COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING BEFORE THE COMMITTEE OF THE WHOLE - - - Room 400, City Hall, Philadelphia, PA Wednesday, May 14, 2008, 10:25 a.m. - - - Bill 080022 - Re Business Privilege Tax. Bill 080154 - FY '09-'14 Capital Program. Bill 080155 - FY '09 Capital Budget. Bill 080156 - FY '09 Operating Budget. Bill 080157 - Re Business Privilege Tax. Bill 080158 - Re Real Estate Taxes. Bill 080159 - Re School Tax Authorization. Bill 080160 - Re Parking Tax. Bill 080161 - Re Parking Tax. Bill 080168 - Re Business Privilege Tax. Res. 080173 - Re Revised Five-Year Plan. Bill 080465 - Assessment of net operating revenue of general acute-care hospitals. (Full text of all of above attached hereto.) Committee Members Present: Anna C. Verna, Chair Jack Kelly Jannie L. Blackwell James F. Kenney Darrell L. Clarke Joan L. Krajewski Frank DiCicco Donna Reed Miller W. Wilson Goode, Jr. Brian J. O'Neill Bill Green Frank Rizzo William K. Greenlee Maria Quinones Sanchez Curtis Jones, Jr. Marian B. Tasco - - - V A R A L L O Incorporated Litigation Support Specialists 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 215.561.2220 215.567.2670 5/14/08 COMMITTEE OF THE WHOLE I N D E X WITNESS Bill No. 080465 Estelle Richman, Secretary, State DPW... M. Nardone, Office of Medical Assistance 22 Sue Rosenthal, Health Care Center 10.... 33 Dr. Walter Palmer, Health Care Center 2 39 Alisa Simon, PCCY....................... 43 Bills 080022-080168 and Res. 080173 Fire Commissioner Lloyd Ayers........... 66 Deputy Police Commissioner Jack Gaittens 84 John Elfrey, Acting L&I Commissioner..... 96 Rob Dubow, Director of Finance........... 99 Bill 080022 Ian Phillips, Philadelphia ACORN.........117 Sherry Cohen.............................130 Kathy Scott, AFSCME District Council 47 133 3 5/14/08 - WHOLE - BILL 080465
Good morning, everyone. This is a public hearing of the Committee of the Whole. The first bill we will be considering will be Bill No. 080165. I would ask Mr. McPherson to please read the title of the bill. MR. McPHERSON: Bill No. 10 080465, an ordinance amending Title 19 of the Philadelphia Code, entitled "Finance, Taxes and Collections," by adding a new chapter imposing an assessment on certain net operating revenue of general acute-care hospitals, all under certain terms and conditions.
Thank you. I believe our first witness is Estelle Richman, Secretary of the Pennsylvania Department of Public Welfare. (Witness comes forward.)
Good 4 5/14/08 - WHOLE - BILL 080465 morning. Welcome again. It's so nice seeing you. SECRETARY RICHMAN: Good morning, and it's great to be back. I feel at home.
Wonderful having you. Thank you. SECRETARY RICHMAN: Good morning, members of Council and staff. I am Estelle Richman, Secretary of the Department of Public Welfare. I am joined by Michael Nardone, Deputy Secretary for the Office of Medical Assistance, and Jim Hardy, consultant to the department, from Sellers Feinberg. I am pleased to be here in the city today to testify on Bill No. 20 080465. This bill would amend the Philadelphia Code to create a new hospital assessment that will raise revenues from certain general accute-care hospitals in the City of Philadelphia. The revenues generated 5 5/14/08 - WHOLE - BILL 080465 by the hospital assessment will create a very important new source of funds to provide health care for low-income children and families. Before going into details of the hospital assessment, I would like to give you some background about Pennsylvania's Medicaid program, including the populations it serves and the need to find new ways to control costs and generate in revenues. It can be easy to confuse Medicaid and Medicare, as both are large government-funded health-care programs. At the risk of oversimplifying the eligibility rules, Medicaid primarily serves poor people regardless of their age; Medicare, on the other hand, primarily serves persons over age 65 regardless of their income. There is some overlap in the populations these programs serve. But 6 5/14/08 - WHOLE - BILL 080465 I want to be clear that today, I am focusing on Medicaid. Medicaid or, as we call it in Pennsylvania, medical assistance, provides for health care for low-income families, persons with disabilities, and low-income senior citizens. 9 million Pennsylvanians get their health care through the Medical Assistance Program, or about 1 in every 6 Pennsylvanians. With 466,000 Philadelphians relying on Medicaid for their health care, the ratio for the City is closer to in every persons. Children make up almost half the caseload, and persons with disabilities and Pennsylvania seniors make up the two next largest groups. With so many children and families relying on Medicaid for their health care, it is not surprising that Medicaid accounts for a significant portion of the Pennsylvania State 7 5/14/08 - WHOLE - BILL 080465 budget. 