New York City Tourism Industry Hit Hard by Pandemic, Visitor Spending Drops by 73%

 

Office of the NEW YORK

STATE COMPTROLLER

NYS Comptroller Thomas P. DiNapoli

Tourism-Related Tax Revenues for NYC Plunge by $1.2 Billion; 

April 28, 2021

The COVID-19 pandemic abruptly halted tourism in New York City, one of the world’s top tourist and business traveler destinations, during parts of 2020, resulting in a dramatic falloff in the number of visitors and creating a steep drop in economic activity, according to a report released today by New York State Comptroller Thomas P. DiNapoli.

DiNapoli said a ten-year period of record growth in tourism came to an end in 2020 as 43.7 million fewer visitors came to the city, a drop of more than two-thirds (66.6 million in 2019 to 22.3 million in 2020), and the industry’s overall economic impact fell sharply from $80.3 billion in 2019 to $20.2 billion in 2020. Employment in the industry also saw a significant decline in 2020 as 89,000 (31.4 percent) jobs were lost from 2019, when employment reached a record 283,200 jobs. DiNapoli said tourists spent only $13 billion in 2020, a 73 percent decline from the prior year, which will cost the city $1.2 billion in lost tax revenues in City Fiscal Year (CFY) 2021.

“The tourism industry is a vital component of New York City’s economy,” DiNapoli said. “Visitors and their spending are essential factors in measuring the health of the economy. The pandemic’s damage to this industry has been staggering and it may take years before tourism returns to pre-pandemic levels. The city and state must help with safe reopening, while targeting relief funds to workers and to hotels, venues, restaurants and other businesses that are unlikely to recover until visitors return.”

DiNapoli said the state and city’s near-term focus remains getting more people vaccinated and reopening attractions and expanding capacity safely. He urged city and state leaders to work with stakeholders to reignite the new normal for New York City’s tourism industry.

DiNapoli’s recommendations include:

• Build the infrastructure and systems that aid flexible adherence to health and safety guidelines, including the expansion of public space for tourism activities.
• Analyze and target relief programs, particularly for the accommodation and transportation industries, ensuring existing and new programs reach workers and alleviate short-term pressure for operators from taxes, loan payments or related fees, so that operations may return.
• Promote tourist activities, including boosting resources for agencies designed to coordinate such activities (i.e., NYC & Company).
• Target domestic leisure travelers in the short-term, as they are most likely to return first, while developing campaigns to lure international and business travelers in the long-term, as they spend more on average than their counterparts.
• Accelerate airport enhancements and improve local transportation options.
• Integrate new and existing technology to make it easier for visitors to arrange and change their itineraries, to make reservations and to avoid lines and help streamline compliance with public health protocols.

"We are seeing clear signs of recovery for New York City's tourism industry, a pillar of the city's economy,” said Donna Keren of NYC & Company. “Prior to the pandemic, the industry saw steady growth. Comptroller DiNapoli's report highlights just how vital tourism is to all five boroughs of New York City, and is also a sobering reminder of how difficult this pandemic has been for our city's tourism industry. It's also a reminder of the opportunity we have to remind people of the incredible experiences that are waiting for them here. We look forward to working with the city and state to bring people back and make New York City the premier tourism destination we know it to be."

“Tourism is the fourth largest employer in New York City and here in Times Square, it is our lifeblood,” said Tom Harris, Acting President of the Times Square Alliance. “With over 60% of Times Square employees living in the outer boroughs, a Times Square recovery is vital for a New York City recovery. We applaud Comptroller DiNapoli's efforts to focus on this vital sector of our economy and support the recommendations made to accelerate a safe return for the industry while also targeting marketing efforts to ensure visitors return to New York City soon and enjoy Times Square again.”

“Comptroller DiNapoli’s report provides an insightful view of the current economic reality of New York City’s tourism sector,” said Rich Maroko, President of the Hotel Trades Council. "Tourism is a critical driver of the city's economy and an essential source of countless middle-class jobs for New Yorkers, including tens of thousands of HTC members. Our union is grateful for Comptroller DiNapoli’s thoughtful analysis of the tourism sector as well as his recommendations for prioritizing its recovery and putting New Yorkers back to work.”

Massive Drop in Tourism Spending

Spending by tourists is a critical driver for tourism industry employment, wages and city tax revenues. DiNapoli estimates after reaching a record high of 66.6 million visitors in 2019 and generating $47.4 billion in spending, the number of visitors to the city dropped by 67 percent and their spending declined by 73 percent in 2020. Tourism-related tax revenue accounted for 59 percent of the city’s $2 billion decline in tax collections, or about $1.2 billion, for CFY 2021. Tourism Economics, an economic forecasting firm, is projecting that visitor spending will return to pre-pandemic levels in five years (2025), while it took three years to rebound after the financial crisis in 2008.

