Good evening. Tonight I deliver my fourth State of the City address. I thank all of you for being here to witness not only an annual message mandated by our Charter, but also to participate in our City government’s obligation to the people. The duty to deliver an assessment that expresses the achievements made and the challenges still to overcome.

I would like to recognize our City of Syracuse Common Councilors here this evening; Syracuse School Superintendent Dr. Stephen Jones; and all of our Syracuse City School Board of Education Commissioners.

I would like to acknowledge Debbie Sydow, President of Onondaga Community College; Father Charles Beirne, President of LeMoyne College; Dr. Cornelius B. Murphy, President of SUNY ESF; and Dr. Gregory Eastwood, President of SUNY Upstate Medical University – they continue their personal commitment through extensive school, neighborhood and community investment. And, of course, our new Chancellor Nancy Cantor, who inspiringly conveys her vigor, determination and vision in truly integrating the University within the City. I am thrilled about the extension of town and gown now more inter- connected than ever!

I am energized with the working relationships with our elected officials in Albany with Assemblyman William Magnarelli, with Assemblywoman Joan Christensen, with Senator John DeFrancisco, and with our newest representative, Senator David Valesky. I am grateful for the support and advocacy of our United States senators, Senator Hillary Clinton and Senator Chuck Schumer.

I am thankful for the efforts of Congressman James Walsh, who has had such an impact in revitalizing and restoring our hometown. And lastly, I want to acknowledge County Executive Nicholas Pirro, who will passionately continue – as will I – to conduct operations in the best interest of our constituents.

I am continually grateful for the support of my wife Patty and my family, who are here with me tonight.

It is an honor for me to deliver the 2005 State of the City address from this historical neighborhood setting. Michael Heagerty has been gracious and generous in his accommodations for this event. His dedication to Eastwood, and especially to his family’s heritage by restoring this treasured landmark, is truly remarkable.

You elected me to assume the stewardship of the City of Syracuse in 2001. Since becoming Mayor, my administration has focused on improving essential municipal operations and delivering quality services to our residents.

In order for me to accurately convey the current condition of our City, I must tell you from where we have come. In 2001, we encountered a City whose beleaguered systems and services were in need of regeneration – strained systems ranging from underfunded schools to police and fire; from fatigued parks facilities to unsightly gateways, and most importantly, inattention to financial management.

During this same time period, the economic climate called for me to become the custodian of the transition so many rust belt cities have faced – changing from big business to small business development and from manufacturing to technology.

I faced these responsibilities head-on and made the difficult decisions required. I instituted performance-based government with regard to efficiency and accountability to put City services on track in a cost-effective way. We raised the bar on employee productivity, and the City workforce showed they were up to the task.

And as I will show, the City of Syracuse has profoundly changed in these last three years. We have created a culture for investment and have greatly succeeded as compared to neighboring cities that fought change in the face of evolution. Now, we must ‘Manage this Growth’. We are in a stronger place and we must capitalize on the resurgence of our government and continue to strengthen the foundations we have built.

Our focus on management and improved delivery of vital services, and our insistence on performance accountability, has made your City government much more responsive to you, its residents. The City is also more fiscally sound, using your tax dollars in the most cost-effective way. 2

Plain and simple, we must continue to do more with less.

Local governments in New York State continue to be under significant financial pressure to maintain levels of municipal services. While the City of Syracuse continues to feel the pressure of State mandated increases in expenditures, coupled within an environment of a shrinking tax base, each budget year brings a new and greater challenge. And cities with financially dependent School Districts, like Syracuse, face even greater difficulties.

However, we have instituted measures so that we did not close schools as did Rochester, nor were we put under a Financial Control Board, as in Buffalo. Instead, when I perceived opportunities for reinforcement, I pursued them. When I saw potential revenue, I fought to secure it. The result of this?

We have diversified our revenue base. The City has developed significant new sources of revenue to support municipal operations to take pressure off the need to resort to property tax increases.

• The City successfully negotiated for a share of the new 1% Onondaga County sales tax that went into effect in September of 2004, resulting in new revenue of over $7 million per year.

• The City reached an agreement with Onondaga County to receive $3 million annually for infrastructure improvements that went into effect last fall.

• The City implemented the first sale of tax liens to the State Municipal Bond Bank. This action resulted in an infusion of $2.9 million in cash.

• The City successfully lobbied for additional State aid and received a commitment of $25 million over three years in the form of spin-up aid.

• As announced in the Governor’s budget message this year, the City will qualify for the highest level of funding under the new AIM program, which will bring in over $5 million in new funds in the coming budget year.

• We secured a back taxes settlement of $1.38 million from the Bank of Oak Park for the Hotel Syracuse.

• The revenue guarantee from Destiny progressively increases annually from $3 million in 2003 to $7 million in 2012.

• As part of the final approval for Destiny, we successfully negotiated for a larger share of the basic 3% County sales tax from the Carousel Mall expansion. Under this legislation, the City will receive 30% of these revenues generated from sales in the expanded mall, and these revenues will not be subject to the existing sales tax cap.

In early April, I will be submitting my proposed 2005/06 budget for the City and the School District to the Common Council for their review. This budget will reflect our success over the last year in fighting to diversify the City’s revenue base, and to moderate pressure on the property tax.

