00001 COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING BEFORE COUNCIL COMMITTEE ON RULES - - - Room 400, City Hall Philadelphia, Pennsylvania Monday, November 13, 2000 10:34 a.m. - - - BILL 000543 - Amending Section 17-104 of the Philadelphia Code, entitled "Prerequisites to the Execution of City Contracts," to add a new subsection requiring businesses receiving financial assistance from the City and City-related agencies to contribute to a fund for Philadelphia's children, the proceeds from which shall be made available to pay for new and expanded program initiatives for Philadelphia children, all under certain terms and conditions. PRESENT: COUNCIL PRESIDENT ANNA C. VERNA, Chair COUNCILMAN JAMES F. KENNEY, Vice Chair COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN DARRELL L. CLARKE COUNCILMAN FRANK DICICCO COUNCILMAN MICHAEL A. NUTTER COUNCILWOMAN MARIAN B. TASCO - - - VINCENT VARALLO ASSOCIATES, INC. Registered Professional Reporters Eleven Penn Center, Suite 600 Philadelphia, PA 19103 (215) 561-2220 00002 I N D E X Carol Reckling, Executive Director . . . . . 4 Child First Authority, Baltimore, MD 5 Margaret Brodkin, Executive Director . . . . 14 Coleman Advocates for Children, San Francisco, CA 6 Shelly Yanoff, PCCY. . . . . . . . . . . . . 32 7 Janice Davis, Philadelphia Dir. Of Finance 83 8 Captain Joseph Mooney, Police Department . . 103 9 Dr. C. Oakman, Center for Youth Development 105 10 Veronica Elias, Roxborough YWCA. . . . . . . 114 Blondell Oates, Nicetown Boys and Girls Club 124 Rev. Mary Laney, St. Gabriel's Church. . . . 129 Mary Veitz, Hope Day Care Nursery. . . . . . 135 Reverend Vincent Coles, Mount Carmel Church 140 Samuel Hodge, Volunteer Crossing Guard . . . 145 William Cotts, Retired Methodist Minister. . 148 Wanda Miale, Congreso de Latinos Unidos. . . 157 00003 P R O C E E D I N G S
Good morning, everyone. This is a public hearing of the Committee of the Whole -- I'm sorry, of the Rules -- regarding Bill No. 000546. Would Mr. Mezzaroba please read the title of the bill.
Bill No. 543, amending Section 17-104 of the Philadelphia Code, entitled "Prerequisites to the Execution of City Contracts," to add a new subsection requiring businesses receiving financial assistance from the City and City-related agencies to contribute to a fund for Philadelphia's children, the proceeds from which shall be made available to pay for new and expanded program initiatives for Philadelphia children, all under certain terms and conditions.
Thank you, Madam President. I am pleased to introduce Bill No. 25 543 to establish a children's fund with 00004 resources from contributions from businesses which receive financial assistance from the City. Children's funds are not uncommon. We're familiar with the Children's Defense Fund, the United Nations Children's Fund, and my intent with this bill is to devise a means of addressing the lack of funding for children's activities, their issues, and their solutions. Children are actually a part of our economic development strategy. Their education their well-being, and their safety each contributes towards the growth and expansion of our city as they enter the workforce and become taxpayers and consumers. Combining our resources to aid our children and to present opportunities for business assistance seems a natural step toward achieving our goals. The goals are specifically to support after-school care and summer children and youth programs. Also included will be measures to encourage the development of high-quality day care facilities. Next, we want high-quality 00005 mentoring and tutorial programs. Until our schools have reached the level of excellence that we desire, we must use all of the supplementary methods that we can to raise their sights and their accomplishments. Today, we will hear about programs from other cities which have been successful in developing a children's fund based on linkage with economic development plans. After hearing from the City representatives, we will hear from advocates and program coordinators who will document the need and offer support for such fund development. We thank you for those individuals who are here to testify, and as we try to bring this to a consensus, we hope we are successful. Thank you very much.
Thank you very much, Councilwoman. It's my understanding that we have four immediate panels that we're going to take. The first panel, represented from cities employing linkage, is Margaret Brodkin, Carol Reckling, and Shelly Yanoff. If you could 00006 please take a seat at the witness table, and you can proceed in the order that you desire, after identifying yourself for the record. (Witnesses come forward.)
Prior to the formal testimony, the Chair recognizes Councilmember Reynolds Brown for additional comments.
Thank you, Mr. Chairman. I simply want to speak absolutely, positively in favor of this bill, and I have prepared comments that I'd like to put on the record.
