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Committee Hearing, April 10, 2012

Minutes from Philadelphia City Council Committee Hearings, Apr 10, 2012

People mentioned

Names our system found in this transcript. Automatically extracted, so it can include anyone named in the record, not only officials or parties.

Organizations mentioned

Mr. Greenberger

Do you want me to answer that one first? It's the same line.

Councilman Jones

Go ahead, please.

Mr. Greenberger

I think you are referring to what is called the welcome fund.

Councilman Jones

Yes.

Mr. Greenberger

Also, referred generically as EB-5. What that is, is, it's a national program, although Philadelphia is one of the first cities to take advantage of it in the United States in a pretty serious way. By which, packets of half million dollar investments are made by foreign individuals in a project. Typically you might pull dozens of these things, depending on the size of the project. These are loans. You might pull dozens of such packets of half million dollar investments together. The project has to produce a certain number of jobs. I think it is one per $50,000 of investment over a two year -- in a two-year period, and during that time the individuals who make the investments are 278 vetted by the Immigration of Naturalization Services to qualify for a green card. So, if they are vetted fully and if the investment produces the jobs, they get a green card.

Councilman Jones

So, have we taken advantage of that, marketed it to --

Mr. Greenberger

Yes, we have.

Councilman Jones

-- to particularly Hispanic immigration and to the large Caribbean and African population in the City, as well as Councilman Oh, the Korean population, are we utilizing that program here in Philly?

Mr. Greenberger

The program is being utilized, and I will give you a couple of examples of loans made relative -- Well, the whole thing is relatively new. But, there are significant loans, to the Convention Authority, it was made through the welcome fund. Significant loan to SEPTA to finance the evolution of kind of the kind of Smart Card system. Significant loan to Kimpton in the development of the Kimpton Monacher Hotel. 279

Councilman Jones

Do we have statistics on each utilization?

Mr. Greenberger

Yeah, we can get you those.

Councilman Jones

We'd like you to provide that to the Chair and we will make it available to all members of Council and also by district where those investments wound up.

Mr. Greenberger

Yeah. I will tell you just parenthetically, I don't know the demographic makeup of the investors.

Councilman Jones

Is there any way to find that out?

Mr. Greenberger

There probably is. Let me look into that. I do know that in at least the last several years it's been very, very heavily done by Chinese investors.

Councilman Jones

I would just like to get a better sense of who, what, where, and why.

Mr. Greenberger

Yes. By the way, realize, once they have green cards, it doesn't necessarily have anything to do with 280 this area. This is just an open green card for the United States.

Councilman Green

Point of information.

Councilman Jones

Councilman Green.

Councilman Green

Thank you. It is called the EB-5 Program. We are one of the first Cities that has organized a center that allows us to aggregate funds and then loan it out and allows the people who invest in the fund to get credit without having to invest in a specific business. So, diversifying the risk and bringing people in. Unfortunately the fund has not really been used to invest in businesses, as you have heard. It's been used primarily for commercial office fit out for new tenants, which allows them to create -- to have, quote unquote, you know, job creation for the fit out and then for the businesses to go in there. The SEPTA thing, the Kimpton thing. Project deals that would have happened anyway, this just happens to be a very low 281 interest source of money for those projects. Because we are a center, we can get away with doing that without actually investing in real businesses. I look very forward to seeing the detail that is gonna come from the Commerce Department.

Councilman Jones

Who administers this program on our behalf?

Mr. Greenberger

It is run through what you might think of as sort of an association between PIDC, who is -- who brings the investment opportunity to the table and in our case, a firm named Canaan, who identifies the investors and sort of walks investors through the whole process of vetting with INS.

Councilman Jones

As we start to try to struggle to find financing vehicles for the grocery stores where there are food deserts in some parts of our town, could this not have been used for that effort?

Mr. Greenberger

It could have, but you also have to realize that we can't just bring any project to the floor. The 282 investment group, Canaan in this case, who is putting together the packets of money, are also looking carefully at the investments themselves to assure themselves that, one, they will be paid back. These are typically five year. So, they are fairly short-term loans. Low interest, as Councilman said. They want to assure themselves that the job creation will happen, because if it doesn't, green cards disappear and at least this particular group has been heading to larger and larger projects. I think it is fair to say that their interest in more Governmental or quasi governmental entities is a way --

Councilman Jones

In the spirit of transparencies that we all live under, we would like that to be transparent.

Mr. Greenberger

That is fine.

Councilman Jones

And made available to all Council.

Mr. Greenberger

Sure.

Councilman Jones

Councilman Green.

Councilman Green

Thank you, Mr. 283 Chair. So, we discussed, I think, the life sciences industry. What other -- Is there another industry, or?

Mr. Greenberger

I mentioned hospitality earlier on, right. Physically with hotels, expansion of the Convention Center.

Councilman Green

Right.

Mr. Greenberger

I think there is --

Councilman Green

You had specific goals for that, which you are gonna provide to the Chair.