While these new revenues will enable us to cover costs in the near term, as we look further into the future, we will face additional challenges to keep revenues and expenditures in balance. I am committed to working with the Common Council to address these challenges.

3 Looking toward the School District side of the budget equation, we raised property taxes for the City School District twice, to help make up for years of stagnant local funding.

However, even with this infusion of funding, the School District operating budget next year will be extremely challenging. The District submitted a budget request that includes a budget gap of $24.3 million. This is primarily due to the fact that the current year budget includes a one-time revenue source of a $20 million lottery aid spin-up.

Our School District is funded predominantly by the State, which comprises 76% of the School District revenues. I call upon our State elected representatives to do what is necessary to provide the appropriate funding levels.

It is widely recognized that the strength of a city is directly tied to the success of its schools. When I became Mayor, I put top priority on adequately funding our schools. Over my tenure, the level of financial support for the City School District has grown significantly. This increase in support for education can be measured in two ways:

1. Overall budget growth: The City School budget has grown from $204.7 million in the 2001/02 budget to $248.2 million in 2004/05. This is an increase of 22.2% over three years.

2. Increase in local funding: Our local dollars earmarked for education have also been significantly increased. The amount of local property taxes designated for the School District has increased from $50.6 million per year in 2000/01 to $59.2 million in the current year, a growth of 17% over three years.

By approving these higher budgets, I have with the Common Council put additional resources at the disposal of the Board of Education to allow them to improve the quality of education in the City’s elementary, middle, and high schools. But, these monies are simply not enough.

I urged the Syracuse City School District to merge financial systems with the City’s oversight department, SyraStat. In spring 2004, the Transportation and Food Services departments participated in Syrastat for the first time. $500,000 in potential savings was identified in these two departments alone.

In the coming year, I hope to see all departments of the City School District integrated within SyraStat for greater efficiency.

4 Next Steps: Joint City School Construction Board Our children have suffered from the deterioration of City school structures, and we have reached a point where we can’t afford not to fix them. We cannot continue on the downward path of relying on shrinking state aid made available to renovate, with our needs far out weighing resourses.

A school renovation project such as the one we are proposing would encompass nearly every aspect of our community: it would create an abundance of well-paying construction jobs; revitalize our neighborhoods; raise property values; and bring Syracuse into the twenty-first century, with new facilities comparable to those found in suburban school districts.

In the past year Dr. Jones and I formed a Joint City School Construction Board, with members appointed from our community, Common Council, School Board and my administration, to put into motion the necessary legislation that will enable the Board to move ahead with the $600 million school renovation project. I continue to work with our State representatives to ensure that this project will take place. I am confident that this project can be exactly the solution that we have been seeking.

Healthy schools encourage learning and help support healthy communities. Often the center of neighborhoods, renovated City schools can revitalize City neighborhoods and encourage home ownership and investment. But most importantly, we are enabling our children- the leaders of tomorrow- to receive a quality, competitive education. Better schools make a community a better place to work and live. I believe that this renovation plan is not only possible and plausible, but a priority for our community.

Our Board of Education has also identified the rehabilitation of the Greystone Building, which many know better as the former Central Tech High School, as the District’s number one priority in its capital plan.

Under the renovation plan, this building, after being abandoned for decades, will be transformed into a new career/technical high school serving the needs not only of City of Syracuse students, but also students from our suburban districts. It is important to provide job training opportunities to our students that may not be college bound, so they enter the workforce with marketable skills. A trained work force will promote, attract, and assist in developing and retaining business and economic growth in our City.

I not only share in the District’s enthusiasm for this project, but have taken steps to insure that the project will proceed this year. Just last week, I, with the Common Council, authorized a contract amendment that will make it possible for the final piece of the design work to be completed. This action 5 will allow us to jump-start the project as soon as the Joint School Construction Program receives its expected legislative approval in Albany later this year.

However, as a backup plan, should the Albany legislation not be approved in a timely manner, we will be in a position prepared to advance this project under the City’s traditional general obligation debt financing without further undue delay.

SyraStat, our department of oversight created in 2002, initially identified nearly $14 million in efficiencies and benefits, and has continued as an effective management tool and is now incorporated in all City departments.

SyraStat expanded its breadth of service to include the monitoring of the $35 million Syracuse Neighborhood Initiative, which impacts all areas of the City, and the $7 million Community Development Block Grant, which supports over 45 community agencies.

Other management efficiencies initiated during my first term are:

• Collection of delinquent water bills by the Water Finance Department totaling $1.2 million. • In 2001, I made a promise we would look outside for funding relief and to supplement community groups as we could when we reinvigorated our Research Department. I am happy to report that $21.6 million has come in as a result of that promise. • Our Department of Water took an aggressive path in bringing in federal and state grants in the amount of $4.6 million. • Energy grants and savings from City and school building energy audits to LED traffic lights add up to $1 million. • Our Lead Paint Program brought in $7.6 million to continue its services • The Division of Collections brought in $1 million in this past year alone!

I applaud the efforts of all of our City Departments that worked so hard to maximize revenues and cut costs.

