The Problem
Currently, 40% of Jerusalem's residents are Palestinian and threaten the Jewish character of the city. Should they decide to exercise their right to vote, the next mayor of Jerusalem will likely be Arab.
The Solution
Take steps to begin to separate from the Arab villages on the outskirts of the city in order to strengthen Jerusalem's shrinking Jewish majority, while initiating a civil-economic plan in those areas to rid them of crime and improve quality of life.
Background
Forty nine years ago (in 1967) Israel annexed the Palestinian neighborhoods and villages surrounding Jerusalem to the city’s municipal jurisdiction, despite the fact that they had not previously been part of the city. This hasty and coercive move was an error of historic proportions.
KEY RECOMMENDATIONS
Today, some 320,000 Palestinians live in areas annexed to the city by Israel. They possess Israeli residency cards and are guaranteed rights under Israeli law, including the right to apply for Israeli citizenship. Many are dependent on Israel for employment, healthcare and welfare services. This dependency cannot be terminated in one fell swoop. It can only be reversed through an ongoing but vigorous effort to build alternative economic, social and municipal infrastructures within and without the Palestinian parts of the city. Only afterwards–as part of a future permanent status agreement with the Palestinians – will it be possible to separate Palestinian and Israeli neighborhoods, political and security conditions permitting.
Administrative Separation
The State of Israel will establish an administrative separation between the Palestinian villages and neighborhoods ('Palestinian Jerusalem') in 'East Jerusalem' and the city’s Israeli neighborhoods. This will not require changes to the Jerusalem Law or affect the status of Palestinian residents.
Municipal Umbrella
A 'municipal umbrella' will be established for the Palestinian neighborhoods and villages, to be managed as a separate municipal framework within the city of Jerusalem. This 'municipal umbrella' will be invested with authority in the fields of planning and zoning, construction, tax collection, infrastructure development, education, municipal services, promotion of trade, assistance to small businesses, community services, etc. It will manage its dedicated budget, separately from the budget of the City of Jerusalem.

Residency Status
The residency status of Palestinians in Jerusalem will not be changed until a permanent status agreement is reached.
No New Palestinian Residents
No new residents will be registered. Any further registration of residency will be limited to those born in the city. An Israeli exceptions committee will deal with special cases.
No Israeli citizenship to be granted to Palestinian residents of the city.
Israeli citizenship will no longer be granted to permanent Palestinian residents of the city.
Protect Current Residents
Rules will be issued to protect the residency status of Palestinian residents of Jerusalem living in areas of the West Bank beyond the city’s municipal limits. This will stem the migration back into the city of those who fear losing their residency status, a development that has led to overcrowding and housing shortages, increased the cost of living and placed an undue burden on already fragile educational and health infrastructures.