Mr. Greenberger

Yeah. Particularly around hotel development.

Councilman Green

Right.

Mr. Greenberger

I think the only other one that I would want to make mention of, which I am sure I am missing some, is that there is a lot of activity in this City at very, very micro levels related to food. It ranges from people who are trying to do urban agriculture and actually sell it, to people starting restaurants. This whole food movement is showing up in little tiny bits at 284 a time. A lot of enterprises don't make it because they are fragile, they are very personal. Back to Councilwoman Brown's question, one of the things that we are doing strategically --

Councilman Green

Let's stick to my questions if we can.

Mr. Greenberger

Sorry. I don't want to get into your time. The other one that I mentioned that is an emerging one is obviously around Clean Tech. We have this grant to do this GPIC. GPIC is now fully formed. It is supposed to be doing research that is attracting other businesses to be around to take advantage of the research. There is a real opportunity here to expand that capacity.

Councilman Green

So, with respect to urban agriculture, or the last thing you mentioned, which is what tech?

Mr. Greenberger

Clean Tech.

Councilman Green

Clean Tech?

Mr. Greenberger

Yeah. Energy.

Councilman Green

Do you have specific 285 goals?

Mr. Greenberger

Again, no. I do not have specific numbers, but I --

Councilman Green

Will you please provide the Chair with how much Commerce Department and PIDC time is used?

Mr. Greenberger

I will try.

Councilman Green

What was used in the last year on these specific areas that you are focusing on, will be used next year on these specific areas you are focusing on, and where you have goals, what those goals are, so that we can understand the allocation of resources among your areas of priority. Several times during the testimony you mentioned the lack of available venture capital. Are you familiar with the law that recently -- that the administration supported that recently passed City Council?

Mr. Greenberger

Yes.

Councilman Green

Do you have, as a goal, a plan to now use the fact that all of Philadelphia will be a tax-free zone for the venture capital space or any investment fund 286 space to specifically recruit people to come into the City of Philadelphia as a consequence of that?

Mr. Greenberger

We are specifically working with one right now, a very consequential person, a very consequential firm in the field of venture capital to get them to move their offices into Philadelphia.

Councilman Green

Right. I have been told by several firms that they are going to move in. Is there a campaign to inform all the funds around the City with respect to this and in particular, a campaign to go to New Jersey and other places which have far worse tax policy at the state level than Pennsylvania has, and now we have taken Philadelphia's taxes out of the equation, makes us extraordinarily competitive. I am aware of several New Jersey private equity funds that just moved to Yardley instead of Philadelphia because of our tax structure, which is no longer a problem. Is there a campaign that you are 287 planning to go pursue these private investment funds around the region?

Mr. Greenberger

Yes, there is. It is in the early stages. We are discussing this with key individuals who are very involved in this sector of the work to figure out how best to do this. I will be happy to engage you in that conversation.

Councilman Green

So, there is no 10 current plan and there is no goals, but there will be a campaign --

Mr. Greenberger

Yes, there will.

Councilman Green

-- of outreach, and potential advertising?

Mr. Greenberger

That's right.

Councilman Green

Okay. I would be very happy to give you my thoughts in that area and be involved --

Mr. Greenberger

I'd like to hear them. I think it's a complicated area.

Councilman Green

-- not at the moment though, my time is up. Thank you.

Councilman Jones

Yes, sir. The Chair now recognizes Councilman Goode. 288

Councilman Goode

Thank you, Mr. Chair. Good afternoon. Just out of curiosity, aside from salaries and benefits, and aside from any State or Federal funding, what type of general fund support is there for economic development programs?

Mr. Greenberger

What type? You mean -- You are not talking about our operations, you are talking about --

Councilman Goode

Aside from State and Federal funding, aside from any support specifically for staff, salaries and benefits. What type of general fund support is there for economic development programs?

Mr. Greenberger

The money that is available primarily resides at PIDC through various programs. Some CDBG sponsored, some private money --

Councilman Goode

That's not my question.

Mr. Greenberger

That's not your question?

Councilman Goode

My question is, what type of general fund support? 289

Mr. Greenberger

There is something called the Economic Stimulus Fund that resides at PIDC, that the City puts money --

Councilman Goode

How much in Stimulus funding is projected for Fiscal Year '13?

Mr. Greenberger

We try to set aside about a million dollars a year.

Councilman Goode

Aside from that, what sort of general fund support?

Mr. Greenberger

That is the primary general fund support right there.

Councilman Goode

So, there is no 13 general fund support aside from the Stimulus funding?

Mr. Greenberger

That's correct.

Councilman Goode

Thank you. Thank you, Mr. Chair.

Councilman Jones

I thank you, Councilman. We will go back to Councilman Green. I will just let you know, you are the last one on the radar, so.