From 1991 to 2019 the number of visitors to the city nearly tripled, with nearly half the growth occurring in the last decade. Domestic tourists have more than tripled in this timeframe, making up just over half of total visitor spending. International tourism has risen steadily over the decades, becoming a more dominant driver in visitor growth since 2009. While the majority of visitors are domestic, international visitors spend four times that of a domestic visitor. International visitors to the city generally spend about twice the amount per visit compared to the average traveler to the U.S., with each Chinese tourist spending an average of $3,000, almost twice the average of any other international visitors.

Leisure travelers account for 79 percent of visitors to the city and 71 percent of the spending. International travelers are more likely to stay in a hotel (76 percent) and primarily visit the city as a destination. Business travelers make up 21 percent of all visitors.

Tourism Employment Dropped Over 30 Percent

By the end of 2019, the industry in New York City had a record 283,200 private sector jobs, accounting for 53.5 percent of the state’s total tourism employment. This was a 35 percent increase from 2009 levels and faster than growth in total private sector jobs (30 percent). DiNapoli estimates employment fell to 194,200 in 2020, a 31.4 percent drop and the lowest level in the city since 2004. Jobs are primarily concentrated in three large sectors: leisure and hospitality (59 percent of tourism jobs), retail (19.3 percent) and transportation (16.1 percent). The top three subsectors (hotels, restaurants and air transportation) account for almost 41 percent of all industry employment.

The majority of the jobs (57.6 percent) are located in Manhattan, with Queens having the second highest concentration with 24 percent. In the last decade, total wages in tourism increased by 81.7 percent, while citywide private wages increased by 64.3 percent. The average annual salary in the industry was $60,400, lower than the city’s private average salary of $97,700. Workers are also more likely to be minorities (66 percent), self-employed (14.4 percent), younger, at an average age of 40, and are more likely to be immigrants, who make up 44.7 percent of the total workforce.

Hotels & Accommodations Hit Especially Hard

DiNapoli has published a series of reports highlighting the impact of COVID-19 on different sectors of the city’s economy. Prior reports have focused on the retail, restaurants and the arts, entertainment and recreation sectors, which are a part of the tourism ecosystem. The two large remaining sectors, hotels and accommodations and transportation, provided 97,800 jobs and $4.5 billion in wages in 2019.

As a share of the tourism industry in New York City, accommodations is the largest component by employment and wages, representing 18.4 percent of employment, 21.1 percent of wages and 4.8 percent of firms. Because of the pandemic in 2020, this sector lost nearly half of its employment base (23,813 jobs or 46 percent).

According to the Department of City Planning, in January 2020, there were 705 hotels with a total of 127,810 rooms. As of October 2020, more than 37,000 hotel rooms in the city remained closed, with 10 percent permanently shut down. Prior to the pandemic, hotel occupancy was 89.6 percent, the highest in the nation. By September 2020, occupancy had dropped to 38.9 percent, lowering daily room rates. Through the third week of March 2021, occupancy in hotels had climbed to slightly over 50 percent.

Transportation Was at Near Standstill

Private tourism-related transportation employment in the city totaled 45,700 jobs in 2019 and declined by 20.9 percent in 2020. Transportation employment represents 16.1 percent of total tourism jobs and nearly 5 percent of wages. Air transportation and related services, including airport operations, account for more than 84 percent of total tourism-related transportation jobs, and have a comparatively higher average salary of $80,200. Air transportation has been impacted by the sharp drop in passenger numbers and in the number of flights arriving and departing, which were down 69.1 percent in city-area airports in January 2021.

Yellow taxis saw their average trips per day decline by 96 percent from January 2020 to its trough in April 2020, according to the city’s Taxi and Limousine Commission. The daily farebox totals for yellow and green cabs was down 79.5 percent in January 2021 compared to the prior year. New York City airports also came to a near standstill, with only gradual improvements. In August 2020, air passenger screenings were down 71 percent in the nation and 80.6 percent in New York City. Despite some improvement over the fall and winter, the city still lags the nation. The number of passengers screened in February 2021 remained well below prior-year levels, down 59.5 percent and 70.1 percent, respectively, in the nation and the city.

Industry Relief and Outlook

The most substantial federal relief program to aid businesses was the Paycheck Protection Program (PPP). In 2020, PPP granted forgivable loans to 42,800 city businesses in tourism-related industries, for a total value of $3.4 billion. These businesses accounted for 27 percent of PPP loans in the city and 18.3 percent of loan dollars disbursed. Loans were concentrated in restaurants (27.7 percent granted to tourism-related industries) and hotels (11.7 percent). Significant standalone federal grants programs have also been created for restaurants and entertainment venues, which should encourage reopening and expansion of operations, providing attractions for visitors returning to the city.

