
6 Thank you.
7 Did we serve together?
8 ASSEMBLYMAN McDONALD: What's that?
9 COMPTROLLER STRINGER: Did we serve
10 together?
11 ASSEMBLYMAN McDONALD: No. I just got
12 here three years ago.
13 COMPTROLLER STRINGER: It's nice to
14 meet you.
15 CHAIRMAN FARRELL: Thank you.
16 Senator?
17 CHAIRWOMAN YOUNG: Thank you.
18 Senator Savino.
19 SENATOR SAVINO: Thank you, Senator
20 Young.
21 Can I call you Scott? It's easier
22 than "Comptroller Stringer."
23 COMPTROLLER STRINGER: Yes. Fine.
24 SENATOR SAVINO: I want to pick up
331
1 where Assemblyman McDonald left off on the
2 pension issue.
3 I know that part of the problem with
4 the city having to put up another
5 $600 million is basically the actuarial
6 assumptions are somewhat wrong. You know,
7 we're dealing with a system that was designed
8 when 55 was old and 65 was dead, and
9 unfortunately our retirees are living longer
10 than we assumed they would. So I'm going to
11 assume that's going to be a problem going
12 forward.
13 So what steps --
14 COMPTROLLER STRINGER: You kind of
15 hope that's a --
16 SENATOR SAVINO: Yeah. I mean, it's
17 likely. You know, people are living longer,
18 and they're going to be continuing to collect
19 pensions, so there has to be some way for the
20 system to adapt to that so that we don't have
21 these shortfalls.
22 Is there something that you guys are
23 working on now that will help deal with that?
24 I see Tim is writing furiously there.
332
1 COMPTROLLER STRINGER: So Tim
2 Mulligan -- who is our excellent deputy
3 comptroller for budget who I probably forgot
4 to introduce, but everyone knows him so well
5 because you call him all the time. And he's
6 served the city, so thank you, Tim.
7 In the new tables that the actuary has
8 issued, a lot of future growth is built into
9 the table, Tim reminds me. So I think that's
10 helpful.
11 But we're going to have to think about
12 retirement beyond the pension --
13 SENATOR SAVINO: Sure.
14 COMPTROLLER STRINGER: And we have to
15 figure out retirement not just for people who
16 are city or state workers. And we are
17 collaborating to come up with ways to create
18 retirement plans for every citizen. You
19 know, everybody in this country can have a
20 secure retirement.
21 SENATOR SAVINO: Well, I totally
22 agree. I know the Governor has a proposal on
23 it, I have a piece of legislation that would
24 allow for it. And I've often said that many
333
1 people would have a pension and many
2 employers would provide pensions if they
3 could afford to maintain a plan. It's
4 incredibly expensive to develop one.
5 And I do think that we are probably
6 missing out on the opportunity for small
7 employers, or even medium-sized ones, to
8 utilize the New York City or New York State
9 pension system as a vehicle of investments,
10 separating the funds, of course, to protect
11 the taxpayer. But it's something that we
12 really need to look at.
13 COMPTROLLER STRINGER: So let me --
14 without letting the cat out of the bag, we
15 have been researching and working on this
16 issue with experts from literally around the
17 world on this issue. Give me some time, we
18 need some -- many months. But we are working
19 with a lot of folks -- and obviously you've
20 talked about this -- to come up with a
21 retirement plan that works for everybody.
22 SENATOR SAVINO: And the other -- on
23 the pension issue, I mean, the New York Times
24 has the report or an article about the report
334
1 that was released today, the independent one.
2 But their headline is rather alarming to the
3 average individual, it says --
4 COMPTROLLER STRINGER: Which one, I'm
5 sorry?
6 SENATOR SAVINO: "New York City's
7 Pension System in Danger of Operational
8 Failure." Now, to the average reader that
9 might seem like there's some sort of crisis
10 impending in the pension system, but I don't
11 believe that's the case.
12 What my understanding is -- it's a
13 couple of things they've uncovered. One,
14 something we've known for a long time, that
15 the money managers that operate within the
16 pension system have been taking millions of
17 dollars in fees and not really producing
18 anything, and that there's also this issue of
19 the Bureau of Asset Management.
20 So I know your predecessor, John Liu,
21 and Mayor Bloomberg at one point talked about
22 restructuring that Bureau of Asset
23 Management, but that plan never went anywhere
24 --
335
1 COMPTROLLER STRINGER: Let me -- let
2 me just --
3 SENATOR SAVINO: -- because of
4 opposition from the funds. So have you been
5 able --
6 COMPTROLLER STRINGER: So it's a
7 little --
8 SENATOR SAVINO: -- to overcome that
9 opposition?
10 COMPTROLLER STRINGER: So it's a
11 little different. So it was a Liu/Bloomberg
12 plan to consolidate the pension fund, it was
13 a plan that had very little support up in
14 Albany and was never going to happen.
15 We worked for two years with the
16 trustees to create an opportunity to align
17 the five boards in one investment meeting.
18 Before we were able to accomplish this, we
19 used to have 55 investment meetings a year
20 talking about 96 percent of the same
21 investments. It was out of a bad movie. And
22 it grinded down the Bureau of Asset
23 Management to the people who were responsible
24 for looking at deals and investments only
336
1 were preparing for the next meeting to have
2 the same discussion all over again.
3 We worked with our trustees and our
4 union partners, we worked with the mayor, the
5 public advocate, borough presidents, and we
6 now have six meetings a year, not 55, which
7 has now given us a lot more time to tackle
8 the issues related to the Bureau of Asset
9 Management.
10 When I took office I said, Look, a lot
11 of BAM is hanging by a thread because we
12 haven't invested in infrastructure, we
13 haven't invested in IT, we haven't invested
14 in whole host of things. When I became
15 comptroller, there was no compliance officer
16 in a $160 billion pension fund. There wasn't
17 a risk management officer, a risk officer to
18 review the investments the CIO was making.
19 We still had pay-to-play in the pension
20 system, we never banned placement agents.
21 We had a six-point plan, we
22 accomplished it, but then I realized we have
23 to go deeper. And this is where sometimes --
24 and today's story in the Times, the headline
337
1 is a little chilling, but I hired an outside
2 consulting firm with the trustees, a $1.4
3 million report that I think is very telling
4 that says we accomplished a lot in the last
5 two years, but if you want to have
6 best-practice pension funds, you've got to
7 finish the job over the next two to six to 10
8 years.
9 We released that because it's
10 transparent. You get a report, you put it
11 out for public consumption. I want people to
12 feel there's a sense of urgency. I want, as
13 comptroller, to be held to that standard,
14 that urgency, and I want the person who comes
15 after me to feel that the Funston report is
16 what you take to work in the morning when
17 you're dealing with our pension fund.
18 So I am not upset; I thought theirs
19 was a great article that talked about the
20 report we did on Wall Street fees,
21 challenging these money managers to recognize
22 it's not just about them, but that they
23 actually represent retirees and public
24 dollars. And so I think we're in an era of
338
1 great reform within the comptroller's office
2 and with the pension fund. And I do want to
3 say on the record -- because sometime the
4 elected official gets more notoriety about it
5 -- true, you get more blame -- but I think
6 people should really thank the trustees of
7 Police, Fire, NYCERS, Teachers -- they have
8 been as reform-minded as anyone at the
9 pension fund.
10 SENATOR SAVINO: It's very good to
11 hear that.
12 And finally, on your new
13 responsibility of administering the state's
14 homeless, I don't know, $20 billion -- do you
15 have a sense of what your role will be
16 separate and apart from what you currently do
17 right now? As city comptroller you have the
18 ability to audit contracts, and you've been
19 very aggressive about that with some of these
20 bad actors in the shelter system, refusing to
21 approve contracts until they clean up their
22 act. So what will be different about what
23 the Governor's budget would grant to you than
24 you're currently doing?
339
1 COMPTROLLER STRINGER: So this is not
2 an Al Haig moment for me, okay? This is --
3 what we're doing is what I've been doing from
4 the very beginning, which is auditing city
5 agencies -- we've been very aggressive with
6 the Department of Homeless Services. We
7 exposed the weakness in the contracting
8 system, we got blowback from DHS, and it
9 turns out we were right, there were issues.
10 We went into the shelter system, did a
11 hard-hitting audit, and we revealed the
12 terrible conditions people were living in.
13 Imagine living with rodents,
14 infestation, doors that don't lock or close,
15 security nowhere in sight, repairs that were
16 so terrible -- it's from back in the days of
17 the '70s when there was redlining and you
18 would go to court with tenants in terrible
19 conditions. This is what kids are living
20 with, 23,000 children. It is so outrageous
21 that I sometimes can't stop myself.
22 We are grateful, I am grateful that
23 the Governor, in the State of the State
24 message, said: You know what, I'm willing to
340
1 give you resources if you need them. I want
2 to coordinate with Comptroller DiNapoli,
3 Comptroller Schroeder, and your office so
4 that if we see dire conditions, that we can
5 take strong action.
6 In addition to the Governor working
7 with us on this, we are also working with the
8 Mayor, and we're working with Commissioner
9 Banks. Because at the end of the day, my
10 goal as the auditor-in-chief of our city is
11 to make sure that by the time we're done that
12 the shelters are going to be places where a
13 child can stay, still get an education, have
14 room to study, have a place to play. This is
15 the 21st century, people. This should not be
16 that difficult. And we're going to continue
17 to do it.
18 And listen, we're ruffling feathers.
19 We're pushing the city administration. This
20 is obviously something that they've got to
21 get their arms around. But we're pushing,
22 and that's what my job is.
23 I am glad the Governor is committed to
24 this process. It is not a negative. It is
341
1 important, we should support that effort, and
2 you should also have assurance from me that
3 we are working with Steve Banks, who is
4 someone I respect, as HRA commissioner. We
5 have had multiple meetings, we talk on the
6 phone all the time, and we are collaborating.
7 And I want you to know that as well.
8 SENATOR SAVINO: Well, that's great.
9 I just wanted one final point.
10 I made the point earlier when I spoke
11 to the mayor about the history of DHS, it's a
12 separate agency from HRA. You know, we're
13 all old enough now, we were there -- I
14 remember Muzzy Rosenblatt, the original
15 commissioner who convinced the previous mayor
16 -- they claimed then it would make service
17 provision easier or better for the homeless,
18 and in fact it was really just a ploy to
19 privatize the shelter system. And as a
20 result, now you're auditing thousands of
21 contracts for these private shelter operators
22 and many of them, as you pointed out, are
23 running shelters that are not fit for humans.
24 So one of the things I would hope you
342
1 would focus on is also looking at the number
2 of these private shelters that are contracted
3 by the city that are not abiding by the rules
4 that say sex offenders should not be living
5 in a place where you have children. They do
6 it all the time, they've taken the position
7 that they can't prevent it because if a
8 family comes into a family shelter system and
9 they're part of a family unit, that they
10 can't prevent even a Level 3 sex offender
11 from coming in with his family.
12 We believe that that's wrong, and we
13 would look -- hopefully your agency and your
14 office will get a handle on that in a way DHS
15 has refused to do up until now.
16 COMPTROLLER STRINGER: Well, look, we
17 would love to be able to collaborate with you
18 on a lot of these issues. I think -- it's
19 not new power/old power you have. If there's
20 a will to get into these shelters and find
21 out what's going on, hold these operators
22 accountable, look at these cluster sites --
23 look, one of the things that we exposed that
24 I just find incredible -- with a LINC voucher
343
1 you can go and get an apartment; right? The
2 LINC voucher program is very significant.
3 There are landlords that won't rent to
4 homeless people.
5 I mean, it's in violation -- it's a
6 violation of the law, and it shouldn't be
7 allowed, and we should crack down on that.
8 People who want to find permanent housing
9 ought to have the ability to do that,
10 especially if they have a voucher and a means
11 to pay for affordable housing, but the
12 landlord says "No homeless need apply." I
13 mean, come on. That is something that we
14 have to be very, very tough on.
15 At the same time, we have to be very
16 tough to make sure that communities are
17 consulted in the siting of facilities. We
18 have to involve communities. We shouldn't be
19 afraid of communities. When I was a borough
20 president I sited homeless facilities,
21 working with different administrations. When
22 you talk to people with respect in a
23 community, when you engage people, you'd be
24 surprised how much people want to help. When
344
1 you tell people that there are 23,000
2 children in our homeless shelters today, in
3 the greatest city on earth in a time of some,
4 you know, prosperity in the city, people get
5 very emotional.
6 We have the will of the people on our
7 side to clean up the shelters, and that means
8 we should be funding initiatives by the
9 Governor and the Mayor to create permanent
10 housing, supportive housing. We have got to
11 create a revenue stream for NYCHA because, at
12 the end of the day, we have got to make sure
13 that housing is strong or we could tip that
14 housing into disrepair, and we'll be doing
15 those kinds of audits looking for children
16 who are living in dangerous conditions. And
17 I don't want to see that happen at all.
18 SENATOR SAVINO: Thank you.
19 CHAIRWOMAN YOUNG: Thank you, Senator.
20 CHAIRMAN FARRELL: Thank you.
21 CHAIRWOMAN YOUNG: Assemblyman?
22 CHAIRMAN FARRELL: Assemblyman Oaks.
23 ASSEMBLYMAN OAKS: Hi, Comptroller.
24 I just -- I know Assemblyman McDonald
345
1 and Senator Savino both talked some about the
2 retirement system, and I just wanted to add a
3 little bit into -- the $600 million, is that
4 all due increase -- is that all due to the
5 actuarial, or is that somewhat also -- I know
6 there was a little bit of maybe down
7 performance from the year before, so --
8 COMPTROLLER STRINGER: All of that
9 $600 million is about assumptions. There's
10 no performance factored into that.
11 ASSEMBLYMAN OAKS: So the total amount
12 of increase, do you know, then, that $600
13 million -- is there an increase year to year
14 anticipated too, or don't we have those
15 figures yet?
16 COMPTROLLER STRINGER: That
17 performance piece was phased in in our
18 November plan. I don't have it with me, but
19 I can get it for you.
20 ASSEMBLYMAN OAKS: Okay. I was just
21 trying to get an idea as -- I mean, over the
22 last several years are we seeing year-to-year
23 going up each year? I know in some of the
24 statewide ERS and some of the systems we've
346
1 seen some decline in the percentages that are
2 paid due to performance and whatever.
3 COMPTROLLER STRINGER: So in our
4 situation, I wouldn't say we've gone up. We
5 have actually started to flatten out over the
6 last couple of years.
7 ASSEMBLYMAN OAKS: Okay. And I'd
8 appreciate seeing some of those figures.
9 Thank you very much.
10 COMPTROLLER STRINGER: We'd be happy
11 to provide them.
12 CHAIRWOMAN YOUNG: Thank you very
13 much.
14 Senator Rivera.
15 SENATOR RIVERA: Thank you, Madam
16 Chairwoman.
17 Comptroller, good afternoon. I have a
18 couple of questions for you regarding
19 Medicaid.
20 Now, I obviously recognize that we all
21 recognize that the budget that we have before
22 us is the working draft, so obviously these
23 budget hearings are precisely about looking
24 for input to figure out the places where we
347
1 could do some shifts and do things in a
2 smarter way. But I wanted to ask you, at
3 least the numbers that we have right now --
4 we covered it yesterday in the Medicaid
5 hearing, but I wanted to -- as the fiscal
6 watchdog of the City of New York, there are
7 many of us that are concerned with the way
8 that the formula on Medicaid has been, at
9 least currently in the budget proposal, has
10 been reorganized, if you will, for the City
11 of New York and the impact that it's going to
12 have on it.
13 So if you could speak a little bit
14 about the fiscal impact that if the budget
15 proposal stays -- oh, here he is. This guy,
16 I love this guy when he appears like a ninja
17 out of nowhere, this guy --
18 COMPTROLLER STRINGER: The --
19 SENATOR RIVERA: But if you could then
20 speak about the fiscal impact this could have
21 on the City of New York, certainly in this
22 coming fiscal year and in years to come, and
23 whether you think that that is a sustainable
24 thing considering that some folks have said
348
1 that the broad shoulders of the State of New
2 York --
3 COMPTROLLER STRINGER: I appreciate
4 your leadership on this issue, and you've
5 been championing our cause here.
6 The numbers that we can give you is
7 that, you know, the Head Start's 2017 -- $300
8 million goes up to $500 million in '18, then,
9 you know -- it just doesn't stop. It gets to
10 2020, and now we're -- as I mentioned in our
11 testimony, it's a $735 million hit. You
12 know, that accumulation over the next few
13 years is over $2 billion.
14 And so this is something that ought to
15 be avoided at all costs. I understand that
16 the Governor and the Mayor talking about
17 efficiencies -- I always believe that you can
18 save money when you look at ways to, you
19 know, come up with new technology, new ways,
20 but at the end of the day, we cannot -- that
21 Medicaid cost would hurt us very badly.
22 SENATOR RIVERA: So it is your sense
23 that -- and certainly you are experienced, as
24 well, through all the audits that you and
349
1 your office do on how to spot
2 inefficiencies -- probably -- not only
3 certainly, in some cases -- inappropriate
4 uses of money, but certainly in certain
5 places where things could be done more
6 effectively, more efficiently -- it is your
7 sense, then, that this is not a cost that
8 could be just burdened {sic} by the city?
9 COMPTROLLER STRINGER: I think our
10 health system in New York City is in a
11 precarious situation, and we obviously have a
12 lot of people in the system who are not
13 covered by insurance. We have a lot of
14 undocumented individuals who have the right
15 to get healthcare, they should get
16 healthcare.
17 This is not the time to take a hit,
18 especially, as the mayor said today, that
19 we're dealing with real budget issues related
20 to the Health and Hospitals Corporation.
21 We've put $300 million in, and I think that's
22 really -- Tim, you would agree -- a stopgap
23 for what has to happen there in terms of
24 figuring out an economic system that works
350
1 there.
2 SENATOR RIVERA: I'd love to work with
3 your office to get some of the more detailed
4 breakdowns, as many of us are arguing that we
5 should certainly shift this conversation --
6 COMPTROLLER STRINGER: You know, maybe
7 Tim -- we could dig a little deeper, we could
8 get some more numbers to you and talk about
9 the different areas. I think we do have to
10 spend some time thinking about the Health and
11 Hospitals Corporation as well.
12 SENATOR RIVERA: I immensely
13 appreciate it. Thank you.
14 COMPTROLLER STRINGER: Thank you,
15 Senator.
16 SENATOR RIVERA: I'm good.
17 CHAIRWOMAN YOUNG: Anybody else?
18 CHAIRMAN FARRELL: That's it.
19 CHAIRWOMAN YOUNG: Thank you.
20 CHAIRMAN FARRELL: Thank you.
21 COMPTROLLER STRINGER: Thank you.
22 Thank you very much. Thank you, Chairman
23 Farrell. Thank you, Senator.
24 CHAIRMAN FARRELL: Is your block
351
1 snowed out? Snowed in?
2 COMPTROLLER STRINGER: What?
3 CHAIRMAN FARRELL: 71st Street, is it
4 -- can I go there on Friday?
5 COMPTROLLER STRINGER: Let me just --
6 the mayor took care of my street.
7 (Laughter.)
8 CHAIRMAN FARRELL: Oh, okay.
9 ASSEMBLYMAN McDONALD: Be careful how
10 you answer that one.
11 (Laughter.)
12 CHAIRMAN FARRELL: Here we go. City
13 of Buffalo, Honorable Byron Brown, mayor.
14 Three and a half hours late. Not by
15 your fault, but mine.
16 MAYOR BROWN: Good afternoon.
17 CHAIRMAN FARRELL: Good afternoon.
18 CHAIRWOMAN YOUNG: Good afternoon.
19 MAYOR BROWN: Are you all okay?
20 Anybody need a stretch break? Water?
21 CHAIRMAN FARRELL: We'll be okay in
22 three weeks.
23 MAYOR BROWN: Senate Finance Chair
24 Catharine Young, Assembly Ways and Means
352
1 Chair Herman D. Farrell, Jr., members of the
2 Legislature, thank you for the opportunity to
3 address you regarding New York State's
4 2016-2017 budget and its impact on New York
5 State's second-largest city, Buffalo, New
6 York.
7 Since becoming mayor, my focus has
8 been on improving the fiscal outlook of
9 Buffalo, creating a stronger business
10 environment that has attracted investment and
11 jobs and has established a more efficient
12 government.
13 While there are still challenges, our
14 efforts have produced positive results. For
15 example, we created a rainy day fund; we
16 implemented dozens of efficiency measures;
17 we've delivered 10 on-time, balanced budgets.
18 It's been four years since Buffalo's Control
19 Board shifted to an advisory panel. The City
20 of Buffalo has improved its bond ratings with
21 the Big 3 credit rating agencies, receiving
22 an A+ from both Standard & Poor's and Fitch,
23 and an A1 from Moody's.
24 We are continuing to keep costs down.
353
1 We are on track to generate about $3.5
2 million in annual revenue now that our new
3 traffic adjudication system is in place,
4 along with a new plea-by-mail system which
5 will also make the streets of our city safer.
6 I want to thank you, the members of the
7 Legislature, for your support in passing this
8 very important initiative for the City of
9 Buffalo.
10 Collective bargaining agreements are
11 also saving us money as a result of
12 provisions like self-insured healthcare and A
13 new prescription drug plan.
14 We've negotiated residency
15 requirements for firefighters and for police
16 officers. In the past 2 1/2 years, we've
17 successfully negotiated contracts with our
18 major unions, including police and fire.
19 We've created the BPD21C Police
20 Academy Pre-Employment Scholarship Program --
21 that's Buffalo Police Department 21st-Century
22 Program -- which will get new police officers
23 on the streets quicker, save the city money
24 during training, and create a police force
354
1 that better reflects the demographics of our
2 community. The program is the first of its
3 kind in the nation.
4 Buffalo's new "Green Code" was
5 recently delivered to the Buffalo City
6 Council for approval. The Green Code will
7 overhaul the city's zoning and land use
8 planning for the first time in 63 years. It
9 is designed to simplify the complicated
10 zoning process, making it easier for
11 homeowners, developers, and small-business
12 owners to invest in the city.
13 We have enhanced public services by
14 installing GPS in many city vehicles,
15 including snow plows, garbage trucks, and
16 police cars.
17 The entire Buffalo Fire and Buffalo
18 Police vehicle fleet has been modernized, and
19 we're in the process of installing LED
20 streetlights along many thoroughfares,
21 business districts, and city-owned parking
22 ramps as part of an energy efficiency plan
23 that will save us money.
24 Today, the City of Buffalo is in its
355
1 best financial condition in decades.
2 Governor Cuomo and the State Legislature have
3 been true partners in Buffalo's renaissance.
4 This year's Executive Budget proposal makes
5 important investments. I am particularly
6 pleased by the proposed $2.1 billion school
7 aid increase that will allow the state to
8 eliminate the outstanding $434 million Gap
9 Elimination Adjustment over two years, and to
10 provide an operating increase to every school
11 district in the state, as well as the
12 Governor's commitment to rebuilding and
13 modernizing bridges, broadband networks,
14 public buildings, and other critical
15 infrastructure in upstate New York.
16 However, we in Buffalo, as I'm sure in
17 the other upstate cities, still have
18 concerns. The City of Buffalo is looking to
19 protect the progress we have made and add
20 tools that will allow our city to reach its
21 full potential.
22 Since I took office in 2006, the City
23 of Buffalo has considerably reduced property
24 taxes. Our steadfast commitment to making
356
1 the difficult decisions has stimulated
2 growth, but we still have to close a
3 significant budget gap for the upcoming
4 fiscal year which threatens our city's
5 ability to continue its progress.
6 The city's exploration of alternatives
7 to property tax increases is critical because
8 Buffalo seeks to continue the positive
9 momentum, excitement, and energy which has
10 been amplified by the Governor's Buffalo
11 Billion, Start-Up NY, and other successful
12 development initiatives that the members of
13 the State Legislature have supported.
14 The city needs some assistance to
15 maintain our fiscally-responsible growth
16 strategy. We have four requests.
17 One, we are working to build a Public
18 Works Campus. Attracting businesses and
19 residents requires public works that provide
20 for safe and efficient travel, clean streets
21 and reliable services, and an investment in
22 maintaining our infrastructure. Buffalo is
23 now a thriving and vibrant place to live,
24 work and invest. Public works services need
357
1 to be consistent and available at all times
2 and in all weather conditions.
3 The City of Buffalo has undertaken a
4 study of six existing Department of Public
5 Works facilities with the intent of creating
6 a combined Public Works Campus. The campus
7 would house the city's municipal snow
8 plowing, garbage collection, paving and
9 construction vehicles, as well as
10 administrative offices, animal shelter, and
11 auto impound. Consolidating these functions
12 into one facility will reduce maintenance and
13 staffing costs. The buildings will be
14 LEED-certified and incorporate solar panels
15 and compressed natural gas filling stations.
16 Construction of the Public Works Campus will
17 enable the city to sell six buildings which
18 are in prime locations for investment.
19 Phase one of the Public Works Campus
20 is estimated to cost $30 million. The
21 proposed new Public Works Campus will assist
22 Buffalo's growth by adding to our City's
23 resiliency. It will be a tool for improving
24 the quality of life for our residents, and it
358
1 will make the city more self-sufficient
2 during major storm events, therefore allowing
3 the state to direct more resources to
4 surrounding municipalities.
5 Car Sharing Main Street Funding is a
6 project that we have been working on since
7 the beginning of my first term as mayor of
8 the City of Buffalo. Another priority is
9 continuing our plan to return cars to
10 Main Street. Automobiles were removed from
11 Main Street in downtown Buffalo over 33 years
12 ago, when the light rail transit system was
13 built. Metro Rail has been a benefit to
14 Buffalo, but closing our premier downtown
15 street to automobiles resulted in building
16 vacancies, blight, lost property and tax
17 value, and essentially killed retail in
18 downtown Buffalo.
19 The Cars Sharing Main Street Project
20 has begun to reverse these effects,
21 generating significant economic benefits and
22 transforming the heart of downtown Buffalo
23 back into a thriving and vibrant destination.
24 I am requested funding for the next
359
1 phase of the Cars Sharing Main Street
2 Project, which would be two major blocks in
3 our downtown, at a cost of $30 million. We
4 estimate the total cost of completing this
5 project to be $80 million. This project is a
6 continuation of successful street projects
7 implemented on the 700, 600, and 500 blocks
8 of Main Street, totaling almost $60 million
9 in improvements, using a combination of
10 funding from a 2011 federal TIGER grant, New
11 York State, and the City of Buffalo. In
12 addition, $22.5 million was recently awarded
13 through a U.S. Department of Transportation
14 TIGER grant and funds from the Dormitory
15 Authority for the lower Main Street/Canalside
16 block of our Main Street.
17 Since 2012, significant private-sector
18 investment of close to $500 million has been
19 made between the 700 blocks of Main Street
20 and the edge of the waterfront at what we
21 call Canalside in Buffalo. Main Street is
22 also developing into a healthy urban
23 neighborhood that is attracting thousands of
24 people who want to live and work in downtown
360
1 Buffalo.
2 We also have a need for Homeland
3 Security funding. As you are well aware,
4 emergencies can happen anytime and anywhere.
5 Ensuring that our critical infrastructure and
6 first responders are ready to meet any
7 emergency or disaster is vital.
8 In the past, the bulk of Buffalo's
9 Homeland Security funding came from the
10 federal government, through the Urban Area
11 Security Initiative, or UASI, program. In
12 2011 Buffalo, Albany, Rochester and Syracuse
13 were removed from the UASI Tier 2 program.
14 Even though funding ended, security
15 risks and vulnerabilities remain. Buffalo
16 City Hall, opened in 1932, is the tallest
17 city hall in the nation. About 1,700 people
18 are employed in this building, and we host
19 more than 125,000 visitors annually. This
20 iconic and highly visible government building
21 was evaluated by the U.S. Department of
22 Homeland Security's Protective Security
23 Division and Field Operations Branch
24 Assessment Group last year. Estimates for
361
1 implementing the recommendations will cost
2 the City of Buffalo approximately $1 million.
3 And finally, we are seeking to close
4 the utility services tax loophole. For
5 decades, the cities of Buffalo, Rochester,
6 and Yonkers have had the ability to collect a
7 3 percent tax on the gross receipts of local
8 services provided by all utility companies
9 subject to the supervision of the New York
10 State Public Service Commission, including
11 phone companies.
12 Technological improvements have
13 resulted in widespread reliance on wireless
14 communication, and wireless telecommunication
15 service providers have successfully argued
16 that they do not fall within the definition
17 of a utility as prescribed in New York State
18 Tax Law.
19 New York State subsequently adopted
20 Tax Law S186-E to impose an excise tax on the
21 sale of telecommunication services by all
22 providers, thereby maintaining this
23 significant revenue stream originally
24 provided by the tax on utility services.
