TESTIMONY BY NEW YORK CITY COMPTROLLER JOHN C. LIU ON THE MAYOR’S FISCAL YEAR 2012 EXECUTIVE BUDGET

   New York City Comptroller John C. Liu today presented testimony before the New York City Council Finance Committee regarding Mayor Bloomberg’s Fiscal Year 2012 Executive Budget.
   Comptroller Liu’s testimony as prepared for delivery is below:

   Good afternoon Chairman Recchia and members of the Finance Committee, and thank you for allowing me the opportunity to present testimony on the Mayor’s Fiscal Year 2012 Executive Budget.
The Mayor’s FY 2012 Executive Budget totals $65.7 billion after various prepayments.  The FY 2012 budget is the product of a series of actions which closed a $3.26 billion gap in the July 2010 Financial Plan stemming from a structural imbalance where expenditures exceeded revenues.  The gap was further exacerbated by State actions that took place during the year.
   While it is estimated that FY 2011 will end with a $3.217 billion surplus, when compared with the $3.646 billion surplus similarly transferred from FY 2010 to FY 2011, it becomes clear that in the current year, the City is drawing on more resources than it is generating. However, if past history is any indication we can anticipate that the year may end with a budgetary surplus.

   Overall spending in the FY 2012 budget has decreased by 0.4 percent when compared to the FY 2011 budget.  But these numbers mask the fact that while overall expenditures have been held flat,  the City-funded portion of the budget has increased from 67.1 percent of the FY 2011 budget to 70.7 percent of the FY 2012 budget.  The City-funded portion of the budget is $2.2 billion greater than the FY 2011 budget and $2.1 billion more than was planned a year ago.  The Financial Plan assumes that by FY 2015 the City-funded portion of the budget will exceed 74.5 percent.  This trend is a direct result of a reduction in State and Federal aid to New York City.

   As we hear talk of layoffs and cutbacks it is critically important for the City to identify as many areas of  savings as possible.

   You are well aware of the outcome of my office’s work on the CityTime issue.  As a result of our steadfast oversight, the project is now nearing completion without any additional cost to the taxpayers. While that may be good news, it does not make up for the fact that the costs ballooned from $68 million to more than $700 million.  My office will continue to work closely with the investigative authorities on this issue in hopes of possibly recouping some of the money that has been allegedly funneled to subcontractors on the project.
   In addition, it was a welcome sign that the Department of Education has decided to cancel a $43 million contract with another high priced consultant, Future Technology Associates, who have been suspected of utilizing subcontractors to overbill the City.  My office has been conducting an audit into the vendor for quite some time and will continue to do so in order fully disclose what really went on.

   While we are discussing the DOE, I would like to point out that a review of OMB documents within the past week has found that after years of looking the other direction, the Department of Education has decided to finally seek additional Medicaid reimbursement funding from the State for occupational and physical therapy and speech and language services.  The Executive Budget assumes an additional $100 million in revenue as a result of increased Medicaid reimbursements on top of the previous estimate of $17 million presented in the Preliminary Budget.

   My office has been working with the City’s Office of Management and Budget and the UFT to identify the actual value of funds eligible for the City. While the current estimate of $117 million is enough to significantly impact the cuts proposed to the classroom, we believe this to be a cautious estimate.  The City may be eligible for greater reimbursements, which would free up funds for use elsewhere.

   The $100 million in additional reserves have been allocated to cover various other expenses in the DOE budget, such as $48 million for general education non-personal service and $26 million for charter schools. These dollars and any additional Medicaid funds realized during Fiscal Year 2012 should be used to help offset the proposed teacher layoffs, which have a more direct negative effect on classroom services.

   In the Executive Budget, the Mayor has allocated nearly $1 billion towards funding anticipated changes in the actuarial assumptions and methods used in computing pension contributions.  The City actuary is currently reviewing an independent audit of the rate change and will offer his recommendations to the pension boards. While it is expected that the actuary will recommend a change in the assumed rate of return of the City’s pension funds, there is more uncertainty about what other modifications would be proposed.  As such, the eventual cost of the any recommendations is unknown at this point.  It is also uncertain as to when the recommendations and the eventual changes would take effect.

   Another potential area of savings is through the City’s settlement of claims.  My office is responsible for authorizing monetary amounts of settlement where we feel the City may have been at fault for personal injury or property damage. The City has indicated that they expect a rise in the cost of settlements to occur.  However, my office anticipates that based upon historical data, the City is overestimating this total by at least $50 million.

