Okay. All right 64 then. What is the level of interface with your department and the Commerce Department?
Through a number of different things that we have worked on. Which would be the Ambassador Program, Campus Philly. What else did I talk about earlier? The Philadelphia Collection, the Philadelphia Fashion Incubator at Macy's. We work on a number of different things together.
Very well. I will say that the discussion about the celebration of smaller arts and cultural organizations with Commerce. What is the level of interface with the Office Of Arts And Culture?
Well, we work with them. We created a program last year, the Jazz Coalition, where there is, this Friday, I believe. This April is Jazz month. Last year we had a press conference on Jazz Day, which was -- we launched on the end of March and then we had Jazz month, which was in the middle of the month and we pulled together a number of different Jazz groups and 65 organizations in the City and announced it Jazz month, which is the U.S. Conference, the Mayor does Jazz Day.
That's a new initiative of the partnership between those two departments?
Very well. I want to put on the record here today that my office has been doing its du diligence around a City wide Children and Youth Arts and Music Festival. They're about 12 celebrating different cities around the county. Philadelphia is not one of them. I was struck by the work of In Liquid (ph). They had a community arts festival last May or June and thought about the value of making it a City wide effort where you celebrate talents of children and youth. So, know that that document is coming to you. I believe I had a preliminary 66 conversation with GPTMC, I simply can't remember, but when I looked at what other cities are doing around the country and celebrating the works and talents of children and youth. I think that is a great opportunity for our City, and when I looked at the different sponsors, some of those sponsors are right here in the region. So, know that that document is coming to you as well as to the leadership of GPTMC.
Okay. Lastly -- That may be it. I think that is it. So, let me close by also acknowledging the important work that you do and the reach that your office has for it to be such a small -- small in terms of numbers. But, your reach is wide and deep and I know that because I see it often in the work that you are doing.
Thank you, Mr. Chairman. My concern is that your office is small and that it seems like there is so much more work that needs to be done. I am not sure who else does it. I guess we have the Commerce Deputy Mayor coming up as well. But, in terms of our need as a City to bring dollars in and to create new employment and opportunities and to attract the type of residents that we need for our growing creative and innovative work force. With all the opportunities to brand Philadelphia, you know, how does your office, in terms of size and activity, compare with cities like New York or smaller cities like Boston, which are well-branded?
What do their offices look like, comparable office to yours?
Well, New York has New York City Marketing, which is an agency that 68 was created quite a few years ago and was an outside agency that pulls together convention tourism and hospitality. It is a very different setup because they have the different bureaus. So, it is even less comparing apples and oranges to compare this office with what New York City Marketing does. We work with, in this City we have PCVB has a separate organization, GPTMC is a separate organization. You also have Center City district. All of whom work together to try and do that promotion and branding, which is what With Art Philadelphia promotion is all about. All of those organizations for the first time really came together. So, we recognize exactly what you are saying and try to pull together to do that, which is also what the Mayor's Hospitality Advisory Board is trying to do. There is not a comparison between us and New York or even Boston in how it is all setup. Each City is set up differently. Philadelphia is definitely unique in the way that we have it 69 setup in terms of promotion and marketing.
Well, for four years I think it is good since we have been working very hard to make a difference and I think we have in a number of different ways. With what we have to do, yes. But I don't think that you can compare New York City marketing to what we have here because it's a very different kind of setup because of the different boroughs.
One moment. I actually think Councilman Oh is on to something. That thematically many of the Council people here today have said is that we are not different than New York. We have different analogies and different definitions of neighborhoods, boroughs versus neighborhoods. But, pretty much, each one of these districts is unique from all around the 70 City and if we thought of it that way to market it in that way, like one of the things we are proud of in the fourth is we have more park land, more waterfront than most districts and as I work with the commercial corridors there, they are trying to push that. Main street is pushing the riverside of things and every time we do a promotion for the arts festival, which you help us with, and others, we are really selling that location and there is a uniqueness about each one of the districts or boroughs if we look at it that way, and I am encouraged by the fact that you have all of these different promoting agencies that should kind of report thematically to you and kind of get that branding kind of out there. We have envy of New York and Washington DC, and we shouldn't. We shouldn't. Councilman Johnson stated that we are uniquely position between the financial and Governmental capital of the world. We are within one truck day's ride between one third 71 of the City, the nation's population. We are unique in ourselves and we need to start branding that in a way that captures some of the creative culture that we are trying to attract, some of the young professionals that we are trying to retain and brand ourselves as something special, and the cheesesteak and hoagie debate should continue.
Thank you, Chairman. Thank you guys for coming out here and I do believe this is an important role for the City to grow and it does seem like we have a couple different organizations doing similar things and it's good to hear that we are now working together to try to coordinate that to -- so we don't have a redundancy of operation between different organizations. But, my district is pretty big and has a lot of different museums throughout the district from the African-American Museum, 72 the Jewish Museum, the Philadelphia Museum, the Mummers Museum, Polish Museum, a million museums. I was just wondering how do you market each individual museum and how do you pick or choose, you know, which ones you highlight at certain times?