In the beginning of my administration, I decided that one of the departments that most aggressively needed an overhaul was our Department of Corporation Counsel, the City’s law department.

Prior to 2001, the City of Syracuse was expending an average of $933,000 per year in lawsuits for the previous 10 years. That comes to a whopping total of $9,3 million paid out over that time period, a 6 completely unacceptable, and frankly untenable, situation.

I am proud to say that due to the efforts of our law department, this has changed. Over the last three years, the City of Syracuse has paid out an average of only $86,870 per year, a dramatic drop of nearly $846,000 per year -- keeping in mind that these are your tax dollars.

Your safety and well-being is paramount, and is my first and foremost charge. The numbers speak for themselves in the decrease in crimes and homicides in Syracuse. This is what we have done for the past three years through a series of essential partnerships. As you can see, of our upstate counterparts, Syracuse has consistently had the lowest homicide rate for the past three years.

For years, the City has been beset by violence in our neighborhoods. While there is still much work to be done, our administration has taken decisive suppression and intervention actions. In 2002 we declared war on the gangs that were preying on our neighborhoods. In 2004, we concluded a joint federal, county and local investigation into the City’s most violent gangs, resulting in 27 arrests and convictions and a decrease in violent criminal activity. The work of our police officers cannot be over-praised or over-appreciated.

We have expanded our suppression of violent crime to all parts of our city through Operation Impact. Operation Impact is the current progressive combination of the Syracuse Police Department, Onondaga County Sheriff's Office, U.S. Marshals Service, New York State Police, New York State Parole Department, the District Attorney's Office and the U.S. Attorney's Office. Its singular purpose: to decrease targeted criminal activity. Working with these entities, we have become a template for the State. Since August 2004, Operation Impact has made 326 arrests on 725 charges seized 12 firearms, 4 stolen vehicles and quantities of crack and marijuana.

7 Knowing that suppression alone is not the only solution, we formed the Violence Intervention and Prevention Program – known as VIP. This program is truly the best of partnerships. VIP brings together and enhances efforts in our community through a collaborative approach involving over twenty organizations as well as parents and community members. These partners are essential to secure long term solutions for the issue of violence in our community.

Sustaining and expanding violence prevention is only realized through this collaborative approach and the sponsorship of our designated leaders: District Attorney Bill Fitzpatrick, U.S. District Attorney Glen Suddaby and County Executive Nick Pirro.

VIP has worked with over 230 youth and their families. At year’s end, this program has:

• Helped 71% of the participants remain free of violence and arrest; • Reduced the number of youth injured by violence by 86%; • Enabled 86% of participants to achieve positive outcomes, such as going back to school; • And, 137 of the 230 individuals and families took part in mental health services.

NEXT STEPS In the near future, we will be formally announcing the expansion of VIP.

We were adamant this past year in our goal of increasing public safety officers. We are unrelenting in ensuring public safety. I believe that one of the most important developments in Our Police Department in the past year has been the augmentation of ranks, as I had promised. We didn’t just hire 24 new police officers -- we hired people that reflected the diversity found in our own community.

I believe, and have always believed, that it is vitally important for the leadership of Syracuse to make a commitment to ensure that the City’s workforce is representative of the people they serve.

8 Our City of Syracuse Fire Department is recognized as one of the best departments in the country, and is one of only 26 departments nationwide to achieve and maintain a Class 1 Insurance Services Organization Rating. This rating gives you, the homeowner, the best possible rates on your insurance premium.

Many of us don’t know that the first person we will see after a car accident is the face of a Syracuse firefighter. While fires are the most dangerous job and are what we think of when we think of our Fire Department, they are actually only a small percentage of the thousands of emergencies responded to each year. Let us pause to look at these statistics...

I would like to thank each and every member of our fire department. As with our Police Department, we have hired a diverse class of 23 new firefighters, to ensure that our Fire Department mirrors our city profile.

Department of Public Works

Our DPW is probably the most familiar, but also the most underappreciated department. This is true of our litter and sanitation crews. Come rain, sleet or snow, (LOTS of snow!) your trash will be picked up, including larger items that a private hauler would charge extra for, such as yard waste, construction debris, and other odd items. Last year alone our sanitation workers picked up over 33,000 tons of waste, and nearly 6 tons of recycling. 9

Our litter crews face the most daunting job of all. Can you imagine spending a day’s work cleaning the litter from an area only to return the next day and see it again covered in trash? 3 years ago my administration created litter crews specifically dedicated to particular areas, like highway on-ramps and gateways, to insure they received the special attention they deserved. Last year alone, the litter crew cleaned over 20,000 blocks and shoveled over 3,000 corners.

However, the Department of Public Works does a lot more than trash and litter pickup. In 2004 our DPW produced over 53,000 tons of hot mix and 576 tons of cold patch; answered your calls to City Line- nearly 70,000 last year alone; and during last years enormous snowfall of 181.3 inches our department of public works did an incredible job of keeping our city streets plowed free of snow and ice – all with a 20% reduction in overtime costs.

I would like to thank all of our employees at the Department of Public Works. On the most basic level, all of you keep our city running.