362
1 However, the telecommunications tax was not
2 expanded to the local level, except in the
3 case of New York City and its surrounding
4 counties.
5 The City of Buffalo requests that New
6 York State authorize municipalities to tax
7 telecommunication service providers at the
8 same rates municipalities are already
9 permitted to tax the gross receipts of
10 utility companies.
11 With budget growth consistently under
12 inflation, a significant reduction in our
13 workforce since 2000, and compromises with
14 our unions, the City of Buffalo has made
15 tough choices and tightened its belt. It is
16 critical for local aid, such as AIM funding,
17 to be increased so that the city's fiscal
18 recovery is assured into the future.
19 Through hard work and careful
20 planning, progress has been made in Buffalo.
21 Together we have worked to build a foundation
22 for future growth and investment. We ask
23 that the State Legislature continues to be a
24 partner in Buffalo's transformation.
363
1 Thank you for your time, and I
2 certainly wish you success in the budget
3 deliberations ahead. Thank you very much.
4 CHAIRMAN FARRELL: Thank you, Mayor.
5 First to speak, Mr. Magnarelli.
6 ASSEMBLYMAN MAGNARELLI: Thank you,
7 Mr. Chairman.
8 And Mayor, thank you very much. And
9 on behalf of myself and my colleagues here, I
10 really want to say thank you for waiting all
11 this time to give your testimony this morning
12 -- this afternoon, now.
13 CHAIRMAN FARRELL: Getting close to
14 evening.
15 ASSEMBLYMAN MAGNARELLI: Getting close
16 to evening, that's right. And hopefully we
17 can do something about it so it doesn't
18 happen next year. We'll try, I promise you.
19 MAYOR BROWN: Thank you.
20 ASSEMBLYMAN MAGNARELLI: The Governor,
21 in his budget, has basically left AIM, the
22 Aid and Incentives for Municipalities, with
23 no change. It's been that way for a number
24 of years. At the same time, there's a number
364
1 of other programs that he has put into place
2 that have been there for a number of years:
3 The Local Government Performance and
4 Efficiency Program, the Local Government
5 Efficiency Grants, Financial Restructuring
6 Board, Municipal Restructuring and
7 Transformational Grants, et cetera,
8 et cetera.
9 I'd just like to hear what you think
10 about the AIM financing in the budget and
11 what you think of these other projects.
12 MAYOR BROWN: Well, this is now my
13 11th year appearing before you as mayor of
14 the City of Buffalo. I'm in my fourth
15 three-year term. And every year I have
16 appeared, I have spoken about the importance
17 of AIM funding. AIM funding continues to be
18 important to the City of Buffalo, and I'm
19 sure you will hear the same from the other
20 upstate mayors who are here to testify today.
21 We have implemented a whole host of
22 efficiency measures in the City of Buffalo
23 which have certainly helped us with our
24 bottom line. We do plan on applying for the
365
1 Governor's Program for Efficiencies. We have
2 some additional ideas, but we believe that we
3 can implement efficiencies and we hope to be
4 able to tap into the resources that are
5 available for those efficiencies.
6 We also hope to partner with other
7 local governments. One of the ways that we
8 think that we can partner with other local
9 governments, and potentially even the State
10 Department of Transportation, is with this
11 Public Works Campus that we seek to build.
12 We believe that there are a number of
13 efficiencies there and services that Buffalo
14 provides now that it could potentially
15 provide to other local municipalities in our
16 region.
17 So the programs that I've laid out can
18 certainly be beneficial to us, that the
19 Governor has placed in his budget, but I have
20 to say that I think AIM is important to local
21 governments, to city governments, and
22 certainly is something that the City of
23 Buffalo is asking for.
24 ASSEMBLYMAN MAGNARELLI: Just one
366
1 other question. Some of the things that you
2 outlined here that you need additional funds
3 for -- Public Works Campus, Main Street, $30
4 million, $80 million -- is any of that doable
5 with the Buffalo Billion?
6 MAYOR BROWN: I don't believe any of
7 those items are fully eligible for the
8 Buffalo Billion.
9 We have used some Buffalo Billion
10 funds for the Cars Sharing Main Street
11 Project to reopen Main Street to vehicular
12 traffic. Those would be included in the
13 almost $60 million that we have already spent
14 on that project.
15 I mentioned that there has been a
16 significant payback in terms of the private
17 sector investment that we're seeing on
18 Main Street as a result of being able to
19 spend those federal, state and local dollars.
20 Some of these other projects that I've
21 mentioned are not eligible for the Buffalo
22 Billion.
23 ASSEMBLYMAN MAGNARELLI: Are they
24 eligible for the Regional Economic
367
1 Development monies?
2 MAYOR BROWN: Again, we have worked
3 with the Regional Economic Development
4 Council in the Western Region to apply for
5 funds for different things. We certainly
6 will pursue funding through that source.
7 It is a competitive process, as you
8 know. And while we think competition is good
9 and competition is a healthy thing, we also
10 believe that these initiatives will give us
11 the ability to be more efficient, to save
12 money, to bring in more private-sector
13 revenue, and potentially to partner with
14 other local governments in our region.
15 ASSEMBLYMAN MAGNARELLI: Thank you.
16 MAYOR BROWN: Thank you, sir.
17 CHAIRMAN FARRELL: Thank you.
18 Senator?
19 CHAIRWOMAN YOUNG: Thank you.
20 And welcome, Mayor Brown. It's always
21 great to see a former colleague.
22 And I first of all want to say how
23 thrilled people are in Western New York on
24 the renewal, the rebirth of Buffalo. As you
368
1 know, I get up there quite often. There's a
2 real synergy and feeling in the air, and
3 things are really turning the corner.
4 So thank you for your leadership in
5 all of those things. And the state certainly
6 has been very happy to support all of your
7 efforts in a very big way, and we're just
8 hoping across all of Western New York that
9 that same prosperity can spread to some of
10 the more rural counties such as the ones that
11 I represent.
12 I just wanted to quickly say thank you
13 for your focus on getting rid of the Gap
14 Elimination Adjustment that has been a fiscal
15 gimmick that has been very destructive to our
16 schools. As you know, the Senate Republican
17 Conference has led the charge to get rid of
18 it once and for all. So thank you for your
19 focus on that, because we really are pushing
20 to have that happen in this year's budget.
21 It certainly would help the schools in our
22 district, the schools all over New York
23 State, schools in Buffalo -- so thank you for
24 your focus on education.
369
1 I'd like to turn it over to Senator
2 Kennedy. I believe he has some questions.
3 SENATOR KENNEDY: Yes. Thank you very
4 much.
5 Mayor, thanks for being here. Thank
6 you for your patience today.
7 MAYOR BROWN: Thank you, Senator.
8 SENATOR KENNEDY: Most importantly,
9 thank you for your leadership. And I'd like
10 to echo our colleague Senator Young's
11 statement. You know, Buffalo is on the move
12 and, you know, I believe that the partnership
13 that your administration has created with the
14 state has paid extraordinary dividends. And
15 whether we're talking about the Buffalo
16 Billion program or we're talking about other
17 key strategic investments, including those
18 you bring to the table today, there's no
19 question that the City of Buffalo is better
20 off today than it's ever been, and continuing
21 to build on that momentum. I think that you
22 bring some very strategic points to the table
23 today.
24 Aside from these, I'd like you to just
370
1 touch on, a little bit, the impact that the
2 state investment and working with your
3 administration has made on key economic
4 drivers like the Buffalo Niagara Medical
5 Campus and SolarCity, and I know you had
6 already touched on Cars Sharing Main Street.
7 But there seems to be a real, strategic,
8 focused momentum on critical mass of
9 development in the core of the city. Can you
10 just touch on that and talk about your
11 expanding efforts on --
12 MAYOR BROWN: I sure can, Senator
13 Kennedy.
14 First of all, let me just say again to
15 you and to the members of the Legislature
16 that are here, thank you for your support of
17 Buffalo. The Western New York State
18 legislative delegation, the Senate, the
19 Assembly, and the Governor have all been very
20 supportive of the needs of Buffalo. And I
21 think we're seeing the impact of your support
22 with significant economic development in our
23 city.
24 SolarCity is a Buffalo Billion
371
1 project. SolarCity will be the largest solar
2 panel manufacturing plant in the northeastern
3 hemisphere. That's significant. It's
4 expected to create 3,000 jobs for the
5 residents of Buffalo and Western New York.
6 It started out on a piece of land that was
7 purchased by the city in 2008, a remediated
8 brownfield. When I initially purchased it as
9 mayor, people said I was crazy to do that.
10 Years later the state, through the Governor's
11 office, was able to negotiate to bring
12 SolarCity to Buffalo, and that purchase of
13 that remediated brownfield land will now pay
14 dividends to our community.
15 Again, the state and all of you have
16 participated in significantly investing in
17 the Buffalo Niagara Medical Campus, which is
18 a center for healthcare in our city, in our
19 region, a place where significant medical
20 research is being done, where Roswell Park
21 Cancer Institute is located, the first
22 comprehensive cancer care facility in all of
23 the United States of America.
24 And right now as we speak, there's
372
1 over $800 million of investment in the
2 Buffalo Niagara Medical Campus, seeded by
3 significant public-sector investment, but
4 certainly incredibly significant
5 private-sector investment taking place. That
6 facility over the next few years is expected
7 to employ over 21,000 people in Buffalo and
8 Western New York. So it is not only a
9 significant economic engine for Buffalo, it
10 is a significant economic engine for the
11 entire region.
12 So I'm glad you asked that question,
13 Senator, so that I could demonstrate how just
14 two of the investments that all of you have
15 supported are paying dividends in the City of
16 Buffalo.
17 SENATOR KENNEDY: Thank you, Mayor.
18 One of the key initiatives for this
19 administration and my colleagues in the
20 Democratic Conference has been enhancing
21 opportunities for everyone, especially those
22 folks that have been left behind in the past.
23 And if you look at the numbers and the
24 statistics, the facts continue to demonstrate
373
1 that there's a real disparity in hiring for
2 women and minorities across the entire United
3 States, but in every single community. And
4 the Governor's office has played a key role,
5 really, in bringing this to the forefront.
6 And I know, and again in partnership with
7 your administration, there has been some real
8 key initiatives.
9 Can you speak to those and what
10 initiatives you're really leading the effort
11 on in this state when it comes to women and
12 minority hiring and enhancing that?
13 MAYOR BROWN: One major initiative
14 that we have worked on with you, Senator
15 Kennedy, and certainly Assemblywoman Crystal
16 Peoples-Stokes, and Governor Cuomo directly,
17 and the Empire State Development Corporation,
18 is again the purchase of industrial land for
19 economic development on the east side of
20 Buffalo, which is in the heart of the
21 African-American community. Roughly 90
22 percent of the residents that live in that
23 section of the City of Buffalo are
24 African-American, and unfortunately that
374
1 population has experienced a
2 disproportionately high unemployment rate in
3 our community. So that -- those purchases
4 will address that.
5 But another major investment that will
6 be made there is a comprehensive workforce
7 training center, which will be built at a
8 cost of about $40 million and that will
9 provide training for residents not only of
10 the east side of Buffalo, the City of
11 Buffalo, but for residents throughout the
12 region to be able to take advantage of the
13 employment opportunities that are coming
14 online in our community, particularly in the
15 high-technology areas.
16 Since 2012, there is nearly $6 billion
17 of economic development activity that is
18 ongoing in the City of Buffalo. And it's
19 estimated that over the next two years, over
20 12,000 new jobs will be created in the City
21 of Buffalo proper which will benefit not just
22 City of Buffalo residents but residents
23 throughout the Western New York region.
24 SENATOR KENNEDY: Thank you, Mayor.
375
1 And there's also, I will point out,
2 your Opportunity Pledge, that I have signed
3 and many have signed, and you continue to
4 promote that as well. Did you want to speak
5 to that at all?
6 MAYOR BROWN: Yes. In February of
7 last year, we initiated what we called the
8 Opportunity Pledge to give individuals in our
9 community -- businesses, organizations -- the
10 ability to demonstrate their commitment to
11 the principles of diversity, equity, and
12 inclusion.
13 We are seeing significant economic
14 development in Buffalo, economists are saying
15 maybe more development than the city has seen
16 in over 45 years. And as that prosperity is
17 rising in our city, we want to make sure that
18 it reaches all people in our community, all
19 sections of our community, all segments of
20 the population. And to date, we've had over
21 5500 individuals like yourself and
22 Assemblywoman Crystal Peoples-Stokes sign
23 that Opportunity Pledge. We've had 225
24 organizations and companies sign the pledge,
376
1 which represent over 158,000 people in our
2 community.
3 So that sends an important message to
4 those who are creating employment
5 opportunities that we want to respect the
6 diversity of the community, we want to be
7 inclusive, and we want to see equity in the
8 opportunity that is rising in our city.
9 SENATOR KENNEDY: Thank you, Mayor.
10 And one last thing I want to touch on
11 here -- because look, we're talking about the
12 economic renaissance that's taking place, a
13 real true transformation in the City of
14 Buffalo, making sure everyone has these
15 opportunities and gets a chance to get
16 employment, has an opportunity to stay in
17 Buffalo, live, raise their family, and work.
18 And part of that is also the focusing on a
19 lot of the quality of life issues.
20 And I know that with the state's
21 support -- and if you can touch on how the
22 state has played a role in some of the
23 PeaceMaker work, in the SNUG work -- this is
24 something that has been on the front lines of
377
1 our conference's agenda that has a real focus
2 on fighting crime in each and every district
3 across the state, but particularly focused on
4 the urban centers that have fallen on harder
5 times in years past, in generations past.
6 We're trying to get out of that.
7 To me, and I know to your
8 administration and to my conference, it's
9 important that we make that strategic
10 investment on public safety. Can you speak
11 to that, please?
12 MAYOR BROWN: Well, certainly quality
13 of life is important in communities all
14 across the State of New York, and I know that
15 the members of the Legislature have been very
16 active in providing funding to support
17 quality-of-life enhancements in communities
18 all across the state.
19 In Buffalo we have focused on being
20 tough on crime as well as being smart on
21 crime. We've added surveillance cameras --
22 we now have over 225 surveillance cameras
23 throughout the city -- and license plate
24 readers -- we have over 200 license plate
378
1 readers throughout the city. We've
2 modernized our police fleet; we've added
3 technologies to our police vehicles that our
4 police officers carry.
5 But in being smarter on crime, we've
6 worked with programs like SNUG, that has been
7 funded through the State Legislature, to work
8 with you to take guns out of the hands of
9 people in communities, to educate them about
10 violence prevention. We funded an
11 organization called PeaceMakers that works
12 with at-risk youth and young adults that
13 actually does street patrol and has helped us
14 to reduce crime in the City of Buffalo.
15 During my tenure as mayor, we have
16 been able to reduce crime overall by
17 35 percent, violent crime by 27 percent.
18 We've been able to do that in partnership,
19 and we've been able to effectively utilize
20 the resources that we have received from you,
21 our partners in state government, to be able
22 to do that.
23 SENATOR KENNEDY: Thank you, Mayor,
24 and thanks for your testimony. And keep up
379
1 the great work.
2 MAYOR BROWN: Thank you, Senator.
3 CHAIRMAN FARRELL: Thank you very
4 much.
5 Crystal Peoples-Stokes.
6 ASSEMBLYWOMAN PEOPLES-STOKES: Thank
7 you, Mr. Chairman, for the opportunity to
8 bring greetings to my mayor and certainly
9 welcome him here in Albany.
10 I suspect you spent a little more time
11 than you expected today. But you're always
12 welcome. You've been around here a little
13 while, so you know how it goes.
14 Just to ask for some specificity as it
15 relates to your budget presentation. On the
16 combined Public Works Campus, how do you
17 anticipate that looking? And what sort of
18 outreach have you had to other governments
19 via state and/or local governments for their
20 participation in that?
21 MAYOR BROWN: So we anticipate a
22 single, unified facility that would house --
23 that would locate, collocate facilities for
24 public works that are now spread across six
380
1 facilities in the City of Buffalo. Some of
2 the areas where these facilities are located
3 are ripe for investment. In a number of
4 them, we've already had private-sector
5 entities express an interest in being able to
6 purchase or bid to purchase the facilities,
7 so we think there could be significant
8 revenue generation there.
9 But we also believe that in
10 collocating these operations, it would make
11 our various public works activities much more
12 efficient. It would create cost savings.
13 We have begun to have dialog with some
14 local governments -- for example, one of the
15 things that Buffalo has that other local
16 governments don't have with the same level of
17 technology, is that they utilize
18 private-sector entities for sign making.
19 And, you know, all governments have to make
20 street signs and other signs. We found that
21 by us doing it, we could provide a
22 significant savings to other local
23 governments and actually beat private-sector
24 entities that are providing those services
381
1 now. So that's one service that we think we
2 could help provide to other governments in
3 our region.
4 We've also begun to have some very
5 preliminary conversations with the New York
6 State Department of Transportation, and we
7 believe with this facility there would be a
8 number of services that we could collaborate
9 on with local governments and potentially
10 even state government.
11 ASSEMBLYWOMAN PEOPLES-STOKES: So any
12 idea or estimate on the amount of savings
13 that could happen for either and/or both
14 governments?
15 MAYOR BROWN: We have worked through
16 some estimates. We believe that savings
17 could be significant, potentially into the
18 millions. And even more significant, we
19 believe that the ability to sell these six
20 properties that we have certainly would run
21 into the millions of dollars.
22 ASSEMBLYWOMAN PEOPLES-STOKES: Well,
23 I'm sure you know there's often talk about
24 consolidating government, and sometimes the
382
1 way to even think more broadly about that is
2 to consolidate services in the delivery of
3 services. So I really actually like that
4 idea, and I hope that we can be helpful in
5 making it a reality for the City of Buffalo.
6 And I already know, you know, that I
7 really like the idea of the barrenness near
8 the historic Mission Street Quarter to be
9 used for some other purpose than garbage.
10 It's a huge attraction, a huge tourist
11 destination, and the removal of that barren
12 would do leaps and bounds for that area.
13 MAYOR BROWN: Well, you have been a
14 champion of the African-American Cultural
15 Corridor in the City of Buffalo. You've
16 provided significant resources and leadership
17 on that important initiative that is designed
18 not only to protect African-American history
19 in our city and region, but also to attract
20 more tourists to our city.
21 We have a public works facility right
22 in the heart of that cultural area where we
23 have plow trucks and garbage trucks and other
24 heavy equipment, as you well know, in and out
383
1 of there on a daily basis. We would like to
2 remove that, and this Public Works Campus
3 would give us the ability to remove that
4 facility from the African-American Cultural
5 Corridor in the City of Buffalo.
6 ASSEMBLYWOMAN PEOPLES-STOKES: Okay.
7 So on the Homeland Security assessment that
8 you had done, was that just on City Hall?
9 MAYOR BROWN: We're talking
10 specifically in terms of the needs of
11 City Hall.
12 ASSEMBLYWOMAN PEOPLES-STOKES: Well,
13 you know what, I'm really pleased to hear
14 that as well, Mr. Mayor. It must be the only
15 city hall left in America where you can just
16 walk in the door. There's no security,
17 there's no one checking to see what you're
18 bringing in there. And I can't even imagine
19 being in that condition in 2016. It's not a
20 good place to put any of our public servants,
21 then. So I'm grateful that you're beginning
22 to take a look at that.
23 On the issue of utility services, the
24 cellphone wireless services, have the
384
1 wireless companies been collecting these
2 resources and not sharing them with Buffalo,
3 Rochester, Syracuse, et cetera? Or have they
4 not been collecting them in those areas?
5 MAYOR BROWN: Yeah. The cities that I
6 mentioned are not able to assess that
7 3 percent charge on the cellular companies.
8 ASSEMBLYWOMAN PEOPLES-STOKES: Right,
9 but have the companies been collecting them
10 from their constituents?
11 MAYOR BROWN: We believe that that fee
12 has been collected.
13 ASSEMBLYWOMAN PEOPLES-STOKES: Okay.
14 Well, then I believe they should reimburse
15 the municipalities like they do in New York
16 City. So I would be happy to work with my
17 colleagues and others to try to make sure
18 that happens for not just Buffalo, but for
19 Rochester, Syracuse, and all other cities
20 that you mentioned as well.
21 MAYOR BROWN: And we can provide you
22 with more specific data on that and how that
23 works.
24 ASSEMBLYWOMAN PEOPLES-STOKES: Thank
385
1 you. Thank you. And one last thing,
2 Mr. Mayor -- actually, two. No, one.
3 Does the City of Buffalo anticipate a
4 budget deficit in your upcoming budget?
5 MAYOR BROWN: We are working now to
6 close an anticipated $30 million budget
7 deficit. Again, some of these efficiency
8 measures that we're putting in place will
9 help us to do that, but right now at the
10 outset of the process of closing next year's
11 deficit we're looking at about $30 million.
12 ASSEMBLYWOMAN PEOPLES-STOKES: Okay.
13 Well, I thank you very much for your
14 comments, and be safe traveling home.
15 MAYOR BROWN: Thank you. Thank you,
16 Assemblymember.
17 CHAIRMAN FARRELL: Thank you.
18 Senator? Assemblyman? Anyone? Okay.
19 SENATOR KRUEGER: Oh, sorry.
20 Senator -- excuse me. Senator Marchione.
21 SENATOR MARCHIONE: Thank you.
22 Has Buffalo been able to stay under
23 the tax cap?
24 MAYOR BROWN: I'm sorry, Senator, I
386
1 didn't --
2 SENATOR MARCHIONE: Has Buffalo been
3 able to stay under the tax cap, the
4 2 percent?
5 MAYOR BROWN: We have to date stayed
6 under the tax cap, yes.
7 SENATOR MARCHIONE: Congratulations.
8 It's not easy to do.
9 MAYOR BROWN: It's challenging. What
10 we find in being able to stay under the tax
11 cap is, as we're seeing new development, new
12 investment in our community, it's been very
13 difficult to realize the benefit of that new
14 investment because of the way the cap is
15 structured. We have shared some ideas and
16 some concerns with the Governor's office
17 about that.
18 They have been very receptive to some
19 of the ideas that we have presented, but in a
20 community like ours -- and I'm sure you will
21 hear from my colleagues as well -- where we
22 are working to stimulate new growth, new
23 development, it is hard because our principal
24 source of revenue is the property tax. It's
387
1 been hard to generate revenue from the new
2 investments that we're seeing in our city
3 with the way the cap is structured.
4 SENATOR MARCHIONE: Thank you.
5 MAYOR BROWN: Thank you, Senator.
6 CHAIRMAN FARRELL: Thank you.
7 Assemblyman McDonald, to close.
8 ASSEMBLYMAN McDONALD: Thank you,
9 Chairman.
10 Good afternoon, Mayor. Ten years into
11 it, you're holding up pretty well.
12 MAYOR BROWN: Thank you, Assemblyman.
13 ASSEMBLYMAN McDONALD: That's good. I
14 did 13 years, he did 12, and look what
15 happens to you after you've been there a
16 while. So keep that in mind.
17 A couple of things. On your DPW
18 campus, which I think is a great idea -- and
19 it sounds like you're trying to move along
20 with the agenda of shared services, and it
21 sounds fantastic. And I think you put a
22 one-time price tag of $30 million on Phase 1.
23 That indicates to me that there might be a
24 Phase 2 or a Phase 3. I'm just curious what
388
1 those costs would be.
2 MAYOR BROWN: The total costs that we
3 anticipate for Phase 2 is another
4 $30 million. The whole structure would be
5 about $60 million. And we're hoping that
6 through the sale of those six parcels of land
7 and facilities that we would consolidate into
8 one, that we would be able to generate
9 substantial revenues towards building out
10 Phase 2.
11 ASSEMBLYMAN McDONALD: Great. That's
12 very smart.
13 And the other question in regards
14 utilities services' taxable -- with the gross
15 receipts tax that you talked about, do you
16 have any idea what the value would be of
17 that? Do you have any idea -- I know this is
18 probably taking a shot away from --
19 MAYOR BROWN: For the City of Buffalo,
20 we have lost about $2 million as we have seen
21 the revenue from landlines decrease. So with
22 more and more people using cellular phones
23 and not having landlines in their home, we
24 have lost about $2 million of revenue in the
389
1 City of Buffalo.
2 ASSEMBLYMAN McDONALD: Over what
3 period of time?
4 FINANCE CMR. ESTRICH: Per year. Per
5 year.
6 MAYOR BROWN: Per year over --
7 ASSEMBLYMAN McDONALD: Per year?
8 MAYOR BROWN: How long?
9 FINANCE CMR. ESTRICH: Probably about
10 five years. Every year it's gone down a
11 little bit more.
12 MAYOR BROWN: Yeah. Over a five-year
13 period.
14 ASSEMBLYMAN McDONALD: And that also
15 speaks to another issue that I don't think
16 directly affects Buffalo, but maybe it does.
17 When the 911 surcharge, which has always been
18 so much for land, a little bit less for the
19 cellphones -- and we've seen this variation
20 change. And the reality is most of the
21 challenges for investment for the 911 centers
22 are to deal with the next generation, with
23 the texting and the whole nine yards. So
24 it's all money, at the end of the day, and
390
1 obviously we're all competing for it. But
2 it's important that we try to make sure that
3 the residents have every opportunity to help
4 support the services they provide.
5 Thank you.
6 MAYOR BROWN: Thank you, sir.
7 CHAIRMAN FARRELL: Thank you.
8 Any further questions?
9 CHAIRWOMAN YOUNG: Yes, I do have one
10 final question, Mayor.
11 I know you know the Southern Tier very
12 well, and you know Cattaraugus County. And
13 located in Cattaraugus County is the former
14 J.N. Adam Developmental Center site, 35 miles
15 south of Buffalo. And I believe you also are
16 aware of the 20-year-plus problem that we've
17 had with the site. The history on it is that
18 it originally was started as a tuberculosis
19 hospital in the early 1900s, was actually
20 donated to the City of Buffalo, and the city
21 has basically kind of given up ownership but
22 has reversionary rights to the property.
23 And so this is an ongoing issue. The
24 state has control of it, and it's been a real
391
1 problem because of vandalism and the lack of
2 economic development on the site, the lack of
3 tax base on the site. The Town of Perrysburg
4 has been waiting and waiting and waiting for
5 a resolution on this, and we've been trying
6 to help with passing legislation for a study
7 on what to do with the property. But as you
8 know, the City of Buffalo still maintains the
9 right to sign off on anything done with the
10 land.
11 And I'm just asking for your help to
12 get a resolution to this. We've been working
13 with the Governor's office on this, been
14 working with the State Assembly on this, but
15 also I need your help, you as the leader of
16 the City of Buffalo to come to a final
17 positive outcome on it. And I didn't know if
18 you have any comments on the situation.
19 MAYOR BROWN: Yes, Senator. We're
20 aware of the challenge that that facility
21 presents in Cattaraugus County and are
22 certainly deeply concerned about that.
23 You know, as a municipality that has
24 had vacant, blighted, decaying structures, we
392
1 certainly don't want to see that for any
2 other community in the state. We have been
3 successful in removing a lot of such
4 structures in the City of Buffalo. During my
5 tenure, we have demolished over 6,000 vacant,
6 unsalvageable structures.
7 And I don't know what necessarily the
8 plan would be for the facility, but as you
9 indicated, the city does -- while it has been
10 transferred to the control of the state some
11 time ago, the city does maintain reversionary
12 rights to the site. We would certainly give
13 up those rights; we have had conversations
14 with the state about it. I can report to you
15 that as recently as about a week ago, I
16 think, my law department was in discussion
17 with the state agency that was talking about
18 potentially securing or getting us to sign
19 off on that reversionary right at some cost,
20 which we certainly would be willing to do.
21 CHAIRWOMAN YOUNG: That would be
22 great, to finally have that resolved. So I
23 would ask that we continue to work together
24 on this. If you could keep me informed about
393
1 it, because it does have such a strong impact
2 in my community and the people who live
3 there. And it's been such a terrible problem
4 for so many years, and it's good to hear that
5 there is some progress regarding the issue.
6 So I look forward to working with you.
7 MAYOR BROWN: We certainly will keep
8 you informed of what we're hearing and what
9 we're doing. With respect to that, Senator,
10 I know that it's a real frustration to the
11 people that live in that community. We
12 certainly don't want to see that continue,
13 and anything that we can do in Buffalo to try
14 to help address that and expedite that, we
15 certainly will do.
16 CHAIRWOMAN YOUNG: Thank you, Mayor.
17 MAYOR BROWN: Thank you.
18 And folks, I apologize, I was
19 negligent. I did not introduce my
20 commissioner of finance, Donna Estrich. And
21 I just want to thank her for the work that
22 she does with us every day to help manage the
23 finances of the City of Buffalo.
24 Thank you all very much.
394
1 CHAIRMAN FARRELL: Thank you very
2 much.