Thank you, Council President Verna, Councilman Kenney, and all of the members of this committee, for allowing me to say a few words on behalf of Bill 543. Although I am not a member of this committee, I felt absolutely compelled to come to the chambers because of my strong feelings regarding this bill. Let me begin by saying that I recognize the role of the City as it pertains 00007 to helping businesses and developers with financial assistance. If we are to retain jobs and create jobs for the citizens of our city, Philadelphia needs to do what it can to make sure that quality jobs are here. -- by "here," I mean within the City limits -- because if we do not do what we can do, those jobs will be in another county, oftentimes in another state. Grants, TIFs, tax abatements are all important tools to get the job done, and I am learning that they're usually necessary to get the job done. I will continue to support these measures whenever it is the right thing to do for the City, its residents, and the School District. However, I must admit that I struggle over these issues when they come before City Council. I struggle because I'm still relatively new and the nuances of the City's assistance to businesses are complex. This bill, introduced by Councilwoman Marian Tasco, and one which I proudly cosponsored, will go a long way to ensuring in my mind that providing financial assistance to businesses is indeed the right thing to do. I 00008 think we all understand that for this city to survive, we need jobs, but I also believe there is something else that we can do as well: we need an increase in sage and stimulating and educational opportunities for the children and youth of our city. Without these opportunities, families have one more reason to leave. Without these opportunities, our young people are given a diminished chance to succeed. The dollar amounts that will be required to be attributed to the youth fund are minuscule within the context of the amount of assistance that businesses are to receive; yet, they would make a large difference in improving the lives of children and youth of this city. Much like our excellent 1 percent for public art whenever there is new construction, I believe that a percent contribution to the youth fund whenever there is a large piece of financial assistance from the City is a reasonable request. This bill is a win-win bill. It will give additional reason for families to stay, it 00009 will improve the quality of life for our children, it will improve the quality of life of the workforce in the area so that businesses who are receiving a large subsidy will also have a stronger pool of workers to choose from. This bill is pro-family, this bill is pro-child, this bill is pro-business, this bill 9 is pro-Philadelphia. I urge you, my colleagues, to vote Bill 543 favorably out of committee so that before we recess for the holidays, we can be assured that by early 2001, we have a mechanism in place that will improve the quality of life for those of us who live in our city, but most importantly, for the most vulnerable among us, our children and youth. Thank you very, very much.
Thank you very much for your comments. The Chair now recognizes Miss Brodkin, Reckling, and Yanoff. Please proceed in your own order but please identify yourself for the record prior to your testimony. Thank you. 00010
It's a pleasure to be with you. My name is Carol Reckling, I'm the Executive Director of Child First Authority in Baltimore, Maryland. Child First Authority funds and helps to organize after-school programs in Baltimore City public schools. We were founded in 1996 and established by the organization BUILD, Baltimorians United in Leadership Development. BUILD is a church-based community organization that is affiliated with the Industrial Areas Foundation, and our sister organization in Philadelphia is PIA, which also organizes as a faith-based organization. I need to tell you that I was very interested 'cause this morning in the taxi, there was mention of a new stadium. I presume that you all are trying to figure out where to build. At the time that Child First Authority was established, it came in the midst of a citywide election, and at that time, BUILD had engaged its members in looking for some 00011 fairness in terms of the spending of public dollars for private enterprise, and looked at it similarly as you are. One of the things that we found for the citywide agenda, as we were preparing for the election, that one concern that was shared throughout our community, no matter which districts we went in, was that there were meaningful activities for young people and that they be funded, because this came about at a time when the city budget was declining, the tax base was declining, and at the same time, two new stadia were being built, and those stadia had, through the Maryland Stadium Authority, had an incredible support network in the business community. We decided that we needed the same kind of champion for children in Baltimore with the same kind of effort. And if we could create an authority that could receive a source of dedicated funding, then we could sustain children's programming in Baltimore City. And so the organized Child First Authority, which was supported by our state legislature and then 00012 by the City Council, through an ordinance which created our organization. In the four years that we've existed, we have funded programs in public schools and we give a grant to each 6 of the sites of $80,000 per year for the school 7 year to operate their after-school program. 8 But that's not all, because having 9 that infrastructure built has enabled us to 10 leverage other resources for our after-school 11 programs, including commitments from -- and partnerships with the Maryland Institute College of Art, who also received a grant of $500,000 from the (unintelligible) Reader's Digest Fund. This enables them to bring art students and art instructors into our program. We worked with the Maryland Historical Society, the Baltimore Museum of Art, all of whom enjoy working through our program because they don't have to create something new. So if you think about what your effort can do for you, you also want to bring in your other cultural institutions. When Child First was established, we received the proceeds from the City public golf 00013 courses, their profits. In recent -- and after the second year, the City, I don't want to say privatized the golf courses, and so now we're looking to attach a $3 -- increase the greens fee in Baltimore City by $3 and have that amount come to the Authority. We estimate that might raise about half a million to a million dollars a year. And I might add, the reason that we thought about the stadium and becoming an authority in Baltimore was because our original goal was to charge $1 on every Orioles and Ravens ticket, which would have netted a substantial fund considering the state's and the city's investment in these enterprises. " And the Safe and Sound campaign is broader than Child First, seeking to raise sustained funding throughout the city for "a youth place network," as we call it. So this will be after-school programs beyond Child First.
We estimate that for the last four 00014 years, we've served about 1300 to 1500 children per year, and when I break down the cost, that comes to about, let's see, I use a figure that's between $1 and $3 per hour per child, which, I like to say, you can hardly buy the snacks for that amount, but that's -- that's the level of funding that we've been able to give. And we're now in our fifth year of operation, nine programs that provide education -- academic, cultural and recreational programs in these sites.