10 Road and bridge reconstruction, City-owned building repairs, City-owned parking garage maintenance, surveying and board-ups are the work of our Engineering Department. Often this

Department’s work goes unnoticed. However, this past year’s projects were high-profile and vital to the City and School District. Some of these projects are:

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Department of Water

On June 28, 2004 the City of Syracuse received news from the New York State Department of Health that our City’s water filtration waiver has been extended indefinitely. This is great news. What this means is that we have once again saved, through the careful conservation and administration of the Skaneateles Lake Watershed Program, the cost of building a water filtration plant for City water - a savings to the tune of $60 million dollars. The annual cost of all the watershed protection programs combined is just 20% of what we might expect to pay for bonding debt service and operational costs for a filtration plant each year. That is a savings of $4-$5 million per year, no small amount of money.

In 2001 we inherited a water system in desperate need of renovation, which we simply cannot afford. However, the age of our infrastructure, such as the water piping, does not give us many options. In 2004, approximately 900 feet of leaky Depression- era concrete pipe was replaced with new ductile iron pipe in a section of the City’s water transmission mains. This project was a start, but by no means an end, to the needs of our water system.

Next Steps Focusing on the future, the reorganization of the Water Department will improve efficiency and include a focus on homeland security measures, on- going water system improvements and the replacement of its current billing system. We are also continuing to seek federal funding for the Westcott Reservoir Rehabilitation Project, which will cost an estimated $28 million.

12 My administration’s commitment to the environment is unwavering. Our natural resources, the health of our children and the future of our City’s economic development are inextricably connected. We must use cleaner and more advanced technology in our quest to preserve our most precious natural attributes. Why? Because it is the right thing to do.

Brownfields In 2005 we anticipate being funded by the State’s Brownfield Opportunity Area Program which will support the City’s planning efforts for the redevelopment of Brownfield properties. Entry into this program also provides our City with preferred status in receiving funds from the State’s Superfund, which will be an extraordinary benefit to our Economic Development efforts.

Energy In 2002, our city was selected to serve as coordinator of the Energy $mart Program through NYSERDA, covering Onondaga, Cayuga, Cortland, Madison, Oneida and Oswego counties. This Energy $mart effort is an effective tool which provides incentives for businesses and residents to use renewable/sustainable energy resources.

We are completing the installation of an Energy Management System that encompasses facilities of critical energy use – such as City Hall and City Hall Commons, DPW, parking garages and some of the School District buildings. Our energy initiatives have resulted in significant savings -- to name a few: $306,000 in energy rebate monies; $168,000 annually through the replacement of LED traffic signals; replaced street lights are not only more efficient but contribute to better lighting and safety for our residents; and we have energy savings of $300,000 with a projection of upwards of $1 million in 2005.

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Over the past two summers, I have conducted 21 town hall meetings attended by nearly 1500 people.

For me, these sessions are the heart and pulse of my course as Mayor. In these town hall meetings, you remind and refresh us to marshal our resources and to deploy them more fruitfully. And we have responded to your needs expressed, such as the police department shifting of territory and foot patrol beats, and increasing the number of officers attending community meetings within the neighborhoods in which they work.

Nuisance Abatement My administration is working in conjunction with the Syracuse Common Council, to strengthen and enforce the existing Nuisance Abatement law. New criteria are in the process of being established for determining which properties qualify under the law.

Through this careful breakdown and expedition of the Nuisance Abatement process, we will see improved identification and enforcement of the law. With the upcoming changes, I anticipate that we will see the Nuisance Abatement law even further utilized in 2005 to improve quality of life.

Certificate of Use In 2004, our City also saw the Certificate of Use Program go into effect. This program was designed as a response to the concerns I heard from Syracuse United Neighbors and other neighborhood groups about delinquent neighborhood businesses.

This ordinance requires all bars, drugstores, food stores and restaurants within the City of Syracuse to apply for, and receive, a Certificate of Use to continue operating. Failure to maintain good order, as defined by the ordinance, results in the accrual of points. When enough points are accumulated, the business can be shut down. This legislation has and will continue to allow us to better enforce regulations, ensuring that all businesses operate in accordance with the law and do not negatively impact the surrounding neighborhoods.

14 Abandoned Cars From the time I sat on the Common Council, abandoned cars have been a plague to our streets. For lack of money and space the City was unable to address this problem. Much of my frustration stemmed from the fact that abandoned cars are often utilized to hide drugs and weapons, heightening the danger posed to children and adults living nearby.

In August of 2004, the Syracuse Police Department opened a new impound lot on State Fair Blvd, with the capacity to accommodate nearly double the number of cars previously towed. In 2004, the Police Department red-tagged 3,991 cars, and towed 1,310. By auctioning off the towed cars, we recoup more than enough money to continue to pay for the lot, at no cost to you, the taxpayer, and removing these eyesores creates a cleaner, safer environment for the residents of Syracuse.

Our national award-winning Lead Program aggressively continues to diminish the danger to the children of our City. 572 children with elevated blood Ievels ages 6 and under, were assisted during the last three years. In addition, 851 inspections of pre-1940 rental housing units were completed, and 601 units were reconditioned.