NYC & Company forecasts that domestic leisure travelers (primarily those making day trips) will be the first to rebound to 2019 levels. International travelers, who have a higher economic impact, are not expected to return to pre-pandemic levels before 2025. Business travelers to the city are not projected to surpass 2019 levels for the foreseeable future. They are expected to reach a maximum of 92 percent of pre-pandemic levels by 2024. The Global Business Travel Association forecasts that global business spending will return to 2019 levels ($1.43 trillion) by 2025.

Report

The Tourism Industry in New York City: Reigniting the Return

Prior Industry Sector Reports

The Restaurant Industry in New York City: Tracking the Recovery

The Retail Sector in New York City: Recent Trends and the Impact of COVID-19

Arts, Entertainment and Recreation in New York City: Recent Trends and Impact of COVID-19

Governor Cuomo Announces 45% Of New Yorkers Have Received At Least One COVID-19 Vaccine Dose

152,118 Doses Administered in the Last 24 Hours      

More than 1.1 Million Doses Administered Over Past Seven Days

Previous Restrictions on Vaccinating Individuals Outside of Specific Prioritization Groups Are Repealed to Reflect Open Access for All New Yorkers Ages 16 and Older       

Vaccine Dashboard Updated Daily on the State's Vaccine Program; Go to ny.gov/vaccinetracker 

 Governor Andrew M. Cuomo today announced 45 percent of New Yorkers have received at least one dose of the COVID-19 vaccine. 152,118 doses have been administered across the state's vast distribution network in the last 24 hours, and more than 1.1 million doses have been administered over the past seven days.      

"We're getting closer and closer to reaching herd immunity and defeating COVID every single day, but we must continue to focus on fair and equitable vaccine distribution so that no New Yorker is left behind," Governor Cuomo said. "So far, 45 percent of New Yorkers have already received at least one dose of the COVID vaccine, and beginning April 29 every adult in New York State will be able to walk into a mass vaccination site without an appointment and get vaccinated. We are doing everything we can to make getting a vaccine as easy as possible, and I urge everyone to do their part and get vaccinated so we can protect all the progress we have made so far and begin our return to a new normal."     

Beginning April 29, all New York State mass vaccination sites will be open to eligible New Yorkers for walk-in vaccination on a first come first serve basis. The walk-in appointments are reserved for first doses only with second doses to be scheduled automatically after administration of the initial shot. In addition, all vaccine providers are encouraged to allow walk-in appointments for eligible New Yorkers. People who would prefer to schedule an appointment at a state-run mass vaccination site can do so on the Am I Eligible App or by calling 1-833-NYS-4-VAX. People may also contact their local health department, pharmacy, doctor or hospital to schedule appointments where vaccines are available, or visit vaccinefinder.org to find information on vaccine appointments near them. 

Additionally, the provisions that restricted access to specific providers or created penalties for vaccinations given to individuals outside of the required prioritization groups earlier in the process are repealed, to reflect open access for New Yorkers age 16 and over at all sites. 

STATEWIDE BREAKDOWN

Total doses administered - 14,702,998

Total doses administered over past 24 hours - 152,118

Total doses administered over past 7 days - 1,120,029

Percent of New Yorkers with at least one vaccine dose - 44.6%

Percent of New Yorkers with completed vaccine series - 31.9%  

Long Island Man Pleads Guilty to Attempting to Provide Material Support to Terrorists

 

Defendant Planned to Travel to Syria to Wage Violent Jihad

 In federal court in Central Islip, Elvis Redzepagic pleaded guilty to attempting to provide material support and resources to the Islamic State of Iraq and al-Sham (ISIS) and the al-Nusrah Front, both having been designated by the U.S. Secretary of State as foreign terrorist organizations.  When sentenced, Redzepagic faces up to 20 years in prison.  The guilty plea was entered before United States Magistrate Judge A. Kathleen Tomlinson.

Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, John C. Demers, Assistant Attorney General for National Security, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the guilty plea.

“Redzepagic, a Long Island resident, admitted that he attempted to travel to Syria on several occasions to wage jihad on behalf of ISIS and other organizations dedicated to violence and mass destruction,” stated Acting United States Attorney Lesko.  “This Office is committed to preventing the spread of terrorism by stopping individuals like the defendant in their tracks and prosecuting them before they are able to harm the United States and its allies.”  Mr. Lesko praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which consists of investigators and analysts from the FBI, the NYPD, and over 50 other federal, state, and local agencies. 