3 CHAIRWOMAN YOUNG: Thank you.
4 CHAIRMAN FARRELL: The Honorable Kathy
5 M. Sheehan, mayor, City of Albany.
6 MAYOR SHEEHAN: Good afternoon.
7 CHAIRMAN FARRELL: Good afternoon.
8 You heard about being late. We've set
9 the record there.
10 MAYOR SHEEHAN: That's okay. I just
11 have to come across the street.
12 CHAIRMAN FARRELL: You're the lucky
13 one.
14 MAYOR SHEEHAN: I feel for my fellow
15 mayors who came from further away.
16 So if you would like me to begin, I
17 want to thank you for inviting me here today,
18 Chairwoman Young and Chairman Farrell,
19 members of the Assembly and the Senate. I
20 want to thank Senator Breslin and
21 Assemblymembers McDonald and Fahy, who I have
22 worked with over the last two years on many
23 of the challenges and great opportunities
24 that we have here in the Capital Region.
395
1 And, you know, we are a regional
2 center, a center for government and for
3 healthcare and for education, but we are also
4 a city with diverse neighborhoods and with
5 many of the challenges and opportunities that
6 all of our cities face and that we share in
7 common and that we have had the opportunity
8 to discuss with mayors and one another.
9 Because with what you've heard today from
10 Mayor Brown and from the other mayors, I
11 think we are doing extraordinary things
12 within our cities to make sure that we are
13 being fiscally responsible and serving the
14 needs of our residents.
15 And the City of Albany has some
16 wonderful treasures. It is home to historic
17 homes, to museums, we have a rich Dutch
18 heritage, we have wonderful traditions here
19 in the City of Albany. And even though, as
20 the Governor said in his State of the State,
21 upstate New York must remain an economic
22 priority, and he talked about the fact that
23 upstate has been shortchanged for many years,
24 I think that what we have been able to do in
396
1 the City of Albany is quite remarkable with
2 the resources that have been made available
3 to us.
4 And we are very grateful that the
5 Governor has in this budget created a fund
6 that is focused on reducing poverty, and
7 Albany is fortunate as being identified as a
8 city to receive those funds. But it's also a
9 list that you don't necessarily want to be
10 on, to be identified as one of the poorest
11 cities in upstate New York.
12 Under that program the city will
13 receive funding so we can look at
14 anti-poverty efforts that are working in our
15 city and other cities and make sure that we
16 are focused in Albany on workforce
17 development, which is one of our biggest
18 challenges, or people being able to access
19 jobs that are available here in the region.
20 There are other proposals in the
21 budget with respect to upstate: Water
22 infrastructure funds, funding for the Thruway
23 Authority, roads and bridges and broadband.
24 I'm pleased to say that we started
397
1 last year looking at a broadband initiative
2 in the City of Albany because we have heard
3 from businesses that have been looking to
4 locate here, and from developers who are
5 developing downtown residential, that this is
6 a real challenge. And so we need to make
7 sure that we have access, that we have high
8 speed, and that we are bridging the digital
9 divide. Because it's important, particularly
10 when you look at the need for broadband and
11 the reliance we have on the internet, that
12 this is right along with any other utility --
13 it's something that needs to be affordable
14 and accessible to all of our residents.
15 So we are well on the path to coming
16 up with a really great plan for how we can
17 spend these dollars wisely so that we can
18 provide high-speed internet in the City of
19 Albany.
20 But we also have significant
21 challenges. In September we were identified
22 as a city in significant fiscal distress. We
23 are the only city in upstate New York that is
24 on that list, and we are one of only two
398
1 cities in the state that meet the criteria
2 for significant fiscal distress.
3 We opened our books when I became
4 mayor in January of 2014. One of the first
5 things that we did was to submit our books to
6 the Financial Restructuring Board. We opened
7 ourselves up to that process. We went
8 through and reviewed with representatives on
9 the restructuring board the challenges that
10 we were facing, and as a result of that for
11 2015 we were able to receive some gap funding
12 to close our budget gap. We started planning
13 for our 2016 budget year -- we're on a
14 calendar budget -- we started planning for
15 that almost immediately, and again worked
16 very closely with the state and the State
17 Budget Office to review the challenges that
18 we were facing, knowing that we were entering
19 that with a gap because of the one-time
20 funding that closed the budget gap that we
21 had in 2015.
22 Our 2015 and 2016 budgets capped
23 costs, we capped growth at under the
24 2 percent target that the Governor has set.
399
1 In 2015, we stayed within the property tax
2 cap, and our 2016 budget proposes no tax
3 increase. And that is because our residents
4 pay by far the highest tax rates in the
5 region, and our tax rates are uncompetitive.
6 We cannot tax our way to a balanced budget.
7 It would cause, I think, further challenges
8 for economic development and growth in our
9 city.
10 So we have been able -- even though we
11 have had a deficit budget in Albany since at
12 least 2007, we have been able, through a
13 patchwork of spinups and other one-time
14 funding streams, to maintain solvency. But
15 we have reached the end of that solvency.
16 We, in our 2016 budget that was passed by our
17 Common Council, are relying on an additional
18 $12.5 million that we would need to obtain
19 from the state in order to close that budget
20 gap.
21 The state, as many of you know, owns
22 more than 30 percent of the property in the
23 City of Albany, and more than 60 percent of
24 the property in the City of Albany is not
400
1 taxable. So the result of that is that
2 people who own -- homeowners who own
3 25 percent of the value of the property in
4 the City of Albany pay 60 percent of the tax
5 levy. And commercial business owners, who
6 own just 13 percent of the value of taxable
7 property in the City of Albany, pay
8 40 percent of the property tax levy.
9 And I included in your materials a map
10 that shows just how much nontaxable property
11 we have in the City of Albany. And when you
12 look at this map -- and this darker gray is
13 also property that is exempt from taxation --
14 you can see very visually the challenge that
15 we face in raising revenue.
16 Our property tax levy is the largest
17 source of revenue for the City of Albany.
18 Sales tax is shared countywide, so the sales
19 tax that is raised in the City of Albany is
20 shared countywide in Albany County. So the
21 only source of revenue, tax revenue, that we
22 control and we directly receive is our
23 property tax levy.
24 And as I said, Albany is not
401
1 competitive with our immediately adjacent
2 suburbs. So when you look at the actual tax
3 bill, a resident in the City of Albany,
4 factoring in school taxes, is paying about 20
5 to 30 percent higher than the surrounding
6 suburbs. And a commercial business in the
7 City of Albany is paying $49 per thousand,
8 and we are at full assessed value in the City
9 of Albany.
10 So when we look at that challenge,
11 again, to increase taxes in order to close
12 our budget gap, I think we would continue to
13 have a challenge in attracting residents to
14 our city and businesses to the City of
15 Albany.
16 I know that many people, when they
17 come to this region -- and one of the things
18 that I'm really focused on is to think of
19 ourselves as a region and act as a region --
20 but many people compliment me on how
21 wonderful Colonie Center is or Crossgates
22 Mall or what a great stay they had at a hotel
23 out on Wolf Road. And I thank them and then
24 I tell them that I'll pass those compliments
402
1 along to Paula Mahan, who's the town
2 supervisor in Colonie, or the town supervisor
3 in Guilderland, because none of those
4 places are located within the City of Albany.
5 We are landlocked, and we have significant
6 challenges in growing our tax base.
7 But that said, we are growing our tax
8 base, and we've seen a tremendous amount of
9 investment in our downtown. By the end of
10 2016 we will have 450 new units of housing,
11 market-rate housing in our newest
12 neighborhood downtown. We are working
13 rapidly to redevelop our warehouse district,
14 and we recently passed a zoning overlay so
15 that we can move quickly and entice
16 businesses to come into and invest in our
17 warehouse district.
18 And we also have been talking to the
19 state -- the state is still considering
20 potentially allowing some private development
21 on the Harriman Campus site, which again will
22 give us an opportunity to grow our tax base.
23 But the challenge for Albany is one of
24 parity. And we receive $128 per capita in
403
1 AIM -- less than Schenectady, less than Troy,
2 less than Utica -- and far less than other
3 larger upstate cities. And so that has been
4 the biggest challenge in looking at our
5 ability to put together a balanced budget.
6 When you look at the property tax levy
7 in the City of Albany, the levy in actual
8 dollars, both city and school, is higher than
9 the levy in actual dollars in cities that are
10 significantly larger than Albany -- not per
11 capita, in actual dollars.
12 So we have a gap. It's 12.5 million.
13 When I came here in 2014, I said it was
14 12.5 million. In 2015, the state was able to
15 provide us with $10 million, and we used
16 $2 million, the last $2 million of our
17 reserves. And I come to you again today
18 saying it's $12.5 million, and that's in
19 light of the fact and notwithstanding the
20 fact that we have continued to cut
21 significant costs from our budget.
22 Our costs of running city government
23 are rising much more quickly than this. Our
24 health insurance costs alone, we're targeted
404
1 to go up 9.4 percent this year. But even
2 with those increases, we've been able to
3 implement cost-saving measures, make
4 decisions about streamlining city government,
5 work with the county and work with other
6 governments so that we can drive cost
7 efficiencies.
8 But this structural gap that exists,
9 again, is about $12.5 million. It's what we
10 would receive if we received the same AIM per
11 capita as the City of Utica.
12 So if we were to try to raise that
13 $12.5 million by increasing our property tax
14 levy, we're looking at a 20 percent property
15 tax increase for our residents, a 22 percent
16 tax increase for our homeowners.
17 We, as I said, held spending to less
18 than 2 percent in each budget since I took
19 office in 2014. We have gone through the
20 Financial Restructuring Board, which
21 acknowledged that the City of Albany has a
22 revenue problem. We have instituted not only
23 cuts but new fees, and those fees, while not
24 popular, are measures that we need to put in
405
1 place so that we can continue to provide
2 services to our residents.
3 We need to grow our tax base, and I
4 believe that we are making the right
5 decisions and the right investments to do
6 that. But we also need state funding that
7 recognizes the unique and compelling position
8 that we have as the capital of New York
9 State. We recognize that being home to state
10 government and hospitals and universities
11 means that we're a center for jobs. The
12 challenge for the City of Albany is that we
13 don't have a municipal income tax, we don't
14 have any way of generating a tax base from
15 those people, many of whom -- most of whom
16 are coming into the city to work. Our city
17 about doubles in population every day. So
18 residents are choosing to live right outside
19 the city and commute into the city, and
20 they're not walking into buildings that are
21 paying us property taxes. So that is the
22 challenge.
23 But we are getting there. We've seen
24 a complete facelift of our Wellington Row at
406
1 the top of State Street. I think many of you
2 have had the opportunity to walk across the
3 street and see the new Renaissance Hotel,
4 which is a spectacular new addition to the
5 city. We've worked really closely with that
6 hotel to ensure that the people who are
7 getting jobs there are residents in the City
8 of Albany.
9 One of the things that we've done over
10 the last two years, and I think we've been
11 successful, is helping the business community
12 focus on the fact that we need to provide
13 jobs for our residents, and they are
14 responding.
15 And the Capital Center is under
16 construction and will be completed, and we
17 are undertaking a number of initiatives so
18 that we can really capture the economic value
19 of that by having new businesses start in
20 Albany, by ensuring that entrepreneurs and
21 that residents of the City of Albany
22 understand the opportunities that are
23 available because of that.
24 So as I said, the challenge is AIM.
407
1 One of the proposals that we have made with
2 respect to the $12.5 million is that, given
3 our unique status as the capital city, that
4 we can amend Section 19A of the Public Lands
5 Law to provide for additional aid to the City
6 of Albany so that we can build a bridge to
7 the future that we have in front of us, which
8 I do believe is a bright future.
9 And we are open to other mechanisms
10 for delivering this additional aid to the
11 City of Albany. But we do believe, when the
12 city receives less than 0.5 percent as the
13 payment that we receive for all of the state
14 land in the City of Albany, that 19A is a
15 mechanism for delivering this aid to a city
16 that is proud to be your state capital and is
17 proud of the services that we provide and the
18 infrastructure that we provide, but that is
19 need of finally closing this structural gap
20 so that we can move forward and have a bridge
21 to a more permanent solution.
22 Thank you.
23 CHAIRMAN FARRELL: Thank you very
24 much.
408
1 Mr. McDonough -- McDonald.
2 ASSEMBLYMAN McDONALD: It happens all
3 the time, McDonough to McDonald.
4 CHAIRMAN FARRELL: I'm having trouble.
5 ASSEMBLYMAN McDONALD: I know, I know.
6 So, Mayor, thank you. And it's a long
7 road, and we're not going to get there
8 overnight, but we're trying to move things
9 along.
10 You know, you're doing all the right
11 things, you've -- I know you've streamlined a
12 lot within City Hall, with efficiencies.
13 Reaching out -- I know there's a shared
14 services effort going on with communications
15 with Troy and Albany County, Rensselaer
16 County, which is important.
17 You're one of the first to go flying
18 into the Fiscal Restructuring Board, which,
19 oddly enough -- it was good, it provided some
20 money, some gap money. But at the same
21 token, after reading the report -- I had to
22 read it two or three times -- it's almost as
23 if they put their hands up, saying, You've
24 got a gap and you've got to figure it out,
409
1 you need to generate more income.
2 And unlike our five-hour guest this
3 morning, which has their own way of
4 generating revenue through the personal
5 income tax, that's not an option in Albany,
6 nor would I recommend that we consider that
7 either.
8 The tax-exempt property status is a
9 large concern. And as you know, I represent
10 five cities -- I'm fortunate enough to share
11 Albany with Pat -- and, you know, Troy,
12 Rensselaer, and Albany are 1, 2, and 4, I
13 think, in regards to percentage of tax-exempt
14 property overall.
15 You mentioned 60 percent. And I'm
16 curious, because we are the home of state
17 government, what is the percent of that
18 property that is tax-exempt that's used for
19 state purposes, to conduct state government?
20 MAYOR SHEEHAN: Roughly 30 percent of
21 the property in the city is owned by the
22 state.
23 ASSEMBLYMAN McDONALD: Okay. You
24 talked about a lot of the developments that
410
1 are moving forward in the city. Some, of
2 course, are another tax-exempt entity like
3 the Capital Center, but we know we'll see
4 great growth with a bed tax and with sales
5 tax and life in downtown Albany. And I know
6 there's a lot, I think there's over 400
7 residential units coming online in the
8 downtown areas.
9 Well, do you have any idea what the
10 projection is for what that revenue might be?
11 MAYOR SHEEHAN: You know, we're
12 looking out three and five years, and we
13 anticipate that we're going to have to enter
14 into PILOT agreements for the foreseeable
15 future. But that's a new revenue stream for
16 the city, so we need to build a bridge. This
17 isn't a one-time ask, and that's something
18 that I want to stress. I don't want people
19 to be surprised. This is a structural
20 deficit, and we are asking for five years to
21 grow our way out of it.
22 But when we look at what the
23 opportunities are both at the Harriman Campus
24 and in our warehouse district and at the
411
1 former Convention Center site, we think that
2 through a combination of cost-cutting
3 measures, fees for services, and growth in
4 our tax base, that we will be able to create
5 that bridge and get to a sustainable city
6 budget. But it will take time. It will
7 absolutely take time.
8 ASSEMBLYMAN McDONALD: Speaking of the
9 bridge, you speak of the bridge, a $12.5
10 million bridge. And, you know, you have
11 included that in this year's budget. And at
12 the same token, right now we're going through
13 the process of -- at least we're trying to
14 shepherd it through to make sure that it's
15 there.
16 And I agree with you, and I want to
17 say this. I commend you on the fact that you
18 found something unique that reflects, really,
19 the capital city of Albany -- or really the
20 capital of the capital of the world, as we
21 say around here. And at the same token, it's
22 something that you recognize that as greater
23 growth goes on, on the 19A property, as more
24 property comes on the tax rolls, that you
412
1 responsibly would say the state should be
2 able to ease off its burden.
3 Most mayors don't usually do that. I
4 don't know, I've been here for 13 years, I
5 was groveling all the time. So I commend you
6 for at least saying here, we want to be part
7 of the -- we need a solution, and we also
8 realize that we can't be on your aid the rest
9 of our lives.
10 I guess the question that comes up is,
11 what if the 12.5 million doesn't show up?
12 MAYOR SHEEHAN: As I've said --
13 ASSEMBLYMAN McDONALD: And I will say
14 this. It's part of your presentation, but
15 it's worth repeating. You know, I only live
16 eight miles up the road. I'm in Albany just
17 as much as I'm in Cohoes, and I'm in the
18 other communities as well. And I've been in
19 a lot of houses here in the community. And
20 you're absolutely right, putting the burden
21 on the backs of the taxpayers is not going to
22 work. I am -- I've come up with the
23 conclusion that the taxpayers here in Albany
24 are exhausted.
413
1 MAYOR SHEEHAN: Well, the challenge is
2 that what it's really created is, you know,
3 we have neighborhoods where we have people
4 who are able to afford the property tax bill
5 and we have neighborhoods that are inundated
6 with low-income housing. And there is really
7 not a lot of room for people who are in the
8 middle here. And so that's a real challenge
9 for the city.
10 If we are not able to bridge this gap,
11 then, you know, the challenge for the City of
12 Albany is that our entire non-union payroll
13 is less than $12 million. So I'll say that
14 again: Our entire nonunion payroll is less
15 than $12 million. So we're talking about
16 significant cuts. It's about 7.5 percent.
17 If we were to go 7.5 percent across the
18 board, it means that we would probably, in
19 effect, have to disband our neighborhood
20 engagement units because we would only have
21 enough police officers left to respond to 911
22 calls.
23 We would, in all likelihood, have to
24 disband EMT services. And we are the front
414
1 line of healthcare for the poorest people
2 living in our community. Notwithstanding the
3 healthcare reforms that have occurred, we are
4 still the front line. We are the people that
5 the poorest people in our community call
6 first to deliver those EMT services. And our
7 firefighters are out there when somebody has
8 an earache, and we are assisting families in
9 getting to the emergency room because they
10 can't afford the cab fare.
11 So that's just the reality. And so
12 we're looking at potentially having to
13 disband those EMT services because of the
14 cuts that we would have to make.
15 And the other, you know, travesty of
16 that is that we will leave money on the
17 table. We received a SAFER grant from the
18 federal government that's paying for
19 15 firefighters for the next two years. So
20 not only would we have to cut those 15 and
21 leave that SAFER grant money on the table,
22 we'd have to go deeper in order to actually
23 realize savings.
24 The same thing with our police
415
1 officers. We'd have to lay off more police
2 officers, because we received a COPS grant
3 for some of those police officers, so we'd
4 have to pay the feds back $3 million for the
5 first one that we lay off. So after we pay
6 back that 3 million, you know, we then would
7 have to go even deeper and lay off more
8 personnel.
9 We're talking about eliminating a
10 summer youth employment program that employs
11 1,200 of our lowest-income children and
12 provides them with extraordinary job
13 experience and opportunity. Under my
14 administration, we have completely
15 transformed that program so that on the fifth
16 day of the week, young people transition --
17 they either spend time learning about career
18 pathways and financial planning, they learn
19 about how to get into college and they visit
20 a college campus, they spend a day with our
21 police officers and learn about knowing their
22 rights from a outside party, our Center for
23 Social Justice that provides them with that
24 training. So it's really been a very
416
1 substantive program aimed at giving young
2 people the skills that they need to succeed.
3 We would not be able to provide that.
4 We would not be able to hire
5 lifeguards, so we would have to close our
6 pools and our parks.
7 We have gone through and looked at
8 what we would have to do to get to
9 $12.5 million. And what you're left with is
10 not a place where people would want to invest
11 and where people would want to live. And,
12 you know, we are laser-focused on being as
13 effective and efficient as we can be, but it
14 would be a very devastating impact to the
15 City of Albany.
16 ASSEMBLYMAN McDONALD: Not only the
17 City of Albany, but the state Capitol as
18 well.
19 MAYOR SHEEHAN: Well, I think that it
20 would really hurt the region. And, you know,
21 we do have so much that is going for us. And
22 I view this as an investment in the success
23 that is here and a recognition that, you
24 know, for reasons that predate all of us, and
417
1 maybe for a lack of a sense of urgency on the
2 part of the city -- because in past years
3 when the pension bill was a million, a
4 million-five, we were able to, you know, be
5 able to have years where even with a spinup,
6 you know, with a spinup we were able to have
7 surpluses. With a pension bill now that is
8 16 to $17 million and has been since 2008,
9 2009, we're no longer able to do that.
10 ASSEMBLYMAN McDONALD: My final
11 comment -- and you don't need to respond if
12 you don't want -- is in the Governor's
13 proposal he rightfully proposes a $25 million
14 investment in the Poverty Initiative, and he
15 chose 10 cities throughout the State of New
16 York. I'm sure it wasn't chosen for any
17 reason but merit -- and it's not a merit we
18 all subscribe to, but it's a merit
19 nonetheless. It's unique that the City of
20 Troy and the City of Albany both have been
21 chosen. Which is ironic, because I know as
22 long as Member Fahy and I have been here for
23 the three short years -- it seems like 20 --
24 that we've always been told, well, Albany
418
1 gets all the jobs, Albany gets all the jobs,
2 Albany gets all the jobs.
3 Well, I find it challenging, if we're
4 getting all the jobs, you would think we
5 wouldn't have to worry about having a high
6 percentage of poverty. And we're in that
7 select group of 10. I just find that to be
8 something that actually speaks more to the
9 issue that we're facing here in the city.
10 MAYOR SHEEHAN: I think people are
11 surprised to learn that the poverty rate in
12 Albany is approaching 26 percent, that more
13 than a third of our children live in poverty,
14 and that fewer than 50 percent of our
15 children are graduating from high school.
16 That number went up, it went up across the
17 state, so we're having more success. I
18 believe that actually last year we were above
19 that 50 percent mark.
20 But we face the same challenges as
21 other struggling cities. But we, like those
22 cities, are tough. We're working on it, we
23 have a deep commitment to it, and we need to
24 focus on advocating for the resources that we
419
1 need in order to accomplish it.
2 And, you know, again, I believe that
3 all of the mayors that I work with and that I
4 talk to across upstate New York have done a
5 remarkable job and are doing remarkable
6 things. And we shouldn't be pitted
7 against -- you know, and arguing, you know,
8 about fairness. I think we need to just take
9 a stark look at what the challenges are and,
10 you know, make a commitment and having an
11 urban agenda.
12 Because these urban centers really are
13 the future of our state. Young people are
14 deciding where they're going to live, and
15 then they figure out what they're going to
16 do. When we talk to employers, and I'm sure
17 other mayors say it, they are looking for a
18 place where they can imagine the best and the
19 brightest wanting to come and live. And the
20 cities of upstate New York, whether it be
21 Albany or Syracuse or Rochester or Troy, we
22 have the bones. We have beautiful
23 architecture. We have all of the things that
24 upstate cities need -- great universities,
420
1 institutions of higher learning, great
2 healthcare.
3 And so we need to invest and build on
4 that. I think this is a really exciting and
5 optimistic time in New York State.
6 ASSEMBLYMAN McDONALD: Thank you.
7 CHAIRMAN FARRELL: Thank you,
8 Assemblyman McDonald.
9 And now we will ask Assemblywoman Fahy
10 to see if you --
11 SENATOR KRUEGER: I'm sorry, we have a
12 Senator. Sorry.
13 CHAIRMAN FARRELL: Oh, I'm sorry.
14 Senator.
15 SENATOR KRUEGER: Sorry. Senator John
16 DeFrancisco, from Syracuse.
17 SENATOR DeFRANCISCO: First, I was
18 watching you on TV last night with the clips
19 from the hearing or whatever it was. I've
20 got to commend you for maintaining your
21 patience. Because if it was me, I know I
22 wouldn't have. That was a very difficult
23 thing to do.
24 One quick question. You said that you
421
1 had 1200 summer jobs that you employ people
2 in the city; correct? What do you pay them
3 now?
4 MAYOR SHEEHAN: We pay the 14- and
5 15-year olds -- I believe it's $6.50 an hour.
6 And then if they're 16, we pay the minimum
7 wage.
8 SENATOR DeFRANCISCO: Okay. And the
9 minimum wage now is $9?
10 MAYOR SHEEHAN: I believe that that's
11 what we budgeted -- yes, it's gone up to 9.
12 SENATOR DeFRANCISCO: Okay. In view
13 of your dire financial situation, as with all
14 the mayors, does that mean if the minimum
15 wage goes up you'll have to employ less
16 people?
17 MAYOR SHEEHAN: We've been able,
18 through federal funding that helps to fund
19 some of those positions, particularly for the
20 older children, to maintain the numbers. The
21 numbers go up and down every year.
22 Our goal actually is to really focus
23 on the 14- and 15-year-olds and be doing such
24 a good job in the experience that they get
422
1 that our 16-year-olds get hired by the
2 private sector. And we're working really
3 hard with private-sector employers in the
4 area to make sure that we're providing the
5 training that they expect.
6 SENATOR DeFRANCISCO Mayor, let me
7 just cut you off.
8 MAYOR SHEEHAN: Yeah.
9 SENATOR DeFRANCISCO: You know, I see
10 what you're saying, but whether it's the
11 private-sector employers or the public
12 employers, if there's so many dollars that
13 are set for summer jobs, entry-level jobs
14 where people can learn how to work, how do
15 you get around not eliminating some jobs,
16 private or public, if you've got the same
17 amount of money to deal with?
18 MAYOR SHEEHAN: Well, we have, in the
19 projections that we have created, built in
20 the escalation to the $15-an-hour minimum
21 wage that the Governor has proposed, and, you
22 know, the total cost to the City of Albany is
23 in the neighborhood of -- I hope I'm not
24 misquoting this -- I think it's about $2
423
1 million, ultimately. And again, that assumes
2 that we keep the numbers the same.
3 So we have to look at opportunities to
4 reduce that cost. Our summer youth
5 employment program only lasts six weeks.
6 That's not the largest driver of it, but I
7 think that, you know, if we can see an
8 increase in minimum wage and move more of our
9 young people into private-sector jobs, you
10 know, that would be ideal. We have, as I
11 said, an almost 26 percent poverty rate. So
12 as a mayor, I know we can debate whether the
13 minimum wage will --
14 SENATOR DeFRANCISCO: No, I'm not --
15 MAYOR SHEEHAN: -- have the results we
16 asking for, but I think that that would be a
17 positive impact on the city overall.
18 SENATOR DeFRANCISCO: I'm about ready
19 to take back my compliment --
20 (Laughter.)
21 SENATOR DeFRANCISCO: -- because this
22 doesn't make too much sense.
23 But the fact of the matter is you've
24 built it in, so instead of $12.5 million
424
1 deficit, you may have a little higher
2 deficit.
3 MAYOR SHEEHAN: We know that that's a
4 bogey that we have to hit. We've got to find
5 cost savings to be able to offset that
6 increase.
7 SENATOR DeFRANCISCO: Okay. Last
8 point. What cost savings other than less
9 employees can you do?
10 MAYOR SHEEHAN: Well, we have some
11 work to do on our workers' compensation
12 costs. We can do a better job of monitoring
13 that within the City of Albany and set some
14 targets for our employees.
15 We can also do better in our health
16 insurance costs. And we were successful in
17 interest arbitration to now have all of our
18 firefighters contributing towards health
19 insurance. And so we've created a union
20 management committee to look at how we can
21 drive down those insurance costs, and our
22 firefighters now have a stake in that. If we
23 can drive down premiums and look at cost
24 savings measures, they're going to benefit
425
1 from that. So I think that we've got room on
2 health insurance.
3 We have room with respect to using and
4 implementing changes in technology. I have
5 an employee who -- we are being funded
6 through the Bloomberg Philanthropies to
7 attend the Denver Peak Academy, which is a
8 program that was funded by Bloomberg
9 Philanthropies in Denver where employees have
10 identified $23 million in savings since 2013.
11 So those are the types of efforts we
12 need to undertake in order to be able to find
13 savings and efficiencies.
14 SENATOR DeFRANCISCO: That sounds
15 great. And it will reduce the $12.5 million
16 you need from Albany then as well.
17 MAYOR SHEEHAN: We know that we're
18 going to need to find ways, and as I said,
19 we're looking for a bridge. And I agree.
20 CHAIRMAN FARRELL: Thank you.
21 Assemblywoman Fahy.
22 ASSEMBLYWOMAN FAHY: Thank you,
23 Mr. Chairman.
24 And thank you, Mayor, for your always
426
1 compelling testimony.
2 Obviously it's very, very sobering,
3 but I also appreciate that you have a number
4 of encouraging, encouraging initiatives
5 underway, including the Capital Center or the
6 Convention Center, along with a host of other
7 programs underway.