Marketing One of our most important quality of life initiatives has been to market our City, to residents as well as to people who live outside the City. This past year we continued producing Renewing Syracuse, our publication about life in our City. By writing, designing and producing Renewing Syracuse in- house, we save marketing dollars that can then be used for other promotional efforts in our city.

15 In 2004 we also announced the publication of Step Inside Syracuse, the beautiful book of local photography that was created through a partnership with Syracuse University. This book hasn’t been an idle endeavor. The money raised from its sale, to date nearly $8,000, has gone directly back into the Marketing fund, to be used for future efforts. I think that we have a City to be proud of, and careful marketing is simply an extension of this pride

The recognitions that our departments receive are a marketing tool that put our City front and center on the State and National stage. These 2004 achievements are impressive and are worth noting.

Next Steps

To continue the marketing of our City, I am announcing today the designation of the City of Syracuse as a Caring Community, in partnership with the Syracuse Common Council.

This is an extension of the successful Community of Caring program that was embraced by our City School District, and is part of a growing national campaign of citizenship development—a

community-response strategy promoting mutual respect, trust, good citizenship, kindness, celebration of family, and responsibility.

Within the next 2 weeks, the Common Council plans to pass a resolution declaring Syracuse to be a Caring Community. Within the next 4 weeks, the Syracuse Caring Community Council will be formed. We will seek membership in association with FOCUS, Leadership Greater Syracuse and the MDA’s 40 Below groups to help guide this program to success. 16

Department of Parks

The quality of life of any city is reflected in the splendor of its parks. As the heart of a city, municipal parks serve as refreshing family and community gathering places. The City of Syracuse operates over 170 parks, fields, and natural areas that span almost 1000 acres of land.

I have always believed that one of the most special attributes of Syracuse, and one of the main reasons people move into our city, is our vast number of green spaces. Look into any city neighborhood, and you will find a park, or a green space, or a field.

This is your space- a place for residents to find an oasis, a respite from city life, within walking distance of your home. Keep in mind, that our parks are a unique part of our city’s history, and that not every city recognizes the inherent value of green space to the health of its residents.

Yet three years ago, our parks were in a grave state of neglect and disrepair, not only from the effects of the 1998 Labor Day storm but from aging facilities and structures requiring vigilance in upkeep. The

revitalization of neighborhood playgrounds has generated much more of an interest in our City parks. In three years we have renovated 34 park playgrounds, pools, athletic fields, and concession stands, and we continue to replace trees through our many replanting programs.

17 2004 wrapped up the complete renovation of the baseball field at Skiddy Park, located on the City’s West side, accomplished through the support of Senator DeFrancisco’s Central New York Sports Fund. The Senator has also provided funding allocations for athletic fields throughout the City.

The Cannon Street Community Center revitalization project is near completion, and a brand new building at the corner of Cannon and Brighton stands ready to welcome neighborhood residents. We owe a debt of gratitude to Assemblywoman Christensen for her financial support that made this facility possible.

In the past three years Assemblyman Magnarelli has contributed to numerous city parks and school projects, including the revitalization of the Corcoran High School Sports Complex and the Schiller Park Waterslide; the renovation of Sunnycrest field; renovation of the Lewis Park Playground and little league baseball field- to name only a few projects.

I can report to you that the state of our parks programs is growing and have gone from a well- kept secret to national attention as evidenced by last summer’s Nickelodeon “Lets Just Play” event that took place in ; the International Children’s games; and the upcoming Tiger Woods Golf clinic, only one of four cities chosen from throughout North America.

All of these events have combined to take our City parks department out of the background, and into the spotlight where it belongs.

Attendance at Clinton Square events – supported by our Parks Department – totaled 179,000 in 2004 alone. All other parks events attracted almost 74,000 participants.

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A priority of mine is to keep a focused effort by our Parks Department on our children----particularly during the afternoon and evening hours when they most need us. The Parks department continues to cultivate opportunities to share resources with the City School District and has created distinct programs to build upon that mission.

The After School Program at Edward Smith Elementary has been in operation for just five months and is generating rave reviews from parents, faculty, and neighborhood advocates. The Parks Department responded to concerns from a parent group, and implemented a structured recreation program that utilizes classroom space and the gymnasium for 4 hours after school.

For the third straight summer, Syracuse Parks, Recreation and Youth Programs has included a school-based Night Recreation component. In addition to the three school district sites, McKinley- Brighton, Franklin Magnet, and Dr. King, additional sites were added at Blodgett School, and Blessed Sacrament School. Staff was also in place on Friday nights at Most Holy Rosary. Total attendance for the program topped 7,000 visits for the first time.

And our dedication to seniors has never waned, with our centers reflecting an 8% increase in participation over the past two years, serving over 113,000 hot meals. Our senior centers continue to hold special events like the Silver and Gold Gala, and provide important holiday meals complete with fanfare.

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Next Steps In collaboration with ESF, Onondaga Park Association and our Parks Department, we are poised to soon announce our plans for a botanical garden and arboretum that would capture the spirit that once existed in lower Onondaga Park.

Community Development

The devastating cutbacks to Community Development over the last decade and those federal policies which have systematically undermined community care programs are unconscionable. According to inclusions in the proposed 2006 Federal budget, there is a 12% cut in HUD funding as well as significant program cuts in other domestic programs.