Mr. Lesko also thanked the Justice Department’s Office of International Affairs, the FBI Legal Attaché Office for Serbia, and the Government of Montenegro Ministry of Justice, Prosecutor’s Office, and Special Police Unit for their assistance in this case.  

“Redzepagic has admitted to travelling overseas to try to join and provide material support to ISIS and the al-Nusrah Front, two foreign terrorist organizations that were engaged in fighting in Syria,” stated Assistant Attorney General Demers.  “The threat from these terrorist organizations has not ended, and we will continue to work to stem the flow of fighters and bring to justice those who provide material support to these groups.”

In early 2015, Redzepagic began communicating with an individual he believed to be both the commander of a battalion in Syria and a member of ISIS or the al-Nusrah Front, and made attempts to join that individual’s battalion to engage in violent jihad.  In July 2015, Redzepagic traveled to Turkey and made multiple unsuccessful attempts to cross the border into Syria.  Unable to enter Syria from Turkey, Redzepagic traveled to Jordan in August 2016, but was stopped and deported by Jordanian authorities. 

In Facebook messages from October 2015, Redzepagic explained that “jihad” is when “you fight for the sake of God” and “die for the sake of Allah.”  Redzepagic stated that he traveled to Turkey to “perform Jihad and join Jabhat Al-Nusra.”  He predicted, “there will come a time where people will only know to say Allahu Akbar.”  In subsequent interviews with law enforcement, Redzepagic admitted that at the time he attempted to enter Syria, he was prepared to strap a bomb to himself.  

AT THE U.S. CONFERENCE OF MAYORS, MAYOR DE BLASIO AND MAYOR LIGHTFOOT PROMOTE EMPOWERED CITIES

 

Empowered Cities is a landmark initiative to advance equity and economic opportunity for low-income people with disabilities and their families

 Today, at the U.S. Conference of Mayors, New York City Mayor Bill de Blasio and Chicago Mayor Lori Lightfoot promoted Empowered Cities, a national network of city and municipal disability leaders focused on the immediate needs of the disability community and addressing long-standing equity issues magnified by the COVID-19 pandemic.  Along with today’s event, the Empowered Cities initiative launched a website which will serve as a tool for other cities to become more inclusive.  

"New York City is thrilled to be leading like-minded cities across the country to uplift the voices and concerns of the disability community," said New York City Mayor Bill de Blasio. "Empowered Cities was born out of a need to fix long standing issues disproportionately impacting people with disabilities, and we're doubling down on that commitment as we create a recovery for all of us."

 

"Being a part of the nationwide Empowered Cities initiative has contributed to our work in creating a more equitable city," said Chicago Mayor Lori E. Lightfoot. "Equity is at the forefront of everything we do, and this includes a commitment to serving Chicagoans with disabilities. Through our collective efforts, we are working towards an achievable goal to ensure we live in a more accessible and inclusive nation."

 

Launched in 2019 with support from Citi, Empowered Cities catalyzes municipal efforts to advance equity and economic opportunity for people with disabilities and their families. This unique collaboration is spearheaded by the NYC Mayor’s Office for People with Disabilities and co-chaired by the Commissioners of the Mayor’s Offices of People with Disabilities in Boston, Chicago, Los Angeles, and San Francisco. Since its inception, the Empowered Cities network has worked to address the most critical unmet needs facing people with disabilities and their families during these challenging times. These include providing personal protective equipment (PPE) to people with disabilities and their healthcare aides, tackling food insecurity, offering durable medical equipment, and ensuring accessible COVID-19 communications. 

 

As the nation and the world continue to address the impacts of COVID-19, Empowered Cities is a necessary collaboration to ensure the needs of people with disabilities are being met. Empowered Cities will focus on issues like accessibility, the digital divide and identifying strategies to advance the original pillars of the Empowered Cities Initiative: financial empowerment, employment, and access to affordable accessible housing. The newly launched Empowered Cities website provides access to resources and the priorities, advocacy and policies of this landmark initiative.

 

"There is strength and power in numbers," said Boston Mayor Kim Janey. "The Empowered Cities program has created a cohesive group of Disability Commissioners from across the US, and brought them together at a critical time in our country. They were able to share information on resources and supports for residents with disabilities during the pandemic," she added. "And they are now working hard to ensure that people with disabilities are fully included in the equitable recovery efforts in each of their cities, which is among my top priorities."

 

“This pandemic has shined a bright light on where our cities fell short, where our policies could improve, and where our leaders could learn from the past rather than return to business as usual — and that’s especially true when it comes to accessibility in our public spaces,” said Los Angeles Mayor Eric Garcetti. “Empowered Cities is helping bring this crucial issue to the forefront of the national conversation, while providing real solutions for cities to make their communities more livable for individuals with disabilities.”