My name is Margaret Brodkin. I'm the director of a child advocacy organization in San Francisco. I've been there for years, and I've traveled to a lot of 19 cities around the country, so I'm very familiar 20 with a lot of what's going on to fund 21 children's services. 22 I'm going to tell you about two measures that we have enacted in San Francisco for funding children's services that have become national models, that have been 00015 recognized by the National League of Cities, the National Conference of Mayors, and many others as being among the most effective landmark approaches to ensuring stable funding for children's services, local funding. And I'd like to say as a child advocate that I'm very proud of what we've been able to do, but I would like to say that there is a tremendous amount of civic pride in what we have been able to do for kids, not just among child advocates, but among the business community, the political leaders, labor leaders. We're very proud of what we've been able to do. Lest you think San Francisco is completely different from Philly, it's not. It -- maybe you should multiply whatever figures I give you by two and a half because your child population is two and a half times ours. But we have, most people may not realize, a very high-risk child population. A third of the kids in our public schools don't speak English, we have one of the highest homeless populations in the city. If you draw a map of our city and 00016 look at where the people -- low-income people live, it's where all the families and children live. About 80 percent of our children are children of color. Our budget process every year is a nightmare, with enormous competing needs. We have an AIDS crisis, a homeless crisis, a substance abuse crisis. So I'm sure we're in the same situation you're in in terms of competing needs. And we have a business community that struggles to create what they think is an environment that is conducive to business and a lot of conflict of what, in fact, that actually entails. And, you know, they are always concerned that we might be doing something that would infringe upon that. The two things I will tell you the most about, one is a property tax set-aside, an amendment to our city charter, which says that for every $100 of assessed property valuation, two and a half cents will be put into a children's fund. That was enacted by the voters in 1991. It was a proposal that was born out of total frustration on my part and 00017 other people's parts, but after ten years of feeling like we were hitting our heads against the wall trying to get the kinds of preventive programs that you have been talking about into the city budget and felt that a requirement, a mandate, an annual mandate to ensure that we have this funding for kids was absolutely necessary. My rationale when I first thought of the idea was that there are really mandates and protections and benefits and guarantees for a lot of parts of the budget. We have an authorized strength for our police department, we have many benefits for businesses, we have many benefits for our city employees, a lot of protections in our city law, and that -- and no 18 protection for kids. So every single politician in the city opposed it, as did the Chamber of Commerce, as did the major newspaper, but we can put things on the ballot in San Francisco by petition of the voters, and that's what we did, and it passed by 54 percent. Now, we put -- we built in -- and that's in an electorate 00018 where only percent of the people who vote have kids in the public schools; 16 percent of the people have kids and only half of them have kids in the public schools. And we are also a city that is losing its families. It was back on the ballot just this November.
It was endorsed by every single elected official in the city, it was overwhelming endorsed by the Chamber of Commerce, it was -- donations to the campaign came from every major business leader in the city, and it passed by 74 percent. Why? Because in the nine years, it was a San Francisco success story, an absolute, unqualified success. As last year, it raised about $20 million in the Children's Fund. It transformed children's services in the city. Felony arrests went down, child abuse went down, mental health hospitalizations went down, graduation rates went up. It's the best $20 million, best bang for the buck that the city ever saw. It serves, with $20 million, 80,000 a kids a year, 180 programs in neighborhoods in every part of the city. 00019 We have something we called "beacon centers" in our middle schools that got started with this, keeping the schools open evenings, weekends, after school, not just for can kids at that school, but for kids in the whole community. We have funded new populations of kids that had not gotten services before, disabled kids, programs for girls who are not getting adequate programs through our rec and park department. We have educational enrichment programs. We've been able to move out into neighborhoods that traditionally have not gotten city services, neighborhoods that were seen as, well, more middle-class neighborhoods, they don't needs money from the city. As a result of having this pot of money, we were able to start children's programs in every asking neighborhood in the city to make this a citywide effort to help kids, and that's fabulous prevention. And, of course, there are kids in need in every neighborhood in the city. We have kids now doing gardening all over the city, we have kids initiating their 00020 own projects. One of the things that was funded, a group of kids decide they wanted to have SAT classes -- it was their idea. They got funded to start their own SAT classes, poetry (unintelligible), cultural activities. It is fabulous. Some of the things that have happened that were unanticipated but that you may be interested in is, it has leveraged an enormous amount of money. For every dollar the city puts into it, there is another dollar that comes into children's services, either from the private sector, from matching state and federal funds, but it has so expanded the pot of money way beyond the money city puts in. It has tremendously increased our planning for children. We had to create an infrastructure to give the money away and to plan for it. We required the city to set up annual children's service plan, we required the city to have hearings in neighborhoods about what the public priorities were. And this time around, we're requiring the city to set up a body similar to the one that's being proposed 00021 here. It created a level of stability and we were able to do so many of these innovative 'cause we had total local discretion over these dollars, which we don't have over most dollars. The second thing I want to tell you about is something that is a fee on office and hotel development. It was actually passed in 1985, and it's a very simple concept, also strenuously opposed by the business community. It says for every square foot of office and hotel development that is approved by the city, the developer will put $1 into an affordable child care fund. This generates now about a million dollars a year. It didn't generate anything when it first passed because it came at a tremendous economic decline and for ten years, there was very little money in the fund, but it was overwhelming opposed. The person who proposed it was accused of being a socialist. And it has also been a fabulous success. What we have to prove in San Francisco and with California law is a nexus 00022 between the fee that's being imposed and the benefit. And it was a very easy thing to do. So for every -- you were going to have all these new employees, with new businesses, new offices, new hotels.