Well, we do a lot with the museums in your district. I actually sit on the Board for the African-American Museum. We just did their gala, and I worked on the committee to create a new event for them that we did in the museum to attract younger people to the museum. So, I have worked on that and that turned out to be a really good thing to do. We are gonna do it again next year. We actually have Quest love in to spin and we attracted a large number. I think about 200 people, and they also got a membership with their cost. So, working with them, I worked very closely with them. As for the Mummers Museum, some of the things we do with Wawa 73 Welcome America, we have a program called Go Forth and Learn. Each year we do different venues, to talk about Go Forth and Learn about history, Go Forth and Learn about music. We did something at the Del last year. This year we're doing Go Forth and Learn about the Mummers at the Mummers Museum. So, we try and come up with different things and partner with the different organizations to figure out, well, if we are doing an event, how can we include this district or this neighborhood. So, you know, we are not able to do every single one, but in the four years that we have been here, I think we have probably hit most of the districts or had a partnership with some organization in that district. We are still continuing to do that.
So, you, try to market, every year try to market a different museum?
We try and market a different venue. We are going to Smith 74 Playground this year as well as the Mummers. We are going back to Franklin Square where they just did a pavilion and we did a big press conference with them. We did -- We are doing something at the Please Touch museum this year. We did something at the Franklin Institute last year. The Academy of Natural Sciences. There are a lot over the last four years that we try and do a partnership because we think it is important to work with the Recreation Department to bring at least two to three hundred kids, depending on the location, to each of the these Go Forth and Learns, where people come out, they read to them, they get a book. They usually get some kind of bag and they get to see the venue, whereas a lot of those parents would not be able to afford the fee for those kids to come in. We try and make sure that it happens.
You also market them to people from outside the City coming in. We have the Philadelphia Museum, Atwater Kent Museum. A lot of people don't even 75 realize what that museum is.
It just seems like we need to be more proactive in marketing all of them to the people, not just the programs in them, but marketing every one of the museums to all the people who come in so they can actually know this museum has this, this is what this museum is.
GPTMC does a really good job with You Wish You Knew. Different places that might not be well known to people, and there is an organization called Hidden City that does that as well to show -- Actually, they are a little bit more extreme because you would not even know some of the places that -- They promote the Met. There are places that might be unfinished or ajeweled (ph) Rine to Rain Hotel. So there are quite a number of different ways that that gets done. We also try and do something to do venues there. We work with both organizations for that.
So, you do work 76 with them to see that is happening?
I just feel like sometimes people come and, I never knew that was there. We never knew that was there. A lot of people living in Philadelphia a long time don't know it,.
Absolutely, Councilman. I'd be very happy to do that. We are still trying to figure out ways in order to do so.
Thank you. I just wanted to briefly ask what the policy is of the administration with respect to our City sister program? How are we utilizing that existing program, you know, in what way? There was mention of ambassadors in the testimony that are related to that, but specifically those cities that are our sister 77 cities, what proactive things are we doing every year?
With the current or are we trying to get new ones; is that your question?
Nancy Gilboy does an absolutely incredible job. She has interns that come. We have people that come for visits where she arranges tours from our sister cities. We are trying to arrange for the Mayor to do some travel to maybe one of those sister cities this year. I don't think that some our sister cities has ever had a visit from one of the Mayor's of the City. So, we work with them, with IVC for what they do. We are not currently taking on any other sister cities because I think your point is is that the nine that we have, we try very hard to keep those going and those relationships going. It is not as simple as, you know -- We actually have a program with our Poland sister city where we did a 78 photography exchange, where we sent a photographer from here and they the sent someone over here to show our culture and there was an an exhibit. There is the Polish Mayor came over. There are a number of different things that happen two or three times a year. Our Kovai City in Japan. We did coincidentally, our marathons happened on the same day. We did a big promotional exchange of our running shirts with them. So, with anything else that we do in terms of organizations, we try and find promotional pieces and work with IVC to see how we can keep it going, to show that we are still very interested.
Well, what is the purpose in the City Reps view, not IVCs view of having a sister program, because they are the city sister cities. What are we doing -- Is there a stated ex goal, expectation, policy with respect to what we hope to achieve from these programs and what resources are we investing in attaining those 79 goals? From your response, it doesn't sound like there is an over-arching policy and set of goals with respect to sister cities and that of course, if there is not, there is not. But, I'd like that to be something that we explore for the future. I think they are valuable, potentially not just cultural, but commercial exchange programs and we should have specific goals with respect to them.
Thank you, Councilman. The Chair recognizes Councilman O'Brien.