Councilman Green

Excellent. Looks like I will get through these questions. Thank you, Mr. Chair. 290 So, you mentioned Clean Tech, and a lot of that effort has been focused at the Navy Yard, which is a KOZ. Is there a thought of not using that space for manufacturing, especially Clean Tech manufacturing and trying to focus the relocation of that elsewhere in the City, given that KOZ space is dear and manufacturing is now going to be single sales factor starting in, I think, finally implemented by 2015 or 2016.

Mr. Greenberger

Yeah. Something like that.

Councilman Green

So, the need to use that space for a tax advantage business may be more appropriate for a knowledge based industry or other businesses that aren't gonna have the tax advantage of single sales factor?

Mr. Greenberger

I think that is something we need to be considering. I mean, we are obviously even now just using the one at the Navy Yard. We are even now just seeing possibly the non need in certain sectors for it. Glaxo, for instance, is 291 moving to the Navy Yard. They are not taking advantage of KOZ to do that. So, they are just doing it because they have other reasons why they want to do it. This gets back to an earlier question about how effectively we are using KOZs and where. And we are again in the early stages of understanding what the new laws are, where we need to be putting our efforts and I think making an honest evaluation about the effectiveness of the KOZs that we have and whether they are truly being effective or whether they are not. I think in some instances, they are not.

Councilman Green

We spent a very long process with the administration getting the single sales factor. So, my question is, what has been communicated to manufacturing, distribution, logistics, people who sell goods, wholesalers, that is in the City that are currently here to let them know that the law is changing such that they will be on a level playing field with their competitors and retain them? 292 Has there been any mailing or outreach to any of the businesses? You mentioned earlier that retention is almost more important than business attraction?

Mr. Greenberger

Yeah.

Councilman Green

What specifically has been done to retain the people that are in the City?

Mr. Greenberger

It is early on. There has not been, as far as I am aware, an organized campaign to do that, but there needs to be one.

Councilman Green

There is not a plan for an organized campaign, but you'll add that to your list?

Mr. Greenberger

That is on the list.

Councilman Green

So, there is some specific programs that we have discussed before and in budget testimony two years ago, you confirmed that Karen Randall and Dwayne Baum were the, quote unquote, primary people in the City government doing business attraction. I hold them both in very high regard, but as the fifth largest City in the 293 country, do we think that that is enough people doing the work and within the Commerce Department, and is there a plan to expand the personnel engaged in business attraction activity?

Mr. Greenberger

It is not enough. We have expanded our internal staff by one, but this is I think also what motivated PIDC to reassign Ann Nevans as head of marketing so that we can pool resources with them and, basically, turn three and four people into eight and nine people.

Councilman Green

So, there are eight or nine people doing business attraction in the City?

Mr. Greenberger

I think so, yeah. With combined forces between Commerce and PIDC, yes.

Councilman Green

Could you please provide that list to Chair, along with the job descriptions of the people doing business attraction?

Mr. Greenberger

Sure.

Councilman Green

Not just their job 294 descriptions within business attraction, but their overall job description, and the allocation of time that they have to business attraction as compared to their other duties?

Mr. Greenberger

Mm-hmm.

Councilman Green

Thank you. So, there are still -- there are now three full-time people in the Commerce Department doing business attraction?

Mr. Greenberger

Well, there is four. With Vince Darby who is specifically in charge of managing KOZ and the industrial uses that are in it.

Councilman Green

He is a City employee also?

Mr. Greenberger

He is a City employee, yes.

Councilman Green

So, who is the fourth?

Mr. Greenberger

I am sorry. So, there is Vince. Dawn Summerville, who we added to the staff. Karen Randall, Dwayne Baum. That is kind of the key staff. 295

Councilman Green

Over a year ago we talked about dedicating meaningful Commerce Department staff -- I am sorry. To being proactive and building business plans. We have talked about this for the last three or four years, but one specific thing we mentioned would include tapping private sector knowledge about what leases are expiring in other regional more high cost Cities to do business, like New York City, North Jersey, et cetera, so we can understand what commercial leases are expiring and make a concerted specific effort to go attract those businesses. In previous conversations about this, we have discussed how the Alabama and Tennessee and many southern development authorities.

Mr. Gregory

North Carolina.

Councilman Green

North Carolina. Come up to our manufacturers and recruit them to move to a lower cost environment and that is one of the reasons it was necessary for us to go to single sales factor to try to retain what we have, because we were losing that 296 competition. They were paying them to move down and they would be in a much better tax advantage situation. So, in terms of us doing that proactively, have we undertaken any effort to identify expiring leases and target those companies in higher cost areas, not in the City of Philadelphia with respect to we specifically discuss commercial leases? Has that been done?

Mr. Greenberger

No, it's not been done and I think if it is gonna be done, and if it is gonna be effective, it has to be done with the State as a major partner. I mean, the ones that you just mentioned, they are all states. We can't pretend to be a state.

Councilman Green

We are not pretending to be a state. We are trying to take knowledge based industries from commercial leases in other places and I am confident the state -- Have we asked the State to help us in this effort?