They're going to need child care, they're going to need after-school programs. Their kids are going to be the kids who will benefit enormously from this fund. And, of course, everybody benefits when you have a healthy child population. This fund also leverages an enormous amount of money. ) family, which you may know about, is one of the wealthiest families in San Francisco, matches this fund every year. It's put into a child care facilities fund. Child care centers and family day care providers apply to this fund to buy equipment, to fix up their yards, to -- for a small things that improve the quality of child care. It is now hailed by the business community -- they brag about it -- as, you know, an example of their corporate citizenship. It is something they use as a selling point and a wonderful PR thing. 00023 We also have, by the way, our 49er tickets have a surveillance charge on them, I think, of 50 cents. It goes to fund the after-school sports programs, the school sports program, which were being cut. With the hotel tax, a portion of which goes into cultural programs for kids. And we have something called a "baseline budget," which says to the city, You can't cut children's services so as we add these things, they don't replace existing services; they come on top of existing services. The lessons from San Francisco that I think are relevant to Philadelphia are that small, discretionary, local, steady funding can create just a huge difference. There's nothing more cost-effective than programs for kids. And so, for a rather modest amount of money, you can serve a lot of kids. It is a wonderful bang for the buck, and it has many side benefits in addition. The second thing that's relevant is that business and development is not negatively affected. The business community opposed both 00024 of these measures -- probably all of these measures, but these small fees, which are small amounts of mandated general fund, have become an enormous source of civic pride and have not negatively impacted the business community. Last year, San Francisco was rated in some major survey, which now I can't even remember who did it, but I think it was a business magazine, as the second best city in the country to raise kids, and you better believe the Chamber of Commerce talks about that all the time and touts that number to continue to attracts businesses and to brag about one of the benefits of living in San Francisco. Number three, we have shown that there is a real clear correlation between the city's ability to care for kids and its attractiveness to business in terms of caring for their employees, in terms of improvement in neighborhood life and the social stability of the kids. Everybody wants to move into a city where juvenile crime is down. And, lastly, this is something I feel 00025 like I am a total expert on. After years of working for kids and talking to people in cities all over the country, this simply will not happen. These kinds of preventive programs will not be funded. If you make kids do battle every year in your annual budget battle, they won't come out on top. You have to hard-wire it into the financial and budget policies of the city. I met a couple days ago on the steps of City Hall a member of our City Council, called our "Board of Supervisors," who was the most adamantly opposed to these measures. She's the most pro-business person on this City Council. She came up to me and she said, Margaret, I was wrong. After eight years on this City Council, I now know that none of these things that you have been able to see funded would have gotten funded, if it had not been a requirement and a mandate. I think you're looking at a very modest proposal. It could have enormous benefits to the City and be the beginning, actually, of more sustained and adequate 00026 funding for your kids. )
Just kidding. Councilman Clarke, do you have a question?
Yes. Thank you, Mr. Chairman. I have one quick question. You had mentioned that office buildings and other types of development, there was a fee proposed, one talking about per square foot, $1 per square foot.
In those particular developments, can you tell me what percentage of those, as best you can, that receive city assistance in terms of developing 00027 that building or that office building or whatever type of facility that they build?
I mean, we didn't even tie it to, You got to get a benefit from the city. I mean, we just said, You're getting to build in this city, you know, we're going to approve your permit, but this is a part of the -- this is part of, you know, the cost of doing business in San Francisco. So some of them, I'm sure, did --
Some of them, I'm sure, got benefits and some probably didn't.
All right. That's important because today's bill speaks of a linkage between City assistance to a particular development, so if you could give us some information.
You know, in Baltimore, one of the things that happens is that we fund -- the City funds new garages in order to keep businesses from moving out of town, which they are constantly threatening to do. And what we just found out, because we wanted to add $1 to parking fees or 1 percent or either $1 to parking fines, and in fact, the City loses -- Baltimore City loses about $2 million a year funding these parking garages. So, you know, really that's a subsidy to the businesses as well. I think that for us -- you probably have a different situation in Philadelphia and San Francisco in that imposing that kind of fee really is a threat to a city where you have businesses that are threatening to leave as oppose to do dying to stay there or to come in. And kind of similar to what you were doing, we were clear that we had to have some 00029 kind of a fee that was new, that created something that did not exist before, which is why I'm talking about the golf course, adding the $3 to the greens fees, because I think currently, for an 18-hole golf and cart in Baltimore public golf courses, you're talking about $16 to $18, which, in surrounding areas, you know, that's a bargain. So we were looking for something additional -- something new to create the new funding stream.
Yeah. Let me give you an example, the reason I asked that question. In the district that I represent, we have numerous development opportunities in correction initiatives, and one of the things that we try to do is to ensure that the local residents are gainfully employed. And when we talk to the developers and the general contractors, there's this question about experience, and they indicate that when they hire locally, people who are marginally or not very skilled, that they end up losing money. So invariably, they come to us and 00030 say, Well, we have to pay a different rate to these individuals and we're going to need a little bit more in the budget because we're going to lose person hours, it's going to take us longer to do the development because these people are unskilled. So when we get the bill 8 for this development opportunity, it's a little higher because of that. I'm concerned that, you know, sometimes this can increase the cost of doing business, particularly when you're talking about a City-funded project, 'cause we ultimately end up passing that fee onto the taxpayers that we're talking about today.
It's a cost-benefit analysis. I mean, we think the benefits far outweigh the costs.
Well, I'm not questioning that. My question is, we're going to pay it anyway, and the question is, do we do it through this initiative or do we just do it, period. You know, do we just fund the children's program because it needs to be funded -- 00031
Well, I don't we see -- we also have many measures like yours. I mean, every time there's a city-supported project, we have hiring where you have to hire a certain number of homeless people, you have to hire a certain number of people -- (Unintelligible, parties talking over each other.)
-- as an example in terms of a pass-through. When we impose certain things on developers, it tends to always pass through to the City, particularly when we're involved in the financing. It doesn't pass through to the private-industry lending institution; it passes through to the City of Philadelphia. So we end up paying the additional dollars on the project, regardless of how we go. So that's why I wanted to know --
Maybe Shelly can respond. (Unintelligible, parties talking over each other.)
Well, I'm not sure whether -- (Interruption due to audio equipment failure.)
We had an earth quake,, you see, so our city hall got to be renovated.
Miss Yanoff, you were going to answer Councilmember Clarke's question?