8 And I just want to echo some of the
9 comments you made earlier and that my
10 colleague Mr. McDonald made, and that is
11 that -- about the region and the impact that
12 Albany has on the region.
13 I represent three terrific towns as
14 well as the City of Albany -- in fact, a few
15 that you highlighted here in your
16 testimony -- and in each of those towns, I'm
17 often comparing property tax rates, because I
18 live here in Albany and I pay those property
19 taxes. And I think the only one that I ever
20 find that gives me anything close to a match
21 is the City of Schenectady.
22 And even among a number of folks in
23 the towns that I represent, they do recognize
24 that if the core, the core of this region,
427
1 along with the core throughout upstate of our
2 key cities upstate -- when the core suffers,
3 the entire region suffers.
4 So I do recognize that while there's
5 much encouraging news, there are tremendous,
6 tremendous challenges. And I appreciate the
7 work that you have done. But as Assemblyman
8 McDonald said, we recognize this is quite a
9 challenge on the $12 million.
10 Can we talk a little bit about where
11 you see some of that turnaround, as you've
12 said, over the next few years, and when you
13 see it? For instance, you made reference to
14 Harriman. I know this body agreed with the
15 Governor's proposal last year to put tens of
16 millions of dollars into development up at
17 Harriman, and that an estimated 30 acres is
18 supposed to come online to be privately
19 developed.
20 Do you have a better sense, any
21 updates on that timeline on when we might
22 begin to see some revenues into the city as
23 that is privatized?
24 MAYOR SHEEHAN: We've been working
428
1 with the state to make sure that they have
2 the information that they need about the
3 infrastructure underneath the Harriman Campus
4 and what the needs would be in order to build
5 it out. We were successful in getting
6 planning funding through the REDC to really
7 focus on that western part of the city so
8 that we can support and have the
9 infrastructure to support growth both at the
10 University at Albany, at SUNY Poly, and at
11 the Harriman Campus.
12 So they, you know, have been
13 requesting information, and it's my
14 understanding that they are developing an
15 RFP.
16 And when you talk about the investment
17 up there, it's a really great example.
18 Because if that investment had occurred
19 anywhere else but in the City of Albany, it
20 would have generated a PILOT payment. So
21 under 19A, if you take property in a
22 municipality and use it for state purposes,
23 there is a PILOT that is paid based on a
24 percentage of the work that was done, the
429
1 construction costs associated with that.
2 And so that is why I think that 19A
3 provides an opportunity for the state and for
4 this body to really look at what the impact
5 is in the City of Albany of this investment,
6 because of the amount of land in the city
7 that the state owns.
8 ASSEMBLYWOMAN FAHY: I actually
9 appreciate you pointing that out on the
10 Harriman Campus. And please correct me if
11 I'm wrong, but I think there have been
12 long-standing bills that my predecessor had
13 and that I've carried for PILOT payments on
14 Harriman, which is hundreds of acres --
15 there's about 30 that are to be developed
16 privately. But my recollection is that would
17 generate about $11 million were we to get a
18 19A payment or PILOT payment on that.
19 MAYOR SHEEHAN: Well, actually that
20 number would go up a little bit because of
21 the recent investment that has occurred out
22 there. So that has increased the value of
23 that property.
24 Again, the elegance of doing this in
430
1 19A is that we have agreed -- and I think
2 that it does make us unique in saying that as
3 the Harriman Campus or as other property
4 that's owned by the state becomes privately
5 developed, that should be subtracted from
6 anything that the state should be responsible
7 for. If we're able to get that revenue
8 through private development, then we are then
9 more aligned in our interests with the state.
10 ASSEMBLYWOMAN FAHY: Okay, very
11 helpful. And any other revenue generators
12 that you could note would also be of help.
13 With regard to the previous question
14 from Senator DeFrancisco, I may have
15 misunderstood, or it might be helpful -- the
16 $2 million that you mentioned would be a
17 shortfall, I guess, if you will, with the
18 minimum-wage proposals, is there a
19 breakout --
20 MAYOR SHEEHAN: No, what we've done is
21 cost out what -- there's an escalator that
22 the Governor has proposed with respect to the
23 minimum wage. So out at the end, 2021, when
24 the full $15-an-hour minimum wage would be
431
1 put in the place -- over that period we would
2 need to be offsetting up to the maximum --
3 would be $2 million. As I recall, I think
4 it's about $2 million.
5 So when we looked at it in the initial
6 years, with the increases, it would not have
7 that large of an impact, again because we
8 have so many employees now who already make
9 above what that minimum would be. So we're
10 really just looking at our full-time
11 workforce that's not at minimum wage. And
12 then our summer youth employment program.
13 And again, in looking at where there
14 are federal dollars that are available for
15 that, we are able to offset more of that
16 increase with the federal dollars.
17 ASSEMBLYWOMAN FAHY: Okay. Thank you
18 for clarifying that.
19 MAYOR SHEEHAN: These are for
20 income-eligible young people.
21 ASSEMBLYWOMAN FAHY: Okay. Thank you
22 for clarifying. That was a big number.
23 MAYOR SHEEHAN: Yeah, it's not
24 $2 million in the first year, no, no, no.
432
1 That's by 2021.
2 ASSEMBLYWOMAN FAHY: I know we have a
3 long night ahead of us, so I will stop there.
4 I just want to say there's not a day
5 that goes by that we don't have conversations
6 up here regarding this need for these bridge
7 dollars and the predicament that Albany is
8 in. I appreciate that you pointed out that
9 this is decades in the making and we are
10 trying to get on top of it.
11 I look forward to working with you on
12 both sides of the revenue -- you know, the
13 creative solutions on the revenue, and on any
14 other reductions and savings that you can
15 propose.
16 Thank you, Mr. Chairman.
17 CHAIRMAN FARRELL: Thank you, Senator.
18 CHAIRWOMAN YOUNG: Senator Marchione.
19 SENATOR MARCHIONE: Thank you.
20 Mayor, just a couple of follow-up
21 questions. You said that poverty is
22 26 percent in Albany.
23 MAYOR SHEEHAN: It's approaching
24 26 percent. We're at, I think, 24.5 percent.
433
1 SENATOR MARCHIONE: Do you have any
2 idea what the poverty level is with single
3 mothers?
4 MAYOR SHEEHAN: A large portion of our
5 people who are living in poverty are single
6 head of households. You know, I don't have
7 that exactly number. I do believe that the
8 Census Bureau does have that information.
9 SENATOR MARCHIONE: The reason I ask
10 is that I got some information on my own
11 district the other day, and the percentages
12 are staggering. Washington County is almost
13 up to 50 percent poverty of single households
14 with children. So much so that I'm
15 calling -- I've called a meeting of a variety
16 of stakeholders from throughout my district
17 to look at that to see if there isn't
18 something that can be done to help head of
19 households -- mostly moms that have
20 children -- isn't there something that we can
21 do special to assist them.
22 So I just wondered if you knew. I
23 didn't know what your number was, but in my
24 districts in Saratoga, Troy, Rensselaer
434
1 County, the numbers are very, very high.
2 Columbia as well.
3 So I think we can zero in a little
4 bit, perhaps we can try to help that group of
5 people -- and I don't mean with handouts, I
6 mean with hand-ups to assist them.
7 MAYOR SHEEHAN: And I think that one
8 of the things, and I've talked to the
9 hospitals about that in the City of Albany,
10 and other large employers, is looking at
11 their shifts and looking at transportation
12 issues to see whether or not there are
13 adjustments that can be made to accommodate
14 what are, you know, a lot of single heads of
15 household who are juggling childcare issues
16 and schedules that really preclude them from
17 being able to maybe work full-time, as many
18 hours as they want to work, or access the
19 workplace at all.
20 And I think there is an interest in
21 doing that if we can do that on a regional
22 level. I think that it's another great
23 example of how this region is coming
24 together.
435
1 SENATOR MARCHIONE: Also, you
2 mentioned that you have 13- and 14-year-olds
3 that you pay --
4 MAYOR SHEEHAN: Fourteen and 15.
5 Sorry.
6 SENATOR MARCHIONE: -- $6.75 --
7 MAYOR SHEEHAN: I believe it's $6.75.
8 We raised it last year.
9 SENATOR MARCHIONE: How do you pay
10 under the minimum?
11 MAYOR SHEEHAN: Because they are under
12 the age of 16 and because of the type of
13 program that it is. So they don't have to be
14 paid minimum wage.
15 And we've debated that. It's a
16 challenge.
17 SENATOR MARCHIONE: It's child labor.
18 MAYOR SHEEHAN: But they are -- most
19 of them are assigned to work sites where they
20 really are learning about working and
21 learning about what is expected of them in
22 the workplace. Many of the opportunities
23 that we provide to young people are really
24 educational opportunities in the form of a
436
1 job.
2 So for some of our young people, we're
3 really encouraging them and incentivizing
4 them to focus on their academic skills, focus
5 on seeing themselves as successful. And I
6 think it's critically important to make that
7 investment, particularly in young people who
8 don't have the opportunities that maybe exist
9 in other wealthier communities.
10 SENATOR MARCHIONE: I agree with you.
11 I come from Halfmoon; we've had a youth
12 program for 13- and 14-year-olds for years --
13 I mean, when I was supervisor 30 years ago.
14 I agree with you, I think it's a tremendous
15 start for youth, but we always paid minimum
16 wage. That's why I wondered how you were
17 doing that.
18 But it is true, and I look at minimum
19 wage as that's the beginning of their career,
20 as they're unskilled and learning the right
21 things to do in the workplace. And, you
22 know, that's why I see the $9 going to $15
23 almost, to me, would preclude your program.
24 As you said earlier, you're looking to
437
1 see whether you can afford it now. Add that
2 extra $6 an hour onto that program, and I
3 worry that programs that are so good will not
4 be in existence anymore.
5 MAYOR SHEEHAN: Certainly if we had to
6 pay that for 14- and 15-year-olds, it would
7 be very difficult for us to continue to serve
8 the number of children that we serve.
9 SENATOR MARCHIONE: Thanks. Thank
10 you.
11 CHAIRWOMAN YOUNG: Thank you, Senator.
12 CHAIRMAN FARRELL: Thank you.
13 Any others? Thank you very much.
14 CHAIRWOMAN YOUNG: Thank you, Mayor.
15 MAYOR SHEEHAN: Thank you.
16 CHAIRMAN FARRELL: Next, the Honorable
17 Lovely Warren, mayor of the City of
18 Rochester.
19 CHAIRWOMAN YOUNG: Welcome, Mayor.
20 MAYOR WARREN: Thank you. Good
21 evening.
22 CHAIRWOMAN YOUNG: It's so good to
23 have you here.
24 MAYOR WARREN: Thank you for having
438
1 us. Ready to start?
2 CHAIRWOMAN YOUNG: Yes.
3 MAYOR WARREN: Chairwoman Young,
4 Chairman Farrell, members of the Ways and
5 Means and Finance Committees, Rochester's
6 great Assemblyman Gantt, Majority Leader Joe
7 Morelle, and other members of the Senate and
8 Assembly, thank you for this opportunity to
9 address the panel on behalf of the residents
10 of the City of Rochester.
11 I'm joined here today with my budget
12 director, Chris Wagner.
13 In our city, we are pressing on with
14 our agenda to bring more jobs, safer streets,
15 and better schools to every corner of
16 Rochester. In order to do this, I'm asking
17 the state to write a requirement that only
18 affects the City of Rochester. So I'm
19 keeping my testimony short and making just
20 one request of the state today: Equity in
21 municipal education funding to cities.
22 Specifically, in lieu of AIM
23 increases, and to meet our state-mandated
24 maintenance of effort to fund our school
439
1 district, I am asking for a $30.9 million in
2 municipal education funding as required by
3 state law. This funding will be given to the
4 city and allocated by the city directly to
5 our school district for local educational
6 priorities.
7 Rochester began planning for the 2016
8 budget with an estimated $41.2 million
9 all-funds gap. Through fine tuning, some
10 estimates, and making some preliminary
11 decisions, including reductions to needed
12 capital spending, we have narrowed that gap
13 to $28.2 million. This means we will have to
14 make difficult choices when it comes to
15 keeping the lights on and the doors open to
16 important city services.
17 Unlike our sister cities upstate,
18 Rochester does not receive adequate AIM
19 funding to cover our contributions to our
20 schools. In every other upstate city, the
21 state aid exceeds the funding that they are
22 mandated to provide to their schools.
23 Buffalo receives $91 million more in state
24 aid than it is required to give to its school
440
1 district. Syracuse receives $7.4 million
2 more than it provides to its district.
3 Rochester stands in stark contrast, receiving
4 $30.9 million less in state aid than we are
5 required to give to our school district.
6 The bottom line, the state requires
7 that Rochester gives 69 percent of its tax
8 levy to its school district. That means that
9 31 percent is left for critical city
10 services, and, to be frank, it's just not
11 fair.
12 A new funding stream called Municipal
13 Education Funding will enable the city to
14 maintain its commitment to fund the city's
15 school district without cutting critical
16 municipal services that the concentration of
17 poverty in our city demands.
18 As you may know, the single biggest
19 barrier our residents face is poverty. Among
20 comparatively sized cities, Rochester is
21 second in overall poverty and first in both
22 childhood poverty and extreme poverty. The
23 Rochester-Monroe Anti-Poverty Initiative has
24 a goal to reduce poverty by 50 percent in 15
441
1 years. I fully support this goal, and as we
2 work toward it, it will be important not to
3 reduce critical municipal services to this
4 same population.
5 The 2016-2017 Executive Budget
6 includes programs and legislation proposed by
7 the Governor that I believe would benefit all
8 of our residents, but particularly our most
9 vulnerable residents. The Clean Water
10 Infrastructure and Pave-NY proposals offer
11 much-needed funding for our city's
12 infrastructure. The proposed minimum wage
13 increase and paid family leave would uplift
14 our families and improve access to good jobs.
15 But I will note that in the State of
16 the State address, Governor Cuomo called for
17 an increase in educational funding and plans
18 to address failing schools, saying: "For
19 generations of New Yorkers, education has
20 been the ladder to climb out of poverty.
21 Today, the need for that ladder is greater
22 than it has ever been."
23 And that's true. Education is a key
24 that unlocks all doors. So I remain
442
1 committed to working with all of you to
2 provide high-quality educational
3 opportunities to families in every corner of
4 our city.
5 The requested $30.9 million in
6 Municipal Education Funding will come to the
7 city, and we will send it directly to the
8 classrooms and to the school districts for
9 their educational priorities. By funding
10 this educational mandate, you will free up
11 much-needed tax dollars that the city can use
12 for the other side of the classroom door.
13 The tax dollars will be used to fund
14 libraries, recreation centers, hard-to-place
15 workers, job training, youth intervention
16 services, and infrastructure that we would
17 need to support police body cameras.
18 I ask that you right this wrong that
19 only affects the taxpayers in the City of
20 Rochester and fully fund our request for
21 Municipal Education Funding. By considering
22 this one request, you have the opportunity to
23 change the lives of 210,000 residents in the
24 City of Rochester.
443
1 Thank you for agreeing to hear my
2 testimony today, and I look forward to taking
3 any questions that you may have.
4 CHAIRWOMAN YOUNG: Assembly?
5 Questions?
6 CHAIRMAN FARRELL: Thank you very
7 much.
8 Assemblyman Gantt.
9 ASSEMBLYMAN GANTT: Thank you very
10 much, Chairman.
11 Mayor Warren, you talked about the
12 fact that there's a big difference between
13 what you receive from state government and
14 what other cities upstate receive. Can you
15 tell me how that happened? Or do you know
16 how that happened?
17 MAYOR WARREN: Mr. Assemblyman, in
18 2007 the state mandated that cities across
19 the state pay their school districts going
20 forward -- it's called the maintenance of
21 effort -- not one dollar less than they were
22 paying at that time. At that time, the City
23 of Rochester was paying our city school
24 district $119.1 million. We have always
444
1 generously given to our school district, and
2 it was at a time when we had the tax base to
3 do so.
4 But as you know, Kodak and Xerox and
5 Bausch & Lomb are not paying the city the
6 taxes that they used to pay. And so when
7 this was mandated in 2007, Rochester had to
8 continue to pay $119.1 million, even though
9 our tax base had significantly begun to
10 decline. At that point in time Buffalo was
11 paying its school district, I think, about
12 $87 million or $89 million; in Syracuse,
13 about 73. And that mandate that you have,
14 with this maintenance of effort -- the AIM
15 aid that you give -- provided to those cities
16 actually can be transferred or covers the
17 costs that they have to pay to the school
18 district.
19 For the City of Rochester, the AIM aid
20 that we receive does not cover that cost that
21 we have to pay to our school district. And
22 so we're asking for this Municipal Education
23 Funding to cover that.
24 ASSEMBLYMAN GANTT: Can you tell me
445
1 what your cost per student is -- or, no, let
2 me go a different way. Can you tell me how
3 many students Rochester had back when the
4 maintenance of effort was in place?
5 MAYOR WARREN: I'm sorry?
6 ASSEMBLYMAN GANTT: Can you tell me
7 what the number of students that Rochester
8 had when the maintenance of effort was put in
9 place?
10 MAYOR WARREN: I'm sorry, I don't know
11 that number.
12 But I know that with the increase in
13 the number of charter schools, that the
14 significant enrollment in the city school
15 district has declined.
16 ASSEMBLYMAN GANTT: So -- but you
17 don't know the total number.
18 MAYOR WARREN: No, I do not.
19 ASSEMBLYMAN GANTT: It's my
20 understanding that at the time we did the
21 maintenance of effort -- agreement of which I
22 was not here when we voted on it, because I
23 thought it was the wrong thing to do then,
24 and I still think it was the wrong thing to
446
1 do -- however, I believe that it was
2 somewhere around 32,000 students that we had.
3 Do you have any idea how many students
4 we have today?
5 MAYOR WARREN: No, I think that we
6 have about 26,000 that are enrolled in the
7 city school district. But that does not mean
8 that those students -- even though they have
9 a decline in the city school district, many
10 of those students are in other schools like
11 charter schools or private schools.
12 ASSEMBLYMAN GANTT: Would you suggest
13 to me that or suggest to this committee that
14 maybe we ought to take a look at our cost per
15 student and, even if the student is going to
16 a charter school, in many cases they don't
17 get the same amount of money for the charter
18 student as they do for that student who may
19 be there in the regular school?
20 MAYOR WARREN: Mr. Assemblyman, I
21 would not advocate for a decrease in the
22 amount of funding to -- I'm not here to
23 advocate a decrease in the amount of funding
24 to our schools. I'm just asking for the
447
1 state to equal the mandate that they put on
2 the City of Rochester and provide us with the
3 same amount of funding that we have to
4 provide to our school districts as other
5 cities have.
6 When you look at the City of Rochester
7 and that 70 percent of our tax base is
8 actually going to the school district,
9 whereas in other cities that is not
10 necessarily the case, then it creates a
11 problem for our residents and only our
12 residents alone. This is an issue that just
13 impacts the City of Rochester.
14 ASSEMBLYMAN GANTT: I'm not suggesting
15 that we necessarily ought to decrease the
16 amount either. I'm simply talking -- I
17 simply want to go to a different method,
18 possibly. And that's to do it by the cost
19 per student.
20 Because one of the things I quite
21 often hear -- I heard the past superintendent
22 talk about going out into the community and
23 knocking on doors and getting students to go
24 to class. In many cases, those students are
448
1 missing from class some 19 days before
2 they're gone after. And I think there are a
3 number of things we've done wrong, and I'm
4 simply trying to get some way to correct
5 that, on behalf of your administration and/or
6 the school district.
7 You talked about Kodak and you talked
8 about Bausch & Lomb and you talked about
9 Gleason -- we can talk about Gleason's -- and
10 I remember Arthur Eve saying to me, years
11 ago, "The problem with you guys, you got too
12 many jobs." And that was back when Buffalo
13 was going through its downturn in the
14 economy. And I'd like to see Arthur now,
15 because I'd like to say the same thing to
16 him. We're now going through that. Kodak at
17 one time had probably 70,000 or 80,000 people
18 there in the City of Rochester; now they've
19 got less than 10, as I understand it.
20 So you've got an additional problem,
21 plus they've taken down many of those
22 facilities that's out there. So it's
23 important that we understand that you need
24 some major help that we ought to be giving
449
1 you. And I think we -- (cellphone
2 interruption) -- as I said, I think we ought
3 to be looking to them now to turn off my
4 phone.
5 So what are you saying, is there any
6 other ways that we can try and help you?
7 MAYOR WARREN: As I indicated, this
8 would be the one request that we have, is
9 that the state give us the $30.9 million in
10 Municipal Education Funding that would comply
11 with -- unless the state changes the rules,
12 the maintenance of effort -- that will
13 comply with us being able to provide that
14 money to the school district and that will
15 free up the money that we need to provide for
16 essential services in our city.
17 ASSEMBLYMAN GANTT: And Mrs. Miner
18 talked about the kids that worked during the
19 summer, or young people -- I assume that most
20 of them are young people. Do you have such a
21 program?
22 MAYOR WARREN: Yes, we have the Summer
23 of Opportunity program where we have about
24 900 young people that are working not only in
450
1 the City of Rochester, but also in private
2 companies as well, to get a great experience
3 during those summers. And they are paid a
4 stipend.
5 ASSEMBLYMAN GANTT: They're paid a
6 stipend? Or -- not minimum wage?
7 MAYOR WARREN: No, they are paid a
8 stipend, and our interns are also paid a
9 stipend, many of them. Our summer interns,
10 college interns.
11 ASSEMBLYMAN GANTT: Are those summer
12 programs funded by the state?
13 MAYOR WARREN: We have received some
14 money from the state for those programs. And
15 let me ask my budget director where -- I
16 believe that we utilize some of our tax
17 dollars for that program as well.
18 BUDGET DIR. WAGNER: The bulk of the
19 funding comes from the state. While some of
20 our youth workers earn the minimum wage,
21 younger workers get a stipend, and it can be
22 less than minimum wage.
23 ASSEMBLYMAN GANTT: One other question
24 I'd like to ask is many of us have watched
451
1 the news and heard over the past few weeks
2 about Flint, Michigan, and the water supply.
3 I can remember -- I've been here long enough
4 to remember that the state gave some monies
5 to the City of Rochester and other cities to
6 correct what they called the lead leads --
7 that's the lead pipe that comes off the main
8 and goes towards the property.
9 I'd like to know whether or not you
10 know how much -- how many of those properties
11 still have lead leads in them, since we had
12 probably -- we had some of the same problems
13 that Flint had with kids not learning, kids
14 going to jail, and many of those things. And
15 what I'm suggesting and what I think is that
16 these kids may have the same problem that
17 people in Flint may have.
18 MAYOR WARREN: I can assure you,
19 Mr. Assemblyman, that the water in Rochester
20 is very safe. Our water has been voted the
21 best water in New York State for many, many
22 years.
23 ASSEMBLYMAN GANTT: And you don't
24 think the leads are doing anything to affect
452
1 our kids?
2 MAYOR WARREN: No, we actually have a
3 --
4 ASSEMBLYMAN GANTT: How do you know?
5 MAYOR WARREN: -- a very good water
6 system for the people in the City of
7 Rochester. It comes from Canadice and
8 Hemlock Lake. It's on a gravity system, so
9 we don't have a pump. We continuously invest
10 in our water system, and though we could
11 always use additional dollars to invest in
12 our infrastructure because of some of the old
13 pipes that we have -- but as it pertains to
14 the quality of the water, it is some of the
15 -- it is the best water in the State of New
16 York.
17 ASSEMBLYMAN GANTT: So you're telling
18 me that we don't have any problems at all
19 with lead in our system?
20 MAYOR WARREN: We have --
21 MR. WARREN: So we've actually
22 replaced some of the lead services that
23 you're talking about going from the --
24 ASSEMBLYMAN GANTT: I agree with you,
453
1 but those lead services were replaced in the
2 neighborhoods that the poor doesn't live in,
3 necessarily.
4 BUDGET DIR. WAGNER: Yes, so --
5 ASSEMBLYMAN GANTT: I remember the
6 program.
7 BUDGET DIR. WAGNER: So we would need
8 to look at and talk to our water department
9 about it, you know, how many remain that we
10 would look at replacing.
11 ASSEMBLYMAN GANTT: I'd like to have
12 that -- I'd like to have that information,
13 because I think there is a correlation
14 between that and kids not learning and kids
15 ending up in the penal institutions of the
16 community.
17 MAYOR WARREN: I actually spoke to --
18 ASSEMBLYMAN GANTT: I think the state
19 ought to fund that, but I think it ought to
20 be done.
21 MAYOR WARREN: I spoke to our
22 commissioner of DES about this issue, and he
23 indicated to me on Monday that this is not a
24 problem in the City of Rochester.
454
1 ASSEMBLYMAN GANTT: Okay. I'd still
2 like to have the information.
3 MAYOR WARREN: I definitely will get
4 it for you, sir.
5 ASSEMBLYMAN GANTT: Thank you very
6 much.
7 Thank you, Mr. Chairman.
8 CHAIRMAN FARRELL: Thank you.
9 Assemblyman Morelle.
10 ASSEMBLYMAN MORELLE: Thank you very
11 much, Mr. Chairman.
12 Your Honor, thank you for being here.
13 First let me start by thanking you for
14 your partnership on the Monroe Anti-Poverty
15 Initiative. It's been great to work with you
16 on it, and I think we're finally making some
17 progress, so I want to thank you for your
18 leadership.
19 It's interesting, during the budget
20 we're all subjected to countless numbers of
21 statistics. And as you can imagine, everyone
22 who appeals to us appeals to us on a set of
23 metrics that they sort of come up with. But
24 I do think -- and I do want to underscore
455
1 this, because I think you've identified it
2 pretty well -- the three numbers here that
3 you've suggested that relate to the
4 relationship between the MOE, which was
5 established in 2007 over the objections of a
6 number of us, and the Aid to Municipalities
7 for the dependent school districts, which
8 Rochester is one -- that we're the only city,
9 the only community whose AIM resources are
10 significantly less than our requirement under
11 the MOE.
12 And as Mr. Gantt had suggested back in
13 2007, the City of Rochester in a sense,
14 depending on your perspective, was penalized
15 because for perpetuity, or at least as long
16 as this law will be in effect -- and so far
17 that's been without change -- the City of
18 Rochester's obligation to its dependent
19 school districts is $119 million.
20 The City of Buffalo, which actually
21 has more students -- it's a bigger city --
22 only has to contribute $70 million to its
23 school district. At the same time, the City
24 of Buffalo receives $161 million or, as you
456
1 identify, essentially if you compare those
2 two numbers -- I mean, $90 million -- after
3 the City of Buffalo takes in its AIM and pays
4 out under the MOE, they end up with a
5 difference of $90 million to the good.
6 The City of Rochester, once it
7 receives its AIM aid, has not only all of its
8 AIM aid going back into its MOE, but has to
9 come up with another $31 million just to meet
10 its obligation under the state law.
11 MAYOR WARREN: Yes.
12 ASSEMBLYMAN MORELLE: So, you know,
13 again, we have metrics all over the place.
14 That's a pretty significant one.
15 And my dear friend Crystal
16 Peoples-Stokes is right here, so I have no
17 objection to the City of Buffalo receiving
18 its funding under AIM, or the decision they
19 made relative to what their contribution
20 ought to be to the city school district. But
21 to have a disparity of that size is really
22 unconscionable.
23 For the City of Rochester to
24 essentially be held now accountable for not
457
1 only using all of its AIM money, but then
2 having to come up with another $30 million to
3 meet an obligation that was set -- frankly, a
4 penalty because we decided to invest a pretty
5 significant amount of our resources into our
6 young people. So that's good; I think we
7 would probably -- and you would probably
8 agree -- continue to do that.
9 But obviously, whether we did it the
10 way you've suggested or whether through
11 AIM -- and I assume -- this is a really bad
12 question, I apologize, but it's been a long
13 day. But I wanted to make the point that I'm
14 assuming that if the AIM aid went up, you
15 would have no objection to that. I mean,
16 you're looking for a vehicle in which the
17 amount you receive from the state is at least
18 equal to what your obligation is under the
19 MOE. Is that correct?
20 MAYOR WARREN: Yes, but we wanted to
21 present to the state a specific issue that
22 just impacts Rochester, that does not impact
23 any other municipality in upstate New York.
24 And that's the reason why we talked about
458
1 specifically the educational funding that our
2 municipality has to provide to our school
3 district.
4 However the state wants to provide the
5 dollars to us, we would appreciate it.
6 ASSEMBLYMAN MORELLE: And as I
7 understand it, too, you're not suggesting
8 that you want to be relieved of your
9 obligation under the MOE, that you're
10 prepared to continue to make that
11 contribution to the city school district, but
12 you'd like the AIM aid or however -- or
13 whatever other aid package to at least equal
14 that obligation so that we're treated like
15 the other upstate cities where they have,
16 actually, effectively a surplus.