Mr. Greenberger

We actually have been 297 doing it, I think, more aggressively in the previous administration. We are not sure yet how to do it with this administration. I am not saying they're not interested. I think they are interested, but we haven't done that.

Councilman Green

Have we ever undertaken the program I just described with the State? Have we asked specifically for the program I just described for the State to assist with that program?

Mr. Greenberger

I don't know the answer.

Councilman Green

Have you?

Mr. Greenberger

No, I have not, but I can't answer for before me.

Councilman Green

Well, the only person before you in this administration is Andrew Altman.

Mr. Greenberger

Well, I meant I can't answer for both him and the --

Councilman Green

As far as you know, no one in the administration has made that request to the State? 298

Mr. Greenberger

I don't know the answer. I can only answer for myself.

Councilman Green

And hopefully through the people who are in the Commerce Department?

Mr. Greenberger

Yes.

Councilman Green

So, there's no 8 return on investment analysis available to see whether or not that makes sense or anything else?

Mr. Greenberger

I have talked to several major developers because I wanted to get their perspective on it. People who operate at a more regional and national scale and I have heard -- I am trying to think how to characterize it. Mostly negative opinion about that. Having some people, I won't bring names into it, but people who feel they have researched it before, tried it, didn't feel they got anywhere, didn't feel it was the best expenditure of their time, concentrated more on what I was talking about before, which was expansion of current clients, expansion for people who are in our 299 midst now. I've heard that several times from several major developers. I'm not saying that that makes a perfect story. I am just saying I did reach out. I want you to understand.

Councilman Green

I don't think you mean developers. Do you mean commercial property owners?

Mr. Greenberger

Well, the commercial property owners and commercial developers who are looking to lure businesses to another place.

Councilman Green

Like a black rock, for example?

Mr. Greenberger

Yes. I mean, I haven't talked to them, but, yes, like that.

Councilman Green

Which we lured to the City of Philadelphia -- almost lured --

Mr. Greenberger

Almost lured to the City of Philadelphia.

Councilman Green

-- the City of Philadelphia into a tax-free zone.

Mr. Greenberger

Into a KOZ, that's right. 300

Councilman Green

There are private investment funds all over North Jersey and New York that would now not need to be in a KOZ to be in the City of Philadelphia?

Mr. Greenberger

Well, one would hope that is true. As you know, it's a bigger story than simply the tax picture. That is a critical piece of it, but it's not the only piece. There is lots of things that cause people to be where they want to be.

Councilman Green

I am not gonna burden everybody with this. I have specific requests to each department. I asked that these details be provided prior to the department's testimony. As far as I know, I have not received a list of all contracts over 50,000, what's been encumbered, unencumbered, et cetera, for current year. Who the TBD -- where the TBD money is supposed to go for those contracts, et cetera. So, we will re-send you -- the administration is aware of these questions.

Mr. Greenberger

Okay.

Councilman Green

I'd like to get the 301 answers to those questions so I can ask questions on that on a call back, rather than engaging in a kind of dialogue about it. So, I guess just one final question. When you and PIDC went out in the suburbs and talked to businesses that you are trying to get to open gateway offices, as the example you gave, did you ask them why they are in the suburbs or why they moved there, if they moved there?

Mr. Greenberger

No. We didn't have that specific conversation. At least with the ones that I am thinking about, no. 14

Councilman Green

Okay. No further questions.

Councilwoman Brown

Does that conclude your questioning?

Councilman Green

Yes.

Councilwoman Brown

Any more questions for these witnesses? It appears that your chapter for the day is done.

Mr. Greenberger

Thank you, Madam Chair.

Councilwoman Brown

Thank you very 302 much for your testimony and the work that you do. For all witnesses that will be speaking for the Philadelphia Board of Ethics, please move to the witness table. Good afternoon. Please state your name for the record and proceed with your testimony.