Well, I was just going to mention that other cities, which I will refer to, have seen such marked drops in juvenile crime that, in fact, when they looked at cost-benefit analysis, they came up very strongly about providing more and more support. And I guess the question that most cities that we look at, it's not -- this is not the only thing that we can do, as San Francisco's doing five things, Baltimore is looking at lots of different things. This is one way that you increase the pool, and then you increase the pool hopefully every year through the budget, this regular budget process, and then you encourage private 00033 participation as well. And then still working on a bill from the state to bring more money down. So, I mean, the point is that there's an enormous amount of money that's needed if we are really going to transform the city for children, families and workers and business. And we need to be creative on how we will pull together that pool, and this presents, it seems, a pretty minimal way of putting some dollars in on a continuous basis.
Just -- I have a question -- two questions for, I'm sorry, Miss Brodkin. What effect do you think San Francisco's robust economy has on the ability to make this program successful? For example, and I think the other witness alluded to the Baltimore issue, is that we are in a constant battle with our suburban counterparts for a level playing field to keep businesses from either leaving or deciding to stay. San Francisco, to it credit, for lots of reasons, its high-tech environment, its 00034 climate, its panache generally as a place to live. In many ways, do you think that that made that program successful?
Because people are less likely to want to leave there anyway?
To want to leave the city as far as businesses? 'Cause, I mean, and I may be wrong about my assessment of San Francisco, but there seems to be more of a desire to be there than to be in --
Well, that's why I started out by telling you a little bit more about San Francisco. It's not just a glamor city and there a lot of rich people in San Francisco, but I've been a part of the city budget process now for years, and the most 22 successful parts of this fund were done in a very, you know, years and years of budget cutting. And the real benefits of this was that children's programs did not get cut; and, 00035 in fact, we were able to enrich them slightly. So the real benefits of this the -- economic upturn has only come in recent years, but the first five or six years of this children's fund was in a terrible economic situation in San Francisco. And, you know, everybody says, Oh, well, it's such a rich city, but, you know, I go through the budget process and there's not enough money for any of the things that I listed. The city departments are always asked to be cutting their budgets, and so we haven't gotten to a point yet where --
Well, I'm not trying to argue that San Francisco doesn't have problems --
-- like homelessness and child abuse issues and education problems.
But there seems to be more of a desire, and it may be simply just anecdotal, that companies would rather be 00036 in the city limits of San Francisco than, as in Philadelphia, would rather be in the nearby suburbs.
One of the things that we have been battling against over the past years is an extremely high Philadelphia 17 City wage tax, which means that any company 18 that comes here needs to take into account the 19 fact that they normally have to pay their 20 employees about 4 and a half percent more than they would in the suburbs because of the imbalance between the --
But I could find out. I think it's one of these grass-is- greener-on-the-other-sides, 'cause if you were to talk -- if the Chamber of Commerce were sitting up here, they would tell you their woes, they would tell you San Francisco is such a hard place to do business 'cause the electorate is always doing these goofball things, you know, and it's very anti- businesses, and all the businesses want to move to the peninsula, and they want to move out of San Francisco. The Bank of America left San Francisco, it was a major civic catastrophe. So, yeah, we -- there's a lot of appeal to San Francisco, but we are struggling with the same issues. People want to leave -- the businesses -- you know, there's pressure to leave the city.
But you also have the added benefit that -- I know in Baltimore, we're expanding our reach to other 00038 organizations throughout the state. And believe it or not, as quiet as it's kept, in the surrounding counties, they also don't fund programs for young people. And I believe that the surrounding counties are also going to adopt such a system to fund their programs because there's a great need, even in the surrounding counties, and I dare say, you would find same thing around Philadelphia.
And I just need you to expound on one area that you talked about, and that was the issue of middle-class families.
One of the problems that Philadelphia -- one of the major problems, maybe the major problem Philadelphia faces is that we've lost about 175,000 people in the last 10 years, and I would suspect that the bulk of them are either middle or upper- middle class. Programs like this generally get the stamp of being for poor people, who -- I'm not suggesting it is; what I'm saying is -- what I 00039 need you to do for the record is to explain why -- and these are some of the complaints that we get, is that you have a stable neighborhood with an active athletic association, an active arts group, an active church group. That basically those taxpaying citizens kind of take care of the problems and needs of their own children in the neighborhood. And the argument that I would get and that some of the other Councilmembers may get is, you know, we take care of our own kids, we raise them right, we fund our own programs, we fund-raise, we do all of the things that we have to do, and now you're going to ask us to contribute to a fund that probably we're not going to be able to take advantage of because we don't have -- our children generally aren't in crisis, we have more two-parent families than maybe other neighborhoods have. I mean how do to we argue to that cohort of people that, you know what, this makes sense for you too, for what reason?
For two reasons. One, because everyone benefits when the highest-need 00040 kids get services and you have a much more stable happy, healthy child population and your juvenile crime goes down and your foster-care population goes down, and a lot of costs to the city go down. But we made a conscious political decision in San Francisco because this was something that was enacted by the voters, and we wanted to see it enacted. And, again, we felt it was very important that everybody benefit. So while there is probably more money going into the higher-need neighborhood, we made a very conscious effort to move after- school programs into every single neighborhood. So that everybody saw a visible program that their kid could go to in their neighborhood. And it was a balancing act and I think we did an excellent job.
And, understand, the less critical-need neighborhoods that I'm talking about are not wealthy neighborhoods.
These are neighborhoods that are working-class, middle- and lower-middle-class people and --
And you're probably having the same thing we are. There are high-need kids everywhere and just because a neighborhood has a reputation for not, you know, having the highest juvenile crime rate or whatever, it doesn't mean that there aren't needy kids throughout that entire neighborhood.