   As always, my office will seek the most fair and equitable results in our claims settlement process and continue to act in the best interest of the taxpayer when doing so.
   We have also identified some risks to the Mayor’s plan.  Most significant is the assumption that contract discussions with the UFT and CSA will not result in any additional cost to the City.  These are placed as risk because the Mayor has not budgeted for raises consistent with those of other municipal unions, and has instead relied on a labor strategy that uses productivity initiatives to offset cost.

   Another risk to the Mayor’s plan is his underestimation of overtime. In fact, my office has estimated that the overtime costs will be upwards of $195 million more than the Mayor anticipates.
   As we gradually move out of this recession, it is important to note that the City is continuing on a steady but slow path to recovery. Despite mostly positive indicators for the City’s short-term economic condition there exist the possibility of negative externalities that could hinder the current expansion.  Factors outside of the City’s control such as rising energy prices, the continued depression of the construction industry specifically  produce additional drag on the US and local economies.

   One area that has shown strength is our City’s pension systems.  After posting returns of 14 percent last Fiscal Year, the most recent data show that the funds are up more than 20 percent in the current year. These gains will help offset future payment towards the pension systems.

   My office released a study last week, the first of its kind, which revealed the past decade of fluctuation in the markets will cause pension costs to rise in the short term.  However, due largely to already enacted benefit reforms that took place between 1995 and 2009 the long term costs to the City will steadily decline.  These
projections are sound and have been verified by independent professional actuaries.

   The study shows that over the next 30 years City pension costs as a percentage of the City's budget will decline from 11.4 percent in FY 2016 to 5.1 percent FY 2040.

   I hope I was able to be helpful today in presenting an accurate look at the City budget, as well as provide some areas worth exploring during phase of the budget process.  As always my office is available to assist you in any way necessary.

Senator Reverend Diaz Prays for Congressman Anthony Weiner

New York State Senator Reverend Ruben Diaz (D-Bronx) has released the following statement today about United States Representative. Anthony Weiner (D-NY):

“The Bible teaches us to take care of others and to help others when they are down.

It is appalling to witness the way that Congressman Anthony Weiner’s colleagues have been running away from him during these past few days.  It is just shameful to see how many of Congressman Weiner’s supposed friends – especially those who are elected officials – have abandoned him as the media makes a total mockery of him.

Although Congressman Weiner has never defended my positions on some of the issues that matter most to me, I know that he has fought hard for New York State.  He has fought hard for the Democratic Party, for his colleagues in the Democratic Party, and for the President of the United States.

I am not defending any mistakes he may have made – who knows – but it is shameful to watch this ongoing ridicule of Congressman Weiner.

I am praying for Congressman Weiner and I ask everyone to join me and pray for him during these difficult times.”

Jeter Meter

Public Hearing on Access to the Jerome Park Reservoir

      On June 2^nd a public hearing was held by Bronx Borough President Ruben Diaz Jr. on the subject of access (or lack of) to the surrounding area of the Jerome Park Reservoir. On hand were local elected officials, members of the Croton Monitoring Committee, as well as representatives of the Department of Environmental Protection including Deputy DEP Commissioner Tim Walters.

     BP Diaz said first that DEP needs to live up to their promise of pedestrian access to the perimeter of the Jerome Park Reservoir. He added that the report done by the DEP for only three days of access to the reservoir was not enough, and that the reservoir was a major civic amenity for the surrounding community that should be enjoyed.

     Councilman G. Oliver Koppell said that upstate people fish and swim in the Croton Reservoir area, and the fences around the Jerome Park Reservoir were not protecting the water here. Ha asked for a reasonable plan of more than just three days of public access.

   Assemblyman Jeffrey Dinowitz spoke of growing up by the reservoir, and the wonderful view that his family had from their windows. He added “this is our lake, and that we the people of the Bronx want access to our lake”.

    Father Richard Gorman (Chairman of Community Board 12) said that he never thought that the water filtration plant for the Croton water supply should have been built in Van Cortlandt Park. He added that CMC members (like himself) are not getting information in a timely fashion, and wanted to know why the DEP spent thousands of dollars on a thirteen page report filled with pictures.

     Mark Lanagan of the DEP said that the DEP feels that public access to the reservoir is not feasible, and that the DEP can explore what it is that the public want, to modify the pilot access program of three days after the construction is done in 2013. Another DEP engineer spoke about why the Croton water system had to be filtered, and that for the past 30 years there was no public access to the JPR. He added that the roadway around the JPR is very narrow and filled with potholes.