Mr. Glazer

Good afternoon, Chairman Reynolds-Brown, Members of City Council. My name is Richard Glazer. I serve as a Chair on the Philadelphia Board of Ethics. Thanks for the opportunity to speak on the proposed FY13 Budget for the Board Of Ethics. Before discussing FY13 appropriation, I would like to give you a sense of the breath of the Board's work during the past year. We have been advised that in accordance with FY13 Council Budget procedures, we have been requested to summarize our testimony. So, the testimony that has been provided of six pages, I will attempt to summarize and provide the essence of that during this testimony. First of all, training. During -- 303 That, in our view, is the most important priority for us. During the past year we continued to focus our work on education, training and outreach efforts because we believe the City officials, employees, candidates and now those engaged in lobbying can avoid making mistakes if they know how the Public Integrity Laws apply to them. The Board prepared for the 2011 municipal elections by conducting training 12 sessions on the Campaign Finance Law that were attended by more than a hundred candidates, treasurers, and campaign staff members. Each session covered the requirements for candidates and political committees under the Pennsylvania Election Code and Philadelphia's Campaign Finance Law. To promote compliance with the Campaign Finance Law and to avoid non-filing violations, our staff issued a sequence of reminder e-mails about due dates for Campaign Finance Reports in advance of each reporting 304 cycle deadline and to alert campaign entities of the hours and the independent expenditure reporting requirements. As with campaign finance training, the goal of ethics training is to prevent potential violations. Half our staff members are involved in scheduling, designing, and presenting in-person ethics training sessions. During the past year we again focused on training new City employees and there were live ethics training sessions 12 attended by more than 300 people. 13 We expect our training activity to 14 expand expedentially as we add mandatory 15 lobbying training to our training calendar in the near future. Second broad item, lobbying. The Board's efforts to implement the City's new lobbying law were a major focus of our work in the last 12 months. Board staff presented a completely new lobbying regulation to the Board in May to clarify the registration reporting requirements of the new lobbying code. The proposed regulation became the 305 subject of a lawsuit filed by Philadelphia Bar Association, asserting that the lobbying law may be unconstitutional if it applies to lawyers engaged in the practice of law. The Bar Association sought to prevent the City's Lobbying Ordinance from taking effect until the merits of its Complaint for Declaratory Judgement and Permanent Injunction were determined. The Bar Association withdrew its Complaint in response to the Board's July 7th resolution that delayed any enforcement of the Lobbying Code until after the Board clarified who must comply with the law and what activities are covered. What followed during the summer was a series of collaborative and productive meetings with representatives of the Bar Association and other interested parties, including members of Council staff. Major changes were suggested and incorporated in the version of Regulation 9 that became effective on November 21st and were intended to clarify that there are many 306 communications with City officials and employees that are routine and do not constitute lobbying. Our staff also began an extensive outreach program to individuals and groups that might have an interest in lobbying in the City of Philadelphia. The other aspect of the lobbying was electronic registration and reporting, and that system is required by the Lobbying Code and that remains unfinished today. Gov project.

Mr. Glazer

Progress on this mandatory electronic filing system has been slow and difficult, has consumed much staff time and is still in development. Due to problems with the original project concept, OIT deemed that the site designed by the vendor was nonfunctional and had to be redesigned. On November 16th, the Board announced that it would delay implementation of the law 307 until January 3, 2012, and when the software still wasn't ready on January 3rd, our staff created an interim paper registration system for lobbyists, firms, and principals that was ready on January 3rd. We believed that it was imperative to the public policy of the lobbying code to bring forth transparency to City government, we have therefore, also made limited lobbying registration information available on our website. We are currently also designing an interim paper filing solution for the Expense Reports that are due by April 30th. This project continues to be a severe drain on the Ethics Board's very small staff. Next major item is advice. Providing advice is a key ongoing responsibility of the Board and an essential way to prevent potential violations to the Ethics law. There were 16 written Advisories issued in calendar year of 2011, one Formal Board Opinion, and 15 Advises of Council. Requests for Board advice frequently deal with multiple topics and require an analysis of multiple 308 provisions of the Home Rule Charter, City Code, and occasionally reference to other legal authority. Our staff also answered 75 general questions by e-mail. We answer a particularly large number of campaign finance and financial disclosure questions by phone and the demand for telephone assistance has already increased to address lobbying related questions. To promote financial disclosure compliance, again in 2011, we sent reminder e-mails to more than 6,000 City employees and to hundreds of Boards and Commission members about their financial disclosure obligation. On the enforcement side. In 2011, Board staff conducted numerous investigations of potential violations of the Public Integrity Laws, which resulted in 12 settlement agreements involving violations of the Campaign Finance Law and two involving violations of the Home Rule Charters Prohibitions on Employee Political Activity. In many other cases, Board staff terminated the investigation after determining that a 309 violation had not occurred. The Board remains committed to continuing and improving its outreach and education efforts in order to foster high levels of compliance with all of the laws it administers. Now, as to FY13 appropriation, the Ethics Board Proposed Operating Budget for FY13 is $898,000. This includes $788,000 for personnel; $96,000 for services; $14,000 for materials, supplies and equipment. It is important to understand that the appropriation of $788,000 in class 100, the personnel one, presumes that the Board will obtain $88,000 in FY13 from the Fund for Philadelphia. While these funds permit us to hire three new staff members for the short-term, the funds are finite and do not provide a long-term solution to our staffing problem. Currently issues raised by the Civil Service have delayed our use of Fund of Philadelphia money to hire new staff in FY12. We, therefore, request your support for an 310 additional $120,000 beginning in FY13 to guarantee we can fund these three additional staff positions in light of our vastly increased workload. The Board continues to defend legal challenges to its authority and actions as well as to the City's laws themselves relating to our jurisdiction. We have been very fortunate to have pro bono representation in two major ongoing cases and these legal services were valued at more than $500,000 in 2011 alone. We are always aware that these generous volunteer legal services may be with withdrawn at any time or may not be available in future litigation.

