Statement by Corporation Counsel Steven Banks to the City Council In Connection with the Preliminary Budget for Fiscal Year 2027

March 13, 2026

Good afternoon, Chair Brewer and Members of the Government Operations Committee as well as other members of the Council. It is a pleasure to come before you to discuss the Law Department's fiscal year 2027 Preliminary Budget. I'm joined by First Assistant Corporation Counsel Sheryl Neufeld, Managing Attorney Eric Eichenholtz, and Chief of Administration Jennie Nagle-Yndigoyen.

The Law Department represents the City, the Mayor, the City Council, other elected officials and the City's agencies in all affirmative and defensive civil litigation. The Department brings proceedings in Family Court alleging violations of criminal laws and represents the People of the State of New York in proceedings filed in Criminal Court to enforce the City's Administrative Code. Law Department attorneys draft and review local and state legislation, real estate leases, procurement contracts and financial instruments for the sale of municipal bonds. The Department also provides legal counsel to City officials on a wide range of issues such as civil rights, education, intellectual property, land use and environmental policy. The Department's work embraces all City entities and operations; our work impacts all areas of daily living in New York City.

The Department currently has approximately 785 assistant corporation counsels and 600 legal support professionals. We are proud to be a leader in the legal profession with approximately 31% of our lawyers racially and ethnically diverse and 58% percent women. Over the past few years, headcount reductions have impaired the Law Department's ability to fulfil its mission in representing the City, it's elected officials, including the Council, and other City entities. The 200 new attorney lines and 100 professional support lines provided to the Law Department in the proposed budget will be allocated to support all areas of the Law Department. This increased staffing will help mitigate the increases in monetary settlements and payouts resulting from a number of factors, including the Law Department's reduced headcount in the past administration. The increase in staff will allow us to restore our ability settle meritorious cases earlier and make dispositive motions or try cases that lack merit, reducing payouts in both types of cases. Other new staff will focus on enhancing the Law Department's ability to advise and support the City through legal advice and affirmative litigation initiatives. The new staffing will also enable the Department to increase the provision of risk assessments in order to help agencies reform practices and avert litigation against the City in the first place. Through all this, we will advance the City's affordability agenda as well as the interests of the City, the Mayor, the Council and other elected officials.

A large focus of the Law Department's work this past year has been addressing potential challenges regarding federal funding requirements, which have changed and evolved rapidly over the last year. To do so, we have set up a special team to focus exclusively on these emerging challenges. Our work has already been critical, safeguarding billions of dollars of federal grants that touch on all aspects of municipal life, including infrastructure, policing, housing, social services, and mission-critical objectives such as disaster mitigation and counterterrorism efforts. With the increased staffing, we will be positioned to litigate - affirmatively and defensively - to protect the City's rights and interests.

For example we brought a lawsuit to protect funding the City received from the Federal Emergency Management Agency ("FEMA") in accordance with federal law to reimburse the City for services to asylum seekers. We sued to protect NYC Public Schools' magnet school funding that was cut based on purported violations of Title IX due to the Public Schools' Guidelines to Support Transgender & Gender Expansive Students. We also joined coalitions of other cities and states to challenge grant conditions that violated federal law because they are intended to commandeer recipients to enforce federal immigration policy and federal Executive Orders, among other things.

Similarly, we filed and joined more than 25 amicus briefs on topics such as immigration enforcement, federal funding, deployment of the National Guard, and New Yorkers' rights and benefits, to ensure that the City's voice is heard as Courts consider these emergent legal issues, even in circumstances where the City is not a party.

At my confirmation hearing before the Council, I emphasized the importance of the Law Department being promptly attentive to the needs of all its individual and institutional clients, including the Council. Since assuming the position of Corporation Counsel, I am pleased to report that we have been working in collaboration with the Speaker and the Council in a number of areas. Individual members of the Council have also reached out to me directly to discuss matters of concern. Our office will continue to work side by side with Council staff on crafting legislation, providing legal advice in a timely manner and ensuring legal clarity and defensibility in doing so. An excellent example of this is our recent work together on procurement reform legislation.