Thank you, Mr. Leader. I would just like -- I talked to Holly Kinser, your wonderful advisor sitting in the back and there is a -- I'd like to explore the possibility of bringing a big event to Philadelphia, and that is in the City of Pittsburgh, they have what is called 80 the Vintage Car Racing and it was started by Myron Cope, the former voice of the Steeler's, and Dan Torisky, who is head of the screen writer's guild. He wrote the movie MASH, Golden Girls, and a number of other things. But, the only place on the planet that this race takes place is Monaco and the City of Pittsburgh. They have 250,000 individuals who go to Chenerey Park and they set all these car clubs up on the golf course in Pittsburgh over a weekend. It grew from an event that took place on a Saturday morning to an almost all-week celebration. They have vastly outgrown their venue in Pittsburgh and they would very much like to come here. There is also another issue I would like to discuss with you with great specificity and that is making Philadelphia a diverse autism or disability friendly City and I think we can explore all the venues that come under your umbrella of responsibility. So, without belaboring the conversation here, I would just like to have 81 the opportunity to explore those opportunities with you in the near future.
Absolutely, Council, and I would be happy to setup an appointment with your office.
I just have two final questions. One, do you have in-house public relations person on staff?
But, for the vast majority of your larger events, I guess you contract out the professional services?
You know what, I am sorry. I apologize. The Film Office; does that fall under the purview of the City Solicitor's Office or is that more Commerce?
Just more in line, as some of the earlier questions about a dollar return in an investment on, you know, promoting Philadelphia, you know, attraction as a place where, you know, rich in history and, you know, in producing of movies and documentaries. If you could take a look at some kind of study analysis and provide that to the Chair as well, I would appreciate it, because I would imagine -- I mean, it seems like -- I think the Film Department has done a wonderful job and it only seems as it's growing, you know. Especially with -- I hope the State brings it back, the tax credit, you know, for the movie, which is a board that I sit on actually. So, I can help promote, you know, being at the table and working hand in hand with your department and sharing on more of a working type relationship. 83 So, I look forward to that, and if we could definitely put, you know, dollar values to some of the great things that we are doing and continue to do, I can help champion in another venue.
I think that actually exists, so I will try and get that for you.
Thank you. Quick point of information regarding your sister cities initiative.
Or activities -- Councilman David Oh has created a new committee for City Council that deals with global opportunities and global thinking. So, I think an opportunity exists there to create a linkage between that office and the work of his committee. I am sure he can give you greater detail on that. Lastly, you state in your testimony that your department works with a number of 84 not-for-profit, including Welcome Philadelphia and the Philadelphia Marathon. Cite or state, provide a couple of examples of other not-for-profit that you work with.
Okay. Here's the subsequent follow-up and ask, there continues to be, in some ways, a concern, in other ways an interest for City agencies that are doing business with not-for-profits, that those not-for-profits in their practices, they are embracing or honoring Mayor Nutter's Executive Order around doing business with MBE, WBE. So, the question is, with those not-for-profits, is there some system, some practice, some oversight where you know that that is happening in a deeper way with those not-for-profits?
Well, I can speak on the Wawa Welcome America and the Philadelphia Marathon as absolutely, as a person who runs both those groups that we've way exceeded -- 85 I am looking for it to give you exact numbers.
The percent, I believe 5 we are 65 percent, but I am going to give you 6 -- 7
Well, that is 8 great news, because unfortunately, that is 9 not the norm for City agencies. 10
We have for, and even for 11 the for profit for my office, the money that 12 we use for programing we have exceeded the 25 13 percent in dealing with minority and 14 women-owned businesses. I think the number 15 for that was 43 percent, the number for 16 Historic Philadelphia, they received money 17 from us and I have that number here, which is 18 why I mentioned that. 19
48 percent overall for 21 minority business, and women-owned business 22 46 percent. I can certainly give you 23 percentages on some of the others. 24
Well, the evidence 86 is clear for your department. So, one final follow-up on this matter, Mr. Chair person. If you had to look at the one quality that helps make that happen, what would you say it is?
We aggressively look for minority in women-owned businesses to do business with. When we send out done an RFP, we keep a log of businesses who have contacted us or people that I get business cards from and anytime we do an RFP, we send out an e-mail letting them know that there is an opportunity for the kind of product or service they provide, and that is how we actually get our numbers. We work with a lot of women and minority owned businesses before those two events because we just think we should and we go after them to try and keep those numbers up.
Agreed. That boils down to leadership. It really does take leadership that doesn't talk it, but walk it in terms of honoring the tenants of the 87 Mayor's Executive Order. So, every chance we get, we need to acknowledge that and say thank you because it is not the norm yet in City Government. So, thank you for the work that you do.
Thank you, Mr. Chair person. Are there any other questions?
Are there any other questions? Seeing none -- whoops Councilman Goode.
You are getting in fast. I know how that works. Thank you both very much. Thank you for you being here. Thank you for all the work you do.
