NBC News and news services
updated 1/30/2010 10:43:02 PM ET 2010-01-31T03:43:02

The Obama administration is proposing a $200 million fund to help pay for security costs in cities hosting the trials of accused terrorists such as Sept. 11 mastermind Khalid Sheikh Mohammed.

The money will be included in a budget plan for 2011 of roughly $3.7 trillion that President Barack Obama will submit to Congress on Monday, a congressional aide said Saturday. The aide spoke on condition of anonymity because the spending blueprint hasn't been announced.

The administration said late last year the trials would take place in federal court in lower Manhattan, near where the World Trade Center once stood. But there's growing opposition from the city, and on Friday night NBC News and other media outlets reported that the administration abandoned its plan to try Mohammed in the city.

Mayor Michael Bloomberg had put the cost of tighter security at $216 million just for the first year after Mohammed and the others were to arrive from the U.S. military detention center at Guantanamo Bay, Cuba. New York City officials had warned of massive gridlock in lower Manhattan due to the extraordinary security steps that would have been required to host the trial.

The money for terrorist trials is just one piece of a $3.7 trillion or so budget plan for 2011 to be released Monday.

Looking elsewhere
Options for alternative trial sites include the northern Virginia city of Alexandria, which hosted the 2006 sentencing trial of Zacarias Moussaoui, who pleaded guilty to helping plan the 9/11 attacks.

Republicans have led the opposition to hosting Guantanamo detainee trials in the U.S.

States such as Illinois would welcome the detainees since holding them is a source of federally funded jobs. Democrats controlling the state government want to sell a prison in the rural northwest portion of the state to the federal government to house Guantanamo detainees.

Attorney General Eric Holder was considering other venues, according to one Obama administration official. Justice Department spokesman Dean Boyd said: "We're considering our options," according to Reuters.

Congress has yet to provide the $100 million sought by the Pentagon to implement Obama's request to shutter the Guantanamo facility and has imposed restrictions on transferring its detainees into the U.S. — except to stand trial.

Though the officials wouldn’t discuss locations under consideration, others have suggested Governors Island, a former military base in New York Harbor that now welcomes summertime picnickers and bike riders; the U.S. Military Academy at West Point or Stewart Air National Guard Base in Newburgh, N.Y.

New York Police Commissioner Raymond Kelly told reporters Friday that a backlash had made it “unlikely” the case would go forward in the city. He said plans to hold the trial there started to unravel after a speech he gave recently detailing the enormous costs and logistical challenges of ensuring security at the Federal Courthouse in lower Manhattan.

Setback for Obama?
New York Gov. David Paterson said he was “elated that our concerns are being considered by the president and the federal government.” He had said earlier this week that if the cases went forward in the city, “Every time there is a loud noise during the two years of those trials it’s going to frighten people, and I think New Yorkers have been through enough.”

Moving the trial would be a setback for Obama. His administration has spent weeks defending its handling of terror threats following the attempted Christmas Day bombing of a Detroit-bound airliner, a case that reignited the debate about whether such terror suspects should face civilian or military justice.

Video: Moving the Sept. 11 trial out of NYC Obama has long supported trying some terrorists in federal, civilian court, while Republicans have argued that terrorists — including the five alleged 9/11 conspirators — should be tried in military tribunals where other Guantanamo Bay detainees will be judged.

Rep. Peter King, R-N.Y., said Thursday he has introduced a bill that would prohibit the use of Justice Department funds to try Guantanamo detainees in federal civilian courts. Republican South Carolina Sen. Lindsey Graham said he’ll introduce a similar bill in the Senate next week.

In a letter sent to the White House Friday, Democratic Sen. Dianne Feinstein of California said the terrorist threat to the U.S. remains high and New York is a prime target. The trial of the most significant terrorist in custody would only add to the threat, she wrote.

When asked by reporters Thursday about the president’s commitment to holding civilian trials, White House spokesman Bill Burton said Obama believes Mohammed and his alleged accomplishes could be successfully and securely brought to justice in a federal court.

“Currently our federal jails hold hundreds of convicted terrorists, and the president’s opinion has not changed on that,” Burton said.

Patrick Rowan, once the top counterterrorism official in the Bush Justice Department, said he expects the administration to try to find a new location somewhere in the same federal court district, which extends into suburban counties north of New York City.

“It’s more likely to be a place like a military facility, where the security issues are essentially as tied down as one could expect them to be,” said Rowan.

Mayor Nicholas Valentine of the small upstate city of Newburgh has offered his community as a possible location. The city has a new state-of-the-art courthouse, he said, and is less than a 90-minute commute from Manhattan. The air base there has been used in the past to fly in terror suspects facing trial in the district.

NBC News' Pete Williams and The Associated Press contributed to this report.

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