     Kevin Mcbribe of the DEP Police spoke of the danger of terrorist attacking the infrastructure of the city water system, and that the Homeland Security bases JPR as a national defense thus not allowing public access.

     Then it was the communities turn to speak, and one after another residents mentioned how wonderful it would be to enjoy the JPR as people in Manhattan enjoy the Central Park Reservoir, and its jogging track around that reservoir. There was mention of the JPR being empty for years now, and how lax security was by reports of a cut security camera cable (for an undetermined time) by local elected officials. Representatives of Bronx High School of Science mentioned the great potential of an ecology lab at JPR. Speaker after speaker mentioned how important access to JPR is, that the DEP had lied to the community, no filtered water would be at JPR, and that the outer fence should be replaced with concrete barriers that would allow people more access while really stopping any vehicle that could break through the current outer fence.

     The best line of the night however had to come from Gary Axelbank when in comparing JPR to former President Regan's speech about the Berlin Wall by saying “MAYOR BLOOMBERG TEAR DOWN THIS FENCE”. BP Diaz closed the meeting by thanking all who came out, and said “THIS IS TO BE CONTINUED”. 

 

Senator Klein Kicks Off Summer Safety Program

Senator Jeffrey D. Klein, announced the kickoff of the “Stay Safe with Senator Klein” program, a joint initiative with NY Life aimed at helping children stay safe, and alerting residents to potentially dangerous sex offenders in their neighborhood

During the program, Senator Klein and staff members, using Internet-equipped laptops, will be visiting summer festivals and street fairs throughout the 34^th Senate District in order to sign people up for New York's Sex Offender Alert System. NY Life will also be on hand to issue child identification cards.

Those who sign up for the alert system, which was created last year via legislation that Senator Klein sponsored, will be able to have information about Level 2 and 3 sex offenders who move into your community delivered via text message, email, or fax.

“I don't think there is a single person who doesn't want to know the moment a potentially dangerous sexual predator moves into their neighborhoods,” Senator Klein said. “I'm proud of my law that brought New York's Megan's Law into the 21^st Century, and I'm working hard to make sure that everyone is able to take advantage of this very important tool.”

Members of the public can access this information at local police stations or via a toll-free telephone number. Level 2 and Level 3 offenders are also listed on an internet sub-directory at the state Department of Criminal Justice Services Web site.  However, the information changes constantly as new offenders are added and existing registrants update their information. NY-alert updates would proactively allow New Yorkers to keep tabs on a specific geographic area, such as where they live or where their children attend school, without having to constantly visit the subdirectory website.

The “Stay Safe with Senator Klein” program had a successful kick off at the recent Westchester Square street fair. There, NY Life issued 120 identification cards, and 60 people signed up for sex offender alerts.

"Our company has been doing this nationwide for quite some time to help customers protect their children free of charge." said Darin Fass, New York Life Managing Partner for Westchester County.  "New York Life's Core Values are around safety and security and it ties in perfectly with the Senator's legislation."

The program will also have a table at the Woodlawn Heights Fun Fair on June 11^th, the Throggs Neck Sidewalk Sale on June 18^th and the Allerton Avenue Homeowners and Tenants Association Picnic on June 26^th.

Future dates will be announced on Senator Klein's website: www.klein.nysenate.gov., and his Facebook account: www.facebook.com/jeffrey.d.klein.

To sign up for the NY-Alert system for sex offenders, log onto: http://criminaljustice.state.ny.us/nsor/nyalert.htm.

To view the Sex Offender Registry, log onto http://criminaljustice.state.ny

      

Assemblyman Dinowitz & State Senator Klein introduce bill to help stop theft of car wheels

Vehicle Identification Numbers would aid law enforcement in tracking stolen wheels

Assemblyman Jeffrey Dinowitz (D-Bronx) and State Senator Jeff Klein (D-Bronx/ Westchester) have introduced new legislation that would finally give law enforcement a tool to track down vehicle wheel thieves. The measure would require that vehicle identification numbers be engraved on the wheels of all motor vehicles sold in New York.

This measure would help deter the theft of alloy wheels, which account for more than 20 percent of all felony thefts in some police precincts in New York City. Current law offers law enforcement no tools to track this type of crime, as vehicle wheels have no identification. Valued anywhere from $1,000 to $3,000 for a set of wheels from even a modestly priced vehicle, wheels are the most valuable item that can be removed from a vehicle with relatively little effort. By design, these wheels are easy to quickly remove with standard tools.