Good morning. Could you state your name for the record and begin 88 your testimony, please.
Good morning, Council. Good morning Councilman in the room. I'm Alan Greenberger, Deputy Mayor for Economic Development, and with me are Angela Dowd-Burton, Executive Director to the Office of Economic Opportunity and momentarily should be Kevin Dow, Chief Operating Officer. But, I will start. He stepped out for a moment. He should be back shortly. I know that you have testimony from us and you have asked -- Here he comes. You have asked us not to read that, so I am going to summarize that testimony as he runs up and I fill air time until he gets here. Let me give you the larger overview of the testimony. As I said, Kevin Dow, Chief Operating Officer and Angela Dowd-Burton, Executive Director Of Office Of Economic Opportunity, and our senior staff who are in the front row and also available to answer questions. Also, several of our more important economic development partners are with us today as well. 89 The broad picture on the dollars is that an awful lot of money flows through the Commerce Department. $252,000,000. If I can just parse that for a moment so that it's a little more understandable to everybody. $152,000,000 of that is aviation, it goes directly to the airport. That is overseen by my colleague, Deputy Mayor for Transportation Infrastructure, Rina Cutler. $48,000,000 is also passed through on the hotel tax fund, that goes to various convention center and promotional agencies associated with hospitality. $15,000,000 is passed through directly to the Convention Center supporting its operations. $24,000,000 of grant funds, and that represents a whole assortment of grants that comes into the Commerce Department for use on commercial corridors, environmental remediations. Kind of a grab-bag collection of things that goes to specific purposes and Community Development Funds $9,000,000. Those typically embody the CDBG and other related 90 funds. Pull all that out it's about $4,000,000 left that is direct Commerce operations. That is --
About $4,000,000. $4,000,000 plus dollars. That is the actual Commerce budget for operations. The mission of the Commerce Department I think can be pretty simply stated and that is to improve, and you have heard me say this before. To improve the business climate of this City. So that Philadelphia is seen as a place of choice by businesses that aren't here, but could relocate here. Businesses that are here and want to expand. Businesses that are here and have choices about where they want to be in the future, which include places outside the City. We are trying to make this a place of choice for businesses. There are a number of ways that that mission gets implemented. I apologize, it's not a simple tiny little package of things. It's a fairly broad 91 package of things that we have to do that range from advocacy. We have to talk more about businesses. We have to go to their events. We have to show that we are serious about wanting them here because we know that they are the source ultimately of the jobs produced in the City, which is the ultimate goal. The tax policy. There have been a number of measures that come out of Council this year that the administration has worked that are on all intended to advance or incentivise businesses to either start up here, stay here or relocate here. Some of them specifically tied to certain types of businesses, they are being implemented and we appreciate Council leadership on that. There are Government operations, regulatory operations. These are things like reforming the zoning code. Making it easier to develop here, creating a business portal with Licenses and Inspections to make it easier to understand how to have a business here. 92 The development services that are offered through the Commerce Department, basically, to hand hold large and small businesses through our regulatory maze, as well as streamlining operations wherever we can. There are other kinds of Government operations that are also very instrumental and they range from business attraction, both internationally as Councilman Green had brought up, to local, regional, national. There are the efforts of the Office Of Business Services to support concierge type activities, for mostly small businesses across the entire City. Corridor, neighborhood corridor improvement programs. There are dozens of neighborhood corridor in the City that we are involved with through various programs that include storefront improvements, corridor management, community development corporation leadership. A whole variety of things that we can talk about, and then there is the indirect things that are related to simply 93 quality of life. A question was asked earlier about attracting people and a lot of that is vested in the quality of life in the City and the perception that it is a good quality of life, which is among the key reasons why people come and stay in a place. Two other things I would like to mention. Integrity of government is an important one that sometimes get overlooked in discussions about businesses. But it is absolutely critical that businesses understand that both now and in the future, government has a light level of integrity. It has a direct relationship to their willingness to invest and stay invested in a place. Lastly, and possibly most importantly is work force itself. On one hand we have a tremendously skilled work force and on the other hand we have a tremendously under-skilled work force that is in need of assistance for it to us. In terms of both work readiness, connection to jobs, and 94 retraining for the new kinds of jobs that are out there. That is a huge agenda and an agency like Commerce, which has 64 people in it, cannot execute that agenda by itself and so the way we have to do it is by forming critical partnerships with a number of agencies outside of the Government or quasi Public Agencies and this is what we do. Just to cite four of them, probably our most critical economic development partner is PIDC.