2 billion, including federal dollars and funding from other sources. These are extremely large budgets to manage, and the task gets more and more challenging every year. The fact that Medicaid and health care spending are continuing to grow at two to three times the overall rate of inflation makes the challenge even harder. One thing that we're doing in response is to aggressively pursue opportunities to rein in medical assistance costs. Over the last three years, DPW has recorded savings of over $370 million in the Medical 8 5/14/08 - WHOLE - BILL 080465 Assistance Program, and we are proposing new initiatives that will save an additional 180 million in cost savings in Fiscal Year '08-'09. This is over a half billion dollars over the last three years We will continue to identify and implement innovative solutions that maximize the limited resources available to us to protect the health- care safety net for nearly 2 million Pennsylvanians who depend on Medicaid. We believe that enacting a hospital assessment is one such solution The hospital assessment is a proven approach that will allow the City to generate new revenue in a way that is good for the City's health- care system as a whole. By leveraging the revenues to generate more federal Medicaid dollars, we will be able to improve critical health care services for our citizens. This is an opportunity for a win/win solution 9 5/14/08 - WHOLE - BILL 080465 Hospital assessments are permitted by federal law as a proven means to draw down additional federal funds. Pennsylvania already has similar assessments in place for nursing home services, ICF/MR services, and medical-assistance managed-care services.
We have taken this road before with these other systems and we know it can work. Let me start by explaining how a hospital assessment would work, including the flow of funds between the City, the State, and the hospitals. The first step is that the City of Philadelphia must impose a modest local assessment on some of the revenues earned by Philadelphia acute-care hospitals. Philadelphia transfers the revenues to the Commonwealth minus a local share that the City's allowed to retain under the agreement that the City will enter 10 5/14/08 - WHOLE - BILL 080465 into with the Commonwealth. The State uses the bulk of the assessment revenues to make supplemental payments to certain Philadelphia general accute hospitals through the Medicaid program. Most importantly, the Medicaid payments are matched with federal funds. As a result, the total payments made to the hospitals, as part of the hospital assessment program, are greater than the overall amount of assessment paid in by the hospitals as a whole. It is a fact that the assessment payments will result in additional federal matching funds that makes this a winning proposition. I want to make clear, however, that individual hospitals will be affected differently and there will not be any guarantee to hold a hospital harmless under this plan. The remaining assessment revenues are 11 5/14/08 - WHOLE - BILL 080465 able to the Commonwealth. In my current position as Secretary of the Department of Public Welfare, I can tell you that these dollars are critical to enable us to maintain eligibility and to provide health-care benefits to those individuals most in need. I have purposely not used a lot of numbness in this testimony thus far because we're still working out the final details of the financial model. I can tell you that the assessment will raise approximately $126 million in new revenue, which, with new federal funds, will result in an estimated $165 million in new payments to Philadelphia hospitals. In addition to the new payments for City hospitals, the City will gain approximately $8 million in new revenue on an annual basis for health-care services provided by the City. 12 5/14/08 - WHOLE - BILL 080465 The assessment also will be used to maintain and increase the current level of payments made to the hospitals through the State Medical Assistance Program. In total, the assessment will generate approximately $142 million in new federal revenue for the maintenance and enhancement of health-care services provided by the City hospitals. The assessment and payments intended to be made with the assessment revenue must first be approved by the federal government before they're implemented. Today, there are states 17 that already have hospital assessments 18 that have been approved by the federal 19 government. It is time that 20 Pennsylvania become the 21st state to enact this approach. In order for that to happen, the State must pass enabling legislation to allow this kind of a funding source to be created. The 13 5/14/08 - WHOLE - BILL 080465 legislation has been introduced in the State General Assembly as House Bill 4 2497 with Representative Dwight Evans as its prime sponsor. The other thing that must happen is that City Council must pass, and Mayor Nutter must sign into law, Bill No. 080465. This bill sets the terms and conditions of the assessment so that the interests of the hospitals, the City, and the Commonwealth are all protected. In addition to these steps by the City and the State, the federal government must also review and approve the hospital assessment. I know that this is a complicated proposal but I also know it is a good one. The hospital assessment will benefit consumers, hospitals, and the City of Philadelphia by bringing more federal Medicaid dollars back to Pennsylvania. I ask for your support for this 14 5/14/08 - WHOLE - BILL 080465 important legislation. I am ready to take your questions, and thank you very much.