Mr. Glazer

We believe that our efforts to administer and promote the City's Public Integrity Laws have, in just a few short years, changed the public's perception of City government and increased confidence in the integrity of City government. However, we continue to struggle with inadequate funding and staffing and believe that a moderate increase in resources would allow us 311 to strengthen our efforts and to satisfy the increasing demands placed on our agency. Thanks very much. Staff and I will be pleased to take any questions you may have, and of course be pleased to meet with any of the Council folks at their convenience if they would like to discuss these issues further.

Councilwoman Brown

Okay. Then. Thank you very much for your testimony. Given the hurdles you acknowledge in your testimony, around the start up and roll out of the lobbying project, have you set a goal date that may have to change because of inadequate staffing and the IT hurdles you have run into?

Mr. Glazer

Councilman, even though I'm a very active Chair, I am the Chair, and not staff. So, I would like to call up two people to help answer that question.

Councilwoman Brown

Absolutely.

Mr. Glazer

The Chief Innovation Officer, Adel Ebeid and member of our staff, Deputy Executive Director, Nedda Massar. 312

Councilwoman Brown

Please.

Mr. Ebeid

Good afternoon.

Ms. Massar

Good afternoon.

Councilwoman Brown

So, share with us, I won't say briefly, goal dates are always important, particularly if you factor in or when you factor in hurdles that have already been articulated in the record. So, knowing what the hurdles are, what would you see as a new goal date for the completion of the lobbying project? Do you see it this Fiscal Year? Do you see it more months out? 13 Just an idea. 14

Ms. Massar

I believe -- Nedda Massar, 15 Deputy Executive Director. I believe that 16 Fiscal Year 13. We are almost at the end of 17 Fiscal Year 12 in a lot of ways. That Fiscal 18 Year 13, we would be able to complete that 19 project regardless of the approach that we 20 take. The Board and those of us on staff, as 21 our Chair indicated, believed it was 22 important to make information available, even 23 if it was through a paper process and 24 disclosure. We believe we have done that and 313 with the assistance of OIT, we will have Expense Report information on our website as well until the complete on-line project can be done.

Councilwoman Brown

My second and final question is, on the topic of outreach and education, the testimony indicated that there were ethics training sessions. They 9 are principally and solely for City 10 employees; is that correct? 11

Ms. Massar

The ethics training 12 sessions counted there, yes, are for City 13 officials and employees. 14

Councilwoman Brown

Has there ever 15 been any consideration, and the reason why I have raised the question, you mentioned, there were 75 e-mails and countless memos, written responses that you have to offer to persons who want to do the right thing. People don't enter an elected office with the intent -- 99.9 percent enter to want to do goodwill, but often times we might be surrounded by enthusiastic volunteers who don't fully understand the particulars of the 314 law. So, has there ever been any consideration given to having ethics training sessions for those who are extensions of a candidate: Campaign volunteers and the like, who have key principal roles in campaigns, and in a world now where there's been an uptake in guidelines and regulations and we know time is needed to get it right and to learn what those new guidelines are so you can be in compliance, any consideration given to those who are not City employee's but are actively involved in campaign efforts and want to honor the law?

Mr. Glazer

We are gonna distinguish between the ethics training, which is mandatory, and the campaign finance training which is not mandatory. When we have offered the various campaign finance training, that has not been limited exclusively. In fact, we have done everything possible to reach out to people, and I gather about a hundred people attended our campaign, some of them treasurers, some of them staff. 315 So, the answer is, it's a complicated law and we do everything possible to try and train people, and it doesn't stop there, because our staff is constantly on the phone and answering questions, from not just City employees or candidates, but anyone who has interest in campaign finance, and that is particularly heavy volume during the time right before reports --

Councilwoman Brown

Filing, of course.

Mr. Glazer

-- are required to be filed.

Councilwoman Brown

Of course. Okay, then. Thank you very much. Councilman Bill 16 Green.

Councilman Green

Thank you. My specific question relates to the Chair's first question, which is when will we have an electronic filing of lobbyist reports as required by law? Specifically during last week's Budget Hearing, OIT testified that the Board considered and rejected using the State 316 system which is a system which is already in place and built and developed. Could we -- I would just like to understand what the history is there and then also, you know, can we get a definitive date from OIT?

Mr. Ebeid

Councilman Green, Adel Ebeid, CIO. I will share with you the milestones as I am aware of them, leading up to today. When I testified last week, I shared with you that the vendor that has been, that the City has contracted with, has delivered a series of software releases. As late as last week, two, and one more that is due this week. Based on what we have seen so far, even though it is an early conclusion, but we believe it is gonna fall far short from what the Board's original user requirements.

Councilman Green

So, there is no 20 point going back in the history of how we got here except for the specifics.

Mr. Ebeid

I figured I would start with the last one and see if you --

Councilman Green

Except for the 317 specific question of why we have rejected trying to piggy back on what the State has already got?

