THE DEPARTMENT OF CORRECTIONS HAD 12,000 EMPLOYEES AND A $244.6 MILLION BUDGET FOR FISCAL YEAR 1978-79. IT ADMINISTERED 33 FACILITIES HOUSING OVER 20,000 CONVICTED OFFENDERS. THE INMATE POPULATION GREW TO A RECORD NUMBER DURING THE YEAR. OPENING OF THE DOWNSTATE FACILITY IN DUTCHESS COUNTY IN EARLY 1979 HAS PROVIDED THE OPPORTUNITY TO INTRODUCE THE UNIT MANAGEMENT CONCEPT IN THE NEW YORK SYSTEM. COMPUTERIZATION OF CENTRAL OFFICE AND FACILITY OPERATIONS MOVED FORWARD DURING THE YEAR. IN JULY, THE DEPARTMENT INITIATED A CRISIS INTERVENTION UNIT TO PROVIDE SPECIALIZED TRAINING TO CAREFULLY SCREENED EMPLOYEES. THE ESCAPE AND FINDING OF ROBERT F. GARROW ILLUSTRATED THE VALUE OF THE CORRECTIONAL EMERGENCY RESPONSE TEAM, BUT UNDERSCORED WEAKNESSES WHICH HAVE BEEN CORRECTED. RESPONSIBILITY FOR CLASSIFYING AND TRANSPORTING INMATES WAS SHIFTED TO THE DUTY COMMISSIONER FOR SECURITY OPERATIONS TO IMPROVE THE FLOW OF INORMATION AND OPERATIONS BETWEEN THE CLASSIFICATIONS-OPERATIONS AND SECURITY OPERATIONS AREAS. ALSO, AN ESCAPE ANALYSIS UNIT WAS CREATED AND A FEASIBILITY PLAN FOR MUTUAL AGREEMENT PROGRAMMING WAS DEVELOPED. OTHER AREAS DESCRIBED INCLUDE ADMINISTRATIVE OPERATIONS, FISCAL SYSTEM, SECURITY PROGRAMS, INMATE EDUCATIONAL PROGRAMS, AND OTHER INMATE SERVIES. PHOTOGRAPHS, TABLES, MAPS, FIGURES, AND A LIST OF DEPARTMENT ADMINISTRATORS ARE INCLUDED. (CFW)