Private Sector Demands Bush Secure the City

Ratcheting up the pressure on the White House and Congressional leaders to help the city prepare for terrorist attacks, representatives from dozens of the city’s largest corporations are preparing to mount a huge lobbying offensive in Washington, D.C., designed to win more federal homeland-security money.

The new campaign, which hasn’t been publicly announced, will add the voices of the city’s most influential business leaders to the chorus of New York elected officials who have been demanding more homeland-security funds. These business executives-many of whom are major donors to both political parties-are growing frustrated with Washington for failing to provide adequate funding for the security needs of New York.

The campaign, which has resulted in an unusual alliance between the city’s business elites and its police force, reflects a recognition among business leaders that New York finds itself in extraordinary straits. At a time when the city is reeling from the worst fiscal crisis in a generation, it is struggling to find the money to defend itself against threats from abroad during wartime.

“We have a budget crisis in the city, and protecting our community from attack is a federal responsibility,” Henry Kravis, a co-founder of Kohlberg Kravis Roberts and Company and the co-chairman of the Partnership for New York City, told The Observer . “The fact that federal funding allocations put New York at the bottom of the list when it comes to per capita funding for security, first responders and intelligence is incomprehensible.”

The funding formula Mr. Kravis was referring to was unveiled several weeks ago by the Bush administration. The plan, which is under consideration in Congress, would designate about $4 billion to defend the nation against future terrorist attacks. Half the money would go to federal agencies and the other half to municipalities. By most estimates, New York City would get around $25 million. This is a less-than-reassuring sum, to say the least, since the Bloomberg administration has estimated that the cost of increased security for the city-including new training, equipment, counterterrorism, intelligence and emergency preparedness-will be more than $1 billion.

Indeed, in one measure of just how badly the city’s finances are being strained by the demands of civil defense, Police Commissioner Ray Kelly has quietly undertaken a fund-raising drive designed to bring in money for the department from private benefactors.

“It is absolutely unacceptable that New York City’s police commissioner has to spend his time passing the tin cup for private contributions to support the technology, equipment and other needs associated with protecting the city from further acts of international terrorism,” Mr. Kravis said. “New York City is at the highest risk, and our Police Department plays an important role in providing intelligence information and security for the country.”

The Bush plan has been assailed in recent days by New York elected officials-Republicans as well as Democrats-who argue that it would provide New York with less federal security money per capita than every state except California. Mayor Bloomberg has been lobbying for more money and, in recent days, Senators Charles Schumer and Hillary Clinton have been leading a drive to amend the Bush plan to provide more than a billion dollars in additional security aid to New York and other “high-risk” cities. A vote on the Schumer-Clinton amendment, Congressional sources say, may come as early as tomorrow, and a vote on the overall bill is expected within two weeks.

Now, for the first time, New York’s business leaders are publicly joining the campaign to wrest more security funding from Washington. On April 4, dozens of executives from major New York companies will meet in Washington to plot their lobbying strategy, along with representatives of the Mayor and Governor George Pataki. The companies that will be represented at the strategy session and will be lobbying the federal lawmakers and policymakers in coming weeks are Ernst and Young, Citigroup, Morgan Stanley, Merrill Lynch and Company, Goldman Sachs, the New York Stock Exchange, J.P. Morgan Chase and Zurich Financial Services, among many others.

Organizers of the partnership’s campaign are hoping that it won’t be lost on Congressional leaders that these companies are among the most generous contributors to political campaigns across the country.

“New York’s corporate citizens are going to be calling in some of their chits in Washington to get more money to fund our anti-terrorism and security needs,” said Kathryn Wylde, the president of the partnership, which is organizing the effort. “This is a priority for every major employer in New York. Our members funded the campaigns of virtually every member of Congress, so we hope they will be receptive to our message.”

Business Angle

The key to the coming campaign, organizers say, will be to give a business cast to the argument over homeland security. Some of the city’s most influential business leaders will be arguing that the future of the city’s economy-and, by extension, that of the nation-will depend on the city’s ability to guarantee that it’s a safe place to shop, visit or establish new businesses.

In coming weeks, many of these business leaders will be making private calls to members of Congress with whom they have personal relationships. They will be working with staff members for the Mayor and Governor to develop the message that they will deliver to lawmakers, both in private conversations and at fund-raisers.

“We intend to take direction from the Mayor and Governor with regard to the Washington strategy,” Ms. Wylde said. “It’s essential, if the city’s going to be successful, that we all speak with one voice.”

On another, separate front, the Association for a Better New York, a powerful civic group, has launched a letter-writing campaign targeting the Congressional leaders of both parties. “It is critical that New York receives its fair share of the appropriated money to allow Mayor Bloomberg and Commissioner Kelly to continue their efforts to keep our City safe from further attacks,” argues the letter, which was sent out on April 1.

The city’s security plan, known as Operation Atlas, is costing the city $5 million a week. And there are millions of dollars in additional expenses, such as counterterrorism initiatives and other measures.

The business community’s campaign comes at a time when many New York companies have been forced to pick up increased security costs themselves. These companies, many of which house thousands of employees in vulnerable skyscrapers, have spent millions of dollars on everything from outfitting their lobbies with sophisticated new weapons-detection equipment to hiring their own anti-terrorism experts to oversee security.

The executives’ new campaign is likely to create political complications for Republican leaders in Washington. The White House, which bills itself as pro-business, will have a tougher time dismissing arguments for more security money when they’re being advanced by some of the most powerful business leaders in the country.

“This really enhances the message, because it’s coming not just from elected officials whose job is to deliver funds, but from business leaders who represent a powerful wing of the Republican Party,” said political consultant Richard Schrader. “These are people who have enormous influence over major investment decisions, and they’re saying that the Bush administration has failed to give us the resources to get our economy going again.”