With a 2004/2005 CDBG budget of $7 million, we have already received requests totaling over $9 million – which falls far short of community need. These reductions clearly spell out the intention to dispose of the ‘safety net’ programs counted on by cities and residents.

This administration also inherited a troubled HUD 108 loan portfolio that was creating a stranglehold on community development programs. Several economic development projects could not meet their loan repayment commitments, including the former Dey Bros Building, Pioneer Freezer, and Spectrum.

To mend the damage, we have refinanced our HUD 108 loans, including the $1.5 million that was owed to HUD on the Dey Bros Building, and began vigorously pursuing delinquent loans, collecting 20 $233,000 thus far. If we had not taken this course of action, we would have been forced to budget the repayment of our HUD 108 loans from our already precarious CDBG funding, which would have been disastrous. I also worked with the Common Council to pass legislation that would require that all future HUD 108 loans go through a more stringent process and be approved by the Council.

TNT In 1998 TNT, Tomorrow’s Neighborhoods Today, was formed out of a need to apply for federal funding for our neighborhoods, by former Mayor Bernardi and the Common Council who passed an ordinance codifying its existence. Three years ago when I came into office, my administration looked at TNT to review its adherence to the mission and tenets of the ordinance. I believed, then and now, in the need for and the importance of TNT.

We have worked hard to increase public involvement in the citizen participatory process through the TNT groups, neighborhood associations, SNI Steering Committees, and Neighborhood Watch. In the past 3 years, through the support of my administration, there has also been a proliferation of community resident involvement and I am pleased to report to you that there are now over 130 identified neighborhood groups and associations.

And with growth comes reorganization and management. To that end we are currently assessing the structure of TNT. For years I have heard concerns that the original 8 TNT quadrants did not sufficiently include and reflect the diversity of all parts of our city. We must harness the momentum we have created over the past 3 years and give everyone a voice at the table.

From all of our combined efforts, property values have and continue to increase with a high demand

for market rate and affordable housing prevailing in most of our neighborhoods. According to the Greater Syracuse Association of Realtors, the average sale price for City homes rose more than 20% from 2000 to 2003, from over $56,000 to over $70,000. Families are moving back into our neighborhoods and others have decided to stay and reinvest.

I respectfully thank TNT, and all our Housing Partners and our many neighborhood groups for all that they do for our city. 21

Syracuse Neighborhood Initiative

Since 1999, the Syracuse Neighborhood Initiative has also been a major component in revitalizing our neighborhoods. Since this time Congressman Walsh has brought over $35 million dollars into Syracuse that has been dedicated specifically to our neighborhoods.

SNI has focused on revitalization efforts in concentrated geographic areas through multifaceted priority projects and phases, to create stable pockets of well-maintained properties that serve as the basis for further investment. SNI has had an enormous impact on our neighborhoods and the psyche of our city.

Planning In partnership with the Common Council, an essential chapter in the welfare of the City of Syracuse is creating a map of imaginative and pragmatic directions. For the first time in 87 years, we have the framework to map out our future -- the Comprehensive Plan 2025. We must protect what is cherished and irreplaceable. We must protect and maintain our rich environmental resources. And we must guide new development and economic growth in a manner that preserves our neighborhoods and our infrastructure.

Next Steps Now, to put our Comprehensive Plan 2025 and our vision of a restored Onondaga Creek into motion, the City has just submitted an application to be designated a Quality Community by New York State. I am making an announcement today that we will be creating an Office of Creek Development, to bring together concerned groups and stakeholders and their respective creativity. Thus, environmental protection, recreation and development can be forged through community consensus as land use and zoning plans evolve, as outlined in the Comprehensive Plan 2025.

22 Airport

Syracuse Hancock International Airport remains a vital component of the Central New York economy and community, providing more than 1,200 jobs and contributing nearly $900 million annually to this community. This past year, the City, in partnership with the Metropolitan Development Association, was awarded a grant from the federal Department of Transportation for air service development efforts. A resulting program – Fly Syracuse – is enabling us to do aggressive Airport marketing, and to continue discussions with existing airlines and new entrant carriers for additional service.

According to the Department of Aviation, passenger traffic jumped 19.3 percent in 2004, one of the biggest increases of any commercial airport in the state. And just this past Sunday, the Post Standard reported that Syracuse was ranked 7th in the Country as the fastest-growing airport ranked by the Boyd Group.

But the myth remains that our airport success “just happened”. I am here to tell you how hard we worked to make it happen.

From the beginning, I took a proactive stance- traveling to Dallas to meet with Southwest Airlines; to Atlanta to meet with TransMeridian Airlines; to New York City to meet with JetBlue; to Washington DC to meet with Atlantic Coast Airlines; and to Minneapolis to meet with Northwest Airlines. The combined effort of our Federal and local partners and this administration has been astounding.

Together, we have been able to recruit several low- cost carriers including TransMeridian and Independence Air, and restored JetBlue’s third daily business flight to NYC. The arrival of these carriers 23 has sparked internal competition and caused our other carriers to lower their prices. And, not only did these carriers bring cheaper prices, they brought convenient daily flights to places like New York City, and Washington DC, enabling business travelers to travel in and out daily even in the face of a fragile national airline industry.