We see them and they see us as full partners in economic development in the City. They are also the City's financial transactor involving loan programs and movement of money. We are together pretty much every single day, either formally in regularly scheduled meetings or informally on the phone, in person, in e-mails. You name it. Every day. Another critical partner is Philadelphia Work Force Development Corporation and as you probably know, there's been a substantial effort in the last year to 95 start to merge the efforts of the Work Force Development Corporation with the Work Force Investment Board into a single unified entity. I am on the combined boards of both the Work Force Development Corporation and the WIB, along with many other people from the private sector. Mark Edwards, the Executive Director of PWDC is here today and John Grady, President of PIDC is also here today as two of our critical partners. At a broader level, we partner with quasi Public Development Corporations and CD, Business Improvement Districts all over the City. Delaware River Waterfront Corporation, Schuylkill River Development Corporation, Center City District in their capacity as a development agency, and of course at the neighborhood level with numerous community development corporations, corridor managers, business improvement districts. All the entities that help to manage the commercial activities in the neighborhood. So, what are the results thus far? The 96 last couple years I think there is some very good news to report. Our institutional sector, which typically is referred to as Eds and Meds. I do like to separate them, but for this conversation we will leave them together; they do rhyme and I am not sure -- sometimes I think that is the reason they get said together, represent 32 percent of our employment base in this City. That is the highest percentage of employment in any major City in the United States. The only City that is even remotely close is Boston in the high percentiles. 14 Those are very big numbers. They are doing 15 well. 5 billion dollars in 20 clinical and administrative and research practices in the City of Philadelphia, to the major universities; Penn, Temple, Drexel, all teaming up and building tremendous projects that are part of an expanded employment 97 base. Part of an expanded student base, and then we're seeing it in the smaller institutions as well. From things like a very aggressive plan to expand institutions like Chestnut Hill College and Holy Family College to name two. We are also seeing increased activities, certainly compared to the last -- the two years prior, might even say three years prior, in both real estate investment and in business investment. We see that in the form of our loan portfolio, which is largely executed through PIDC. We see it in the number of developers who are coming to us with projects that are starting to look financed. They are not there yet. We can talk more about that. But, we are certainly seeing far more activity on both of those fronts and I think a particularly good piece of news on the real estate side is we're seeing investments from major outside developing entities that we have not seen, at least in my memory, in the City, and just to give you a couple of 98 examples. Buck company in Chicago, major national international developer broke ground a couple weeks ago on a significant -- probably the first speculative development in the City since the recession began at 22nd and Chestnut, a 30 story market rate rental apartment house with commercial activity below and replacing with a new facility, the Sydney Home and Medical Center that had been there for many years.
The Rose Company in New York, and I think in fact the reason Council President isn't here today is because he went to the ground breaking of this great mix use, residential and commercial development project that sits astride the Temple University train station, to things like Kimpton Hotel, a San Francisco based hotel firm that is now finishing its second development project in Philadelphia. The Kimpton Monaco at 6th and Chestnut. Very, very enthused for Philadelphia. They see a market here that other hotels frankly have not seen as clearly. 99 They are investing. They are putting their money where their mouth is and I think there is more to come from Kimpton. It's a terrific organization. We are seeing a rise in entrepreneurship in the City. This was not a City that was known as an entrepreneurial City. We ranked poorly in major cities in the number of start-up businesses. We ranked very high in research, extremely high in research, particularly biomedical research. Poorly though in commercial activity that comes from that research. But, we are seeing that change and to kind of give you a marker on that, currently in the City, there are 43 separate physical locations that are specifically there to support entrepreneurial activity, either through as incubators, as places for co-work and sharing, or as places as multi-tenant operations for small start ups. Commerce Department is not involved in every single one of them, but we have been involved in many of them really helping to 100 get them started, helping to find entrepreneurs to populate these things and giving them support. We have -- In partnership with PIDC, we have a program called Smart City Smart Choice, which is a set of promotional materials that were developed in-house that really talk about Philadelphia as a great place to locate a business, a great place to live, and we think it's created several opportunities that are of interest. One of the most important ones is that we are seeing an explosion of the number of young people who are originally from out-of-town who come to the colleges and Universities in this area and stay. The percentage increase over the last ten years has been from about the high percentiles, 19 27, 28 percent to 46 or 7 percent. It's an 20 enormous increase in talent that is staying in the City. We need to support them and they are the kind of talent that is attractive to a lot of businesses, many of whom are not located in the City. 101 What those businesses are starting to see and what we are -- we have a strategic program to go talk to them, is to say, all right, you have got an established business in the region somewhere. You have got a happy work force perhaps, that is located out there on a more senior level, but you have got a talent problem in terms of attracting new people and that talent is more interested, generally speaking, in being in the City than being out in the deep suburbs. Businesses are starting to recognize it. With PIDC, we went out and visited a pretty big software company about a month ago. They are clearly in the market now looking for such a gateway enterprise in the City. We intend to go out to another dozen or so businesses and have that same discussion, as well as having discussions with, I would say midsize to large private enterprises that are actually talking about relocating their operations wholesale, and we are actively talking to some of them about relocating in the City. 102 The City is getting great notoriety for this. It is in the national press, it is hot. We are winning awards. People are recognizing Philadelphia for a lot of the initiatives that are going on here and they are seeing it as the place that we all want it to be. We sometimes wish that was a little more known in the City of Philadelphia, but we can have a discussion about that. One of the critical markers of that is the City's own bond rating.
