On 10 April 1898 the first Navy Bill was passed by the Reichstag. It authorised the maintenance of a fleet of 19 battleships, 8 armoured cruisers, 12 large cruisers and 30 light cruisers to be constructed by 1 April 1904. Existing ships were counted in the total, but the bill provided for ships to be replaced every 25 years on an indefinite basis. Five million marks annually was allocated to run the navy, with a total budget of 408 million marks for shipbuilding. This would bring the German fleet to a strength where it could contemplate challenging France or Russia, but would remain clearly inferior to the world's largest fleet, the Royal Navy.
Wallabout Bay on the River was the site of most of the British prison ships – most notoriously the HMS Jersey – where thousands of American prisoners of war were held in terrible conditions. These prisoners had come into the hands of the British after the fall of New York City on September 15, 1776, after the American loss at the Battle of Long Island and the loss of Fort Washington on November 16. Prisoners began to be housed on the broken-down warships and transports in December; about 24 ships were used in total, but generally only 5 or 6 at a time. Almost twice as many Americans died from neglect in these ships than did from all the battles in the war: as many as 12,000 soldiers, sailors and civilians. The bodies were thrown overboard or were buried in shallow graves on the riverbanks, but their bones – some of which were collected when they washed ashore – were later relocated and are now inside the Prison Ship Martyrs' Monument in nearby Fort Greene Park . The existence of the ships and the conditions the men were held in was widely known at the time through letters, diaries and memoirs, and was a factor not only in the attitude of Americans toward the British, but in the negotiations to formally end the war.