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Owners outraged at NYC's 'mis-use' of cop tax.

"Outrageous" was the cry heard from the real estate industry when New York city budget officials admitted at a City Council hearing they would be using tax-payer money earmarked for crime prevention for other purposes.

The so-called "Safe Streets/Safe City" tax was passed, nearly three years ago, after a series of children were killed by stray bullets nearly three years ago. The money, raised through an add-on to property taxes, employee taxes and a special lottery game, was to be used to hire civilians for desk jobs to free up police for the streets and also provide funds to hire additional police. Other educational and intervention programs were also to be funded.

Mayoral budget planners told a City Council Finance Committee meeting last week that about $80 million of the money will be diverted this year. About $40 million will come from a one-year delay in hiring 1,000 civilians. Meanwhile, the hiring of new police will also be postponed until the beginning of fiscal year 1994, which begins in July 1993. This would save on both salary and pensions, the budget officials said.

Steven Spinola, president of the Real Estate Board of New York, said "We were outraged and then saddened by the city's clear shift of the money. We stood up with the mayor and said we support it if it is going for more police. We believe there is a serious credibility issue as a result of their shift in focus for that money."

Spinola, who testified at the City Council hearing said for the last four months REBNY has been looking into where the money is going.

"We've had some serious arguments and have been lobbying the City Council," he added. "We're pleased with the City Council hearings because it forced the city to admit that they included a diversion of $80 million from Safe City, Safe Streets."

Mike Clendenin, a spokesperson for the City Council, said that after the Finance Committee hearing, the Council had serious concerns about the Mayor's preliminary budget.

The program, Clendenin said, was sold to the public as a direct payment and it should be kept that way.

Because of the testimony, the Council has since released its own budget proposal that includes putting back $47 million for the "civilianization" of the Police Department.

"It doesn't give us everything back," said Spinola, "but it's a start and the right way to go. Mr. and Mrs. Jones believes they paid higher taxes for more police and they should get them."

Dan Margulies, executive director of the Community Housing Improvement Program, said "It's a sad but typical situation where they took a good idea, created an ill conceived program and are administering it badly. It's more proof that this administration cannot be trusted with out money."

In January of 1991, the first payments from property owners brought in $55 million. Another $130 million was collected in July 1991 for fiscal year 92 while $130 million will also be collected for fiscal 1993 beginning this July. The additional property tax is scheduled to go up to $150 million for fiscal years 94, 95 and 96 respectively. "The program is built on the premise of continuing," said one city staffer.

John J. Gilbert III, the president of the Rent Stabilization Association, said, "The Mayor and the City Council made a contract with the owners and the taxpayers that this new tax was going to cops and that contract has been broken."

The city claims, Gilbert said, they are within the law to do this. "I don't know if that's true or not," he said, "but whether implicitly or explicitly agreed to, the bottom line is that we supported the program because it meant more cops and now it doesn't and it's not the way you do business."

Gilbert said the Taxpayers For An Affordable New York will meet to determine what to do next.

Irwin Gumley, president of Gumley-Haft, Inc., and the Apartment Owners Association, Inc., and a member of Taxpayers For An Affordable New York, said any diversion of funds from security and from crime prevention is going to be a "medium-term" negative.

"Despite being in the paper that all crime is down, the perception of the streets being less safe is here", he said. One of the chief concerns of people in their neighborhoods is the safety." The sad part, he said, is the political juggling.

Stephen L. Green, chairman of S.L. Green, and co-chair of the Property Tax Fairness Coalition, noted that the property owners, himself included, paid 50 percent of the Safe Streets tax. Originally, he said, the owners all applauded the intended purpose because of the safety issues.

"The perception of safety is necessary to keep businesses and lure businesses and keep a residential environment in which people feel comfortable," he said. "If the mayor is diverting this tax to other uses, that is tantamount to stealing."

Green pointed out that if he were to collect money for one purpose and use it for another, he would be indicted. "If you make an agreement, whether it is a breach of a contract or it is a crime, I think our Mayor and our city government should be subject to that same scrutiny", he said. They should not be above the law. That's downright unethical and I am truly amazed."
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Title Annotation:use money collected for crime prevention for other purposes
Publication:Real Estate Weekly
Date:Apr 1, 1992
Previous Article:Olympia & York restructures.
Next Article:Daniel R. Tishman.

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