What all of this means is that our passenger traffic has now increased to a level higher than ten years ago, to over 2.2 million passengers per year, one of the highest increases in New York State. This isn’t just good, it is great. We will continue all of our efforts, including meeting face-to-face with airline executives, to ensure that this upward trend continues.

When discussing the state of economic development in the City of Syracuse, I will begin by speaking directly to the projects on many of your minds.

Before I start, though, let me state that I have always believed that one of our City’s greatest strengths is its history. Not every city still has standing landmarks and historic treasures. Throughout the years many of our own have been razed, only to be replaced with contemporary architecture that resembles buildings in any city across the United States.

Mizpah Towers is one of those very buildings with unique architecture and an amazing sense of history. Its unusual design, by Syracuse architect Gordon Wright, included a hotel, called the “Inn Beautiful,” that was added to the church in 1915,

and a restaurant that was added in the 1920’s. Mizpah’s gothic structure was modeled after the Canterbury Cathedral in England.

It was in March of 1998 that Mizpah Towers was seized by the City of Syracuse for unpaid taxes totaling over $470,000. Several plans were considered by Mayor Bernardi’s administration, including one to sell the structure to the developers for the Avenue of the Arts project and have it turned into a high school arts technology center.

24 However well-intentioned the plans, they did not work out. When I became Mayor, the towers were still owned by the City, and treated as an unwanted real-estate “orphan.” The building had severely deteriorated, with stained glass windows stolen, broken water pipes, and had become a haven for every pigeon in the State of New York. At that time, I, too, was of the opinion that the structure should be disposed of as rapidly as possible, so as to mitigate cost to the taxpayers, and to our City’s liability.

In 2003 I instructed my administration to issue a Request for Proposals to ascertain if there were any private developers willing to spend the money it would take to save this historic gem. Much has been written about this ill-fated round of Request For Proposals; however the bottom line was that there simply weren’t any qualified proposals on the table.

Undaunted, I then solicited the opinions of the Syracuse University School of Architecture and of Dean Mark Robbins, as to possible methods of use or ways to divest the city of it. During this period of exploration I have come to view the Mizpah Towers in a very different light.

I see a unique, distinct beauty in the exterior architecture that cannot be replaced. I have come to marvel at the amazing sanctuary with its rare marble and mahogany finishes, arched doorways and intricate details.

It was Dean Robbins’ recommendation that the Mizpah Towers be preserved for future generations.

25 In his opinion, the history and majesty of the towers can be rivaled only by the Cathedral across the street and would be irrevocably lost if the building were used for lesser endeavors.

And so, I report to you today that our update on the Mizpah Towers is one of exploration. We are trying to find a win/win situation, where a private developer can be successful, but still preserve the history of our City for our children and grandchildren. Achieving this will be challenging as substantial subsidies and adequate parking would be required to make such an undertaking fiscally viable. After my administration has exhausted all possible leads, only then will we be issuing another Request for Proposals.

A report on the Hotel Syracuse is warranted during this State of the City address. Unlike the Mizpah Towers, the Hotel Syracuse has never been owned by the City of Syracuse and it is not owned by the City now.

The Hotel Syracuse first opened its doors in 1923. Envisioned as a luxury resort with every amenity available to guests, the hotel had 24 specialty shops, staffed an in-house physician and trained nurses, had outdoor tennis, squash and handball courts on the roof, and even had its own barber shop and beauty salon. It occupied nearly an entire block, and contained 612 rooms -- making it the largest hotel at the time between New York City and Buffalo.

The financial growth of the Hotel Syracuse continued to blossom throughout the 1950’s, and it became an indelible, unforgettable mark on our cityscape and our history. But by the 1980’s, the Hotel Syracuse could not stem the tide of increasing financial debt. In recent years the amazing hotel where many of us danced at our prom, or held our wedding receptions has been mired in bankruptcy and structural disrepair.

In December 2004, after 3 years of negotiations by my administration, a settlement was reached with the bankruptcy courts that repaid back taxes to the City of Syracuse in the amount of nearly $1.4 million and placed its title in the hands of its owner, the First Bank of Oak Park. 26

I believe that it is in the best interest of our entire community, that there is a fully restored Hotel Syracuse once again.

Ladies and gentlemen, these historic buildings are a double-edged sword. They are our history, but at the same time are the most costly and difficult projects to re-develop. For far too long these projects have been passed from one administration to another because viable plans never materialized. I have, and I will continue to work for creative solutions to prevent the majesty of these buildings from being lost, as we cannot recreate history after we neglect it.

It is hard to speak of economic development in Syracuse without addressing the proposed development of the Destiny Project and the Inner Harbor Project. People often ask, “When is construction going to begin in the Inner Harbor? Why haven’t we seen any progress on Destiny after five years of talking about it?”

While these mega-projects have captured our imagination and heightened our excitement, we must realize that they take time. It is important to understand that my administration fully supports the redevelopment of the Lakefront area and urges all parties involved to move forward together toward a shared goal.

