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New York City Comptroller William C. Thompson, Jr. today released a report questioning whether New York will ever receive as much as $3.7 billion in federal aid initially pledged in the aftermath of the September 11th attacks. Thompson’s report, “9/11: Two Years Later, An Analysis of Federal Aid” noted major concerns regarding the level of assistance that New York City will actually receive under the disaster relief package and the timing of that assistance, and offered a series of recommendations to improve the flow of aid.

In the report, Thompson stated that two years after the devastating attacks, the original $21.4 billion aid package has dropped to $20.8 billion as a result of programmatic adjustments. The Comptroller reported that, to date, New York has only received $5.6 billion of the $21.4 billion aid package promised by President Bush. Of that amount, $11.5 billion is in the pipeline, and is expected to reach the City over the coming years. However, Thompson estimated that as much as $3.7 billion is at risk, and requires prompt action to avoid being lost or unduly delayed.

“Given the monumental impact of the attacks on New York’s economy and the continuing stagnation of the City’s fiscal health, this is disappointing,” Thompson said in the report. “The timing of the flow of Federal funds is critical because of the need to inject funds into the City’s economy as rapidly as possible in order to stimulate the growth needed for recovery.”

Besides identifying “at risk” aid, Thompson’s report presented the expenditures and allocations to date. Thompson pointed out that the greatest concern is the “at risk” aid, which includes funding that is not yet earmarked for specific programs or projects, and benefits that may not be realized.

Unprogrammed aid includes $1.4 billion in Federal Emergency Management Agency (FEMA) assistance and $1.2 billion in Community Development Block Grant funds yet to be allocated. The remaining $1.1 billion involves benefits related to the Liberty Zone program. The program was established in March 2002 to provide a package of tax benefits to New York area businesses.

Additionally, the report’s appendix contains a detailed compilation of statistics demonstrating the continuing impact of the September 11th attacks on jobs, businesses, wages and the real estate market in lower Manhattan.

Thompson offered a number of recommendations to ensure that New York gets the pledged amount of federal assistance.

“The federal aid package needs to be revised to reflect the City’s actual recovery needs, and the Federal government needs to accelerate the rate at which the City receives the funds,” Thompson said. “If appropriate action is not taken, the total aid package could decrease to $17.1 billion, $3.7 billion less than the amount pledged.”

Further, Thompson recommended that FEMA allocate all unprogrammed funds ($775 million), either accelerate or reprogram all funding currently allocated to programs that have not met their targets, and that the Lower Manhattan Development Corporation and the Empire State Development Corporation develop programs for the $1.2 billion in undesignated Community Development Grant funds. He also recommended that officials reevaluate the Liberty Zone program – and whether the Liberty Bond program deadline should be extended - in light of the economic climate and changes in the tax laws.

Comptroller Thompson further recommended that the Federal government provide a “unified and systematic” accounting of all of the aid that has been pledged and expended to be able to identify any shortfalls and address them.

“After a disaster of the magnitude of the World Trade Center attacks, the City needs and deserves the full amount of aid promised by the Federal government,” Thompson said.