Ms. Massar

If I might. We visited, members of our staff, visited the State back in the summer of 2010 and looked at the software and saw certain problems with it. After we visited, then members of the staff of OIT, then DOT, visited as well and they were under the impression that the system needed serious fixes and revising and that many filers -- it is not mandatory, electronic filing, at the State level, and that many filers continued to file on paper because of problems with the software. Unofficially, we were later advised that they will probably be scrapping this system as it exists right now. I don't know if that has happened or not, and since it was possibly going to be abandoned, it was the decision at that point, I believe it was November --

Councilman Green

That makes perfect sense. 318

Ms. Massar

So, we did not follow suit with that.

Councilman Green

Okay. So, the final question is, how long will it take for -- This is a basic form that information from it will go into the database, it could be on Google Forms. I mean, it is not a complicated undertaking, I don't believe, to get data in fields and have it made available on the internet for public consumption. I think a simple RFP could probably have the people doing this in Indy Hall, you now in several weeks or a month if we have clearly defined -- you know, an architecture or plan for how the system is to function. I am just wondering why we don't, at this point, issue an RFP with clearly defined goals and see what we get back, rather than going to a vendor and trying to do this the same way we did it before.

Mr. Ebeid

Just a point of clarification. You are somewhat correct, the system is not as complicated. However, there is some complexity in it with regard to work 319 flow and credentialing. So, it is not all straight forward.

Councilman Green

Has that all been written, requirements for that?

Mr. Ebeid

There is a set of user requirements that have been drafted jointly that I believe are in pretty good shape and paint a pretty good picture of what the Board of Ethics would like to see in order to implement the spirit and the intent of the law. Let me just cut to the chase here. Monday, April 16th is our drop date. If we do not -- If we are not happy with what the vendor has delivered as of that date, we are going to terminate the contract, jointly document the process, and approach the Department of Law to see if we have any claims against the vendor, which I think we would.

Councilman Green

Yeah.

Mr. Ebeid

We would then move on to, there are three other options that we could pursue. I am gonna list them in the order of preference. New York City has offered their 320 system, so that could be an option.

Councilman Green

That is awesome.

Mr. Ebeid

That could be one option. A second option, we could do what you just suggested, which is go out with an RFP and pursue another vendor, and option three, which is my least preferred, but it is possible that we would could bring it in-house and finish the project. Based on the requirements that I have seen, this is the type of project that should not take more than four months. It is unfortunate of all the events that OIT and the Board of Ethics got dragged in to, but we are where we are. We are trying to recover from it as soon as possible.

Councilman Green

I ran a software company and I can tell you, the company I ran, this would take less than two weeks. So, I understand that Government process is long no matter what you do because of the need for an RFP even before people start work, but I would suggest that if we can pursue using New York's, and I agree that is 321 what we ought to do. So, the closest deadline you are willing to commit to is four months from April 16th?

Mr. Ebeid

Based on the requirements that I have seen. I don't understand why it would take more than four months for a capable vendor to produce a solution.

Councilman Green

Unless we take New York City's solution.

Mr. Ebeid

We would have to customize New York City even though it might be, my guess, cut down on some of the deployment time, we would certainly have to share it with the Board of Ethics. See how close it is, and work on the gaps. Certainly starting with something is much better than starting from scratch.

Councilman Green

Okay. Thank you. I am just gonna put my other questions on the record.

Councilwoman Brown

Council, please don't force me.

Councilman Green

Madam Chair, I would like to put my questions on the record and 322 then not ask any more questions.

Councilwoman Brown

Oh, okay. Very well. Proceed.

Councilman Green

If you would please provide to the Chair an explanation of what the problem is with the Civil Service Commission in terms of providing the funds that have been allocated to you since the Street administration? Not answer today, but provide that to the Chair so that we can understand that. Let us know if an interim solution might be a loan from the City that was repaid when you finally get those funds. If that is something you can work through, and I have questions about Class 200 contracts that every department has been required to provide to The Chair prior to the testimony. I don't have that, and if you could just provide that information to The Chair. If you don't have a copy of those questions, which you may not, because it went through the administration, we will provide them to you. Thank you, Madam Chair.

Councilwoman Brown

You're welcome. 323 Councilman Jim Kenney, please.

Councilman Kenney

Thank you.

Councilwoman Brown

You're welcome.

Councilman Kenney

Just in a general way. I think I have said this to you before. When we first started out in this new process, in this new world, there was lot of bumps in the road, and just getting people to understand the changing culture. I think we are actually getting there. I sense that there is a smoother -- This last election period was a smoother go, with a lot less information that was needed quickly. It seemed like a lot more of a calmer pace. So, I think as time goes on, things will get even better. The issue I want to raise is relative to the ability, or if you are looking at the ability to do ethics training on-line with an interactive -- I have seen so many interactive on-line interfaces that, you get through it. You have to answer the questions. So you know people are participating and reading it and 324 understanding it. I just think it would be so much easier than trying to round people up and get them to a physical training as opposed to requiring them to go through this every year at their desktop. So, where is that going or what do you think about that?

