Cities are, theoretically, the nimblest governmental level. Unlike federal and state governments, they’re not tasked with national defense or managing massive entitlement programs or social safety nets. Instead, they provide basic services, from public safety to education. Also, in theory, cities maintain the flexibility to adjust their services based on tax-revenue fluctuations and to try different service-delivery methods.

Over the past five decades, though, New York City has gradually lost control of its public services—both budgetarily and operationally—because of consent decrees, legal settlements, and concessions to outside monitors, all resulting from expansive court proceedings. The operations of three out of four uniformed services, as well as much of the city’s education and social-services portfolio, are now driven not so much by local political will or fiscal resources but by court-mandated agreements with politically unaccountable third parties.

These decisions constrain the city’s capacity to experiment with service delivery and, in a severe budget crunch, will further restrict its ability to protect key government functions. Gotham doesn’t make the federal or state laws that these legal cases are based on, but it has worsened its own situation unnecessarily. The good news: it can take steps to improve things.

The constraints fall into three broad, and overlapping, categories. First are consent decrees or legal settlements that force the city to spend money—often, lots of it. (A judge issues a consent decree, with the approval of the parties to a legal case; a settlement is made between individual parties to a case.) Second are decrees and settlements that require the city to do something, or to stop doing something. Third are decrees and settlements that—practically, if not legally—require nothing concrete but instead set up years of expensive outside monitoring to measure the city’s performance in a particular area.

An example of a consent decree that falls into the first two categories is Callahan v. Carey. The 1981 case arose in the early era of what law professors Ross Sandler and David Schoenbrod called, in their 2003 book of the same name, “democracy by decree.” The phrase describes a regime that combines entrepreneurial nonprofit legal firms seeking to use the law to make long-term policy; a state and local judicial philosophy of expanding individual rights, even when unnamed or vague in the state or federal constitutions; and a municipal government that doesn’t adequately defend itself. Together, these forces have brought agreements of (so far) permanent duration that consume a growing share of the city’s budget and limit its governing capability.

Callahan got going in 1979, during Ed Koch’s mayoralty, when New York’s nonprofit Coalition for the Homeless sued on behalf of three homeless men, charging that, under the state constitution, they had a right to city- or state-provided shelter. The state constitution’s bill of rights guarantees only traditional American-style protections, mostly against government overreach, such as unwarranted searches. And if the constitution did guarantee a right to shelter, it would be a state-level protection, not a city one. Nevertheless, a state judge found that the homeless men were indeed “entitled to board and lodging.”

New York City officials could have appealed Callahan to the state’s highest court. Instead, in 1981, the city and state settled the suit. New York City took on a new responsibility to give shelter and board to “each homeless man” who fit not-hard-to-meet criteria; the state would reimburse costs.

Mayor Eric Adams’s administration approved a settlement in another lawsuit, this one against the NYPD, the terms of which will severely hamper policing. (NDZ/STAR MAX/IPx/AP Photo)

Why did New York settle? Stan Brezenoff, a named defendant in the case in his capacity as the Koch administration’s human resources administrator, recalls that, though “the city was still in dire financial circumstances” following the 1975 fiscal crisis, “the general consensus was that we were going to lose” an appeal. “At the moment in time, it seemed like the prudent thing to do,” he says, to get a settlement that the city could afford. Further, the decree then applied only to adult homeless men, a population in the low single thousands, and only required the city to provide communal shelter. That fit with what the Koch administration wanted to do anyway: get derelicts off the streets, as New York worked to improve its quality of life.

Still, says Brezenoff, “we didn’t have a sense that this was an iceberg” and that “we were seeing [only] the immediately visible part.” The decree inexorably expanded into a far broader right. In 1983, a judge ruled that Callahan applied to women, on equal-protection grounds. And in 2008, then-mayor Michael Bloomberg agreed, in a new legal settlement, that the city was obliged to house homeless families with kids, so long as the families could demonstrate that they had no other options—and that the government had to provide such family shelter not in communal settings, which would be unsafe for children, but in individual rooms and apartments. With each expansion of the city’s mandated responsibilities, state support has dwindled as a share of the annual spending. Before the city’s migrant crisis, when the state began providing temporary aid, city funding, at nearly $1.7 billion annually, was nearly ten times the state’s contribution.