As you know from news article, I guess in the last week, our lowest bond rating which is with Standards and Poors and I don't profess to understand how these bond ratings exactly -- what all these markers mean but it was a B,B,B rating. It was the lowest of three major rating agencies. It was just moved up to a B,B, B plus, with a positive outlook, which means we hope that within a year's time there is opportunity for further growth and we get an A somewhere in that equation. This has a direct impact on costs for 103 the City of borrowing money, therefore, has a direct financial benefit as well as a standing that we see differentiating ourselves from the plight of many American cities indeed the plight of many countries in the world. Our office of economic opportunity, I think is, and we will talk more about this, has become a very highly organized machine. We can't do everything we would like to do, but we are actively working with every agency, with projects that require EOPs. We are setting goals. We are monitoring and in places where there had been problems, we are doing enforcement actions. Unemployment rate, the one big marker that I can't say is doing as well as it should be is stubbornly high. percent. Our Unemployment rate typically tracks about percentage points higher than the national average. That's been going on for 20 years. Sometimes right before the recession it 104 got down to about a 1 percent differential and then it grew again. With the confirmed numbers coming out post-holiday season, I'm a little nervous that the numbers are going to go up some because of temporary employment that has ended, and as we all know, that is an average rate. The unemployment rate in some sectors in the community, in some of the poorer communities, some of the minority communities are much higher. Hard to get a grasp on the numbers, but they are much higher and they are appallingly high. There is a lot of work to do and unfortunately we don't control all that action. We are subject to the flumes of the national economy as well, obviously. I would say that is the one critical thing that in our view is a very big problem that needs work. You asked us to comment on both contracting and staff demographics, this the last part of my summary. The Commerce Department contracts with very few non Governmental entities. In fact, we only 105 contract with one and that is E Consult, that does our annual disparity study. That is an $80,000 contract they have. Minority participation is about percent. Through a firm -- am I saying that right, Angela Melligan?
Melligan. 9 Lastly, staff demographics Commerce is 10 in operation of 64 people, with what I would 11 characterize as 12 people in leadership 12 positions. Of those 12 people, 50 percent, 6 13 out of 12, are minority members, and 7 out of 14 12, approximately, 60 percent, are women. 15 That concludes my summary and I would like to 16 open it up to your questions. Thank you. 17
Thank you very much, 18 and I must say that I listened intensely to 19 your testimony and it answered many of the 20 questions that I had by way of a grade. I 21 don't think in my history, I am gonna check 22 with my freshman colleagues, in our term -- a 23 first term we have ever applied the term 24 "hot" to the City of Philadelphia. I guess 106 --
That is a good thing. I guess we're gonna have to dig down a little bit to kind of get a grade on some things and I'll go with the first one that you said, employment. Employment is always the last indicator of a recovering economy to swing back to right the unemployment levels in the City of Philadelphia. I had a statistic that was given to me when we took a ride up to Lehigh Valley and we went to an industrial training school where they had 3,200 students being trained from everything from shops, electric, plumbing, things like nano technology. When I talked to the head of that particular department, they said their No. 1 place where they are placing their graduates is in the City of Philadelphia. That a best kept secret about Philadelphia is that we are one of the hubs for nano technology, and I was wondering, 107 since we are talking about unemployment and I know attraction is important, but retention is also important. Young people who graduate from Philadelphia high schools and graduate from Philadelphia universities, and what they said was that there was a disconnect between that emerging industry and our ability to train a work force that can, at the entry level, deal with some of the math that is required for nano technology. I would like to also ask John from PIDC to come on up. Some of these questions are going to be directed at you. But, where is that connection between the two -- Another shovel from the President. A sign of the economy. So, I want to know, are you working with the School Board to design curriculum for future jobs, present jobs as opposed to preparing work force for 8 track tape players that no longer exist?
I hope we are not training for 8 track tape players, but I 108 remember those. I think, actually, if I could ask Mark Edwards to come up and talk about a little bit about that from the work force side, because this is something that is of intense interest on that side and this is our critical partner in this. I would summarize it though by saying, and I think you mentioned it in your comments just now, we see three major problems out there. There is a work force readiness issue, and I think you alluded to something that you might have even seen in the last couple weeks that was in the news about math skills that some businesses apply to incoming candidates for employment and they are finding a shockingly high rate of inability to do things like -- I think the thing I read was calculate the area of a cylinder because the cylinder had something very critical to do with their business. Or the other one I think was, how many pallets can get on a forklift that has a weight limitation? The numbers were really 109 shockingly high, inability to do that. So, we are seeing that kind of problem in work readiness. We are also seeing problems in work readiness related to simple things about job behavior. Get there every day, be on time, dress appropriate to the job. There are those things. At the other end of the scale, there are obviously very big changes going on in the work force, both -- something like the industrial work force where the nature of industrial jobs is changing dramatically from a person who used to be able to do something very directly with their hands and now has to apply that knowledge abstractly to a computer that controls a box that does the same thing. So, there is a retraining issue and then in the middle is the whole problem of connecting people to the jobs that are out there, and with that summary, I would ask Mark to talk about some of the things that are going on, if that is okay.