17 MAYOR WARREN: Yes.
18 ASSEMBLYMAN MORELLE: Thank you very
19 much.
20 MAYOR WARREN: Thank you.
21 CHAIRMAN FARRELL: Thank you.
22 Senator? Thank you very -- oh, excuse
23 me. Assemblyman Aubry.
24 ASSEMBLYMAN AUBRY: Mayor, how are
459
1 you?
2 MAYOR WARREN: I'm good. How are you?
3 ASSEMBLYMAN AUBRY: And it's just
4 interesting, the conversation you had
5 relative to potential lead in your water and
6 where that is today. So were you -- were you
7 indicating -- the question was, was there
8 ever an issue of lead in the water in
9 Syracuse in the past?
10 MAYOR WARREN: And this is Rochester.
11 ASSEMBLYMAN AUBRY: I mean Rochester.
12 MAYOR WARREN: I believe that there
13 was some lead piping that had to be removed
14 and replaced, and the state was able to help
15 us with replacing that lead piping. And what
16 the Assemblyman wants to know is do we have
17 any additional lead piping that is impacting
18 our water.
19 We have a water filtration system that
20 really cleans the water and is a robust
21 system that we utilize today. And I had a
22 discussion with my DES commissioner about
23 that, and he indicated that we do not have
24 the problems as it pertains to lead that
460
1 would be a challenge to our community. We
2 have the best-tasting water in New York
3 State.
4 ASSEMBLYMAN AUBRY: Right. And as --
5 so at what point in time were you assured
6 that the water was fine? Was there a date
7 certain they said "We've finished this work,
8 it no longer is a problem," and beyond that
9 it may have been a problem? My point is it
10 doesn't have to be mutually exclusive. You
11 could have had a lead problem in the water --
12 we see that things have happened recently in
13 Flint, where at one point it wasn't, at one
14 point it was -- and that the impact on
15 children might go back some time relative to,
16 you know, what they were receiving in the
17 water system.
18 And without testing or tracking it by
19 time, one might not know whether or not it
20 had that kind of impact relative to learning.
21 Because we know that lead in the systems
22 causes that; we see it all over the country.
23 MAYOR WARREN: Yes.
24 ASSEMBLYMAN AUBRY: So my question is,
461
1 is it --
2 MAYOR WARREN: Do we know the -- I
3 could not give you the exact date when those
4 pipes were changed and if at that point in
5 time we had a problem with lead in our water.
6 I can tell you that the problem with
7 lead in the City of Rochester has been
8 because of lead paint that was in our homes.
9 ASSEMBLYMAN AUBRY: No --
10 MAYOR WARREN: And we have been
11 working with our landlords, and we have a
12 lead policy, one of the best policies in the
13 State of New York, that deals with that
14 issue, where we actually go in and, in order
15 to get a certificate of occupancy for
16 renters, they have to actually make sure that
17 the lead is dealt with and the home is
18 lead-safe. And we have been for a number of
19 years, you know, enforcing that at a level
20 that other municipalities have not been.
21 But specifically as it pertains to the
22 water, I would have to get you that
23 information about the date.
24 ASSEMBLYMAN AUBRY: And I'm not
462
1 suggesting that I need to look at it. But
2 I'm only suggesting that there might be -- if
3 there are connections, that they're worth
4 looking at and knowing and that they're
5 capable of being found out based on
6 scientific investigation.
7 Because if there needs to be
8 remediation for people who have had that kind
9 of impact in their lives, you know, it's also
10 something the state should bear the cost for.
11 All in an attempt to help you resolve the
12 issues that, you know, the city may be
13 facing.
14 MAYOR WARREN: Thank you.
15 ASSEMBLYMAN AUBRY: You're welcome.
16 CHAIRMAN FARRELL: Thank you.
17 Further questions?
18 ASSEMBLYMAN GANTT: Just for your
19 information, I happen to be a landlord in the
20 City of Rochester. I can tell you they do a
21 tremendous job in terms of the lead-paint
22 stuff. They really do do a great job, and I
23 think that's working.
24 I still have the question in my mind
463
1 about the lead leads that come into the
2 house, and I'd still like to see whether or
3 not we can get some dollars to double-check
4 that one.
5 MAYOR WARREN: We will get that
6 information to you, Assemblyman.
7 Thank you.
8 CHAIRMAN FARRELL: Thank you very
9 much. Thank you, Mayor.
10 CHAIRWOMAN YOUNG: Thank you, Mayor.
11 Thanks for being here.
12 CHAIRMAN FARRELL: Next, the Honorable
13 Mike Spano, mayor of the City of Yonkers.
14 MAYOR SPANO: Let me say good evening.
15 CHAIRMAN FARRELL: You came in first.
16 You came in with us.
17 MAYOR SPANO: Good evening, Senator
18 Young, Chairwoman Young; Chairman Denny
19 Farrell; Leader Stewart-Cousins;
20 Assemblywoman Shelley Mayer and Assemblyman
21 Gary Pretlow, my members of the Assembly; to
22 all the friends that are here today.
23 I'm going to actually deviate a little
24 bit, because I know that the night has been
464
1 long for you. And what I'm going to try
2 to do is go off script, give you my four
3 priorities, and be able to open it up
4 for questions. I think you've heard
5 enough, and we probably don't need another
6 scripted speech, at least at this point,
7 because there's a lot happening.
8 Let me first start off by saying
9 thank you. You know, the last two years,
10 three years I came to you with the Yonkers
11 Board of Education in crisis, a $55
12 million mistake, and a need for some
13 type of action. And it was under the
14 leadership of our great Governor, Andrew
15 Cuomo, working with us, especially under
16 the leadership of our local delegation,
17 where we were able to put in place a
18 two-year plan, a two-year plan that
19 allowed for additional state resources,
20 that allowed for the city to raise some
21 of its resources, that allowed for the
22 city to embark on a consolidation
23 program between the Board of Education
24 and the City of Yonkers, where we merged
465
1 six different departments within the
2 City of Yonkers, saving the Board of
3 Education close to $10 million. And it
4 has been going very well, and I think
5 could be a model that could be used
6 across the state. But certainly
7 something that we're very happy about.
8 Just to tell you a little about
9 what I heard before, with the Mayor of
10 Rochester, I like her plan, just so you
11 know. That's going to give us about
12 $115 million in additional aid, so if
13 that works for you guys, you won't have
14 a problem with us.
15 But just let me run into a couple
16 of things here. The legislature is
17 actually putting forth -- I'm sorry, the
18 Governor in his proposed budget has put
19 forth additional dollars for education,
20 and that's a good thing. That's going
21 to help us. You know, Yonkers is a
22 school district that still has 16
23 percent of its enrollment are children
24 with disabilities. We have 12 percent
466
1 of our enrollment are children who
2 limited English proficiency. We have
3 been still suffering over the years of cuts
4 that took back during the last recession.
5 So as we move forward, we've been trying to
6 restore programs. And we are still at one
7 art teacher for every 623 students, one
8 music teacher for every 744 students. We
9 have a library ratio -- you'll like this
10 one -- of 3,347 to 1. And guidance
11 counselors, 787 to 1.
12 Despite this, the school district
13 has a graduation rate last year of
14 78 percent, the highest of the Big 5.
15 That is a testament to the good hard
16 work that the teachers do each and every
17 year but, as you know, pales in
18 comparison when you look at our
19 neighbors. The neighbors of Scarsdale,
20 Eastchester, and Bronxville are
21 graduating at 97, 98, and 99 percent.
22 So whatever additional aid we can
23 get to our schools to help us again
24 continue the journey of restoring music,
467
1 art and the different programs that we have
2 started to restore -- but not fully -- will
3 certainly help us.
4 So again, I say thank you in
5 advance, because I know that this body
6 generally fights for additional aid to
7 education.
8 The partnership. I know I heard a
9 lot of people speak about AIM aid. AIM aid
10 is critically important to us, especially
11 in the City of Yonkers. When you look at
12 the fact that our AIM aid has not been
13 increased since 2009, it would be actually
14 very good for us to have a 2 percent cap
15 on that, where we would just get a 2
16 percent increase. That would help us
17 out, especially if you look at just in
18 the past 10 years: Health insurance, up
19 51 percent; workers' compensation, up
20 160 percent; Employee Retirement System,
21 up 66 percent; police and fire
22 retirement, up 41 percent. These are
23 very significant numbers. And when you
24 look at what revenues we'll be able to
468
1 claim this year under the tax cap, we'll
2 be able to claim about $409,000.
3 So when I came into office, our
4 union contracts were three years out. And
5 so we have been solving contracts that are
6 six years old. We've gotten most municipal
7 contracts done, but it has cost us about
8 $30 million to do so. Again, we've been
9 able to make it work, we've stayed within
10 the property tax cap for the past four
11 years. But it's been very, very difficult.
12 And when you have to cut at the city
13 level, our cuts obviously hurt. Our cuts
14 mean police officers, firefighters,
15 teachers and so forth and so on. So if
16 there's a push to increase AIM aid, I'm
17 all for it, and I just would ask that
18 you consider that.
19 The other two areas obviously are
20 our aging infrastructure -- it's
21 streets, it's bridges, but it's not just
22 streets and bridges, we have to rebuild
23 a firehouse this year. We have a
24 firehouse that is just completely fallen
469
1 apart. It's the fire headquarters. We
2 have to rebuild that this year. It's
3 estimated to cost $10 million.
4 But if you look across the city,
5 you look at our firehouses, you look at
6 our precincts, you look at our city
7 pool, you'll see that there's a
8 tremendous amount of need for those
9 infrastructures and for upgrades to
10 those infrastructures.
11 The last big ask I'm going to put
12 forward is going to be to rebuild our
13 schools. This is the one thing I really
14 would like to just talk about a little bit.
15 Yonkers has 39 schools. We have close to
16 27,000 students in our school district.
17 We are 4100 students over capacity. We
18 have 4100 more students than what these
19 39 schools can hold.
20 Our schools, the average age of a
21 school in Yonkers is 75 years old. We
22 have two schools that are over 100 years
23 old. Our children are being taught in
24 converted basements and converted
470
1 gymnasiums. They're being taught in
2 auditoriums where they've taken the
3 section out so they can put a wall up.
4 There are areas of our district where
5 the walls are crumbling, where the roofs
6 are leaking. The City of Yonkers has an
7 immediate need to start to rebuild the
8 schools.
9 You rebuilt Buffalo schools; that
10 was smart, that was the right thing to do.
11 You've started Phases 1 and maybe -- I'm
12 assuming at least Phase 1 in Rochester and
13 Syracuse. That was the right thing to do.
14 The kids need these schools. We are now in
15 a situation where Yonkers needs to rebuild
16 its schools.
17 People will say, But jeez, you're
18 in Westchester County, how is it you
19 can't rebuild your own schools? We are,
20 in Yonkers, at 90 percent of our
21 constitutional taxing authority. We
22 have -- and we all know, we all have,
23 you know, an income tax surcharge, we
24 have a transfer tax, we have an income
471
1 tax, we have a higher sales tax, we have
2 everything that you might want if you're
3 trying to run the city. But we don't
4 have the deep pockets that are needed to
5 rebuild these schools and put our kids
6 in a proper environment.
7 So what I'm going to be coming to
8 you with this year is legislation, we're
9 going to work with the delegation, we're
10 going to work with the committees that
11 would have this, to try and come up with a
12 plan that will allow us to rebuild our
13 schools over the next 13 years in four
14 phases. Obviously it would take a
15 significant push and help from the state.
16 We're going to push for this at the local
17 level and push for additional dollars
18 from the local level as well, but it's
19 not going to be easy.
20 But I think the time has come for
21 us to rebuild these schools. This is
22 really the legacy for our kids. And
23 with your help, I anticipate that this
24 will be done. Again, you've been
472
1 extremely helpful over the years in
2 terms of economic aid, in terms of
3 coming to our rescue when it's been
4 needed. You've been just a great
5 partner. This is the next step. We want
6 to be able to rebuild our schools.
7 Yonkers, as you know, if you watch "Show Me
8 a Hero," the HBO special, they talked about
9 desegregation in Yonkers schools. It was a
10 lot to do with the quality of the schools
11 and the fact that there not enough
12 buildings on the east side of town. And we
13 still are in the situation where we have
14 old schools, where we have children of
15 color from the west side being bused to
16 schools that are 75 to 100 years old, and
17 still not getting what they should or what
18 they need.
19 So that's why I'm asking for your
20 help and support on this, because I
21 really think this is the next step if we
22 want to free Yonkers of those problems.
23 With that, I'll just open it up
24 for questions. And again, just thank
473
1 you.
2 CHAIRMAN FARRELL: Thank you very
3 much, Mr. Mayor.
4 Assemblyman Magnarelli.
5 ASSEMBLYMAN MAGNARELLI: I just want
6 to say again, Mr. Mayor, thank you very
7 much for being here and for waiting all
8 this time again, too.
9 My questions again revolve around
10 AIM and all the other programs that the
11 Governor has put into the budget for the
12 last few years, and whether or not you feel
13 that those programs are something you can
14 take advantage of, or are you just simply
15 pushing on the AIM side of things? Which I
16 can understand.
17 MAYOR SPANO: Let me first start off
18 by just telling you who's with me: Andrew
19 Lenney, who's the budget director; John
20 Liszewski, who's the finance
21 commissioner. So let me just -- because
22 they might jump in.
23 Many of the programs that the
24 Governor has put forth are good
474
1 programs, they help us. But the
2 numbers, the numbers that are there, the
3 dollars that are available to us are not
4 dollars that are rationed significant
5 enough, at least in the big city world,
6 to solve the problems. And so I think
7 that the ideas are right, the approach
8 is right; the dollars need to be
9 increased for these programs to work for
10 us.
11 ASSEMBLYMAN MAGNARELLI: Okay, thank
12 you.
13 CHAIRMAN FARRELL: Senator?
14 SENATOR YOUNG: Thank you. And I
15 want to give a special welcome to my former
16 colleague in the State Assembly. It's been
17 like Old Home Day in many ways, because
18 some of our former colleagues from the
19 Assembly and the Senate have been here. So
20 I just want to say welcome to you, we're
21 so glad to have you here to testify.
22 And at this point I would like to
23 turn it over to Senator Andrea
24 Stewart-Cousins.
475
1 SENATOR STEWART-COUSINS: Thank you.
2 Thank you so much, Senator Young.
3 Welcome. I know it's been a long
4 day, and so I appreciate your condensing
5 the presentation. And I know that
6 Education Day is going to be tomorrow, so I
7 suspect that we will hear very similar
8 things from our superintendent. But I am
9 glad that you brought up the need to
10 rebuild the infrastructure in not only our
11 bridges and roads, but also the schools.
12 It's certainly something that our
13 conference has been putting forward over
14 the past couple of years. Especially as we
15 get dollars into the state that are
16 one-shots and we look at where we can put
17 that money, clearly also investing in the
18 infrastructure of our schools and our
19 children's education makes a difference and
20 means something.
21 So I am looking forward to seeing
22 whatever the proposal is. I think the
23 reality is that Yonkers is in an
24 incredibly difficult position, with
476
1 about 37 schools that need to be
2 rebuilt. But quite frankly, throughout
3 the state there is a need to start
4 looking at where we're asking our
5 children to learn so that they can
6 actually be competitive in this global
7 society. We have to really make sure that
8 they have all that they need in order to
9 get out there.
10 So I'm hoping that not only will
11 this make sense in terms of the Legislature
12 putting forward, but again it causes a
13 conversation which is a statewide
14 conversation -- certainly within the
15 district that I represent, and I'm so sure
16 so many others -- of how are we going to
17 help municipalities, especially in a tax
18 cap world, to do just that type of
19 rebuilding. So I'm looking forward to it.
20 You did mention that there were
21 47,000 students --
22 MAYOR SPANO: No, no, 27,
23 Senator.
24 SENATOR STEWART-COUSINS: Did you
477
1 say 27? I'm sorry, because I thought I
2 heard 47,000, and I was wondering where the
3 other 20,000 came from. Okay.
4 (Laughter.)
5 SENATOR STEWART-COUSINS: I said, I
6 know I've only been up here for a day and a
7 half.
8 (Laughter.)
9 MAYOR SPANO: Sorry about that,
10 Senator. You know, we're known to
11 exaggerate that number a little bit, but I
12 didn't want to exaggerate that much.
13 SENATOR STEWART-COUSINS: Yeah, I
14 was going to say that's a big leap. So
15 that was my question that I had.
16 But I also want to let you know that
17 we in my conference have talked about this
18 increase in AIM, because we understand that
19 Aid to Municipalities is just that. And we
20 understood also that during the recession
21 it was frozen. But at this point we are
22 moving along in terms of the economy of
23 the state, and I think it's really time
24 to start revisiting what we do for our
478
1 localities as it relates to AIM. So
2 again, I'm looking forward to knowing
3 more about the proposal and continuing
4 to not -- you know, we did the bailouts
5 and we did -- and I really want to thank
6 my colleagues, too, for being as
7 responsive, and obviously the Governor
8 for what was a critical time in Yonkers
9 where there was a $55 million
10 mathematical error that led to what would
11 have been a terrible crisis. So I really
12 want to thank my colleagues for responding
13 so well.
14 But I'm glad that you're being
15 proactive and looking at the next level.
16 MAYOR SPANO: And Leader Cousins,
17 let me just start off by saying thank you
18 to you, because you've been a great leader
19 for us and you've stood up for us time and
20 time again, and I don't know what we would
21 have done in the last two years if we
22 didn't have your leadership here. Thank
23 you.
24 SENATOR STEWART-COUSINS: It's a
479
1 pleasure.
2 CHAIRMAN FARRELL: Assemblyman
3 Pretlow.
4 ASSEMBLYMAN PRETLOW: Mr. Mayor,
5 welcome back to Albany. I know you spent
6 many a year here, off and on.
7 Before I start, I want to give you
8 congratulations on an excellent job of snow
9 removal in the City of Yonkers on Sunday.
10 I happened to find myself by the St. John's
11 Hospital hill, and I know you know it well,
12 and it's a dangerous road anytime. And it
13 was perfectly done, and I was impressed.
14 A few years ago I had asked you if
15 you felt like Sisyphus. You remember that?
16 MAYOR SPANO: Yes.
17 ASSEMBLYMAN PRETLOW: And I think
18 from your testimony today, you've finally
19 gotten that stone over the hill. The curse
20 has been lifted, and I think Yonkers is on
21 the way to greater things.
22 I think that, you know, the
23 leadership that you've been providing in
24 operating under the constraints that the
480
1 city and most cities have been required to
2 operate under has worked out. You know, I
3 mean I've sat on this panel for at least
4 20 years, and every year speaking to your
5 predecessors as well as you, it was always:
6 Next year we're going to be great, if X
7 will just happen, we'll be great, if we get
8 this, we'll be great, bail us out, bail us
9 out. And, you know, looking through your
10 testimony, you're not asking for a bailout
11 this year. You're asking for capital,
12 you're asking to help get the
13 infrastructure together, and that's
14 something that's usually doable. That's
15 long term, that's not repeating. And I
16 think that, you know, because of, you know,
17 management of the city and getting, you
18 know, your contracts and things in order,
19 that it is happening. So I think that's
20 good.
21 I just want to focus, though, on the
22 Board of Education. Now, we did some
23 financial things last year to increase
24 dollars to education. We have the sales
481
1 tax, maybe half a percent or a quarter of a
2 percent of sales tax that's supposed to go
3 directly to education. The estimates were
4 a certain number. How on target are we
5 with those numbers?
6 BUDGET DIR. LENNEY: We're on target
7 for the half-percent sales tax that's
8 dedicated for education. It's
9 $11.4 million.
10 ASSEMBLYMAN PRETLOW: So we're on
11 target, so I can expect to see an
12 additional $11.4 million going to education
13 in the next year?
14 BUDGET DIR. LENNEY: I'm talking
15 about in the current year we're on target.
16 ASSEMBLYMAN PRETLOW: Well, the tax
17 just kicked in in December, you're six
18 months -- your fiscal year is in June;
19 right?
20 BUDGET DIR. LENNEY: Yes.
21 ASSEMBLYMAN PRETLOW: So you've got
22 to get six months out of it. So the total
23 projection was I think $14 million; half
24 a year would be $7 million. You're
482
1 telling me you can get $14 million in
2 six months?
3 BUDGET DIR. LENNEY: It was
4 $11.4 million, it was nine months. It
5 started in September.
6 ASSEMBLYMAN PRETLOW: Oh, September,
7 okay.
8 BUDGET DIR. LENNEY: And the
9 maintenance of effort, concurrent with
10 that, was an $11.4 million increase to the
11 Board of Ed. So in fiscal year 2016, we
12 are on target.
13 ASSEMBLYMAN PRETLOW: Okay, sounds
14 good.
15 Mr. Mayor, you know, I've never
16 believed in the way that the
17 administrations, all of them, have always
18 phrased the Yonkers budget as city side
19 versus school side. I've always said
20 Yonkers has one budget. But through all
21 the years, I've always heard about the
22 school side was always out of whack and the
23 city side was in great shape. And the same
24 taxpayers, same dollars, same
483
1 everything.
2 Right now, is there a proposed
3 shortage in what you would term the Board
4 of Education budget?
5 MAYOR SPANO: Based on the
6 Governor's numbers, we're about 7 million,
7 if you want to stay status quo. So 7
8 million short if you want to be status quo
9 to last year. Which is, in a $550 million
10 budget, it's --
11 ASSEMBLYMAN PRETLOW: You said
12 $7 million? Not $70 million, like the last
13 year, and not $110 million?
14 MAYOR SPANO: Seven.
15 ASSEMBLYMAN PRETLOW: Seven?
16 MAYOR SPANO: Yeah. Now, now --
17 now, just a minute. I like painting the
18 rosy picture, but I'd also like to point
19 out -- if you don't mind, I just want to
20 point out something too.
21 While I think we've done a lot
22 better, our bond rating's going up, we're
23 managing within our finances, we're also
24 using a bunch of tools that have helped us,
484
1 you know. For instance, the pension
2 smoothing -- just trying to think of what
3 the others were. Pension smoothing and the
4 bonding for certiorari and the use of our
5 surplus has kept us there as well. Which
6 is not the greatest thing in the world, but
7 certainly what the city has used before,
8 and we've continued that.
9 But we'd like to start to move away
10 from that in time, because I think that
11 would really help us out.
12 But on the overall budget -- I'm
13 sorry, if you go just to the education
14 side, we're 7 million for status quo.
15 Dr. Quezada will come here tomorrow, the
16 superintendent of our schools, will
17 probably talk to you about additional
18 things or additional areas that he would
19 like to inject some money into, like
20 special ed or English proficiency, where he
21 feels that he can bring us even further
22 along in terms of having the school
23 district that we all envision we want.
24 So you'll probably -- so before you
485
1 think there's two different numbers,
2 there's not. He'll tell you that. But
3 he's also going to point out -- which is
4 what the delegation has asked for -- you
5 know, point out what are some additional
6 dollars you need and what would you use
7 them for and how would the city use those
8 dollars. And that's --
9 ASSEMBLYMAN PRETLOW: So everything
10 stays exactly the way it is, you're
11 7 million short, but the new superintendent
12 is probably going to ask for more music
13 teachers and art teachers and
14 infrastructure repairs and things of that
15 nature, so he will be looking for an
16 additional X million dollars.
17 But as far as the city functioning
18 and the school district moving on, we're
19 not going to have a crisis as we've had in
20 the past several years.
21 MAYOR SPANO: No. And that's
22 because of the partnership we have. And I
23 want to say thank you.
24 ASSEMBLYMAN PRETLOW: Thank you.
486
1 Thank you.
2 CHAIRMAN FARRELL: Thank you. Any
3 other Senators?
4 SENATOR YOUNG: No Senate questions.
5 CHAIRMAN FARRELL: Thank you very
6 much, Mr. Mayor.
7 SENATOR YOUNG: Thank you,
8 Mr. Mayor --
9 (Cross-talk.)
10 CHAIRMAN FARRELL: Oh, yes, sorry,
11 Shelley. I'll wake up. Shelley Mayer.
12 ASSEMBLYWOMAN MAYER: Thank you.
13 Thank you, Mr. Chairman. It's a long day.
14 Thank you, Mayor. I do want to
15 commend you on the snow removal. I do
16 think, you know, under incredibly difficult
17 circumstances, this was the best Yonkers
18 has done.
19 And I would commend you also on
20 having the snow emergency and prohibiting
21 street traffic. I think it was a very wise
22 decision, and it led to us being able to
23 come back. Although leaving the schools
24 closed on Monday was unfortunate.
487
1 MAYOR SPANO: Yeah. Thank you,
2 Assemblywoman.
3 ASSEMBLYWOMAN MAYER: I have a
4 question. Last year, in addition to the
5 sales tax, the dedicated half-percent sales
6 tax we got for education -- which I think
7 was unique in sales tax history, and I
8 appreciate the partnership we had on
9 that -- we also got a hotel occupancy tax
10 that you had wanted for a long time.
11 What is projected revenue for the
12 City of Yonkers hotel occupancy tax?
13 BUDGET DIR. LENNEY: Six to $700,000
14 this fiscal year. And it was also a short
15 year, so it was started in September.
16 ASSEMBLYWOMAN MAYER: What's the
17 full-year projection for it?
18 BUDGET DIR. LENNEY: Probably closer
19 to eight, eight to 900,000.
20 ASSEMBLYWOMAN MAYER: And are we on
21 target on that?
22 BUDGET DIR. LENNEY: Well, we
23 actually did not -- it came after the
24 budget was released. And it's going to
488
1 fall to fund balance. But we are on target
2 for our projections in our multiyear plan,
3 yes.
4 ASSEMBLYWOMAN MAYER: Okay.
5 Secondly, in terms of infrastructure,
6 non-school infrastructure that you
7 mentioned in your testimony, do you have a
8 projected dollar number that you're -- not
9 a wish list, but, you know, a realistic
10 number that you're thinking of that you
11 would seek for capital infrastructure?
12 MAYOR SPANO: I don't want to say
13 something that would sound at all
14 disrespectful. It's kind of limitless.
15 (Laughter.)
16 ASSEMBLYWOMAN MAYER: I know that.
17 I'm asking for a limit.
18 MAYOR SPANO: But I will tell you
19 this. We have an immediate need to build a
20 firehouse. We put it out to what they call
21 an RFP just a couple of weeks ago. We
22 project it to about $10 million.
23 And so what we've done, because the
24 firehouse had fallen into such disrepair --
489
1 previous administrations had planned on
2 closing it, so no one put money into it,
3 the facade started falling away. We were
4 afraid about what could happen to the
5 firefighters; we moved them out and put
6 them in another firehouse. They're kind of
7 crammed in. So we have to build another
8 firehouse pretty quickly.
9 And so, yeah, I think that would be
10 our immediate need, is a firehouse. And we
11 are going to move forward with that locally
12 even though it's going to be a strain, but
13 we'll probably bond the money and move
14 forward with it. But any additional help
15 we can get from Albany here, the State
16 Capitol, would help us out tremendously.
17 ASSEMBLYWOMAN MAYER: Well, if you
18 could share the projected costs of the
19 replacement of the firehouse. And also if
20 I know your capital budget anticipated
21 shortfall in numerical -- in a chart, that
22 would be helpful.
23 MAYOR SPANO: Okay.
24 ASSEMBLYWOMAN MAYER: Lastly, on the
490
1 rebuilding of the schools project, which I
2 know we're going to get briefed on later
3 this week, and so I don't know the answer
4 to this, within that proposal is there a
5 portion of the capital costs that's going
6 to be borne by the City of Yonkers?
7 MAYOR SPANO: Yes, there is.
8 And what we were asking for, our
9 numbers are similar to what Rochester,
10 Buffalo and Syracuse are paying. We know
11 that that may not pan out. We're willing
12 to have a discussion. We're willing to put
13 what we can into it. But we're realistic
14 to the fact that, you know, even if -- at
15 90 percent of our taxing limit -- and I
16 realize that those dollars are exempt, but
17 we're still there -- that if we were to put
18 under today's number, today's number would
19 be about $600 million to the local property
20 taxpayer, which would be pretty near
21 impossible for the taxpayers to afford.
22 So I think there's a political will
23 to rebuild the schools, but the dollars are
24 not there. And because we're in
491
1 Westchester County, I think that there's a
2 belief that Yonkers is this wealthy
3 community. And while we're doing much
4 better than we've done in the past and we
5 seem to be moving up and economic
6 development is happening, we're still --
7 you know, our expenses are still exceeding
8 our revenues by this much (gesturing).
9 It's beyond anybody's control.
10 But like I said, I like to see the
11 glass as half-full. We're getting there,
12 and we're just going to keep on fighting.
13 But anything that we can get in terms of
14 additional state aid to help us close that
15 gap will be something that I think will
16 make it real or make happen. If it's based
17 on today's formula, those schools will not
18 get built because the local property
19 taxpayers don't have the money to do it.