But the electorate who are moving would argue to you that I can get a better deal in the suburbs by moving out of the City and taking advantage of a school system that I have confidence in, taking advantage of manicured baseball fields, and other activities that kids can take advantage of. And that's -- part of the argument that we have all of the time is that we're trying to take care of those high-need individuals and families, but at the same time, trying to make a case for people in the City who say, You know what, either you're poor and 00042 you get everything or you're rich and you don't need it, I'm going to leave. And that's one of the problems -- probably, again, the major problem that we're facing in the City is the loss of that group.
We have the same thing. In 1960, there we 180,000 kids in the city, now there are 140,000 kids in the city, and it's primarily middle-class kids that have left the city, and we are trying very hard to bring back those neighborhoods and give them their fair share of this funding. And you know, so that there are benefits to living in the city -- the cultural benefits -- and try and link some of these programs to kids being able to go to the ballet and being able to go to the symphony and taking advantage of good parts of the culture of the city.
Thank you, Mr. Chairman. Miss Brodkin and Miss Reckling and 00043 Miss Yanoff, to the extent that I know you've had testimony from other locales, can you quickly run back through the different either funding sources or funding mechanisms? I was listening to your testimony and I was trying to take relatively scattered notes, but I wasn't writing as fast as maybe I needed to be. Tell us again what the funding mechanisms are for your respective cities.
Well, I think I can tell you mine briefly because it's a shorter time and it's a smaller effort so far. We are getting -- when we first started, the source of dedicated funding that we had was from profit from the public golf courses, which netted us about a half million dollars a year.
And at the time, were they -- it had already moved into private management?
Yes, the city was still running it. Actually, the city still owns it but it's managed by --
Yeah. We are also -- I'd like to tell you about some of the things that we took a look at, because it might be instructive to you. We're taking a look at, as I said, proposing percent of parking revenue, perhaps adding a dollar to parking fees. We looked at a penny in Baltimore, a penny on a bottle tax. We 00045 figured that would have raised about $2.5 million per year, which was quite substantial for such a small amount, 'cause we figured we could do quite a campaign on something such as that.
Doesn't Maryland 00046 also have a deposit or a return?
Just tell me real quickly, and I know you're going through your list, when did the Children's First Authority start?
And this was through the percent of profits from the public golf courses?
Yes, with that. And then we got a grant from the state because of our -- our -- we do a lot of organizing in our efforts in the gubernatorial election where we 00047 got the candidates to agree that they would support it, so we've been getting a half million dollars from the state as well. And currently, that's coming through TANF. It didn't always, but that's what it's --
Did you start Children's First Authority? I mean, are you --
What was the -- I guess, what was the genesis of it? Why was it created? I'm assuming Baltimore funds some level of children's programs anyway, so you must have --
You know, it's interesting because when you look at programs for children, I often tell people that pretty much what we want for young people is the same thing that I want for my child. And when I do things for my child, I don't always say, you know, this has to give me this result immediately. I'm willing to invest in my child for the long term. 00048 And we said, you know, this is the same kind of approach we have to take to families in our community, that some of the things that we do are just because we know they're good things to do. Now, somewhere, we're also going to be accountable for the funds that we're spending and we are certainly going to have some outcomes that we expect. But for us, it was that, why is it that programs for young people typically run by nonprofit organizations, which typically last three to five years, and then foundations go on to another whatever their -- their -- you know, pet project is at the time.
And so it's very difficult to get that kind of operating money that you need.
Had you done an assessment of currently available programs back in the '95-'96 time period? 00049
Yeah, we did. As a matter of fact, with the community organizations, we are working -- BUILD members from different churches went through our neighborhoods. And at that time, recreation centers were being closed. So we took what they printed as the schedules of activities, we went around, we went to see how many people were employed in the recreation centers, were there activities actually going on, were young people there people there utilizing them. And, in fact, the buildings were in such dilapidated conditions, typically having one person there to manage the facility and the activities, that these things just weren't happening. So we did do an assessment of what was available in communities.
I brought you an evaluation of the Children's Fund, a poll done in San Francisco of people's attitudes about the Children's Fund, and a copy of the legislation that enacted it, which I will give 00050 you.
In 1991, when we were having terrible economic problems in San Francisco, there was a real downturn. So we have five mechanisms in place. We have -- Children's Fund is a set-aside of property tax, a portion of the property tax; we have the fee on hotel and office development; we have a surcharge on our sports tickets; we have a portion of our hotel tax going to cultural programs; and I didn't mention, we also have a portion of something called the "Open Space Fund," which is, you know, sort of an environmental, make sure we have money in the budget to purchase open space, and our argument was if we're going to have all this open space, we better be able to run some children's programs in it, so a portion of the Open Space Fund has been dedicated to after-school programs.
And similar to the questions I had asked Miss Reckling, when 00051 the Children's Fund was started in 1991, had you done some level of evaluation of what was being provided or not being provided by the City of San Francisco for children's programs and activities?
Oh, yeah. I mean, over a decade of effort, sort of documenting the need and what the gaps in services were and trying to get it through the regular budget channels, et cetera, et cetera, yeah.
And had you also figured out, I guess, what it would take to bring things up to whatever a standard or level, whether you wanted a good level or a superior level? I mean, how did you -- I mean, was you money determination a function of this is what we think we can get?
It's a soft science. To be perfectly honest, we thought, what do we think we can get and could it purchase enough to make a difference? 00052
If we started with every kid deserves an after-school program and affordable child care, it would be just more money than we could have done.