 

“While we know that disability equity has always been a critical part of our success as a city, the pandemic has taught us that elevating residents with disabilities within our communities is more important now than ever.” said San Francisco Mayor London N. Breed.  “We know that Deaf and disabled communities have been disproportionately impacted by COVID-19. The work of Empowered Cities truly shows us that cities can come together, and all of us, including people with disabilities, can thrive together.”

 

“During these unprecedented times, the need to create a better, fairer, and more equitable America, in which every person is helped to realize their full human potential, has never been greater. This initiative focuses critical attention on one of our most vulnerable communities and is helping to serve as a real catalyst for change,” said U.S. Conference of Mayors President and Louisville Mayor Greg Fischer.

 

“The disparities in outcomes for individuals with disabilities that already existed prior to COVID-19 have only been exacerbated by the pandemic. As we look to recovery, there has never been a more important time for mayors to lead on efforts to strengthen diversity, equity and inclusion than right now,” said Tom Cochran, CEO and Executive Director of The U.S. Conference of Mayors. “Empowered Cities is a critical effort to truly create opportunity for all.”

 

“In the United States, one in four people identify as having some kind of disability,” said Victor Calise, Commissioner of the NYC Mayor’s Office for People with Disabilities. “As a nation still reeling from COVID-19, the Empowered Cities initiative helps to ensure that everyone’s needs are being met. In 2020, we came together to provide resources and information to address the issues within the disability community. As we begin an inclusive recovery process, Empowered Cities will help put disability needs at the forefront of municipal government.”

 

“I am proud to work with our fellow Commissioners across the nation to develop effective solutions and strategies to improve the lives of individuals with disabilities nationwide,” said Rachel Arfa, Commissioner of the Chicago Mayor’s Office for People with Disabilities. “We have worked together throughout this pandemic to share approaches that will ensure people living with disabilities continue to access employment opportunities, maintain financial freedom, and thrive independently in our communities.”

 

“Being part of the Empowered Cities initiative has helped us to better serve the residents of our cities," said Boston Disability Commissioner Kristen McCosh. "MOPD Commissioners from across the country have learned from each other and developed best practices to support people with disabilities during the pandemic. But we know that there is more work to be done," she added. "Boston Mayor Kim Janey is committed to an equitable reopening, and my work with Empowered Cities will be a key piece of this moving forward."

 

“COVID19 has caused us to imagine new ways to work, learn and provide access to resources and information,” said Stephen David Simon, Executive Director, Los Angeles Department of Disability. “With the creation of Empowered Cities, we have the opportunity to reimagine and elevate accessibility for all people with disabilities across our nation.”

 

“San Francisco is privileged to be part of the Empowered Cities effort,” said Nicole Bohn, Director of the San Francisco Mayor’s Office on Disability. “From the distribution of PPE to residents with disabilities to truly understanding the technology and digital equity needs that have arisen after a year of our communities sheltering in place, we are forging pathways that will build better futures for all of us.”

Governor Cuomo Updates New Yorkers on State's Progress During COVID-19 Pandemic April 27, 2021

 

3,184 Patient Hospitalizations Statewide

728 Patients in the ICU; 461 Intubated

Statewide Positivity Rate is 2.61%

Statewide 7-Day Average Positivity Rate Drops to 2.06%—Lowest Since November 7

26 COVID-19 Deaths in New York State Yesterday

 Governor Andrew M. Cuomo today updated New Yorkers on the state's progress during the ongoing COVID-19 pandemic.

"New York is making progress in the footrace between the vaccination rate and the infection rate - we are continuing to make it even easier for residents to access the vaccine and at the same time New Yorkers are staying tough and practicing the safe behaviors we know stop COVID in its tracks," Governor Cuomo said. "All the arrows are pointing in the right direction, and we've been able to open even more sectors of our economy and increase capacity for several different industries, but we're not out of the woods yet. The virus is still here and we need all New Yorkers to follow the public health guidance for us to get through this pandemic and reach the light at the end of the tunnel together."

It is important to note that data, including test results and hospital rates, reported early in the week are often not completely reflective of the current situation due to lower discharges and testing volume over the weekend. Data trends over a period of time, such as using 7-day averages, are a preferred metric.