20 But if the State of New York is able to be
21 a little more creative with us in terms of
22 how we can finance this and do this over
23 the next decade, I think it's realistic it
24 can happen.
492
1 ASSEMBLYWOMAN MAYER: And last
2 question, I know certainly since I've been
3 here, Yonkers has stayed under the property
4 tax cap. This year the cap is so low that
5 it's very much a challenge for all
6 municipalities, and it's going to be a huge
7 challenge for Yonkers. And I know you're
8 not at the budget yet, but is it your
9 anticipation you can stay under the tax
10 cap?
11 MAYOR SPANO: Yes, it is.
12 ASSEMBLYWOMAN MAYER: Okay, that's
13 it.
14 MAYOR SPANO: It's going to be hard,
15 I get it. But we committed to that and
16 we're going to stick with it.
17 ASSEMBLYWOMAN MAYER: Thank you.
18 Thank you, Mayor. Thank you, Mr. Chairman.
19 CHAIRMAN FARRELL: Thank you very
20 much.
21 SENATOR YOUNG: Thank you,
22 Mr. Mayor.
23 SENATOR KRUEGER: Thank you.
24 MAYOR SPANO: Thank you, members of
493
1 the Legislature.
2 CHAIRMAN FARRELL: The Honorable
3 Stephanie Miner, mayor of the City of
4 Syracuse.
5 MAYOR MINER: Thank you, Chairman
6 Farrell. I also want to thank you,
7 Senator Young, for welcoming me here
8 tonight -- although I didn't anticipate
9 saying "tonight" when I arrived. But I do
10 want to genuinely thank you for this
11 opportunity to come and talk to you today.
12 And I want to say, first off, that
13 having had the opportunity to hear all of my
14 fellow mayors, that I join in most if not all
15 of everything that they talked to you about
16 today.
17 I'd like to take a moment to offer
18 some different thoughts than they did, and
19 some thoughts about the state of our
20 democracy here in New York, with a
21 particular emphasis on the growing
22 disconnect between the general public and
23 the political class and what that growing
24 disconnect means for our ability to govern
494
1 and, yes, budget effectively, which after
2 all is just setting priorities.
3 Our state's recent past, and
4 especially this past year, has been notably
5 marked by a dark storm cloud of public
6 corruption and self-dealing, and this cloud
7 darkens the door of every elected official,
8 the honest and the dishonest, the state and
9 the local officials, cheapening public
10 service and discouraging good people from
11 entering into politics. And as that
12 cloud's shadow grows, it helps feed a
13 corrosive sense of "us versus them" that
14 drives down voter participation, stifles
15 growth and people's sense of equitable
16 public policy. Corruption, in a word, is
17 toxic to democracy.
18 And sadly, even as the appalling
19 toll of that stormís damage to both
20 individuals and institutions continues to
21 mount, its fundamental root causes remain
22 unaddressed. And one of those root causes
23 is the insidious role that money currently
24 plays in our stateís politics.
495
1 Because of the "LLC loophole" and
2 other chasms in our campaign finance laws,
3 we have a system where an individual or a
4 corporation can pour virtually unlimited
5 amounts of money into candidates and causes
6 and do so in a way that effectively masks the
7 true identity of the contributor. I have
8 taken the step of voluntarily refusing to
9 accept contributions from LLCs, and I would
10 urge you to take action to eliminate that
11 loophole statutorily.
12 Another root cause is the barriers
13 that have been erected to prevent greater
14 voter participation. If voter
15 participation rates are an indication of
16 the body politicís health, then we have a
17 grave illness that needs our attention. In
18 the 2014 elections, less than one-third of
19 New York State's eligible voting population
20 participated. We can and must do better.
21 And to that end, I urge you to look at
22 three proposals that have been proven to
23 increase participation rates.
24 First, to allow a 20-day early voting
496
1 period, as exists in 37 states in our
2 country.
3 Second, to allow "no excuse"
4 permanent absentee voting. Currently,
5 there are 27 states that permit this type
6 of absentee voting, which allows eligible
7 voters to request a ballot that can
8 submitted by mail without mandating the
9 voter declare a reason. This reform is a
10 steppingstone to explore a vote-by-mail
11 policy that has been implemented with great
12 success in Washington, Oregon, and
13 Colorado.
14 And third, as Oregon has recently
15 done, enact universal voter registration,
16 whereby individuals are automatically
17 registered to vote at 18 unless they choose
18 to opt out. This groundbreaking proposal
19 will almost certainly boost Oregonís
20 best-in-the nation turnout rates that
21 exceed 80 percent in presidential years. I
22 say that to you again: 80 percent in
23 presidential years. Imagine what our
24 democracy would look like here in New York if
497
1 we could reach those voters.
2 It is worth noting that voter
3 participation is closely tied to
4 demographics. Racial and ethnic
5 minorities, the young and the poor, have
6 the lowest participation rates -- and,
7 ironically, are most impacted by government
8 policies. And as a result, some of our
9 most vulnerable populations are left with a
10 diminished voice in their government.
11 In Syracuse, we live this. As
12 you've heard, many of the mayors before me
13 talked about their overwhelming poverty
14 rates. Our numbers are stark. We have one
15 of the highest poverty rates in the
16 United States, exceeding 35 percent. And
17 we have the highest level of poverty
18 concentrations among blacks and Hispanics
19 in the 100 largest metropolitan areas. The
20 Syracuse City School District has the
21 fourth highest poverty rate in New York
22 State, with more than three-quarters of the
23 students qualifying for free lunch.
24 If we are going to replace poverty
498
1 with true opportunity, New York State must
2 stand up for these children from birth
3 through college. It begins with prenatal
4 and early childhood home visits by nurses
5 and family outreach workers, as I heard
6 today was asked of Mayor de Blasio to
7 commit to Nurse-Family Partnerships. These
8 programs and others show that we can
9 improve high school graduation rates, the
10 health of students and families. We need
11 to make sure that quality, affordable
12 childcare is available to every family who
13 needs it, and New York State needs to
14 fulfill its promise to provide every
15 4-year-old with access to full-day
16 prekindergarten.
17 Based on the Campaign for Fiscal
18 Equity court ruling, New York State was
19 ordered to pay our neediest schools more.
20 And under the ruling, the state currently
21 owes New York State schools $4.8 billion.
22 And of this, the Syracuse schools alone are
23 owed $63 million. Our students need and
24 deserve this smart investment.
499
1 New York can afford to invest in
2 creating opportunities for all children to
3 make sure that they succeed from birth
4 through college, and we must do that.
5 Another topic I'd like to address in
6 general terms is our approach to economic
7 development. I say "our" in the sense that
8 economic development is often a
9 collaborative process between various
10 private entities and levels of government,
11 each with its own set of tools.
12 My concern is that our current
13 approach to economic development is
14 uncoordinated and essentially a
15 "trickle-down," relying too heavily on big
16 tax breaks for big developers in exchange
17 for promises of dubious benefits for
18 taxpayers that often don't pan out.
19 Earlier you heard me speak of the
20 corrosive effect of corruption, and I would
21 argue that trickle-down economic
22 development also plays a role in
23 undermining people's faith in government. At
24 a time when income inequality and economic
500
1 insecurity is palpable for many New Yorkers,
2 including Syracusans, we continue to pursue a
3 failed top-down strategy that only exacerbate
4 the problem.
5 We need to begin to rethink our
6 approach to place emphasis on economic
7 development that serves the public good,
8 where taxpayers can see and feel a real
9 return on the investment of their tax
10 dollars, and gives people a true sense of
11 opportunity.
12 One of those places, as you've heard
13 me speak before about, is infrastructure.
14 You've heard many of the mayors speak about
15 infrastructure. It is vital to the core
16 mission of government, and it transcends
17 political parties. The signs of a
18 functioning government to the average
19 citizen are paved roads and clean waters,
20 and the ability for trash to be collected.
21 And as New Yorkers, we have a history of
22 understanding that investing in
23 infrastructure spurs economic growth for
24 everyone.
501
1 A Federal Reserve study found that
2 infrastructure expenditures have a huge
3 multiplier effect, and every dollar yielded
4 an outcome of more than $2.
5 Competing needs for operations and
6 infrastructure are putting local
7 governments at a breaking point. And we
8 have seen that and you have heard that
9 firsthand from many of the other mayors who
10 have spoken to you today.
11 There is little question that local
12 governments are in desperate need of
13 partners to ensure that the infrastructure
14 we were once so proud of is fixed, updated,
15 and maintained. We only need to turn on
16 the television or read the newspaper to see
17 the dangers of ignoring critical
18 infrastructure. This is playing out
19 tragically before our eyes in Flint,
20 Michigan; we saw it in Troy; we are
21 learning about it in Hoosick Falls as well.
22 One would be hard-pressed to find a
23 greater cautionary tale of the toll that
24 budget neglect can wreak on a community. What
502
1 is happening across the country is a stunning
2 indictment of the "Age of Deferred
3 Maintenance" and its disproportionate
4 impacts on communities of color.
5 I urge you to do everything in your
6 power to ensure that the necessary
7 investments are made to help ensure that no
8 New York community suffers the same fate.
9 Thank you for allowing me the time
10 and the opportunity to testify before you
11 today, and I look forward to working with
12 you to make sure the promise of opportunity
13 is attainable for all New Yorkers.
14 Thank you.
15 CHAIRWOMAN YOUNG: Thank you.
16 CHAIRMAN FARRELL: Thank you very
17 much. Any questions?
18 Mr. Magnarelli.
19 ASSEMBLYMAN MAGNARELLI: Yes.
20 Mayor, thank you for waiting.
21 MAYOR MINER: It's my job,
22 Assemblyman.
23 ASSEMBLYMAN MAGNARELLI: Mine too.
24 It's been a long day.
503
1 Again, I've been reading some of the
2 things that you've just said and also your
3 comments I think in the Times Union. I'm
4 not sure if I got that one right or not;
5 there have been a lot of things I've been
6 reading lately.
7 But the idea that we can -- I guess
8 I don't see the plan. That's what I want
9 to ask you. I don't disagree with you in
10 terms of the things that you have set forth
11 here and that we should be striving to
12 do -- all of them. There isn't anything
13 that I disagree with.
14 On the other hand, the amounts of
15 money that it would take to do those things
16 across New York State are a lot more than
17 increasing taxes by 1 percent on the rich.
18 It would be humongous amounts of money.
19 So all I guess I'm saying is I
20 understand what you're saying -- so this is
21 kind of a statement to at least say to you
22 "I hear what you're saying." I think it's
23 very important that we get into these issues
24 and that they're talked about. But at the
504
1 same time, I've got to deal with the budget
2 for this year for New York State, for the
3 cities across New York State, and how do I
4 deal with that?
5 So I'm going to ask you, just for
6 Syracuse now, the same questions that I've
7 asked basically every other mayor that's
8 come up here. Is AIM enough? And how do
9 the other programs that the Governor has
10 put in place, how do they work? And with
11 Syracuse, because of the report that came
12 out also, some of the things that he has
13 been -- the consensus report, I'm alluding
14 to -- some of the things that the
15 Governor's programs put in place would help
16 that.
17 So with that in mind -- I know this
18 is kind of a rambling question, but I hope
19 I'm getting my point across --
20 MAYOR MINER: You are.
21 ASSEMBLYMAN MAGNARELLI: -- what do
22 you think?
23 MAYOR MINER: AIM is not enough, as
24 you've heard each of the mayors say, the
505
1 mayor of New York City, AIM is not enough.
2 It's been flat. And we have seen our
3 pension costs, some go up, they're starting
4 to ratchet down for us here in Syracuse.
5 But as we see the market underperform, we
6 worry that in December, you know, the
7 pension costs are going to go up again.
8 Healthcare goes up. Binding interest
9 arbitration awards come down from police
10 and fire, and they really hamstring us.
11 So we are dealing with a situation
12 where our revenues are flat, and yet our
13 expenses continue to grow in large leaps
14 and bounds.
15 I would tell you that in terms --
16 every budget, having to do Syracuse's
17 budget as mayor during very challenging
18 times for the last seven years, I
19 understand it's about setting priorities.
20 And there are lots of needs and not enough
21 resources. But I would share with you that
22 the more we ignore infrastructure, the more
23 we ignore the kind of pernicious effects that
24 poverty is having on the people of this
506
1 state, we will no longer be seen as a place
2 of opportunity.
3 One out of every two children born
4 in the City of Syracuse, the City of
5 Rochester, the City of Buffalo, is born
6 into poverty. And because of the programs
7 that have been systematically and quietly
8 eliminated by the federal government and
9 some by the states, those children and
10 those families will not have an opportunity
11 to escape poverty. And they will become
12 burdens for our criminal justice system,
13 for our social services system. But most
14 importantly, all of us I think who are in
15 public service, we believe that those
16 children and families can be an asset to
17 our economy.
18 And until we start looking at
19 economic development in a way that includes
20 everyone and doesn't just depend on giving
21 tax breaks, we're going to continue to see
22 the futures of those families and children
23 across our state -- and obviously I'm very
24 concerned about Syracuse in particular --
507
1 continue to grow.
2 When you look at what the Governor
3 admirably did in his State of the State and
4 budget proposal talking about the poverty
5 initiatives, but you look at that map of
6 where those numbers are, that, I think, is
7 a telling sign that we need to approach
8 economic development differently. That we
9 have that many children, that many people
10 in our state living in those kind of
11 circumstances.
12 ASSEMBLYMAN MAGNARELLI: Now I'm
13 going to just make one more statement to
14 you, okay? As a friend, which we have been
15 for many, many years, we disagree on some
16 things. And my concerns are that we create
17 jobs. So we'll continue to do that.
18 But I definitely want to thank you
19 for your comments and your thoughtfulness
20 in terms of putting these in the forefront
21 of this committee and what we should be
22 looking at when we're looking at a budget.
23 Thank you very much for being here.
24 MAYOR MINER: And, Assemblyman
508
1 Magnarelli, I appreciate your comments.
2 And I also want to take this
3 opportunity to thank you for the support
4 and the resources that you have given the
5 City of Syracuse so we have been able to
6 put them towards our planning for
7 infrastructure. Thank you.
8 CHAIRMAN FARRELL: Thank you.
9 Senator?
10 CHAIRWOMAN YOUNG: Senator Krueger.
11 SENATOR KRUEGER: Hi. Thank you,
12 Mayor Miner. I know it's late. So we
13 haven't been friends for many years, but I
14 find myself agreeing with you on almost
15 everything every time you do come up to
16 testify before us. So I want to thank you
17 for your testimony and the globalness of
18 your thinking as a city mayor.
19 And just to highlight, perhaps not a
20 question, but pointing out, reinforcing
21 what you were talking about with are we
22 putting our money into infrastructure where
23 we should be, are we putting our money into
24 economic development that might not actually
509
1 gain us what we need, I just want to point
2 out at the Transportation hearing last week,
3 people came to testify about upstate rail,
4 both passenger rail and mass transit and
5 freight rail, and I asked both sets of
6 testifiers were they eligible for state
7 economic development money, and I was told
8 no.
9 And I have to say, even if you have
10 disagreements about the concept of what
11 you're doing with economic development
12 money, it's hard to believe that we in the
13 State of New York spend so much money on
14 economic development but we don't recognize
15 that urban infrastructure and rail and mass
16 transit north of Westchester is actually
17 relevant to the future of the State of
18 New York.
19 So I do just want to say thank you
20 for staying so long, and not just speaking
21 on behalf of the people of Syracuse, but I
22 think the issues are there for the people
23 all over New York State. Thank you.
24 MAYOR MINER: Thank you, Senator
510
1 Krueger. I just would like to -- I
2 appreciate very much your comments, and
3 just say that, as I have said here before,
4 and you've opened the door, so I'm going to
5 say it again, you know, the City of
6 Syracuse was put on the map because of the
7 Erie Canal, which is the first major piece
8 of infrastructure that opened up the west
9 and transformed our economy.
10 So infrastructure is part of our
11 history, but it's also part of our history
12 as a state. When you look at the MTA and
13 the Tappan Zee Bridge and the Long Island
14 Railroad and what -- you know, when you're
15 looking at also what is going on with
16 people talking about the quality of water
17 across the country, and also drought, we in
18 New York State are blessed with lots and
19 lots of water. So water and water
20 infrastructure is going to be a tool and a
21 way to do real economic development. It's
22 going to be the oil of the 21st century.
23 And if we can take advantage of it, then we
24 will be the beneficiaries. And when I say
511
1 "we," it will be all New Yorkers, not just
2 a small segment of the lucky few.
3 SENATOR KRUEGER: Thank you.
4 Thank you, Senator.
5 SENATOR YOUNG: Thank you very much.
6 CHAIRMAN FARRELL: Further
7 questions? Thank you very much.
8 MAYOR MINER: Thank you very much.
9 Thank you.
10 CHAIRMAN FARRELL: Patrick Madden,
11 mayor, City of Troy.
12 MAYOR MADDEN: Good evening,
13 Chairman Farrell, Chairwoman Young,
14 distinguished members of the Joint Senate
15 and Assembly Budget Committee. Thank you
16 for allowing me to speak this evening.
17 I know it's been a long day for you,
18 so I'll be brief and I'll just skim through
19 some of my written comments.
20 My name is Patrick Madden. I am the
21 mayor of Troy. I believe I represent the
22 smallest community to come before you
23 today. I try to speak for all of them. And
24 I'm sure I'm the newest member to come before
512
1 you today as well; I've been in office 26
2 days now.
3 And if you read the local papers or
4 watch the local media, you already know
5 that I'm here to speak in regard to the
6 dire need for more investment in our aging
7 municipality water infrastructure.
8 Out of sight, out of mind is a good
9 phrase to describe public awareness
10 surrounding the issue of water
11 infrastructure, an essential yet seemingly
12 invisible component of not only economic
13 prosperity but improved quality of life
14 across our communities in upstate New York.
15 As a brief background, Troy, also
16 known as the Collar City, is a small city
17 of 50,000 people located just a few short
18 miles north of Albany. During the last
19 five years, the City of Troy has
20 experienced an incredible rebirth. Over
21 100 new business and development projects
22 have chosen Troy as their home. The New
23 York Times recently called our city "the new
24 Brooklyn." This renaissance has renewed the
513
1 promise of a bright future for the residents
2 and businesses of the Collar City.
3 Troy is also the principal supplier of
4 treated water to nine nearby communities,
5 representing approximately 135,000 customers
6 in three counties. Each day, roughly 21
7 million gallons of potable water is processed
8 by the Troy Water Plant and distributed to
9 our customers in surrounding municipalities.
10 These towns and cities choose to receive
11 their water from the City of Troy because of
12 its high quality, our system's reliability,
13 its rapid availability, and our cost. It is
14 also one of the largest sources of revenue
15 for our city.
16 Just over one week ago, on Sunday,
17 January 17th, I was informed of a major
18 water main break in the Lansingburgh
19 neighborhood of our city. Our city had
20 experienced water main breaks in the past;
21 all were quickly identified and isolated.
22 However, this was not your average break. It
23 was not like anything we had experienced
24 before.
514
1 Upon arriving on the scene, I was
2 shocked at the magnitude of what I saw.
3 Water sprayed six feet into the air from a
4 massive crater which had torn open the
5 street. Pieces of shale and shattered
6 concrete were pushed by rapidly moving
7 streams pouring down Fifth Avenue.
8 The break was a result of a
9 catastrophic failure of a 110-year-old
10 33-inch water main, and it poured over
11 8 million gallons of water into our streets
12 before it could be shut off. Roads were
13 closed, neighborhoods were flooded,
14 businesses were closed. A state of
15 emergency was declared.
16 Thanks to the quick response of our
17 public utilities crews, we were able to
18 isolate the ruptured main, stop the flow of
19 water, and restore service back to our
20 city.
21 The ramifications of this incident
22 were quite significant. All communities
23 served by our system were asked to
24 voluntarily restrict water usage. Two
515
1 communities, the towns of Halfmoon and
2 Waterford, because of their location on our
3 system, were severely impacted. In an
4 effort to keep a flow of water to their
5 residents, schools were closed for two days
6 and businesses were affected. We were
7 fortunate that no hospitals or senior
8 living facilities needed to be vacated.
9 The water main break was more than a
10 mere inconvenience. It impacted commerce
11 and could have had serious health and
12 safety concerns. While final costs have
13 yet to be calculated, there is no doubt
14 that the cost of this event will negatively
15 impact our city's services and our ability
16 to make future infrastructure improvements.
17 Further, Troy's recent growth and
18 economic gains could be at risk.
19 Reliability of infrastructure is a key
20 determinant of a business's decision to
21 locate or grow. A failure to invest further
22 in our aging water infrastructure system
23 poses a risk not only to our quality of life,
24 but also to our economic prosperity. Without
516
1 reliable sources of water, we may see a
2 reduction in our upstate cities' ability to
3 retain key partners who bring investments and
4 jobs to legacy cities like Troy.
5 Approximately 145 miles of water lines
6 run beneath the city of Troy. Some of these
7 pipes date back to the 1860s. A recent
8 estimate put replacement costs for these
9 lines at approximately $1 million per
10 half-mile. While it is not necessary to
11 replace all of the water lines running
12 through our city, there are critical
13 sections, such as the one that let go last
14 week, whose age, size and importance keep
15 us awake at night. The estimated cost to
16 replace just the recently damaged water
17 main is close to $2.7 million. That covers
18 just 3700 feet of supply line, a mere
19 4/10ths of 1 percent of our distribution
20 system.
21 It is important to stress that Troy is
22 not alone in facing issues of aging water
23 infrastructure. Cities across New York State
24 are looking for avenues to address the very
517
1 same concerns. This is a statewide problem,
2 and it requires a comprehensive approach from
3 our local municipalities and state leaders to
4 take these steps to ensure the future
5 prosperity of small cities like Troy.
6 My administration has remained in
7 constant contact with Governor Cuomo's
8 office, and through additional help from
9 our local elected representatives --
10 Assemblyman McDonald, Senator Kathy
11 Marchione -- we have continued to pursue
12 financial assistance for these projects.
13 The problem cannot be handled solely on a
14 local level. Our upstate cities need this
15 critical investment in the invisible
16 network that exists beneath our feet.
17 To that end, I respectfully request
18 the Senate and Assembly fully fund Governor
19 Cuomo's proposal for $250 million in
20 increased water infrastructure funding in the
21 2016-2017 budget. The stakes have never been
22 higher for upstate communities like Troy.
23 Thank you for your time.
24 CHAIRMAN FARRELL: Thank you very
518
1 much.
2 Assemblyman McDonald.
3 ASSEMBLYMAN McDONALD: Thank you,
4 Mr. Chairman.
5 And Mayor, welcome. You're much
6 dryer now than the last time I saw you
7 about a week and a half ago when we were
8 standing over the grave of that broken
9 pipe. And as I kind of kiddingly said, but
10 it truly was a baptism into being a mayor
11 by having about 8 million gallons of water
12 going flowing out of your community.
13 You've kind of laid out -- I mean,
14 if you look at the numbers, it's impossible
15 to replace every water line in every
16 community. I know you're only 26 days on
17 the job right now. But have you gotten a
18 sense from your department head or utility
19 department, when you look at something like
20 this, which was unexpected, how much more
21 needs to be done? Do you have troubled areas
22 right now? When you're budgeting a million
23 dollars per half-mile, do you have areas that
24 they know that probably were in worse shape
519
1 than what they got here?
2 This was an area that they said,
3 Well, maybe it could happen; maybe not.
4 Are there other areas you know that are
5 troubled that keep you awake at night?
6 Other than the other parts of the job that
7 keep you awake at night.
8 MAYOR MADDEN: Oddly enough, before
9 I came into office, about five weeks ago I
10 met with our director of our DPU, and he
11 indicated to me that this very line, the
12 one that ruptured, was the one that kept
13 him awake at night. As I indicated, it's
14 110 years old. It's riveted steel, very
15 difficult to repair, a very fragile line.
16 And lo and behold, three weeks into my
17 administration, it broke.
18 So that probably is the worst line.
19 But I will also note that the line that runs
20 from the reservoir to our water plant over
21 several miles is also a riveted steel line of
22 a similar age. We know that that needs to be
23 repaired. We have begun acquiring property
24 rights to do that project. We estimate that
520
1 that will cost, replacement of the line from
2 the reservoir to the water plant will cost
3 about $40 million. That's on top of the
4 roughly $3 million it will take to replace
5 this line that ruptured.
6 ASSEMBLYMAN McDONALD: I know that
7 you're here primarily to speak about the
8 Water Infrastructure Grant Fund, which we
9 appreciate. That's something I know all
10 members of the Legislature supported last
11 year, with the Governor. And Steve Otis,
12 who's a former mayor, he and I approached
13 our Speaker, who doubled down and said,
14 "Let's go for $200 million," which we were
15 pleased about. And obviously we're going
16 to advocate for even more this year. And
17 we're glad that the Governor is supporting
18 it.
19 Same token, as you know, Mayor Sheehan
20 from Albany was here a little while ago
21 speaking about the issues in the City of
22 Albany. It's been well chronicled that
23 there's a draft order report from the
24 Comptroller's Office on the overall fiscal
521
1 health of the City of Troy. And I know you
2 really can't discuss it in great detail,
3 but I think it should be known to all the
4 entities that Troy is also in probably what
5 I would consider a precarious financial
6 state as well, which is consistent with
7 many of our cities throughout the State of
8 New York.
9 I don't know if you have any
10 comments you'd like to make at this time or
11 expand upon that, but now would be a good
12 time if you chose to.
13 MAYOR MADDEN: Yes, Troy is in a
14 very precarious fiscal state. The budget
15 that I was given from the last council is
16 structurally imbalanced, perhaps by as much
17 as 2 or 3 percent at this point.
18 I am reviewing our internal operations
19 at this point in time to look for the
20 efficiencies that might close that gap a
21 little. But it leaves us virtually no money
22 to invest in infrastructure needs such as
23 this.
24 Troy's financial problems are 20 or 30
522
1 years in the making. I'm not going to fix it
2 in Year One. It's going to take some time to
3 dig ourselves out of that hole. But, you
4 know, I am confident that we can get there.
5 I have assembled a terrific team with great
6 municipal financial experience, and we will
7 be developing a roadmap to move us out of
8 this position. But it is going to take us
9 some years, and we will need some assistance
10 to get us there.
11 ASSEMBLYMAN McDONALD: Thank you.
12 Thank you for being here.
13 MAYOR MADDEN: Thank you.
14 CHAIRMAN FARRELL: Thank you.
15 Any further?
16 SENATOR MARCHIONE: Yes, I do have.
17 CHAIRMAN FARRELL: Senator?
18 SENATOR KRUEGER: Senator Marchione.
19 SENATOR MARCHIONE: Mayor, thanks for
20 being here. You really have had a very
21 eventful 26 days in office. And that's
22 difficult, and I think you've done a very
23 good job in meeting --
24 MAYOR MADDEN: Thank you.
523
1 SENATOR MARCHIONE: -- the real
2 serious challenges that have come before
3 the City of Troy in just these 26 days. So
4 hopefully things will get easier as time
5 goes on, because --
6 MAYOR MADDEN: I hope so.
7 SENATOR MARCHIONE: -- yeah -- as a
8 previous supervisor, I recognize what keeps
9 you up at night. And that is absolutely
10 something that keeps you up at night.
11 Water is not -- as important as parks are,
12 water is not a park. Water is something
13 that our residents absolutely need. It's a
14 necessity to be able to turn on your
15 faucet, to be able to have water come out
16 to wash your children, to cook your food.
17 And I agree with you, this is critical in the
18 budget.
19 I'm thrilled, I think it was one of
20 the times in the Governor's speech that
21 actually he received an applause from people
22 that were there, I believe it was relative to
23 these monies that are being put into the
24 budget.
524
1 So certainly we are here to work
2 with you. As Local Government chair, this
3 is very important to me that these monies
4 stay in the budget and that they are
5 available for use in cities and towns
6 throughout New York State. So as one of
7 those Halfmoon residents that was on a
8 "don't use very much water," I absolutely
9 recognize the need to make sure that our
10 water lines are in good shape.
11 So thank you so much for all you've
12 done in your short 26 days here, and I
13 certainly stand ready to assist you, as
14 what I said the other day, in any way that
15 you might feel the need.
16 MAYOR MADDEN: Thank you, Senator. I
17 appreciate your help.
18 CHAIRMAN FARRELL: Thank you.
19 MAYOR MADDEN: Thank you.
20 CHAIRMAN FARRELL: Thank you.
21 Blair Horner, executive director, New
22 York --
23 SENATOR KRUEGER: He's not here. He
24 had to leave.
525
1 CHAIRMAN FARRELL: He had to leave?
2 He didn't have to leave. He didn't want
3 to --
4 SENATOR KRUEGER: Fair enough. He
5 didn't have to leave, but I double-checked
6 and he has left.