The Law Department's work is both revenue saving and revenue generating. For example, in FY25, the Department saved the City $128 million by resolving $140 million dollars in claims in contractual disputes for a total of $12 million. Similarly, the Department's defense of real property tax assessments protected $96 million in property tax receipts in FY25 and almost $65 million during the first half of FY26, which preserved funding for City services.

During this fiscal year so far, the Department has recovered over $35 million for the City and City entities. This includes monetary recoveries for property damage, breach of contract, restitution, false claims act cases, securities fraud, public health and safety matters, including anti-youth vaping and tenant protection/code enforcement cases, and opioids settlement payments, among other things. In this year fiscal year, collection law firms supervised by the Division recovered another $30 million.

In addition to recovering monetary damages, the Department sues to enjoin unlawful or harmful practices that cause or contribute to a public nuisance, or otherwise negatively affect public health and safety. For example, we are currently litigating against Kia and Hyundai over their failure to install industry-standard engine immobilizing technology in low-end models of their vehicles, which, when highlighted as part of a TikTok challenge, led to a massive spike in thefts of those models in the City, as well as dangerous driving, property damage, injuries and deaths. We are also currently litigating against four major social media companies for the harms that have resulted to the mental health of young people, and the costs those harms impose on the City, as a result of the deliberate design, marketing, and operation of addictive social media platforms which intentionally target our youth. And, as was reported yesterday, we recently obtained a ruling assessing $2.1 million in fines against a landlord who has failed to make repairs to a residential building and $1,000 in ongoing daily fines until the conditions are corrected. These cases and other litigation aim to change behavior by compelling compliance with city law and policy, to enhance public health and safety, and protect New Yorkers from unlawful and harmful conduct.

We also anticipate saving the City over $100 million dollars this Fiscal Year in payouts from the judgment and claims fund through our continuing activity to compel insurance companies to defend and indemnify the City. This program, which began in the late 1990s, has saved more than three billion dollars in judgments and claims payments through insurance takeovers since its inception. Every case that the insurance company steps up to defend is a case that does not have to be defended by city attorneys, thus saving enormous legal resources. Settlements and judgments paid by insurers in cases falling within the policy coverage also save the City substantial sums.

The Law Department represents the City in litigation in more than 70,000 cases annually. We continue to experience an increase in pending cases. Approximately half of our pending cases-some 35,000-involve tort matters. These pending cases include a large number of Adult Survivor Act and Child Victims Act cases, and we anticipate a continued influx of these cases, which involve claims of misconduct that occurred many years ago. We also expect a continued increase in Gender Motivated Violence Act cases with claims for past conduct. Given the significant fiscal impact of these cases on the City, we are looking for solutions that give the City certainty regarding exposure while properly compensating survivors with meritorious claims.

The Department also serves as the statutorily mandated Presentment Agency for all Juvenile Justice, Adolescent Offender and Interstate Child Support cases referred to the New York City Family Court. Under the rehabilitative mandate of the Family Court Act, the Department must work to achieve outcomes that serve the needs of each individual young person brought before the court, while at the same time, protecting the interests of crime victims and ensuring the safety of the community at large. Law Department attorneys also appear in New York City Family Courts to handle petitions to establish parentage, and obtain, modify, or enforce an existing child support order. In 2025, Juvenile Justice case referrals increased by 11% to 7,740 from 6964 referrals in 2024; 66% of the referrals represent felony charges. In 2025, there were 348 firearms cases referred to the Department, which is a decrease of 15% from 411 firearms cases in 2024. The number of Child Support referrals in 2025 remained virtually the same with 1,889 child support referrals in 2024 and 1,894 in 2025.

My testimony today provides an overview of the very broad and varied legal work performed by the Law Department. By keeping the interests of all New Yorkers at the center of our work, we can do what is right and just, solve problems, reinforce trust in government, and help meet the needs of New Yorkers.

I thank you for your support of the Law Department and look forward to our continued collaboration. I would be happy to answer any questions you may have.