New York’s biggest challenge in upholding this now four-decade-old “right” is the current migrant crisis. The surge of nearly 70,000 migrants in recent months, as of March 2024, has doubled the city’s pre-Covid shelter population, bringing it to record levels. Migrant spending will eat up $4.2 billion in city funds this year, 6 percent of Gotham’s tax dollars, and nearly 4 percent of its total budget, including federal and state dollars. Even as New York struggles to recover from pandemic disruption, it has now commandeered thousands of Manhattan tourist hotel rooms, and some empty office buildings, for indefinite migrant housing, all to meet its Callahan and subsequent mandates.

The migrant crisis is exactly the type of situation that calls for adaptability, not for rigid adherence to an old decree. With greater governing flexibility, New York could still aid some migrants, but decide exactly how to help, and even use such decisions as leverage over the federal government, which has failed to secure the U.S. southern border and to allow for the orderly settlement of vetted asylees. For example, New York could say that it would support housing for, say, 10,000 migrants who have already officially applied for asylum, and for whom the federal government has authorized work permits.

Instead, New York just keeps opening hotel shelter after hotel shelter, with no end in sight; the number of migrants in city “care” is expected to hit 90,000 by summer 2024. “The rules that govern these consent decrees immobilize the government,” observes Sandler. “No battle plan in life can be so rigid,” he adds. Yet “every modification [request in court] opens up another litigation.”

Eric Adams’s mayoral administration recently spent more than a year in mediation with the Coalition for the Homeless and the Legal Aid Society, the outcome of which modified the right to shelter so that the city can ask migrants to reapply for housing after 30- and 60-day stays for adult singles and families, respectively. The process pointed up another shortcoming of government by consent decree. How many migrants New York can afford to shelter, whether the city should limit aid to official asylum seekers or to all migrants, how long it should provide such shelter—all are critical public-policy questions, placing demands on the city’s finite budget and on its tourism infrastructure. Yet because the Coalition for the Homeless is a private party in a private legal action, the discussions over change to the consent decree happen in secret.

A second case from the era of democracy by decree—one requiring the city to do something, albeit poorly defined, and to spend dollars doing it—has constricted New York’s ability to budget for, and govern, education. In 1975, Congress enacted what was then called the “education for all handicapped children act,” codifying an equal-protection right for disabled kids; schools that took any federal funding had to comply.

This sounds admirable, but as Sandler and Schoenbrod noted, what exactly did it mean, and who would pay for it? In a 1979 suit brought on behalf of a student against New York City in federal court, known by the student’s name—the Jose P. case—a federal judge found the city in violation of the law. But how to fix the violation? “A free, appropriate public education,” the right guaranteed in the new law, is an “aspirational standard,” Sandler observes. How do courts know when New York has met the standard? What does “appropriate” mean? “Even with infinite resources,” says Sandler, sometimes “you can’t reach the aspiration.” With these cases, courts have moved away from telling defendants to stop doing something (don’t block the schoolhouse door to black students, for example, in the 1950s) and have started telling them to act in specific ways—in this instance, to ensure that everyone gets an (ill-defined) “appropriate” education. Jose P. spurred the city to create its vast special-education bureacracy; almost a quarter of the city’s nearly 1.2 million students are now in special ed.

Particularly in education, where it is so unclear whether a standard has been achieved, plaintiffs and courts are satisfied with mandating only that New York spend more money, even if it isn’t tied to a provable outcome. Money becomes a proxy for how much the city cares.

A federal monitor now oversees all hiring decisions for New York City’s fire department. (U.S. Army photo by Sgt. 1st Class Brian Hamilton/Alamy Stock Photo)

Another case affects state, not city, spending: in 2002, in a lawsuit brought on behalf of New York City schoolchildren, the state’s top court ruled that New York State was deficient in not guaranteeing that city students receive a “sound, basic education,” as the state constitution demands. The state, in response, has boosted city education spending over the past two decades, though no one has ever defined “sound, basic education.” What does it mean in New York City, where education spending has long exceeded national levels? Is money the only way to define it?