Today's data is summarized briefly below: 

• Test Results Reported - 103,675
• Total Positive - 2,704
• Percent Positive - 2.61%
• 7-Day Average Percent Positive - 2.06%
• Patient Hospitalization - 3,184 (+10)
• Net Change Patient Hospitalization Past Week - -689
• Patients Newly Admitted - 304
• Hospital Counties - 53
• Number ICU - 728 (-1)
• Number ICU with Intubation - 461 (+7)
• Total Discharges - 174,345 (+258)
• Deaths - 26
• Total Deaths - 41,875

Former White House Adviser Arrested For Stealing $218,000 From Charter Schools He Founded

 

 Audrey Strauss, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of a complaint charging SETH ANDREW with wire fraud, money laundering, and making false statements to a financial institution, in connection with a scheme in which ANDREW stole $218,005 from a charter school network that he founded.  ANDREW was arrested this morning in New York, New York, and will be presented today before U.S. Magistrate Judge Gabriel W. Gorenstein.

Manhattan U.S. Attorney Audrey Strauss said:  “As alleged, Seth Andrew abused his position as a founder of a charter school network to steal from the very same schools he helped create.  Andrew is not only alleged to have stolen the schools’ money but also to have used the stolen funds to obtain a savings on a mortgage for a multimillion-dollar Manhattan apartment.  Thanks to the FBI’s diligent work, Andrew now faces federal charges for his alleged scheme.”     

FBI Assistant Director William F. Sweeney Jr. said:  “Locking into the lowest interest rate when applying for a loan is certainly the objective of every home buyer, but when you don’t have the necessary funds to put down, and you steal the money from your former employer to make up the difference, saving money in interest is likely to be the least of your concerns. We allege today that Andrew did just that, and since the employer he stole from was a charter school organization, the money he took belonged to an institution serving school-aged children. Today Andrew himself is learning one of life’s most basic lessons – what doesn’t belong to you is not yours for the taking.”

As alleged in the Complaint unsealed today[1]:

In 2005, SETH ANDREW helped create “School Network-1,” a series of public charter schools then based in New York City.  In the Spring of 2013, ANDREW left School Network-1 and accepted a job in the United States Department of Education and, thereafter, as a senior adviser in the Office of Educational Technology at the White House.  While employed at the Department of Education, and at the White House, ANDREW was paid by School Network-1.  In November 2016, ANDREW left his role in the White House and, shortly thereafter, in January 2017, ANDREW officially severed his relationship with School Network-1.

School Network-1 comprises several charter schools throughout United States including several in New York City.  Pursuant to an agreement with the New York State Board of Regents, School Network-1’s New York-based charter schools must maintain an “escrow account” that may be accessed only if the school dissolves.  Three such escrow accounts, for three New York City-based School Network-1 schools, were opened by ANDREW and other School Network-1 employees at  “Bank-1” in 2009, 2011, and 2013.  As to each of those three accounts – Escrow Account-1, Escrow Account-2, and Escrow Account-3 – ANDREW was a signatory and had access to the funds in them.  However, pursuant to the charter agreement, the funds in the Escrow Accounts were reserved in case the school dissolved, and the funds could not be moved by ANDREW, or anyone, without proper authorization.

After he severed his relationship with School Network-1, on March 28, 2019, ANDREW entered a Bank-1 branch in New York City and closed both Escrow Account-1 and Escrow Account-2.  Bank-1 provided ANDREW a bank check in the amount of $71,881.23 made payable to “[School Network-1] Charter School” (“Check-1”) and a second bank check in the amount of $70,642.98 to “[School Network-1] Harlem Charter” (“Check-2”).  Check-1 and Check-2 represented the funds that were in Escrow Account-1 and Escrow Account-2, respectively.

The same day that ANDREW closed Escrow Account-1 and Escrow Account-2, ANDREW entered a Manhattan branch of a different FDIC-insured bank (“Bank-2”) and opened a business bank account in the name of “[School Network-1] Charter School” (“Fraud Account‑1”).  To open that account, ANDREW represented to a Bank-2 employee that he was a “Key Executive with Control of” School Network-1 Charter School, which was a lie.  ANDREW then deposited Check-1 into the account but, that day, ANDREW did not deposit Check-2.

Five days later, on April 2, 2019, ANDREW used an ATM machine in Baltimore, Maryland, to deposit Check-2 into Fraud Account-1.  It appears ANDREW waited to deposit Check-2 because it was made payable to “School Network-1 Harlem Charter” and not “School Network-1 Charter School.”  Had he tried to deposit Check-2 when he opened Fraud Account-1 it would not have been honored by Bank-2.