Mark Edwards. I'm the President and CEO of the Philadelphia Work Force Development Corporation. The short answer to your question is, yes, we are beginning to work with the school district in light of some of its own reform that it is going through right now, to look at ways in which we might change. Work with them to change their curriculum to be more responsive to the needs of employers in the area. It is a challenge that we have for all of the reasons that Alan has already indicated. We, in terms of the public work force system, are beginning to prioritize our training dollars to support the same kinds of opportunities that might exist in a smaller -- on a smaller scale outside the School District of Philadelphia, where there are opportunities for us to connect with smaller employers through the kinds of skill building and other kinds of areas of improvement that people who would be a part of the work force 111 needs in order to be able to fill the needs of smaller employers. I am familiar with the project that you visited. It is a model that we are looking at as well. It is the kind of thing that we would like to replicate here in the City of Philadelphia, and as we strengthen our relationship with the School District through it's reform efforts, we are looking to do just that.
It was incredible that in the daytime, high school students attended these various skill enhancement training programs, but they kept running right after the school hours right into the night and adult populations occupy the same shops, learning the same skills that they did, and it prepared them. There was not a metal detector in the place. 3,200 students with ten feeder schools going to there. Their placement ratio was -- The kids didn't get in fights because they knew at the end of the rainbow, there was a real job with a real paycheck. 112 So, that kind of concept, that kind of thinking from the Work Force Development from the Commerce Department, to prepare young people for jobs that are really out there. We have a lot of lights lit, but I want to ask one more question. Commercial corridors. What is the vacancy ratio on our commercial -- We have a hundred plus commercial corridors in the City of Philadelphia. What is the vacancy ratio on our commercial corridors?
Karen Fegely, who is 17 the Executive Director of our office of 18 Neighborhood Economic Development oversees 19 commercial corridors, and what she just said 20 was the vacancy, on average, is about 20 percent.
I think there is a number of things that we are doing that are instrumental in this. This too is a bit of a complicated story. These commercial corridors throughout the City grew at a time when there was, I believe, when, A, the City's population was much bigger and, B, people shopped more locally than they do now. One of the results is that most of our commercial corridors, both the healthy ones and the not so healthy ones, are probably bigger, longer than they ought to be and that's a source of a problem when you have less people shopping at them, both in terms of raw numbers as well as in terms of, well, I am getting in my car and I'm going to a big box that is in, you know, Cheltenham or something. So, I think there is a couple things you do about it. One is that we are finding that corridors that have corridor managers 114 are more successful than ones that don't. So we need to work with local business associations, whether it's the Business Association, the Community Development Corporation, a bid in some cases, to do better management on these corridors, and this sometimes is very simple stuff. It is picking up the trash, it's having people out on the street. It is showing people that good things are happening there. It is safe to come there and it's a good healthy shopping environment. We are doing that. We are offering technical assistance to groups who are not as organized to try to get them organized to do more of this. These corridor managers also, I think, the successful ones, are also thinking long and hard about trying to attract businesses that they think will compliment a kind of natural market that exists there that would be productive. I know that you have all seen, for example, vacant -- stores that are going vacant that wind up being rented to things 115 that are sort of less vital to a commercial corridor, but important for other reasons. Whether that is a local church, day care center, doctor's offices, you see this kind of stuff happening all the time. I have heard personally people express anxieties about it and the fact is, it's a result of vacancies and landlords looking for some way to create an income stream. On the zoning level, I think one of the things that we have to do, and this is gonna take years to do, but is to start compressing the commercial zoning so that it's a better thing if a corridor is smaller, but less vacant, that's 100 percent corridor. That ultimately, we think, is a better thing. You do that through strategic remappings and over the years, you are not putting anybody out of business, but as those that are outside that zoning that are grandfathered-in, go out of business, those corridors start to shrink. So, I think those are among the techniques that you have to use.
I am gonna reserve 116 my questions for the next round and get some of my colleagues. I am gonna recognize Councilman Goode.
All my questions is pointed for the Office of Economic Opportunity. So, whoever wants to answer that can answer that.
First question is, for the Philadelphia Home Rule Charter, when are the annual Disparity Study and Participation Goals due?
Well, the disparity study is due 30 days before the end of the fiscal year.
They should be done by the end of April in anticipation of the need to review the document.