Another court decision directly commands city education dollars. Under a 1993 U.S. Supreme Court ruling, involving the same language as the Jose P. case—a “free, appropriate, public education”—New York must now spend nearly $1 billion annually on the tuition of 15,000 students with disabilities, whose parents don’t think that public schools can meet their special needs; spending in this area has risen nearly tenfold over the last decade. With, again, no clear definition of “appropriate” and no objective way to compare whether a private school meets a student’s needs better than a public one, how can a school prove that it has met the standard? Is assigning two aides to a student with profound mental disabilities an appropriate amount of extra attention? Is a private school that can assign three aides acting in a more appropriate manner?

As with sheltering the homeless, it’s not that New York shouldn’t provide any aid, or even pay to send disabled children to specialized schools when appropriate. But the government must be able to act within its fiscal limits, and with some leverage. If taxpayers are paying to send disabled kids to private schools, the city should be able to negotiate the price and get some data on the results.

In yet another education case, New York City has surrendered not just its ability to determine what an appropriate education is but also its hiring flexibility. Last year, the Adams administration settled a long-standing federal lawsuit that charged that the city’s teachers’ exam discriminated against black and Hispanic applicants. New York not only gave up autonomy over future tests, and thus its future workforce; it agreed to pay $1.8 billion to 5,200 plaintiffs, who supposedly would have worked or been promoted as teachers, but for the purported bias.

In three other critical public services—those that help maintain the tax base to pay for the above social and education programs—New York City now labors under unending, and costly, outside monitoring.

First up: firefighters. In 2007, the U.S. Department of Justice sued the fire department of New York, charging that the entrance exam to become eligible for training was discriminatory. The test—a basic-skills assessment, with study guides available for free to the public—had a “disparate impact” against black and Hispanic applicants, a federal judge ruled in 2009; the ruling was upheld on appeal in 2013. Rather than appeal to the Supreme Court, New York settled, surrendering control over personnel decisions at the fire department indefinitely. A federal monitor now oversees recruitment, exams, hiring, training, and promotion. Just as in the would-be teachers case, the city also had to pay up—here, $99 million to 1,470 people claiming back pay because the department had neglected to hire or promote them.

The police and correction departments are other examples. In one of his first mayoral acts, in 2014, Bill de Blasio settled decade-old litigation over whether the NYPD practice of “stop, question, and frisk” to control street crime by taking weapons off the streets was unconstitutional. A federal judge had ruled that it was, but de Blasio’s predecessor, Michael Bloomberg, had planned to appeal further. The settlement leaves New York in a strange netherworld. With no high-court ruling on the matter, the NYPD can, and does, continue to make stops for suspicious behavior; the federal monitor merely requires far more police recording (including by body cameras) of the reasoning behind such stops, and their outcomes.

Similarly, in 2015, de Blasio settled litigation against the correction department, brought by current and former inmates at Rikers Island. Joined by the federal government, the suit charged abuses at the jail; the settlement required the appointment of a federal monitor to oversee reforms, including changes to officers’ use of force.

Of course, police and correction officers should follow the law and respect constitutional rights, and in instances when they don’t, the victims should have legal redress (and do—the city pays out close to $150 million a year to settle individual civil rights lawsuits). But where reforms are good, or politically and publicly popular, such as the use of body cams, New York City could have enacted them on its own. Relying on federal monitors to effect positive change or change broadly desired by the public, by contrast, weakens the city government’s autonomy. For example, de Blasio could have just cut back on the NYPD’s use of stop, question, and frisk tactics without settling the federal case; he had run for and won office in 2013 pledging to reduce such stops.

When it comes to real and persistent abuses, moreover, federal monitors often let them continue. It’s hard to argue, for instance, that nearly a decade of federal monitoring at Rikers has improved inmate conditions. In 2022, 19 died—the highest number since well before the federal monitor took over. The federal monitor writes reports criticizing the city’s practices but never exerts its right to take over the jails—partly because no federal administration wants responsibility for them. In fact, the Rikers lawsuit that de Blasio settled joins an earlier agreement, related to 1975 litigation, that still hasn’t fixed jail conditions.