But we did say, you know, we can get a thousand employment slots, we can get a thousand child care slots, we can get 2,000 kids into after-school programs, et cetera, you know, with this amount of money.
What's the annual budget or, I guess, the distribution of funding out of your children's fund in San Francisco and yours in Baltimore?
The affordable child-care fund is about a million, the cultural programs are about a half a million. I think the sports thing must be -- it's somewhere between a half, probably around half a million. And the Open Space Fund is about a million.
And our operating budget for to 1500 children was 1.2 million 13 last year in operating and a million in capital.
Okay. Miss Yanoff, I know from previous materials that I've received, and it's mentioned in someone's testimony, PCCY did a report some time ago -- and I think it was called "Home Alone" -- with regard to children. I mean, is that document and that work still fairly, I guess, timely and current and useful in terms of assessment of what programs exist and what we would want to have or what we need in order to serve significantly more children? 00054
Well, we have done an update. You all should get in your offices this week a list of after-school programs in the City according to zip code. And we've done -- and we've worked with Safe and Sound here in assessing what's needed. And, really, if we're going to set our sights on a real vision, we need more than $50 million in after school. That's for every -- that's not just -- (Unintelligible, parties talking over each other.)
We need more -- we need probably around $50 million. If every -- 5-0 -- is going to have the kind of support --
Yeah. But that's not what we're saying -- (Unintelligible, parties talking over each other.) 00055
Right. And that's why one of the issues that we wanted to talk about was that we know that this fund can't get us where we need to be. It's one of a lot of initiatives that we need to do to transform it and to make the difference. If I could, Councilman, just (inaudible) formal testimony, but I'd like to share with you what Little Rock -- Councilman Kelly was supposed to be here but he couldn't at the last minute. What they've done, what other cities are doing in trying to build prevention and youth development and child-care dollars. You want that now or later?
What I would suggest is that if you want to quickly synopsize and then we'll take the formal testimony and make it a part of the record, 'cause we do have four other panels that are waiting.
Okay, fine. In Little Rock, in 1994, they created a one-half percent sales tax specifically to support prevention and initiatives for youth 00056 development in order to lower the crime rate. The crime rate for juveniles, the crime rate has remarkably dropped: It's decreased 65 percent in violent crime and in all crime by almost 50 percent by juveniles. So they -- they started by dedicating a half a percent of sales tax, and in pursuit of supporting families, improving children's achievement, and, in fact, in lowering violent crimes by juveniles and general crime, and they've succeeded. Pinellas County in Florida has been investing in youth through a special dedicated property tax since 1946. In the mid-'90s, other Florida counties did the same thing and they have now -- they've created special taxes with their property taxes, and $63 million annually comes in for this kind of youth, family support, prevention in these counties. In Seattle, a family and education levy, similar to San Francisco's initiative was passed in 1990 and again renewed overwhelming in 1997 to support programs. These programs are supported by funds again over and above the 00057 normal city budget allocation; they do not supplant a supplement. In Oakland, California, a kids first initiative requires the city to set aside 2.5 percent of unrestricted revenue in a children's fund for direct support. In Washington, DC, a special fund is currently being developed, similar to Baltimore's, and they have budgeted as a total what they expect $30 million to come in for youth development programs -- not all of it from local government at all, but significant amount. Santa Cruz in Concord have done what San Francisco did in developing a child care developer fee. New York City -- and this, Councilman Kenney, is in part responsive to your earlier question. New York City has about $125 million that they do for prevention. For their beacon initiative alone, they spend $19 million. And they made the political decision early on that every district was going to have a beacon school, and that increased, and beacon schools 00058 or after-school communities supports after-school programs, and that meant that that initiative got the political support. It began under Mayor Dinkens, it continued and expanded under Mayor Giuliani because everybody recognized that it was doing something positive. So those are -- that's a fast summary of what's happening in other places that are just beginning to try to respond to a clear need for kids and families. I'd like to just -- can I finish my testimony real fast?
Okay. Which brings us to Philadelphia. We're not asking in this bill, Councilwoman Tasco and the sponsors are not asking that we have a property tax, that we levy a sales tax, that we do a huge set-aside. You know, we're not -- we're saying to those businesses that get a benefit, percent, a tiny amount of that benefit, can go to making this city more attractive to families and more supportive of families. As we go to 00059 incentivize business, we should incentivize families in staying here. Recently, you had hearings on the loss of population. Families are moving out. Families are moving out generally for a couple reasons. One is schools and one is that the communities are not supportive of families, especially families that are working. And some crime issues. You've got the three.
Let's not forget the 4 and a half percent wage tax, I mean, 'cause that does make a difference.
Well, this is saying -- we can't do everything, but we can handle with a minimal cost, a minimal cost, we can improve and we can make this city better for kids. What does this bill say we can do with them? We can support child-care programs, we can support after-school programs. We can do the things with some money that the schools used to do, like middle school sports. There's some residents here from Children's Hospital 00060 who are very concerned that kids don't have enough exercise, enough sports program. We've cut that cut, we've band cut, we've arts, we've cut music. And every year, you hold hearings in this room on what are we going to do about this loss or that loss? And we all agree there's a need, but we can't figure out where the money is. Well, this is one way to add to that pot of money. So I guess in this Year of the Child, we urge you to link youth development and family support with business development and to help us move forward. There are lots of reasons that we can always find not to do something. We can find a gazillion technical reasons -- gazillion's a very clear term of art. We can find a lot of technical reasons, we can find a lot of reasons to say, Oh, this will hurt A, B or C. We're giving to A, B and C; we're asking them to give a little bit back. And in that way, their businesses will be more successful, employees will be happier being here, and we will build a better city. 00061 So we urge you to do it. (Applause.)