Mr. Glazer

It was at your suggestion that we have pursued this, and I think we are at point where we can give you some information.

Councilman Kenney

Thank you.

Ms. Massar

This is one of those instances where our staffing has had an impact on our ability to deliver. We have been concentrating heavily this past year on campaign finance, outreach, and training and the lobbying projects. We have made technical progress with the on-line software. There had been a problem, we believe that is solved at this point. We are working to develop the content right now and we hope to have some kind of pilot project available in the fall 325 once we get lobbying launched, we will go back to this. It is our goal to have it available on a broader basis. It would probably be next calendar year, but we hope to have an on-line pilot project to test the whole system before the end of this calendar year.

Councilman Kenney

I will assume that that in place, at some point in time would free up your staff for other duties that, instead of conducting these in-person seminars, they would be going doing other things too.

Ms. Massar

It will still require that we monitor who has taken, and that was actually the technical problem that we had to resolve, was the receipt process, so that we know who has taken the on-line training. So, we will still need some staff to track that. To make the software available, there will have to be several modules, depending upon the content, and we will have to make those available in some kind of sequence and target those people who are to be taking that 326 particular training. But, you are absolutely right, it will be a different kind of work flow that is involved.

Councilman Kenney

Okay. Great. Thank you. Thanks.

Councilwoman Brown

Point of information. Councilman Kenney, do you know if other municipalities actually do that?

Councilman Kenney

I don't know, but I know when are you are taking tests, for example, on-line tests or on-line learning, there is -- the platforms exists and the software exists that you can have that relatively easy based on the amount of resources you have to implement them. I just think -- You know when you get your -- It is hard getting me down to one of these things, or over to your offices or in the caucus room. So, just to be able to sit for a half an hour, 45 minutes and go through it, I think would be helpful.

Councilwoman Brown

Yes. Let me say on behalf of Council members, it was appreciated that you made a decision to allow members of 327 Council and staff of Council to take the training sessions here. It was very, very helpful. So, thank you for that management decision. We thank you for your testimony. Anyone else to speak to these witnesses? Thank you very much.

Councilman Kenney

Thank you.

Councilwoman Brown

At this hour we'd like to call up Community College of Philadelphia. Good afternoon. Welcome to the Budget City Council Hearings. You may please state your name. State your name for the record and proceed with your testimony.

Ms. Fernandez

Good afternoon. I am Varsovia Fernandez. Afternoon, Council President Clarke. I am sorry, I am reading this stuff, Madam Chair. Good afternoon, Councilwoman Reynolds-Brown and all members of Council who have been patient enough to stay here for us. I am Varsovia Fernandez, Chair of the Community College of Philadelphia. My day job is President and CEO of the Greater Philadelphia Hispanic Chamber of Commerce. 328 Joining me is college President Dr. Stephen Curtis, as well as several members of our cabinet, including Sam Hirsch, Office of Student Affairs. I have Jill Garfinkle, our General Counsel, and Vice President of Human Resources. Lynette Brown-Sow, our Vice President of Marketing Government Relations. Dr. Judith Head, our head of Academic Affairs. My colleagues on the Board of Trustees and I are Government Civic and business leaders who represent a cross section of Philadelphia. We volunteer our time because we care deeply about Philadelphia and recognize the importance of Community College of Philadelphia to the future of the City. While Greater Philadelphia is home to more than 100 colleges and universities, Community College of Philadelphia is unique first because it is the only community college in Philadelphia, and second because for many residents, it provides the only affordable access points they have to earn a college degree or certificate. Community 329 College of Philadelphia is an open admission institution that provides access to education for thousands of Philadelphia residents. We offer more than 70 degrees, academic certificates, and proficiency certificate program that allow our students to successfully transfer or enter the workforce. The Board of Trustees is grateful for the support of City Council, and Mayor Nutter continues to provide for the College, especially during this challenging fiscal times when the City's support becomes more relevant to most of our students and adults. For the Community College of Philadelphia to continue meeting the needs of residents thinking to sharpen their skills, advance their careers, and obtain employment, and for employers to draw from our workforce, your support remains highly important. In spite of our budget challenges, we have made quality education and student center services our top priorities. Much of our future centers on what we do during this critical budgetary period. 330 We ask that you consider the growing demand for our programs and the City's critical need for a more educated workforce. The City's financial support is essential if we are to continue to successfully meet our students educational and training needs. I take this opportunity to thank each of you, members of Council, and some of you are not here, for your direct contribution to our City, and in particular to those of you who find ways to get involved with our community college. Thank you.

Councilwoman Brown

You are very, very welcome. We thank you for your testimony and the work that you do in your leadership role there at the University, and the leadership that you have shown with regards to something we care about very much here in this legislative body, and that is to make sure the University at all levels looks like Philadelphia. Thank you very much. President Curtis.