However, let us clearly understand that the lifeblood of the United States, New York State, and the City of Syracuse is, and has always been, small business. According to the Metropolitan Development Agency’s “Essential New York Initiative”: “Small businesses account for more than half of the U.S. private sector employment and make up nearly 80% of all net job growth nationwide.”

From 2001 through 2004, investment in our City exceeded $230 million, representing more than 88 economic development projects in all sectors of the City. We are also experiencing a renaissance of our traditional neighborhood business corridors with

27 new investment and business development. Many of these are small businesses, supporting local business and job growth, with over 2,500 jobs that have been created and retained, and over 1,500 projected new jobs.

This past year the City of Syracuse was named one of the nation’s top 50 cities for business expansion and relocation by Expansion Management magazine, and number 14 of the top 25 medium- size cities for doing business in the United States by Inc online magazine.

Another important aspect to the economic development policies of my administration has been my insistence on diversity and inclusion by contracting with Minority and Women owned businesses. It is important to support the economic health of our urban neighborhoods and level the business playing field by contracting with businesses that reflect our population profile.

Our Office of Minority Affairs insures that the departments of the City of Syracuse meet our established goal of contracting with at least 15% minority or women owned firms on capital construction project contracts of $20,000 or more. We exceeded this goal last year with almost 20%, or $3.34 million, of our contracts being awarded to minority and women owned firms.

Downtown Housing My administration has also worked hard to increase the number of market rate rental housing in and adjacent to our downtown. Part of having a vibrant City center is the availability of urban housing. There have been a number of projects, most notably the Lofts at Franklin Square, the Loew’s Building, Hanover Square, and the newly proposed Amos Building and Lofts at the Willow, which would bring our available downtown housing to over 1,200 units. Not only are these units affordable, they preserve the integrity of our unique urban landscape.

28 Let us take a moment to review some of our economic development successes.

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Ladies and Gentlemen: The notion that nothing is happening in Syracuse is simply false and only adds to the negative attitudes people perpetuate.

Next Step We must collaborate, focus our attention, and bring to conclusion our larger Economic Development projects.

Centro Together, with our federal, state and local partners, we must continue our efforts to move the Centro common center to a new indoor facility for the safety, security and comfort of riders. This proposed facility relocation from the 300 block of Salina Street would create a pedestrian friendly City Center by relieving traffic congestion, noise and air pollution and would allow for more creative urban design and mixed-use development igniting a rebirth of our City’s major corridor.

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Wilson Building Another historic downtown structure, the Wilson Building, was seized by my administration in a tax lien for over $700,000 owed in back taxes. Prior to coming into the City’s possession, the Wilson Building had been in bankruptcy court three times over the last 14 years, which clearly stalled any sort of progress on rehabilitation or renovation efforts.

We have again consulted with Dean Robbins and the Syracuse University School of Architecture, to put together a conceptual re-use of this significant structure. This plan will be the basis for an RFP that will be issued to private sector developers.

It is my greatest hope that the Wilson Building will eventually become a portal that will allow the energy and creativity from to flow into the 300 block of South Salina Street.

SU/Downtown Project One of the projects I am most excited about is the proposed integration of Syracuse University and our downtown. In December of 2004, Chancellor Nancy Cantor announced that Syracuse University plans to buy downtown properties, establishing satellite campuses in the heart of our City. It is my hope that these projects will bridge the physical and psychological divide that has so often separated our City from the University. By bringing students into our downtown we will help create sustainable collaborations and add to our City’s vibrant future.

Center of Excellence We must now work together to bring to completion the Center of Excellence in Environmental and Energy Systems. Not only will this Center create jobs, it will move Syracuse forward in its transition to a technology based economy and job base. This project will also propel the development in this downtown quadrant and continuing the connectivity of SU and our downtown.

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Conclusion

Three years ago, there was a sense of anticipation, energy and enthusiasm among City staff and members of my administration – a commitment to change and moving forward. I feel that sense now more than ever. Each year we can appreciate the progress achieved, while always impatient to escalate the effort. That eagerness is apparent still – not only within our City workforce but interwoven throughout the broader Syracuse community.

Matthew Martin, a senior economist with Economy.com, said in the 2004 Progress report talking about and rust-belt cities that, and I quote: “Particularly when you put it in context of neighbors to the west, Syracuse is the shining light. It’s pretty remarkable that the short trip from Rochester to Syracuse shows that much improvement.” But he didn’t just stop with a positive report of past performance; he went as far as to predict future growth, something we don’t hear about often in upstate New York. Martin reported: “Syracuse is in a pretty good position for an Upstate economy to have a good year.” Please allow me to read a definition of growth that I feel is relevant. This is where Syracuse is right now. We did not get here by accident. We have charted a course, righted our ship and now are ready for our rewards. We must not lose our momentum….. We must not doubt our mission…. We must not retreat from our desired goals…. I am more eager than ever, I am more determined, and I am more prepared now than at anytime in my public career to lead our City to its true greatness.

Ladies and Gentlemen, together, we have built the foundations needed to achieve our dreams – for this City, for our families and for our children. We must believe in each other and stay the course. Thank you for coming this evening, May God Bless You and our City. Goodnight. 35