At the time ANDREW deposited Check-1 and Check-2 into a Bank-2 bank account, ANDREW was contemplating obtaining a mortgage from Bank-2 to purchase a residential property.  At that time, Bank-2 offered certain customers, as a promotion, more favorable mortgage interest rates if those customers maintained a certain amount of funds in Bank-2 accounts.  Specifically, for every $250,000 on deposit, up to a total of $1 million, Bank-2 would lower that qualifying customer’s mortgage interest rate by 0.125%.  Thus, in total, if a qualifying customer maintained $1 million or more of his/her funds in Bank-2 accounts that customer would receive a 0.5% interest rate deduction on a Bank-2 mortgage.  But to take advantage of the interest rate deduction promotion, Bank-2 required that the funds a customer deposited be funds owned by the customer or, in some instances, a business the customer owned, controlled or was lawfully associated with.  Bank-2 did not permit a customer to utilize money owned by someone else to gain the benefit of the interest rate deduction promotion.

By April 2019, because of the $142,524 ANDREW deposited in Bank-2, using the money he stole from two charter schools, ANDREW deposited a total of approximately $1,007,716 with Bank-2, and therefore became eligible to receive a 0.5% interest rate deduction – the largest deduction a customer could receive from Bank-2’s promotion.  Without the $142,524 deposited stolen funds, ANDREW would have been eligible for only a 0.375% interest rate deduction.  On August 21, 2019, ANDREW purchased a residential property located in New York, New York, for approximately $2,368,000.  To effectuate that purchase, ANDREW, and his spouse, obtained a mortgage from Bank-2 in the amount of $1,776,000 with an interest rate of 2.5% –  taking full advantage of the promotion Bank-2 offered. 

On October 17, 2019, ANDREW closed out Escrow Account-3 and received a check (“Check-3”) made payable to “[School Network-1] Endurance” in the amount of $75,481.10.

On October 21, 2019, ANDREW deposited Check-3 into an account that he opened at a third bank (“Fraud Account-2”).  Approximately one month later, ANDREW obtained a check from Bank-2 for $144,473.29, which constituted the funds stolen from Escrow Account-1 and Escrow Account-2, and ANDREW ultimately deposited those funds into Fraud Account-2.  Five days later, ANDREW rolled the funds in Fraud Account-2 into a certificate of deposit.  That certificate of deposit matured on May 20, 2020, which earned ANDREW $2,083.52 in interest.  ANDREW then transferred the funds from the certificate of deposit – including the funds stolen from the Escrow Accounts – into a bank account held in the name of a particular civic organization that ANDREW currently controls, thereby concealing the money’s association with School Network-1, and depositing the stolen money into an account under ANDREW’s complete control.

ANDREW, 42, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison, one count of money laundering, which carries a maximum sentence of 20 years in prison, and one count of making a false statement to a bank, which carries a maximum sentence of 30 years in prison.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Ms. Strauss praised the outstanding investigative work of the FBI.

The charges in the Complaint are merely allegations, and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.

MAYOR DE BLASIO, FIRST LADY MCCRAY, SCHOOLS CHANCELLOR PORTER, AND SPEAKER JOHNSON ANNOUNCE HISTORIC EXPANSION OF MENTAL HEALTH SUPPORTS FOR ALL SCHOOLS

 

An unprecedented investment in mental health staff, supports and training for students, teachers, and parents

 Mayor Bill de Blasio, First Lady Chirlane McCray, Schools Chancellor Meisha Porter, and Speaker Corey Johnson today announced an historic expansion in access to school-based mental health supports for school communities as they confront and heal the trauma caused by COVID-19. As part of this expansion, mental health supports are being integrated into Summer Rising, all schools will participate in social-emotional screening, and over 600 social workers, psychologists, and family support workers will be hired totaling over 6,000 mental health workers in our schools across the city. Additionally, mental health resources and training will be made available to parents through DOE’s Parent University and to early childhood educators. 

"Here in New York City, we are doing everything we can to make sure our children and their families feel supported. Given the trauma of the past year, we know that starts with building out and fortifying our City's mental health infrastructure," said Mayor Bill de Blasio. "Our message to children, parents, and guardians is clear: we will heal our city together."

“Social-emotional screenings at every public school marks a critical expansion of mental health support for our young people,” said First Lady Chirlane McCray. “These screenings are a preventive measure, with a focus on maintaining wellness. Children will have an opportunity to talk about how they are feeling, how they’re getting along with friends and family, and talk about anything big or small they may be experiencing. These are conversations they should be able to have in the best of times. But after the year we’ve had, these conversations are more important than ever as they manage the grief, anxiety and trauma triggered by the pandemic.”

 

“Since day one, we have prioritized access to mental health care for all students and fought to ensure our educators and families have the supports they need to confront the trauma caused by the pandemic,” said Schools Chancellor Meisha Porter. “This historic investment underscores our commitment to address the social-emotional needs of our children by providing wraparound supports and services to meet them where they are. Our future is brighter when our young people are thriving.”