My question is, when will it be done? The Home Rule Charter says that the annual Disparity Study Participation Goals must be done --
30 days before the end of the year. They have not been done 30 days before the end of the year over the last two years. So, my question is, when will they be done this year?
Okay. Last year it was done in October; is that correct? 118
According to the Disparity Study that was released in October, which area of contract had the highest recommended goal for DB participation? Was it Public Works? Was it personal and professional services or was it service, supplies and equipment?
It was probably service, supplies and equipment with the Waste Management contracts.
The question was the goal. For the Disparity Study that was released in October, which area of contracting had the largest recommended goal for DB participation?
The goal here stated in the Disparity Study was 30 percent for service, supplies, and equipment.
My first question 119 was -- That is my next question. The first question was, what area of contracting had the highest recommended goal?
The area of contracting was service, supplies, and equipment.
Looking at the 15 Disparity Study and looking at the 16 availability of companies that are in our 17 registry who actually sell what we buy, we 18 are -- 19
Ms. Dowd-Burton, 20 that is what the Disparity Study does. It 21 looks at all that and Econsult makes a 22 recommendation. Econsult recommended 30 23 percent. 24 What gives you the authority, either 120 administratively or legally, to change what the Disparity Study says?
The ultimate -- Obviously, the goal is for the office of Economic Opportunity to maximize level participation on all contracts that are awarded by the City, and we drive our goals based on the past history of --
My question was, first of all, administratively, who authorized you not to accept the recommendation from Econsult, which said it should be 30 percent?
We work with the Mayor's Office of Economic Opportunity.
So, the goal came in at 30 percent, who said -- I'm sorry. The recommendation came in at 30 percent. Who said you can change it to 25?
We adopt the City's goal of percent, which is a stretch goal. 22
I am talking about 23 services, supplies, and equipment. 24
I understand that, 121 sir, and we apply that goal across all departments and across all commodities.
That's not true. I am sorry. I have asked the Chair for special disposition. So, he's gonna let me go through my line of questioning. The Disparity Study came in October, several months late.
The recommended goal for services, supply, and equipment was 30 percent. Who has the authority to not accept that recommendation from Econsult, administratively? In fact, who made the decision administratively?
Who specifically made the decision administratively not to accept Econsult's recommendation?
The legal frame work for setting goals, period, means that they have to be based upon Disparity Study. So, if the availability is 30 percent, how do you think you justified in setting the goal at 7 percent? 8
Well, the 9 availability that they have identified for 10 service, supplies, and equipment for all MBEs 11 is 26 percent and for women, it's 15 12 percent. So, the fact that they have 13 identified 30 percent utilization, we could 14 not address and, therefore, went with an 15 overall goal of 25 percent for the City. 16
So, you are saying 17 Econsult's recommended goal was wrong, was 18 technically flawed? 19
I am saying in some 20 fashion it is technically flawed. That's 21 correct. 22
Okay. Good. We're 23 gonna go down that line then. 24 What was the overall participation goal 123 recommended by Econsult?
It's established 12 based on the utilization of companies in our 13 registry, along with the availability of 14 firms based on what we buy from one year to 15 the next. So, we are looking at past history 16 along with driving a number of companies in 17 our registry. 18
Econsult does that 22 work to determine what the availability is? 23
Econsult looks at the 24 level of availability based on the 124 information Office of Economic Opportunity provides them in terms of our participation reports and our OEO registry.
Have they ever made a recommendation of more than 30 percent -- I'm sorry, of more than percent for the 10 overall goal? 11
They prepared a draft 12 that was higher than what we have previously 13 achieved and they revised that draft down to 14 25 percent. 15
So, they gave you a 16 draft recommendation. What you are referring 17 to is a draft recommendation, and said the 18 overall goal should be 30 percent a couple 19 years ago and you changed it to 25 percent? 20
They changed it, 21 sir. And they changed it after for the 22 recession -- 23
That was one of the 24 late Disparity Studies we got, right? 125
The Disparity Study you received last year was actually delayed because we asked Econsult to go back to the drawing board and look at the commodities we actually buy, look at the services we actually buy.
I think what we did was deliberate and concluded that based on the information that we have, the history that we have been able to drive, and if you look at the soon to be published Disparity Study --
So, you don't trust -- I am talking about past now. We're not going into the future yet. You don't trust your consultant to make the right recommendations if you have the same consultant?
If your consultant says 30 percent, then how or why do you 126 change it to percent; unless there is some reason the administration chose to create and arbitrate 25 percent goal? 4
What we looked at, 5 Councilman, was the history of the 6 participation that we have been able to 7 drive, and as I have indicated earlier, we 8 will maximize the level of participation 9 across the board where we can. 10
But, you are not 11 going to set the goal above 25 percent? 12
Are you gonna set 14 the goal above 25 percent? Even if Econsult 15 says it should 30, are you ever going to set 16 the goal above 25 percent? 17