7 (Laughter; discussion off the
8 record.)
9 CHAIRMAN FARRELL: Steven J.
10 Acquario, executive director, Robert
11 Astorino, Westchester County executive,
12 New York State Association of Counties.
13 And next is Peter Baynes and Gerry
14 Geist. If you come down lower, you save us
15 one or two minutes. And I really need
16 those one or two minutes now.
17 (Laughter.)
18 MR. ACQUARIO: Good evening.
19 CHAIRMAN FARRELL: Good evening.
20 MR. ACQUARIO: Thank you, Chairman
21 Farrell, members of the Legislature. It's a
22 pleasure to be with you here this evening.
23 My name is Steven Acquario. With me
24 here today is David Lucas, who is our
526
1 director of finance for the Association of
2 Counties. And I appear today on behalf of
3 our president, William Cherry of Schoharie
4 County, and Rob Astorino, the president of
5 the County Executives Association.
6 The voice of the counties of
7 New York is consolidated through the
8 New York Association of Counties, bringing
9 you the voice of the counties instead of
10 having everyone come testify before you
11 here this evening.
12 I appreciate that your committees
13 have provided this opportunity to gather
14 feedback on the state budget. The State
15 Legislature has inherent authority and
16 influence under Article 7 of the state's
17 constitution with respect to the
18 appropriation of state revenue, and we value
19 the opportunity to present the local
20 government perspective.
21 In recognition of the time
22 constraints, I've submitted some written
23 testimony to you, but I will depart from the
24 written testimony in the interest of time.
527
1 Before I do so, I want to continue to
2 urge this body on a matter of quite
3 importance to the citizens, to the people
4 of this state, and that is organ donation.
5 I continue to urge this body to pass laws
6 that help raise the profile of organ
7 donation. We are last in the country.
8 There's no explanation for it other than
9 the wrong policies are in place in this
10 state.
11 We implore you to continue to fix
12 these problems, these barriers for people
13 to sign up. As you continue to modernize
14 the election system, making it easier for
15 people to register to vote, give them the
16 opportunity to become an organ donor as well.
17 We have a license renewal in this state that
18 takes eight years. Well, that's eight years
19 of lost opportunity for people to sign up to
20 be an organ donor. That's wrong. It's the
21 wrong policies. We need to address it, and I
22 urge you to do that this session.
23 The state has imposed a property tax
24 cap. We've heard much about it today when
528
1 the New York City mayor has testified.
2 It's been in place for five years for
3 counties. On average, over the past five
4 years, 85 percent of counties have met the
5 tax cap each year, ranging from 81 percent
6 to 89 percent compliance. This was
7 achieved with some assistance from the
8 state through mandate relief, but also
9 through tough decisions at the county
10 level, including reducing the workforce,
11 privatizing numerous operations, and the
12 selling of public assets to the private
13 sector. We've significantly reduced our
14 fiscal and emergency reserves, delayed
15 maintenance and replacement of critical
16 infrastructure, reduced or eliminated local
17 service levels for discretionary programs
18 under our direct control.
19 In 2015, 28 percent of the counties
20 reduced their levy or held it flat.
21 Forty-seven percent of the counties reduced
22 their tax rate or held it flat. Counties
23 continue to work very hard to meet the tax
24 cap, but it presents many challenges and
529
1 difficult choices. For 2017, we expect the
2 county tax cap inflation factor to be in
3 the range of 0.3 percent.
4 With this in mind, we continue to
5 urge the Legislature to consider minor
6 modifications to the tax cap, including an
7 exclusion for certain capital expenditures
8 and extraordinary costs relating to
9 responding to natural disasters or other
10 emergencies, which we just heard from the
11 Troy mayor; and, two, ensuring the
12 commissioner of Tax & Finance implements
13 reforms to the quantity change factor to
14 address the problem of tax-exempt properties.
15 One last observation impacting the
16 property tax base. There is a proposal for
17 energy plant closures in the Governor's
18 budget. There is transitional assistance in
19 there. We ask that that language be modified
20 slightly from the, quote, permanent closure
21 to include temporary closures.
22 The state impact on the county
23 property taxes. Over the past several years,
24 the Governor and the Legislature have been
530
1 careful not to impose new mandates or shift
2 costs on counties and other local
3 governments. When new mandates are created
4 or there is an increase in the cost of
5 existing mandates, or a shift to local
6 governments without any flexibility to
7 mitigate these higher costs, we all recognize
8 that this will hurt local taxpayers.
9 In recognition of this, the State
10 Legislature and the Governor have passed two
11 significant local government mandate relief
12 reforms in recent years, capping the local
13 share of Medicaid and enacting major pension
14 reform. We appreciate these reforms and
15 continue to work with you to build on these
16 successes.
17 To this end, we do not support the
18 Governor's proposal to shift significant
19 higher education costs to New York City and
20 to further dismantle the Medicaid cap for the
21 city. Both would be counterproductive to the
22 positive work we have done in recent years to
23 improve accountability to the local taxpayers
24 by reducing the growth of costs for local
531
1 governments imposed by state mandates.
2 As a reminder about what are mandates,
3 when the state enacted a property tax cap,
4 the Legislature and the Governor pledged that
5 mandate relief would be forthcoming. While
6 we wait, the counties and New York City must
7 raise more than $12 billion each year in
8 local taxes to support just nine major state
9 mandates: Medicaid, public assistance,
10 safety net, child welfare, preschool special
11 education, early intervention, indigent
12 defense, probation, youth detention, and
13 pension costs. Put another way, every penny
14 collected by the New York counties outside of
15 New York City goes to Albany to pay for just
16 these nine programs -- every penny collected
17 on the tax levy.
18 Complying with each uses up local
19 resources. Last year alone, the Office of
20 Children and Family Services, the Office of
21 Temporary and Disability Assistance, the
22 Department of Health issued more than 50
23 administrative directives or guidance letters
24 to counties that had to be implemented.
532
1 With respect to government
2 consolidation, the Governor continues to
3 make consolidation a top priority.
4 Counties have long advocated for greater
5 efficiencies and innovation in government,
6 and we continue to do so. There's no doubt
7 that communities can benefit from
8 streamlining government operations, whether
9 through consolidation of functions, through
10 shared services or taxing jurisdictions with
11 voter approval. Our goal is the same as the
12 state's: Stabilize and reduce the tax burden
13 while continuing to provide excellent public
14 services to those in need.
15 The state's position continues to
16 evolve. This year the state budget contains
17 a $20 million prize for a consolidation
18 competition at the local level. Last year
19 you appropriated $150 million for a Local
20 Government Restructuring Grant program, but
21 that application process was never announced
22 and that funding has now been repurposed for
23 anti-poverty programs and downtown
24 revitalization efforts.
533
1 The budget zeroes out funding for
2 the ongoing $40 million Local Government
3 and Performance Efficiency program, but
4 provides $80 million in reappropriations
5 for the Financial Restructuring Board.
6 If it sounds confusing, it is.
7 Changing policies and incentives year to year
8 is confounding to local officials who
9 consider these efforts. Instead, let's go
10 back to the consolidation idea and start with
11 consolidations that also provide mandate
12 relief permanently and reduce the cost of
13 government at the county level. It has
14 proven to be successful to the taxpayers of
15 New York.
16 Indigent defense is a state program
17 that counties are required to provide. Let's
18 build on the state settlement of the
19 Hurrell-Harring lawsuit. We should be
20 consolidating the services and funding for
21 indigent defense services across the state.
22 We should include in this budget before you a
23 uniform indigent defense program and have the
24 state gradually assume the cost of indigent
534
1 criminal defense services, as set forth in
2 legislation introduced by many of you on this
3 panel.
4 This chart here is named "Fix the
5 52." It shows you the State of New York,
6 where five counties are operating under a
7 different indigent defense system than the
8 rest of the state. New York City, operating
9 similar to the five counties that are in a
10 consent decree with the State of New York.
11 We need to fix the 52 counties and have one
12 system of justice in New York State.
13 A few years ago the state increased
14 the counties' share of safety net funding to
15 71 percent and reduced the state's share to
16 29 percent. Initially this was offset by
17 fully federalizing both state and local TANF
18 costs. Counties strongly objected at this
19 time, and it's becoming a significant
20 challenge for many counties. We are urging
21 the Legislature to gradually restore the
22 historic 50/50 funding shift. Many counties
23 have seen their cost and caseload increase by
24 double digits in more than one year since the
535
1 state cost shift occurred.
2 An additional issue is the cost of
3 affordable housing -- and we've heard a lot
4 about affordable housing through executive
5 orders and the mayor's testimony this
6 morning -- and shelter options in some
7 counties, which is significantly increasing
8 costs in counties. This leaves counties
9 paying 71 percent of the fastest-growing
10 program that is controlled by the state.
11 The safety net funding shift is part
12 of a long string of decisions by the state to
13 gradually walk away from its constitutional
14 responsibility to care for the needy and
15 place most of the funding responsibility on
16 the local property taxpayers. Let's
17 consolidate our efforts for safety net and
18 homeless and housing efforts. It makes
19 sense, and it will save the local taxpayer
20 dollars.
21 Increasing community college FTE aid.
22 We all know families for whom higher
23 education would be beyond their reach if
24 their kids couldn't attend community colleges
536
1 in their first couple of years. Increasing
2 FTE aid is property tax relief. The societal
3 benefit of community colleges is enormous.
4 They allow people without great wealth to
5 move up the economic and educational ladder.
6 If the state is serious about its
7 commitment to the poor, working class and the
8 middle class, and serious about providing
9 property tax relief, it should make a
10 meaningful $250 increase in FTE aid for
11 community colleges.
12 Public safety, two quick issues. We
13 operate 911 functions. Several counties have
14 consolidated these functions with other
15 municipalities in the past several decades.
16 The funding mechanism used to operate,
17 maintain and upgrade these 911 systems is
18 insufficient. We believe the state should
19 allow counties to impose a $1.20 local public
20 safety surcharge equal to the state's
21 surcharge on all wireless devices that are
22 capable of accessing 911 services. This
23 would allow counties to upgrade, operate and
24 maintain their 911 centers.
537
1 Navigation law. Currently, sheriff's
2 departments in over 40 counties outside of
3 New York operate marine patrol units on
4 navigable waterways in their counties. The
5 budget before you reduces the reimbursement
6 from 50 percent to 25 percent. We urge the
7 Legislature to reject this proposed funding
8 cut.
9 On the use of bank settlement funds,
10 we remain concerned about the allocation of
11 $2.3 billion in bank settlement funds that
12 remain for your appropriation. We believe
13 more funding of these needs to be targeted to
14 locally owned and maintained infrastructure,
15 unlike the way the last round of the bank
16 settlement funds was appropriated.
17 PAVE-NY and BRIDGE-NY. This body
18 heard testimony from the contractors and the
19 public works superintendents from across the
20 state. There remains details, it is
21 confusing, the competition that's there. We
22 ask you to return it to the formula that's
23 worked for decades. Drive this funding
24 formula through CHIPS so everyone can benefit
538
1 -- the cities, the towns, the villages, and
2 the counties.
3 The Governor's proposal to provide an
4 additional $100 million for water quality, we
5 urge your continued support for this program
6 which you created last year.
7 Finally, in electronic waste
8 recycling, counties would like to see a small
9 fund set aside from the use of the bank
10 settlement funds allocated to the
11 Environmental Protection Fund, to be
12 dedicated specifically to local governments
13 for electronic waste disposal. The New York
14 State Electronic Equipment, Recycling and
15 Reuse Act was implemented to manage the
16 recycling costs of electronic waste by
17 requiring manufacturers to collect and
18 dispose of their products. However,
19 manufacturers have continually fallen short
20 of this requirement. As a result, disposal
21 of this waste has shifted unexpected costs to
22 local governments for the collection and
23 disposal of electronic waste.
24 Thank you very much for that rapid
539
1 testimony. I really appreciate the time
2 that you've given us.
3 SENATOR YOUNG: Thank you. Thank you
4 very much, Executive Director.
5 Do you have any Assemblymembers?
6 ASSEMBLYMAN MAGNARELLI: I just want
7 to thank the executive director for his
8 testimony and for being here and for -- I
9 don't know how long you were sitting up
10 there, but I think it was a long time.
11 And the only thing I have to say about
12 this and your testimony is there's a lot
13 there. And I'm going to go through it. A
14 lot we've talked about all day today. The
15 one thing that I can assure you is I'm going
16 to be in touch with your office over the next
17 couple of weeks to go over a few things.
18 MR. ACQUARIO: Thank you, Chairman
19 Magnarelli. We'd be pleased to present to
20 your Local Government Committee as well.
21 ASSEMBLYMAN MAGNARELLI: Okay, thank
22 you.
23 SENATOR YOUNG: So, Executive
24 Director, I am impressed, because that was a
540
1 speed round. You did extraordinarily well.
2 (Laughter.)
3 SENATOR YOUNG: And as Assemblyman
4 Magnarelli pointed out, there is a lot of
5 information here. As you know, the Senate
6 wants to work very closely with the counties
7 to be as helpful as possible, and we
8 appreciate the input very, very much. And
9 we'll take it very seriously as we go through
10 the budget process. You know, we always want
11 to give more relief to the counties, and we
12 want our communities to grow, and we all want
13 more jobs and more opportunities across New
14 York State.
15 So I want to thank you for all of your
16 advocacy. I think you do a great job.
17 MR. ACQUARIO: Chairwoman, thank you.
18 You had stepped out of the room. Just real
19 quickly, we are calling for the energy plant
20 closure transitional aid. There's a
21 provision in there for $19 million for
22 closure on a permanent basis for municipal
23 property tax losses.
24 We'd ask that you consider including
541
1 sort of a temporary closure of a minimum of
2 six months as well as you consider this
3 budget for -- it would affect NRG in your
4 district.
5 CHAIRWOMAN YOUNG: Right. As you
6 know, that's a point of serious concern to me
7 and something that is detrimental to
8 Chautauqua County. And so we're looking at
9 solutions in order to address the situation.
10 So you're right, and I will pay close, close
11 attention to that issue. So thank you.
12 I know Senator Marchione had a
13 question.
14 SENATOR MARCHIONE: Just one question.
15 In 2011, the Mandate Relief Council was
16 established in order review mandate relief
17 proposals from particular local governments
18 and then of course make registrations to the
19 Legislature associated with these proposals.
20 In 2013, the council received only
21 four requests from municipal governments, and
22 it was eventually dissolved. Why do you
23 believe local governments were unwilling to
24 submit requests to have the state review
542
1 mandates through the council?
2 MR. ACQUARIO: Well, I feel like the
3 Medicaid Inspector General. It's very
4 difficult to hear down here. I should come
5 up and sit next to you and answer questions.
6 No, I'm not going to do that --
7 SENATOR MARCHIONE: Do you want me to
8 repeat it?
9 MR. ACQUARIO: No, I did hear it, but
10 it is difficult to hear.
11 SENATOR YOUNG: You can come up if you
12 want.
13 MR. ACQUARIO: No, that's okay.
14 SENATOR MARCHIONE: I found the same
15 thing yesterday. I couldn't hear the front
16 row.
17 MR. ACQUARIO: I don't know the
18 answer. I think the rules of engagement with
19 that commission were not the correct rules
20 and that we were given guidance not to submit
21 programs that I've discussed with you today,
22 that the types of things that were to be
23 submitted for those things were more rules
24 and regulatory issues. Matters that
543
1 pertained to budget-related issues were not
2 to go before that commission.
3 So I think that we -- we need to just
4 focus on a couple of things with respect to
5 mandates. As Mr. Magnarelli talked about,
6 there's a lot in this testimony. There's a
7 lot that this state requires its local
8 governments to do on your behalf. You make
9 these choices, you're requiring the local
10 taxpayers to send billions of dollars to
11 Albany to pay for programs in the past.
12 But I'm not here about the past. I'm
13 here about what can be done in the future.
14 Let's try to focus in on one thing or two
15 things. We can't just say, We've capped
16 Medicaid, and move on. You've capped our
17 revenue and property taxes. It's going to be
18 a problem. It's going to be painful. So we
19 need to continue to work together on trying
20 to identify some of these deep-rooted
21 mandated expenditures and try to help offset
22 some of those local costs as they grow.
23 SENATOR MARCHIONE: I absolutely agree
24 with you and believe that local governments
544
1 are spending a great deal of money on
2 mandated programs. I just didn't
3 understand -- because you don't seem to have
4 a problem sharing what the problems are, and
5 they're very important concerns that local
6 governments have. I just wondered why it
7 didn't go through the council at the time.
8 So thank you for your response.
9 MR. ACQUARIO: My pleasure, Senator.
10 Thank you.
11 ASSEMBLYMAN OAKS: Assemblyman
12 McDonald.
13 ASSEMBLYMAN McDONALD: Thank you,
14 Mr. Chairman.
15 And, Steve, thank you for condensing
16 your multipage discussion. Sadly, I think
17 many of these things are very familiar. I
18 think you've been talking about them for
19 years, and some of us have been listening to
20 them for years. And hopefully we can make
21 some headway. I just have a couple of
22 comments and then a question at the end.
23 Comment on the FTE aid for community
24 colleges. And I actually met with many
545
1 community colleges today. I just want to
2 remind people, last year that was the same
3 request. And at the end of the budget
4 process, our message that we had gotten
5 back from the college community was because
6 of the declining enrollment, the FTE aid
7 doesn't really help them to that degree.
8 Now, hopefully enrollment is
9 starting to increase. I fully understand
10 the relationship with the counties and
11 their fiscal responsibilities. But it
12 probably would be helpful if everybody was
13 singing from the same sheet of music as we
14 go through the process. Because we do try
15 to --
16 MR. ACQUARIO: You do.
17 ASSEMBLYMAN McDONALD: -- address
18 the concerns that are brought forward to
19 us. And last year it was made clear to us
20 that the capital money that they had received
21 was much more appreciated and necessary and
22 fruitful.
23 The 911 surcharge, you know, I've
24 gotten a little more engaged in that the last
546
1 couple of years. As you know, Albany and
2 Rensselaer and Saratoga counties are trying
3 to do some coordinated efforts.
4 MR. ACQUARIO: Yes.
5 ASSEMBLYMAN McDONALD: And I fully
6 agree with you that all mobile devices
7 should be subjected to the surcharge, and
8 that's something that many of us are going
9 to be committed to during this process.
10 I also think that -- and it was
11 mentioned earlier today, as you probably
12 heard, that the days of the landlines are
13 becoming kind of -- they won't say
14 obsolete, but the reality is it's probably
15 a time to really take a more comprehensive
16 look statewide at the surcharge on
17 landlines versus the surcharge on
18 cellphones, because we are a much more
19 mobile society than we've ever been before.
20 And the reality is usually those calls are
21 used for emergencies, and a lot of our
22 emergencies also happen outside the
23 household. They happen inside, but they also
24 happen outside.
547
1 So I think that's something that I'm
2 glad you continue to bring that up, and I'm
3 also very cognizant of the fact that
4 sometimes the state isn't as kind sharing
5 its resources that it collects with those
6 revenues and that we need to do a better
7 job of that.
8 MR. ACQUARIO: That's right.
9 ASSEMBLYMAN McDONALD: I noticed you
10 didn't mention that directly, but I want to
11 make sure it's stated for the record.
12 My final comment, and then you can
13 comment on anything you want if you'd like,
14 you mentioned the tax cap next year, I
15 think it will be 0.31 percent. We're
16 hearing -- last week I had a roundabout
17 with all the different BOCES in the region.
18 From the dozens of school districts:
19 0.12 percent. I think the Conference of
20 Mayors will be in that 0.12 percent range as
21 well, because they're following you on your
22 tail.
23 What does 0.31 percent mean in total
24 revenue across the state for the counties
548
1 that you represent? It doesn't sound like
2 it's an awful lot of money.
3 MR. ACQUARIO: Okay. So let me just
4 address the first point you made and then
5 pick up on that second point.
6 We need to address 911 funding.
7 It's very important. We're all concerned
8 about increasing taxes and fees and charges
9 or what you want to call them. Fine.
10 Let's lower the rate. Let's lower the
11 rate, but appropriately spread it out and
12 charge the devices that are accessing the
13 911 system. How are we supposed to upgrade
14 our facilities to next-generation 911 to
15 collect texting, to collect texts? It's a
16 different generation out there now, they're
17 used to texting. I think we can actually
18 lower the fee but broaden the base so that
19 we're adequately collecting the revenues.
20 And you're right, Assemblyman, the
21 landlines are going precipitously down and
22 the use of wireless devices and tablets and
23 every other sort of personal device that's
24 out there right now that can access 911,
549
1 we're not collecting a surcharge. And also
2 on prepaid plans that are being purchased
3 now in the stores, not subject to 911 and
4 we're losing revenue on all those plans.
5 So thank you very much for bringing
6 that up. I do appreciate those
7 observations. You are on top of it, and I
8 appreciate it.
9 To answer your other question, the
10 growth in just the nine mandates is
11 probably -- I don't have a figure in front
12 of me, but it's substantial. Hundreds of
13 millions of dollars; I'm not sure exactly
14 what it would be. But the growth levy that
15 we're allowed is about $29 million.
16 ASSEMBLYMAN McDONALD: That's not a
17 lot.
18 MR. ACQUARIO: Twenty-nine million
19 in the growth. Dave is suggesting here that
20 0.3 percent equals 15 million.
21 So this is what the state has imposed
22 on us. We're not objecting to a property tax
23 cap, it's done, it's five years in the
24 making, the people of New York had too high
550
1 property taxes. We appreciate the Governor's
2 emphasis like a laser, your emphasis like a
3 laser on a very wildly popular program. But
4 it's going to have sacrifices, and it's going
5 to pay its price at some point in time
6 without additional relief.
7 ASSEMBLYMAN McDONALD: There's no
8 doubt -- and I agree with the Governor, you
9 know, property taxes are too high. And I
10 think we need to -- we need to continue the
11 cap. I think the challenge is going to be
12 how do we make sure we don't lose our
13 municipalities along the way. It sounds as
14 if we need, particularly in these times
15 when you have such a low growth rate and we
16 still have stagnant tax bases in many
17 communities, and even -- you listen to some
18 of these mayors, the tax bases they're
19 talking about, even if you put a $10 million
20 project in your downtown, it's not going to
21 bring a bountiful amount of revenue.
22 We need to really find at least
23 something for this period to cover the gap,
24 in some way to find revenue that we can at
551
1 least make sure our communities still
2 provide the basic elemental services.
3 We're not talking painting the streets with
4 gold, we're talking about making sure that
5 the streets, you know, get paved.
6 Thank you.
7 MR. ACQUARIO: Thank you very much.
8 CHAIRMAN FARRELL: Thank you.
9 MR. ACQUARIO: Thank you.
10 CHAIRWOMAN YOUNG: I'm sorry,
11 Senator Krueger has a question.
12 SENATOR KRUEGER: That's okay.
13 Hi. Thank you. So first I want to
14 thank you and the other two associations who
15 are still waiting for spending the whole day
16 hopefully listening to some of it.
17 MR. ACQUARIO: We were.
18 SENATOR KRUEGER: And I would just
19 make an argument, as much as I respect and
20 enjoyed all the mayors, we should let the
21 associations go first next year, because you
22 actually speak for a very broad universe of
23 localities.
24 MR. ACQUARIO: Thank you.
552
1 SENATOR KRUEGER: And I actually
2 think some of the back and forth between us
3 would go more smoothly, even for the
4 mayors, if we let all of your associations
5 go first. So lobby us for that for next
6 year, is my opinion.
7 MR. ACQUARIO: Thank you for that
8 observation. Thank you.
9 SENATOR KRUEGER: I also just want
10 to read one thing and let everyone else,
11 when they come up, respond.
12 I don't know why you're not madder
13 at us. When I try to add up the numbers,
14 it looks like over the last five, six
15 years, as we've attempted to deal with
16 budget gaps at the state level to the tune of
17 about $28 billion in gap closing, we've made
18 the localities pick up half of that. We've
19 cut Aid to Localities by I think -- and maybe
20 someone will challenge me -- by over $14
21 billion.
22 And so you come and you testify, and I
23 might agree or not agree with every proposal
24 you made. Thank you for calling out on organ
553
1 donation; you're absolutely right. We might
2 have disagreements about individual proposals
3 you're making, but the fact that the State of
4 New York each year continues to decide to
5 balance our budget problems by cutting your
6 local funds to counties, cities, and towns is
7 something frankly you all ought to be much
8 more upset about. And you need to be telling
9 us that. That's just my advocacy pitch to
10 you all.
11 So I want to thank you for your
12 testimony.
13 MR. ACQUARIO: Thank you, Senator.
14 Thank you very much.
15 CHAIRMAN FARRELL: Assemblyman Otis.
16 ASSEMBLYMAN OTIS: I'll pass.
17 CHAIRMAN FARRELL: You're okay?
18 SENATOR YOUNG: Okay. I think we're
19 okay, then. Thank you, Steve. Thank you.
20 MR. ACQUARIO: Thank you.
21 SENATOR MARCHIONE: Steve. Steve. I
22 just leaned over to the Senator and I said,
23 "I've known Steve for years. That was his
24 mad."
554
1 MR. ACQUARIO: Thanks, Senator.
2 CHAIRMAN FARRELL: Peter Baynes,
3 executive director, New York State
4 Conference of Mayors.
5 MR. BAYNES: Thank you, Chairwoman
6 Young, Chairman Farrell, and all the
7 members who are still here, the diehards.
8 We certainly appreciate it.
9 CHAIRMAN FARRELL: It's the chain on
10 our leg.
11 MR. BAYNES: I'm Peter Baynes. I'm
12 the executive director of the Conference of
13 Mayors. We represent the cities and
14 villages of the State of New York. I have
15 with me Barbara VanEpps. She's our deputy
16 director. She handles all of our
17 finance-related budget issues and coordinates
18 our legislative advocacy.
19 I can't speak as fast as Steve
20 Acquario, so I'm going to have to try to say
21 less, is the only way I'm going to get
22 through this. So I'm going focus on two main
23 issues in the budget. You know, I think the
24 Executive Budget does make some important
555
1 strides in partnering with rather than making
2 scapegoats of local governments, and I'm
3 going to address some of those positive
4 things and also some suggestions we have to
5 make the budget even better for communities
6 across the state, whether they're upstate or
7 downstate, large or small, urban or rural.
8 So I said two categories I'm going to
9 speak about. One is unrestricted state aid,
10 the other is infrastructure funding, both of
11 which you've heard about today. Hopefully we
12 can add a little bit to that discussion in
13 our allotted time here.
14 Every state in the union has a
15 program of unrestricted state aid for its
16 municipalities and schools. The idea is
17 fairly basic, that the schools and
18 municipalities help generate revenue for the
19 state and then the state reinvests that money
20 back into their local governments.
21 Unfortunately, New York's track record of
22 late is very weak in this regard. And I
23 actually should say it's inconsistent in that
24 regard. We oftentimes -- we just say "local
556
1 governments" a lot, rather than
2 differentiating between schools and
3 municipalities. And in New York, when it
4 comes to the state budget, there is quite a
5 distinction made between schools and
6 municipalities.
7 If you look at the school segment of
8 local governments and how they're treated
9 in the state budget, over the last 10 years
10 school aid has increased by $7.3 billion.
11 That's a 26 percent increase. And that
12 money is -- every penny of that, we -- we
13 do not question the value of it, it goes to
14 fund education for our children and it
15 helps limit the growth in real property
16 taxes. But it's gotten to the point now,
17 after years and years of no increase in aid
18 for municipalities, that school aid is
19 actually 30 times larger than unrestricted
20 state aid to municipalities.
21 So how do we treat the municipal
22 segment of our local governments? As I think
23 you've heard today from some of the mayors,
24 there has not been an increase in AIM funding
557
1 since 2008. It's actually down 15 percent in
2 real dollars over the past 10 years, and the
3 total amount of AIM funding is $715 million
4 in total. The school aid increase in each of
5 the last three state budgets, just the
6 increase in school aid in each of those
7 years, was larger than the total amount of
8 the AIM program.
9 So the question we have is why the
10 different treatment. We think there's a
11 clear nexus between schools and the
12 services they provide and municipalities
13 and the services they provide. As we say,
14 communities that aren't succeeding are
15 going to lead to schools that aren't
16 succeeding. We need to make sure not only
17 that we're investing in our schools but we're
18 investing in our municipalities.
19 You heard, I think from every mayor
20 today, about the AIM program, probably the
21 most we've heard about it in years. The AIM
22 program, which is what used to be called
23 revenue sharing, which is unrestricted state
24 aid, it's critically important to our
558
1 members, especially the larger cities who get
2 the vast majority of AIM funding. So we
3 firmly believe that AIM funding should be
4 revisited to see if it can be increased to
5 help the larger cities who in many cases have
6 the most needs.