“The bill for these arrangements could exceed the city’s limited ability to raise taxes. Third-party legal restraints also encourage helplessness.”

When justified, then, federal monitors do what New York should have been doing, anyway—and often fall short when the city still doesn’t do it. Federal monitors can impose severe constraints. In September 2023, for example, the Adams administration approved settlement in another lawsuit, this one brought by 2020-era protesters, upset at the NYPD practice of “kettling” them—using metal grates to pen them in a location, to keep them from moving unlawfully into streets or to make it easier to arrest them en masse. In the settlement, the Adams administration will agree to stop future kettling and to submit to yet another outside overseer.

The settlement’s language is telling: “no individual will have any force used against them on account of their lawful First Amendment speech.” At best, this is effectively a pledge not to behave illegally or unconstitutionally in the future. But implicitly, all governments, corporations, institutions, and people are under a prior restraint to behave legally—or face the consequences. Rather than adjudicate instances of kettling on a case-by-case basis to determine whether each is justified, though, the city is now giving up the NYPD’s ability to engage in the practice at all. Sometimes kettling may be appropriate, and sometimes not. A blanket ban severely hampers policing at a time when aggressive protests over Israel and the climate are increasing. Bizarrely, Adams first praised this settlement, saying last September that it would “keep New Yorkers safe and protect their civil liberties”; months later, he condemned it, saying that he “pushed back hard” at the agreement because it sent the city in a “troubling direction.” Pushed back against whom? He’s the mayor.

Consent decrees, settlements, and federal monitors hobble New York City’s basic capabilities. The bill for these arrangements could exceed the municipal government’s limited ability to raise taxes. Third-party legal restraints also encourage helplessness. Why fix Rikers Island ourselves, when the federal government might just take over?

What is to be done? The first step is to stop entering new agreements. The reasoning for Adams to enter into the city’s new agreement restricting the NYPD’s ability to kettle protesters is inscrutable. With no lower-court federal judge having yet ruled on the practice, why not at least wait for a court judgment?

Second, New York City should appeal any intermediate court decision to the highest court possible. Yes, in the “right to shelter” case, the city benefited, in the short term, from settling, likely winning more state aid by shielding Albany from a broad, high-court ruling guaranteeing a statewide right to shelter. But in the long run, Gotham took on an open-ended obligation to house the entire world, with limited, discretionary aid from the state. Similarly, if the practice of stop, question, and frisk is federally unconstitutional, the Supreme Court should say so; if it isn’t, the NYPD should stop laboring under an indefinite federal monitor.

Third, as Sandler maintains, any time the city can’t avoid a ruling under which a court appoints a long-term federal monitor, it must keep asking: “How do you terminate the appointment [of the monitor]? How do you modify [the appointment]?” Federal monitors have zero incentive to declare victory and walk away. Typically private-sector lawyers or law firms appointed by the judge, monitors have raked in $111 million in fees from the city over roughly a decade, a New York Post investigation found. As one former city official says, the arrangement “enriches the people who are doing the monitoring.” Judges, says Sandler, should also “be more sympathetic at modifications” of existing consent decrees and settlements.

The biggest concern: the federal and state laws written purposely vaguely, or not at all. Members of Congress got much credit, back in 1975, for decreeing that all students with disabilities should receive an appropriate public education—who could disagree with that? But they left behind a mess of how to figure out what “appropriate” means. New York State lawmakers, when it comes to the supposed right to shelter in New York City, have remained silent. If a state constitutional right to shelter exists, why haven’t they passed a law to define it and fund it statewide?

Finally, the best defense—though incomplete—is competent local government. It is the New York City government’s job to provide public and limited social services competently—and it is up to a free press, the city council, the state legislature, and the governor to ensure that the city carries out this public charge. If the city can’t govern itself, no outside force will be a viable substitute.

Top Photo: A consent decree dating from the 1980s requires the city to provide shelter to all who seek it—and the migrants keep coming. (Steve Sanchez/Sipa USA/AP Photo)


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