 

“The past 13 months have been unimaginably difficult for our students. In addition to the already daunting normal stressors, they’ve endured intense emotional and mental trauma because of the pandemic. They need help. They need more social workers and other mental health resources to deal with these enormous challenges,” said Speaker Corey Johnson. “This City Council has fought to add social workers in schools in every budget, and I’m proud we are making that happen in this budget when they are needed more than ever.”

 

SUMMER RISING

 

Supporting the mental health and recovery of our students is ongoing over the course of the school year. For many students attending Summer Rising, this summer may be their first time back in school buildings. Under this initiative, every Summer Rising site will be staffed with social workers who will ease the transition of returning and provide students with individualized and group counseling. They will be crucial in ensuring students are getting the support they need over the course of the summer and as they get ready for in-person learning this fall. 

UNIVERSAL SOCIAL-EMOTIONAL SCREENING

 

To ensure there is a successful return and recovery this fall, our educators must have the resources and supports necessary to address the social-emotional needs of all students. To that end, a social-emotional screening tool will be made available citywide to all children from infants/toddlers through grade 12. Social-emotional screening assists educators in better understanding the development of children, identifying common signs of trauma and distress in students, and helping better plan next steps in providing care. To coincide with the screening expansion, the DOE’s successful staff training initiative will expand to reach all 30,000 early childhood staff members. This means that every early childhood staff member will have access to professional development in trauma-informed practices.

HIRING 500 NEW SOCIAL WORKERS

 

When educators identify a young person who needs additional support, over 600 newly hired mental health professionals will be on hand to provide care. This fall, 500 new school-based social workers will be hired, inclusive of the 150 social workers announced in December. 60 borough-based social workers, 90 school psychologists and 30 family support workers will also be hired to provide direct care for students in the 270 most high need schools. 

This means that every school will have at least one full-time social worker or school-based mental health clinic - in addition to other pre-existing supports like Community School programs and resources across the city, such as NYC Health + Hospitals and ThriveNYC. In total, over 6,000 social workers, guidance counselors, and school psychologists will provide support to schools this fall, in addition to community-based resources.

ENGAGING PARENTS

 

Parents are educators’ strongest partners in ensuring the City’s young people are thriving and parents must have access to the same resources educators do. The expansion of Parent University will include resources that help families understand if their child may need social-emotional and mental health support. In addition to school-based supports, parents will have access to a parent hotline, where counselors will be trained on the school social-emotional screener and can provide families with community-based options for care. 

Families of our youngest learners will also have expanded access to a 4-week family workshop series, “Parenting Through the Pandemic.” This workshop, facilitated by the DOE’s Division of Early Childhood Education social workers, provides families with community and connection as well as support in creating routines, managing stress, and supporting family wellbeing, with a focus on neighborhoods most impacted by COVID-19. To date, 2,000 families have been trained with a goal of training at least 2,000 parents annually.

 

Before the COVID-19 pandemic, supporting the mental health of our students was a central part of this Administration’s focus with the 2019 major investment in social-emotional learning and mental health. Additionally, since the pandemic began we launched several initiatives to address the unique trauma caused by this crisis: 

 

• Trauma 101: At the height of the pandemic, the DOE trained approximately 13,000 staff throughout the spring and summer in a Trauma 101 series focused on grief and loss, bereavement and self-care in a crisis. This included Crisis Team members, who respond to schools that experience a loss and provide mental health supports, school leaders and school support staff. 

 

• Trauma Responsive Educational Practices (TREP): Building on that, the DOE launched an online trauma-informed care professional learning platform, that builds adult capacity to recognize signs and symptoms of trauma, strengthen community and foster resilience, proactively support student needs, and respond appropriately when students require additional support. To date, over 75,000 DOE educators and community partners have participated in this opportunity. 

 

• Bridge to School: Prior to the reopening of schools, the administration announced the “Bridge to School” initiative, a multi-pronged focus on mental health supports for students and staff this fall that trained every school leader in trauma-informed practices, like how to create classroom structures that facilitate healing, identify students in crisis, and procedures for compassionately supporting students struggling with grief and bereavement.

 

• In October: NYC Health + Hospitals began directly connecting to 26 schools in the neighborhoods hardest hit by COVID-19 to outpatient mental health clinics, where children and adolescents can receive ongoing therapy, psychiatric evaluation, medication management, and other clinical services. Additionally, the City moved to transform School Mental Health Consultants, who previously worked with schools to develop mental health plans and capacity, into providers of direct clinical mental health care in 350 schools in those neighborhoods.

 

• In December: the City expanded these supports by launching mental health screeners in the neighborhoods hardest hit by COVID-19. A social emotional screening is an evidence-based tool that facilitates a check-in on how students are doing emotionally and assesses a general sense of wellbeing, based on the observations made by the adults in school that know them best.