Just two last quick questions. One is, have we begun to see, I guess, any of the benefit of the increase in after-school program funding? I seem to recall during this year's budget hearing that the Administration and Mayor Street announced, I believe, an over $3 million increase in after- school funding programs for this current fiscal year, which is only, I guess, four months old. One, have we seen any of the benefit of that? And two, when all is said and done, whether it's Baltimore, San Francisco or a half a dozen other cities that you've mentioned, am I incorrect to believe that we are ultimately more interested in having additional funding for programs than we are in where the money comes from or what the source may be or what the mechanism is for getting it there? I mean. Do you ultimately care whether or not it is directly linked, indirectly linked or internally accounted for within government where this funding source is, 00062 as opposed to can you have $3 million-plus more for programs?
Obviously, we want more support. We also believe that at this time, we can't look at a property tax or a sales tax or an additional tax.
I wasn't talking about any tax. We can raises taxes to increase funding for after-school programs this year.
Well, I appreciate that, Councilman, but if we -- we need to do a lot of different things at the same time. And while we don't -- you know, if the Administration says, We're going to put $20 million in it, Council is going to vote $20 million every year for kids' funds over and above, then we would be really -- that's terrific. But if we just -- if the Administration puts in $10 million more and you have another 3 million coming from this, you've got $13 million. You could handle much better child care, much more after-school programming if you did it that way. I mean, the point is, it's not that 00063 we have to say that it has to be this way.
But it is -- it seems to us important, first of all, to get the message out that good business is also being good for kids; that's number one. But number two, it's that we've got -- there's so much to do, we shouldn't overlook opportunities that would bring in more so that we could make this city so much better. When the art linkage bill came about a half a century ago, we're quite sure and we -- looking at history, that people said it really made no sense and it would be bad and it would be bad for business, and it turns out to have been pretty good, most people would say. And so we're saying -- and it didn't stop the development, it didn't stop development here, it didn't stop new buildings from going up in Center City in Philadelphia. We're saying that this is an opportunity, we should expand it, we should definitely -- if we can get the money and the kind of money we need in other ways, sure. But 00064 until we get to that spot, we shouldn't turn away anything.
I wasn't suggesting that we turn away anything. What I asked was, does it matter to you one way or the other if the government makes a calculation that the 1 percent amounts to $3 million additional a year or the government decides to put $3 million above and beyond whatever our funding is for DHS, Recreation, Fairmount Park, library system or anyone else, but that the calculation is made that we had 10 projects last year or 20 projects last year and they received X-amount of funding and 1 percent adds up to $3 million, does it ultimately matter to you whether or not it is a direct check cut out of these potential businesses' pockets, which ultimately, more than likely, they would just ask us for more money to help cover their percent? Or that because we do benefit from their activity and because they do benefit from having financing from us and every project that we get seems to have a project plan that goes 00065 with it that indicates that there will be more tax revenue to the City, if we make the calculation that the City will receive higher taxes as a result of doing this project, we make the funding commitment to the project, we make the calculation of what the 1 percent would be, and that the money is then transferred to the children's fund, all I'm asking is, does it matter to you how the money gets into the children's fund as long as it is not being taken away from baseline funding as we know it in the year 2001?
Well, I would -- I would urge that we do both, but I certainly wouldn't turn away a major commitment to children.
Thank you, Mr. Chairman. I don't believe I have that many more questions left after the questions that have already been asked. 00066 But, Miss Yanoff, just to let you understand, I don't think that this is something that is bad. I've been a proponent of tax abatements and I guess some of the questions I would ask to the other ladies at the table here, if you could provide the Chair with some information as to whether San Francisco or Baltimore offers tax abatements or exemptions to encourage business. I mean, on one hand in the bill that we're being asked to comment on or vote on eventually, there's a portion in the bill that says that that same 1 percent would apply to any real estate taxes that have been abated. On the one hand, we're trying to encourage development by offering abatement, then on the other hand, we're saying, Well, give us something back. I just want to be fair, and I think we could come to some reasonable fairness in this whole process. And as you know, Miss Yanoff, I'm working with the advertising agencies to come up with something similar to this, I guess, where they've already agreed to 00067 put up a portion up of their gross receipts for wraparound signs and billboards into the special fund, and I hope to have either this week or next week that bill finalized for at least introduction. Miss Brodkin, is there -- does the percentage of whatever the tax is that goes into this program in San Francisco, is there a baseline, is there a threshold? Does it apply to all businesses or does it apply to a business that has a certain amount of gross receipts coming in? Could you explain a little bit to me?
Well, the development fee has a threshold and I don't remember what the square footage is but it's a square footage threshold. And I have the legislation here, which I could give to you. So smaller buildings don't pay at all and --
And that would be important because I spent five hours in your beautiful city while I was waiting to fly out of California not too long ago, and most of the 00068 buildings that you may think are small quite large in Philadelphia terms, so I think that would be very --
As is Baltimore, you're correct. And there was some mention -- I think you testified to a $1-per-room tax?
Is there a recurring tax or is that just during the initial stage of the development?
But maybe we could make it annual, that's a really good idea. (Laughter.)
Don't let the founding fathers or the people that run your city know that I suggested that or else they won't allow me back into San Francisco. Is there a liquor tax by any the chance in San Francisco? Do you have a liquor-by-the-drink tax?
I know you had a 1 cent or 1 percent on a bottle purchase? Would you happen to know if there's a liquor tax?