7 We do think New York City needs to
8 be part of that program. They are one of
9 our constituent cities in this state and
10 should be included in that program.
11 But we also think the larger group
12 of local governments -- cities, towns and
13 villages, no matter what their size is,
14 there are things we can -- there is a way
15 to help them in a significant way without
16 really costing the state relatively that much
17 money, and at the same time address this
18 oppressive property tax cap we've talked
19 about, that is 0.12 percent for villages in
20 June, for school districts in July, for large
21 cities in July. For the towns, counties, and
22 cities that adopted their budgets for January
23 of this year, their limit was 0.73 percent.
24 Our cap, it's referred to as a
559
1 2 percent tax cap -- it's not a 2 percent
2 tax cap. The state has a state-imposed
3 spending cap of 2 percent. It's a flat
4 2 percent. Ours floats downward; it's
5 virtually zero now. Our cap does not
6 exclude capital expenditures. The state
7 spending cap does. If you looked at state
8 spending last year and you included the
9 capital in, like we have to include it in,
10 it would be over a 5 percent increase.
11 So we're told by some to do as the
12 state does, but it's not a fair comparison
13 when you really look at how the tax cap
14 operates. It's taking its toll on our
15 members. Fund balance is dwindling of our
16 cities and villages. There's a steady
17 reduction in the size of the workforce. And
18 the capital investment that we've all
19 acknowledged today is so important has been
20 basically halted in our municipalities
21 because of a lack of a steady revenue stream
22 from the state.
23 So our suggested solution to this
24 problem with the tax cap -- we know the tax
560
1 cap is here to stay. We know nobody wants
2 to revisit the tax cap and open up the
3 statute and maybe make it a hard 2 percent
4 cap. But what we're suggesting is a sort
5 of tax cap equalization aid, where every
6 local government in the state, every city,
7 town and village, if they stay under their
8 cap, whatever it be -- whether it's 0.73
9 percent, 0.12 percent -- if they continue
10 to make the efforts, like most of them have
11 been, to stay under that cap, that the
12 state would make a payment to them equal to
13 the difference between how much their levy
14 would be able to go up under a 2 percent cap
15 versus how much it's legally allowed to go up
16 under the real tax cap.
17 Statewide, if every city, town and
18 village complied with the tax cap so that
19 they could qualify for this aid, it would be
20 approximately $100 million in funding. But
21 we think the advantages of doing that are
22 worth the $100 million investment.
23 I think there are four main advantages
24 that would demonstrate the state's commitment
561
1 to partnering with municipal governments in
2 helping to achieve full tax cap compliance.
3 It would replace a portion of what we call
4 the killer property tax with the state's
5 progressive revenues. So there would be a
6 portion of the property tax being offset. It
7 would generate real property tax relief and
8 support essential local services, just as the
9 $23 billion that goes to schools helps
10 control school taxes and support school
11 services. And finally, it would create a
12 hard 2 percent tax cap, in essence, without
13 having to go into the tax cap statute.
14 We do think, though, there does need
15 to be, in addition to that, a look at those
16 municipalities that, under the State
17 Comptroller's fiscal stress monitoring
18 system, those municipalities that have a high
19 fiscal stress score, that they receive some
20 additional aid on top of that tax cap
21 equalization aid.
22 Secondly, infrastructure funding.
23 Mayor Madden from Troy really said it better
24 than I could ever say, what the challenges
562
1 are confronting cities and villages large and
2 small. We're very thankful for the
3 initiative the Legislature, Assembly and
4 Senate, and the Governor took last year in
5 creating the Water and Wastewater Grant
6 Program, and we're very excited that the
7 Governor has upped the ante by $100 million
8 in the Executive Budget. But as you may
9 know, the subscription -- it was
10 oversubscribed, I should say. The
11 application -- the funding round of Round 1
12 for that water/wastewater money, there were
13 approximately $800 million worth of grant
14 applications submitted. So as you can see,
15 there's still a tremendous need.
16 So we do encourage you to concur with
17 the Governor's request and hopefully find
18 within the bank settlement monies some more
19 significant funding to add to that program.
20 Transportation-wise, the Governor's
21 budget is very positive, we think. From what
22 we can tell so far, it approximates that
23 parity that we think is important between
24 upstate and downstate, between roads and
563
1 bridges and the MTA.
2 We do have some concern because we
3 don't really know how the $2.5 million in
4 PAVE-NY, BRIDGE-NY and extreme weather
5 money, how it's going to be allocated
6 between local governments. Are only a few
7 going to be eligible? We'd like to see
8 something more like what the counties said,
9 where all of that money goes through the
10 CHIPS formula, which is a proven formula,
11 and we get money to all local governments.
12 Lastly in the infrastructure realm, I
13 just want to mention the Downtown
14 Revitalization Program. We have said for
15 years that we think downtowns and Main
16 Streets have not been given the attention
17 from the state they deserve. We are happy to
18 see that the Governor has proposed
19 $100 million for downtown revitalization. We
20 are very concerned, though, that it would
21 only go to ten downtowns and each REDC would
22 be able to select just one downtown. I think
23 that's not even a fair task to put before the
24 REDCs, to have to pick between all the
564
1 downtowns that are on the cusp of succeeding
2 within their regions if only they could get
3 the state investment that they need.
4 So we would rather see the hundred
5 million for the downtown revitalization to
6 be spread out among a larger group of
7 downtowns rather than just the 10 that are
8 under the Governor's proposal.
9 So I apologize for going over by a
10 minute or two. Those are our key priorities
11 this year. Thank you for your patience and
12 your stamina. And we, as always, are ready
13 to come and talk to you and outline our
14 proposals in further detail if you'd like to
15 see that.
16 Thank you.
17 CHAIRMAN FARRELL: Thank you.
18 Assemblyman Otis.
19 ASSEMBLYMAN OTIS: Thank you,
20 Mr. Chairman.
21 Peter, Barbara, thank you for your
22 great work and advocacy.
23 One question about water
24 infrastructure projects, and you gave the
565
1 numbers there about how much interest there
2 is from municipalities in that. Do you
3 have some feedback or can you get some
4 feedback post this about how much of -- how
5 many of those requests are coming from
6 communities that are under consent decrees
7 or EPA/DEC enforcement actions which drive
8 some of the numbers for the fact that we
9 need more money? And great credit to the
10 Legislature and to the Governor for
11 supporting this program and the Governor
12 increasing it.
13 But if we could get some sense of the
14 magnitude of the need based upon enforcement,
15 that would give some valuable information to
16 the Legislature.
17 MR. BAYNES: That's a great point. We
18 do not have that data, but hopefully, working
19 with your offices, we can get that from DEC.
20 Because I would suspect just the
21 municipalities that are under consent orders
22 from the DEC or EPA could eat up that money
23 pretty quickly themselves. Which shows you
24 that, you know, even the most urgent need
566
1 would consume a large chunk of it.
2 But we would really like to work with
3 you to identify that overwhelming need.
4 ASSEMBLYMAN OTIS: Thank you, Peter.
5 Thank you, Mr. Chairman.
6 CHAIRMAN FARRELL: Any Senator?
7 SENATOR KRUEGER: We appreciate your
8 testimony. Thank you very much.
9 MR. BAYNES: Thank you.
10 CHAIRMAN FARRELL: Mr. McDonald.
11 ASSEMBLYMAN McDONALD: Thank you,
12 Mr. Chairman.
13 Peter, on the tax equalization aid,
14 which basically is dealing with this
15 abnormally low tax cap, the -- you know,
16 2 percent is 2 percent, but it's actually
17 0.12 percent right now.
18 MR. BAYNES: Point one-two percent.
19 ASSEMBLYMAN McDONALD: Point one-two,
20 right.
21 So I just want to make sure I
22 understand this. So you're basically
23 proposing that the state provide that revenue
24 for that delta, that -- whatever that
567
1 difference is, with the caveat, of course,
2 that the community doesn't vote to exceed the
3 tax cap. So they can actually budget that
4 money as firm revenue for their budget. And
5 you're not saying it's in permanency, you're
6 just saying, you know, as the tax cap --
7 maybe it will go up to 0.85 percent next
8 year -- that that would be a lesser amount of
9 money the state would have to contribute for
10 that year.
11 MR. BAYNES: Yes. It's really meant
12 as sort of an emergency effort to help local
13 governments deal with -- I don't think
14 anybody in the Legislature or even the
15 Governor's office saw inflation going down to
16 near zero when they enacted the tax cap and
17 said it was 2 percent or inflation, whichever
18 is lower.
19 So I think inflation as it drifts back
20 up toward 2 percent, the amount of that aid
21 on an annual basis would shrink. But, you
22 know, in the short term, you know, this year
23 I think without that kind of assistance,
24 notwithstanding the greatest efforts of local
568
1 governments and school districts, the
2 percentage of noncompliance with the tax cap
3 is going to go way, way up from where it has
4 been.
5 ASSEMBLYMAN McDONALD: I'm trying to
6 picture this, because essentially, you
7 know, one of the challenges of the tax cap
8 is because we have this tax rebate and the
9 freeze rebate -- these rebate checks that are
10 coming out, you know, if you'd asked the
11 average taxpayer when they look at their
12 taxes in 2014 and 2015, they look at their
13 bills, they went up. So they're not always
14 seeing the difference. Some people tend to
15 forget the check that shows up after the
16 fact.
17 In this situation, in a sense --
18 unless I'm reading this wrong -- I wouldn't
19 see a difference in the increase, provided we
20 met the tax cap, local government. And this
21 could apply to school districts as well,
22 which I've heard this more prominently lately
23 with school districts. But basically,
24 looking at my tax bill for Year 1 and Year 2,
569
1 provided they met all the requirements, I
2 wouldn't see an increase. Which is really
3 true taxpayer relief up-front. Would you
4 agree?
5 MR. BAYNES: Right. It would
6 short-circuit this circus of they pay
7 higher taxes, local residents, they pay
8 higher taxes, then they wait for a rebate
9 check to come back, hope it's the right
10 amount. Whereas this would say, local
11 government, you've made the effort to stay
12 under the cap, we acknowledge that the cap is
13 extremely low, and too low for you to provide
14 the services you need to provide, but if you
15 can make the effort to stay under it, we the
16 state will make this payment this year to
17 make you whole so that it is, in effect, a 2
18 percent tax cap.
19 ASSEMBLYMAN McDONALD: It's very
20 interesting. I'd be interested in following
21 up on that. Thank you.
22 MR. BAYNES: Okay. Thank you.
23 CHAIRWOMAN YOUNG: I did have one
24 question.
570
1 Welcome. And so happy to have you
2 here.
3 MR. BAYNES: Thank you.
4 SENATOR YOUNG: I had a question.
5 As you know, the Executive proposes a
6 $20 million fund for municipal
7 consolidation and restructuring under
8 infrastructure capital, and the funds would
9 be awarded to a county or other local
10 government that pursues shared services and
11 consolidation which results in the greatest
12 permanent reduction in the property tax
13 burden.
14 And I wanted to -- I know you may have
15 touched upon it a little bit, but I wanted to
16 get your thoughts on that. What do you think
17 about the Executive's $20 million
18 consolidation contest? And also, as a second
19 part to that question, do you believe that
20 this will incentivize local governments to
21 consolidate?
22 MR. BAYNES: Well, on the first part,
23 you know, we have consulted and worked with
24 our members on efforts to consolidate,
571
1 whether it's services or even their local
2 governments. But when you think about the
3 fact that AIM funding has not gone up in
4 eight years and yet we're willing to spend
5 $20 million of state resources on one local
6 government to consolidate in some way, with
7 the hope that maybe it will generate some
8 savings, that $20 million could go so much
9 farther toward property tax relief and
10 helping our communities by going into the AIM
11 program or going into this program we just
12 outlined.
13 We just don't think -- you know, I
14 know Assemblyman Magnarelli has asked the
15 question to some of the people who have
16 testified, what do you think of that program
17 and all the different incentive programs that
18 have been out there. It's no coincidence
19 that they've been underutilized, because they
20 either aren't working or they're too hard to
21 access.
22 I mean, if you compiled those all
23 together, you'd have your hundred million to
24 do the aid program we just talked about. We
572
1 just think it's a better way to recognize
2 what local governments do. It only rewards
3 them if they maximize their efficiencies and
4 stay under the cap. We just think that's a
5 more progressive, holistic statewide approach
6 to helping our local governments.
7 SENATOR YOUNG: Thank you for that.
8 ASSEMBLYMAN OAKS: Peter, just a quick
9 question.
10 I know that the concept of the cap
11 works well if resources keep coming in from
12 the different ways that municipalities have.
13 But if the state doesn't keep up with its
14 part of the bargain -- and you're talking
15 about AIM and other types of resources that
16 may not keep up with that -- then it makes it
17 very difficult, because that's one more place
18 that you can't keep up with it.
19 So, you know, from this perspective on
20 what you were just talking about, I know
21 there are some legislative proposals outside
22 the budget that are out there. Actually,
23 Leader Kolb has one that would do kind of the
24 formula that you put forth today which would,
573
1 if you kept within it, would provide those
2 resources in state aid to make up the
3 difference.
4 And so certainly we would be very
5 interested in talking more as we go forward
6 here in the budget discussions and
7 negotiations, to make something like what
8 you're talking about a reality. Because then
9 I think it could be something you can depend
10 on, you know you stay where you are, you're
11 going to get those monies back and it doesn't
12 have to be taxed and then rebated to people.
13 MR. BAYNES: Right. And it also helps
14 those municipalities that are under a 0.73
15 percent cap. They don't get as much help as
16 the ones that are under a 0.12 percent cap.
17 So it treats everybody fairly based on the
18 pressure that the cap is putting on them.
19 So we're certainly, you know, excited
20 to talk to any of you about the idea and try
21 to flesh out how it might ultimately work.
22 CHAIRMAN FARRELL: Thank you very
23 much.
24 MR. BAYNES: Thank you.
574
1 SENATOR YOUNG: Thank you.
2 CHAIRMAN FARRELL: Now, to close,
3 Association of Towns of the State of
4 New York, Gerry Geist, executive, Andrea
5 Nilon, president, and Bill Moehle, executive
6 committee.
7 MR. GEIST: Thank you, Chairman
8 Farrell. Thank you, Chairwoman Young. Thank
9 you for affording the Association of Towns
10 the opportunity to come here tonight on
11 behalf of our 932 towns regarding the budget.
12 My name is Gerry Geist. I'm the
13 executive director of the Association of
14 Towns. And with me, on my left, is our
15 president, Andrea Nilon, the assessor from
16 the Town of Hamptonburgh in Orange County.
17 And to my right is Supervisor Bill Moehle,
18 from the Town of Brighton in Monroe County.
19 Due to the late nature of the evening,
20 and so much of it you've heard today, I'm
21 going to short-circuit our written statement.
22 And I just want to talk about a few points,
23 and we're going to divide our time as best we
24 can.
575
1 With regard to the budget, we believe
2 it fails to utilize existing revenue-sharing
3 programs to lower property taxes. Revenue
4 sharing works for the National Football
5 League, and it can work for us. It's now
6 Super Bowl time, so permit me to use my
7 football analogy. There are 32 teams in the
8 NFL. Depending on the size of their fan base
9 and their media markets, each team has the
10 potential to earn more or less revenue. Each
11 team contributes to the common pot, which the
12 NFL distributes amongst its member teams.
13 Unlike other major sports, this model affords
14 small-market teams that earn less revenue an
15 equal opportunity to succeed and better serve
16 their fans and communities.
17 Revenue sharing is a successful
18 business model for the NFL and its members.
19 Through robust revenue sharing, the State of
20 New York, its local governments and
21 taxpayers, can enjoy the same success as the
22 NFL, its member teams and communities.
23 Towns and villages will again share
24 $67.6 million in AIM funding and cities will
576
1 share $647.1 million in AIM funding. While
2 this might sound like a lot of money in the
3 aggregate, individually most towns receive
4 very little. As a class of local government,
5 towns receive 6.8 percent of their total
6 revenues from state aid. If you factor in
7 inflation, unrestricted state aid to towns
8 has been reduced by nearly 10 percent.
9 Starting in 2010, the year of the
10 current flat funding paradigm came into
11 effect. Adjusting the amount of AIM given
12 to towns for inflation would have meant an
13 additional $30 million. Despite authority
14 for a 2 percent annual spending increase,
15 the state has kept AIM levels flat.
16 Although the state has evinced a clear
17 desire to reduce the burden on property
18 taxpayers through the tax cap and tax-free
19 programs, the budget again fails to utilize
20 an existing program that was originally
21 established by Governor Rockefeller to
22 reduce local reliance on property taxes to
23 fund local services and expenses.
24 We can do better. We should do
577
1 better. And we ask you to consider
2 increasing the general purpose revenue
3 sharing.
4 The Association of Towns stands
5 ready to work as a partner with you to help
6 address these urgent needs. I will also
7 say that we join with Steve Acquario of
8 Counties and Peter Baynes from NYCOM on
9 their opinions about how we should do the
10 infrastructure funding. We don't need to
11 recreate the wheel; we have a proper
12 formula program. Let's use it. It's fair.
13 Everybody should have an opportunity to
14 succeed here.
15 At this time I'd like to turn over
16 our time to Andrea Nilon, our president, an
17 assessor in the Town of Hamptonburgh,
18 Orange County, to address STAR and property
19 tax exemptions.
20 ASSESSOR NILON: Good evening, I do
21 believe. Thank you very much for your
22 dedication to our cause and for listening
23 to I guess the last but hopefully not the
24 least.
578
1 I just want you to know I've worked
2 for local governments, several towns over
3 40 years. Half of that time has been spent
4 administering STAR. So I don't know what
5 that says exactly, but there have been many
6 iterations.
7 And this year Part A of the revenue
8 Article 7 bill of the 2016-2017 Executive
9 Budget converts the STAR benefit from a
10 real property tax exemption to a personal
11 income tax credit program. It's applicable
12 to any property purchased or transferred
13 after the 2016 taxable status date.
14 The personal income tax credit
15 program would be administered by the
16 Department of Tax and Finance, and the
17 Association of Towns appreciates the
18 attempt to reduce the administrative burden
19 faced by local governments. However, the
20 consequence of this bill is higher real
21 property tax bills. And we've heard a lot
22 about that today. This would subject town
23 officials to additional administrative
24 hurdles and the increased ire of residents.
579
1 Additionally, while on paper this
2 program shifts the administrative
3 processing to the Department of Taxation
4 and Finance, the fact remains that it would
5 take decades before assessors see any sort
6 of administrative relief. Under this new
7 program, town officials are still required
8 to process STAR exemptions to all
9 qualifying properties, which is essentially
10 any property where ownership remains
11 constant prior to 2016. Until the
12 Department of Tax and Finance completely
13 takes over STAR administration, local
14 governments will continue to expend
15 significant time and resources
16 administering the state program.
17 Local governments are currently
18 serving in an economic climate that
19 presents a multitude of financial pressures
20 through unfunded mandates and taxation
21 limitations. It's virtually impossible for
22 towns to continue to bear the financial
23 burden of administering the state program
24 while also reducing taxes. Real property
580
1 taxes serve as the primary source of
2 revenue for towns throughout the state.
3 Such revenue is necessary to comply with
4 these unfunded mandates.
5 And in this era of tax freeze, we
6 are hopeful that the state recognizes that
7 the STAR program enhancements enacted over
8 the years have had a direct impact on the
9 towns responsible for its administration.
10 And, while the STAR personal income tax
11 credit is a step in the right direction
12 towards relieving towns of its
13 administrative burden, such burden will
14 remain for decades.
15 We therefore request that the state
16 reinstate funding to towns to offset the
17 costs of administering the STAR program.
18 And I might add that if you read it, our
19 seniors would be affected even greater
20 because a lot of the seniors that do not
21 file or aren't required to file New York
22 State income taxes, it would be very
23 difficult to locate those people and give
24 them the relief that they so desperately
581
1 need.
2 I'd also like to talk about a bill
3 for retroactive nonprofit exemptions. It's
4 Assembly Bill 6011 and Senate Bill 605.
5 And it would seek to amend the Real
6 Property Tax Law 420-a to allow, by local
7 option, eligible nonprofit organizations to
8 receive retroactive exemptions when they've
9 purchased real property after our taxable
10 status dates.
11 The taxable status date exists to
12 provide taxing jurisdictions with a uniform
13 date upon which to base the assessments.
14 The taxable status date currently functions
15 so that while the value of properties may
16 change due to events occurring after tax
17 status date, the assessed value of the
18 property is not impacted for that tax year.
19 A uniform taxable status date
20 provides stability and certainty in the
21 real property tax cycle, and it's necessary
22 so that local governments can develop their
23 budgets based upon the assessment roll. The
24 taxable status date cannot and should not be
582
1 construed to encompass a shifting period of
2 time. To do so would create instability,
3 uncertainty, and unfairness in the real
4 property tax structure.
5 Shifting the tax status date from a
6 date certain to any date in time will serve
7 to further erode the tax base from which
8 local governments can derive revenue to
9 provide essential services to the
10 residents. This erosion of the tax base
11 unfairly shifts the tax burden to
12 non-exempt owners and presents substantial
13 fiscal problems for local taxing units.
14 In addition to further extending the
15 disparity between exempt and non-exempt
16 owners, eliminating the taxable status date
17 for certain owners eliminates the guarantee
18 that all property owners within the taxing
19 jurisdiction would be treated equally, as
20 it grants certain owners preferential
21 treatment to the detriment of non-exempt
22 owners.
23 While this bill is available by local
24 option only, the fact remains it would become
583
1 a political necessity forced upon town
2 officials. Given the administrative and
3 financial difficulties presented by the
4 legislation, the Association of Towns opposes
5 this proposal.
6 Thank you very much.
7 MR. GEIST: Thank you, Andrea.
8 I'd now like to turn it over to
9 Supervisor Moehle from the town of
10 Brighton, Monroe County, to talk a few
11 minutes about local roads, bridges and
12 drinking water.
13 SUPERVISOR MOEHLE: Thank you,
14 Gerry.
15 Thank you, Chairman Farrell,
16 Chairman Young. We appreciate the
17 opportunity to be here. I will try to be
18 brief; I'm bringing up the caboose in this
19 long day for all of you.
20 Senator Krueger, I appreciate your
21 urging us to be all more perhaps strident
22 in our advocacy, particularly on some of
23 the issues that have been vexing and you've
24 heard from all of us on.
584
1 I have been the supervisor of the
2 Town of Brighton for four years, so this
3 tax cap world is the only world that I
4 know. But I must say that it is a
5 challenging one, and we do appreciate your
6 efforts to support local government. And
7 the fact that several of you have
8 yourselves been members of local
9 government, I know you have an
10 appreciation.
11 We do appreciate the proposed
12 five-year capital plan for 2016 through
13 2020. That does provide significant
14 support for local municipalities. I know
15 at the Transportation Committee testimony
16 you heard from the Associated General
17 Contractors that there is as much as a
18 $6 billion disparity between the DOT plan
19 and the MTA plan. I know we heard
20 something slightly different earlier.
21 But I think in this time,
22 particularly with the still tenuous
23 economic recovery upstate and the impact of
24 the tax cap and the increasing likelihood
585
1 that the tax cap will force local
2 municipalities to skimp on those
3 infrastructure items that are sometimes not
4 very visible, it is very important,
5 particularly given the history of parity,
6 that that parity between DOT and MTA be
7 maintained. That will help make sure that
8 all New Yorkers have safe transportation
9 options.
10 I would note that in this era where
11 "Complete Streets" are increasingly
12 becoming a philosophy that local
13 municipalities like my own Town of Brighton
14 are using in highway development, that DOT
15 money will ensure not only that traditional
16 highway transportation but also other forms
17 of active transportation -- pedestrian,
18 cycle transportation -- will be provided
19 for residents in all parts of the state.
20 Certainly the PAVE-NY proposal would
21 be a positive for local municipalities. I
22 would note that local governments own and
23 maintain nearly 100,000 center-line miles of
24 highways. Towns own and maintain over 60,000
586
1 of those center-line miles. Over the five
2 years of this $1 billion program, 1300 lane
3 miles would be addressed. So it's a good
4 thing, but appreciate that it is still a
5 relatively small number given the overall
6 need.
7 As has been noted, CHIPS funding,
8 Marchiselli funding remaining static again
9 in this Executive Budget poses challenges.
10 It just makes it very difficult for local
11 government to continue to maintain the
12 streets, the bridges, the highways.
13 The BRIDGE-NY program again will
14 help local governments. I believe
15 $500 million of that $1 billion would be
16 directed to local bridges over the
17 five-year period.
18 Again, if a hundred needs, a hundred
19 local bridges can be addressed, that's
20 good. But we towns maintain about
21 8600 bridges in the State of New York.
22 Local taxpayers pay 75 percent of
23 the costs of maintaining, repairing, and
24 upgrading local roads. So I do encourage
587
1 that we continue to use the CHIPS formula
2 for the increased bridge aid, for the
3 PAVE-NY aid. It's a tried and true, tested
4 formula. It has worked, and I think we
5 should continue to use it.
6 We've heard about Flint, we've heard
7 about Troy. I'm not going to spend a lot
8 of time talking about water infrastructure.
9 But again, Hoosick Falls as well, these are
10 all indicia of how important water and
11 wastewater infrastructure is.
12 I would note drainage as well. In a
13 town like Brighton, we are nestled between
14 the Erie Canal and the Genesee River. It's
15 a low-lying community. Stormwater can be a
16 real issue. Over 50 percent of our storm
17 drainage system is clay pipes from the
18 19th century. We are also living on
19 borrowed time. That is a situation that we
20 have to continue to maintain and upgrade.
21 I won't go into a lot of time about
22 some of the things we have faced in
23 Brighton, but I'll just give you one example.
24 We have a neighborhood right on the border of
588
1 the City of Rochester. The University of
2 Rochester's growth trajectory is coming right
3 into that neighborhood. We're a significant,
4 a fairly large -- but we're an inner-ring
5 suburb. You would think that a community
6 like ours would have sewer systems in place.
7 However, this particular neighborhood, about
8 a hundred households -- and there are others
9 in Brighton -- continues to operate on septic
10 systems.
11 They would like us to review
12 installing -- extending an existing sewer
13 line and installing a sewer system in their
14 neighborhood, creating a sewer district for
15 that neighborhood. Even with EFC funding,
16 which has been used by the Town of
17 Brighton, has been very positive and we
18 support continued efforts in that area,
19 just that one project with the tax cap
20 numbers that we see now, whether it's 0.12
21 or slightly higher or slightly lower for
22 towns, just that one project would eat up the
23 entire tax cap for the Town of Brighton -- to
24 support a need that residents, 100
589
1 households, are asking us: "We want this.
2 We want to pay you for it."
3 So those are the challenges of the
4 tax cap. And I don't dispute for a minute
5 the philosophy, the discipline that it
6 places on us in local government. But it
7 prevents us from using the kind of
8 return-on-investment analysis that we would
9 also like to use, for example, to look at
10 buying our street lighting system from
11 RG&E.
12 RG&E is not tariffed to use LED
13 lighting systems. We would like to buy
14 that system, used LED lighting, save our
15 taxpayers significant operating costs. But
16 because of the up-front capital cost, we
17 can't, like a business would, look at, do
18 that return-on-investment kind of analysis.
19 We see that a project like that would force
20 us to override the tax cap and therefore
21 prevent us from taking advantage of not
22 only the cost savings but the environmental
23 savings.
24 Again, thank you for taking the day.
590
1 It's been valuable to listen, frankly, to
2 the testimony of the mayors and the other
3 groups, and we appreciate the opportunity
4 to be here.
5 CHAIRMAN FARRELL: Thank you.
6 Any questions?
7 SENATOR KRUEGER: Thank you very
8 much for your testimony.
9 CHAIRWOMAN YOUNG: Right. I just
10 want to say thank you so much for your
11 testimony. Thank you for coming from
12 Rochester on the Thruway. We appreciate
13 you being here today. Sorry it was such a
14 long day. Obviously a lot of interest this
15 year in local government issues, which I
16 think is a very healthy thing.
17 So we appreciate your input, and
18 we'll take it to heart as we move forward
19 through the budget process.
20 SUPERVISOR MOEHLE: Thank you very
21 much.
22 ASSESSOR NILON: Thank you.
23 CHAIRMAN FARRELL: Thank you very
24 much.
591
1 MR. GEIST: Thank you very much.
2 CHAIRMAN FARRELL: We're adjourned
3 until tomorrow at 9:30, Elementary
4 Education.
5 - - -
6 (Whereupon, the budget hearing
7 concluded at 7:59 p.m.)
8 - - -
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
Newsroom
Go to Newsroom
Chautauqua County Soldier Posthumously Honored
October 1, 2018
Senator Young Honors Chautauqua County Hero
September 28, 2018