Kelly sent a letter to City Council Speaker Christine Quinn detailing the changes. Quinn, a likely candidate for mayor, has been a vocal critic of the policy. Last year, more than 630,000 people were stopped, mostly black and Hispanic men. About half are frisked, and only about 10 percent are arrested.
Kelly said in the letter that the steps were meant to increase public confidence in the tactic and that the New York Police Department has reiterated its policy that prohibits racial profiling.
The department is also establishing an early warning system to identify officers who have received public complaints on the policy, and precinct commanders will be held accountable at weekly meetings.
Kelly also created a new training course detailing how to conduct a lawful stop, following a review of the stop, question and frisk encounters. More than 1,500 officers who work in the highest-crime areas are receiving the training, and more will follow, Kelly said.
The news comes a day after a federal judge gave class-action status to a lawsuit by people who had been stopped. The lawsuit accused the police department of purposefully targeting black and Hispanic neighborhoods and said officers are pressured to meet quotas as part of the program and are punished if they don't.
U.S. District Judge Shira Scheindlin ruled that there was "overwhelming evidence" that the practice has led to thousands of illegal stops.
Kelly said later Thursday that the department is always open to looking at new strategies and refining current ones, but he thinks overall the policy is working. He pointed to drops in crime as evidence the strategies are working. In the past decade, the city has seen the lowest number of murders since record-keeping began in 1966. In 1990, murders hit an all-time high of 2,245. In 2011, there were 515.
"We must be doing something right," he said. "It's not that people are getting nicer. Human nature hasn't changed that much."
Kelly said in his letter to Quinn that the department has expanded community outreach and started a pilot program aimed at "vulnerable youth" that teaches them computer skills.
"It is our hope that this course will build lasting relationships and provide an outlined that might help foster positive interactions between these teenagers and police officers," Kelly wrote.
Mayor Michael Bloomberg defended the policy, which the police have said is a life-saving, crime-fighting tool and has helped lead the city to historic lows. Quinn has been a more vocal opponent.
She said the changes are a good start but more must be done.
"The NYPD, the Mayor, and the City Council have more work to do to ensure that all stop and frisks are appropriate. I know that we can both keep crime at these historic lows and protect the civil rights of all New Yorkers. That must be our commitment to the people of New York City," she wrote.
Donna Lieberman, head of the New York Civil Liberties Union, and other potential mayoral hopefuls said the changes amount to little more than a public relations effort.
The NYCLU analyzed a year's worth of stop-and-frisk data and found that while the number of stops has risen dramatically, the number of illegal weapons uncovered has not.
The NYPD has about 35,000 officers. The second-largest department is Chicago, with about 13,000.
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