Similar measures have been implemented to prevent airbag and stereo theft and have proven widely successful, leaving wheels as the last frontier of accessory theft. This measure would allow citizens to report their wheels stolen and subsequently enable law enforcement to return the stolen goods to their owners. Currently, this is nearly impossible, due to the lack of identification on vehicle wheels. This bill will correct this problem and was crafted in direct consultation with the New York City Police Department to ensure it will accomplish its goals.

“This legislation will give law enforcement another weapon in its arsenal of crime fighting laws and will help make a major dent in one of the most common crimes in New York. It will save money and grief for thousands of people, and the only ones who will pay are the thieves,” said Assemblyman Dinowitz. “This legislation lets the people of the Bronx, New York City, and New York State as a whole know they can rest assured law enforcement has the tools they need to protect our citizens from would-be criminals.”

“This wave of criminal activity cannot be dismissed as petty thefts,” said State Senator Klein. “This legislation will make it tougher for thieves to profit from their crimes, as well as protect residents from having their property taken from them.”

The bills, A.7646 and S.5414, have been referred to the Transportation Committee in both houses. “We hope to see action before the end of this legislative session,” Assemblyman Dinowitz added.

STATEMENT ON WAL-MART

New York City Comptroller John C. Liu issued the following statement in response to questions concerning the NYC Pension Funds’ presentation at Wal-Mart’s annual meeting in Fayetteville, Arkansas today.

“Low prices are good, but it is Wal-Mart’s responsibility to ensure that it is not passing to its customers savings bought with abusive labor practices,” Comptroller Liu said.  “Wal-Mart can and should do much more to hold its suppliers accountable for protecting human and workers’ rights.  Wal-Mart can’t claim to be that bright yellow smiley face that we see around the world if its global suppliers don’t protect their workers from abuse or intimidation.”

The NYC Pension Funds’ shareholder proposal calls on Wal-Mart’s board to require that the company’s suppliers publish reports on their compliance with internationally recognized standards of human and workers’ rights.  Kalpona Akter, a labor rights leader in Bangladesh and former garment worker, presented the proposal to Wal-Mart’s board of directors at the invitation of Comptroller Liu and the Funds.

The NYC Pension Funds hold 5,696,055 shares of Wal-Mart, Inc. valued at $305,023,745.25 million as of 6/2/2011.

TAX LIEN ASSISTANCE OUTREACH SESSION SCHEDULED AT COUNCILMAN KOPPELL’S OFFICE ON JUNE 13, 2011

Council Member Oliver Koppell has scheduled a tax lien assistance outreach session at his district office, 3636 Waldo Avenue, Riverdale on Monday, June 13, 2011 from 10:30 a.m. to 2:00 p.m. for constituents whose tax liens are on the list to be sold. 

This sale is the transfer of the lien to a single authorized buyer who hires a collection agency.  It is not a sale of the property, but if the taxes and/or charges are not paid or resolved, the lien holder can begin a foreclosure proceeding in court.

A representative from the NYC Department of Finance will be available at the June 13^th session in Koppell’s office to meet one-on-one with homeowners with tax liens to help them avoid the Lien Sale by discussing eligibility for exemptions from the sale or ways of resolving the lien.

 In order to prevent the sale of a lien on property, the debt must be resolved by August 1, 2011 through one of the following methods:

•   Pay your outstanding debt in full; 

•  Enter into a payment agreement;

•  Apply to receive an exemption that will exclude the property 

 from the Lien Sale; 

• Dispute the charges by filing a formal dispute with DEP or Finance.

Individuals in Koppell’s district who have been sent a legal claim against their property for unpaid taxes, or whose property was on a published lien sale list, are encouraged to attend this outreach session to obtain advice and to take the necessary steps to  prevent the sale of their lien  The Finance representative will provide assistance in  developing  payment agreements, resolving billing disputes and helping complete Exemptions applications for those who qualify.

Koppell said, “My office has sent out invitations to this session to those of my constituents whose tax liens are in danger of being sold. I strongly urge these individuals to come to the session in order to obtain the help they need to avoid the sale, which can have serious consequences in the future.”

 If you plan to attend, it is necessary to RSVP to Drew Gabriel in Koppell’s district office, (718) 549-7300 or dgabriel@council.nyc.gov  to schedule an appointment.