Thank you. Are there any questions from members of the committee? The Chair recognizes Councilwoman Tasco.
Thank you very much. Good morning. SECRETARY RICHMAN: Good morning.
Nice to see you back again. SECRETARY RICHMAN: Thank you.
Certainly it is a complicated process, but at the end of the day, it sounds like a good deal for Philadelphia. Now, would this program, as proposed, be just for the City of Philadelphia? SECRETARY RICHMAN: This is 15 5/14/08 - WHOLE - BILL 080465 just for the -- it's just for the City, County of Philadelphia. And that -- we looked also at the County of Allegheny as the only two counties that have a Medicaid population high enough to actually make this work, and so we had determined that we could not continue to make it work in Allegheny. So right now, Philadelphia is the only county that's in this.
What do you see as the timeline to fulfill this process? SECRETARY RICHMAN: If indeed we get the ordinance passed in Philadelphia and the enabling legislation is passed at the State level in our current budget process, then we can immediately submit it to the federal government. Our hope was to have it approved in time to see dollars flowing in January.
Thank you, Madam President. 16 5/14/08 - WHOLE - BILL 080465 And thank you, Miss, Richman for your leadership. You did a good job in bringing CBH here, so I know this is a pretty good deal for Philadelphia. Thank you. SECRETARY RICHMAN: Thank you.
Thank you, Madam Chair. Madam Secretary, good morning. SECRETARY RICHMAN: Good morning.
Could you tell me -- you might have mentioned it in your testimony and I missed it. There's a significant amount of dollars that are being spent by some of our hospitals, the trauma units on un-- on non-reimbursed care. SECRETARY RICHMAN: Right.
Will this be helpful to that particular issue? SECRETARY RICHMAN: Yes. The 17 5/14/08 - WHOLE - BILL 080465 dollars that the hospitals get back this, they have their choice on how to use those dollars. They can use those dollars for uncompensated care, they can use those dollars for a purchase of equipment that they may need that there's not always -- they can use these dollars -- how they use these dollars is at their discretion and their choice. Our hope, of course, is that they use it for uncompensated care and for ways that will benefit the residents of Philadelphia.
'Cause I recollect a half a dozen years back where Temple was up against it and they were to the point where they were going to close. Something good happened, obviously, where the State stepped in and administered. Do we have a chart, or is there information available on how much money actually goes to our City 18 5/14/08 - WHOLE - BILL 080465 trauma units to help for that uncompensated care that these trauma units are providing? SECRETARY RICHMAN: There is a payment that goes from the State to the hospitals that is specifically designated for trauma, and we can get you the list of how much each hospital within the City gets on the trauma payment. Our hope is that -- there's a lot of pressure on the hospitals, and to be able to give them some relief, the hospitals all -- we have not worked out the final payment or the final assessment on how we return dollars to the hospital at this point. We're trying to -- our consultant, through Sellers Feinberg, is working with these numbers. We have ranges now, but we would be glad to share with you, as we are able to finalize this, what those numbers and ranges would be. 19 5/14/08 - WHOLE - BILL 080465
If you could provide that to the Chair, it would be good. Is there anywhere in this equation that we won't get that visit from the various hospitals, Temple, where they're not going to come and say, We've gotten to the point where we're not going to close our trauma unit. Is there any way we can require them to maintain that service if they accept these dollars? SECRETARY RICHMAN: I would have to look and get back to you. Being able to offer mandates is difficult even at the State level, but we certainly work hand in hand with many of the hospitals. Our goal is to -- from DPW and it's for Philadelphia and for a variety of places in the Commonwealth, is to keep our hospitals alive, functioning, and solvent. That's very difficult. As some of you may know, 20 5/14/08 - WHOLE - BILL 080465 the federal government is decreasing the amount of dollars available in the Medicaid program across the country. There are several bills in Congress now that we're hoping to get extended or delayed to another year just because the devastation they would have to the Medicaid program is fairly significant. Given all that to the future, it's hard to predict right now. As we're all aware, we will have a new administration coming in to Washington in January, and our hope is that health care will be a major item on their agenda and there will be some understanding of the need to maintain the Medicaid budget to be able to make sure that the very high and increasing number of people who are uninsured begins to get stabilized. And that is a primary concern of both the Governor, the Office of Health Care Reform, and the Department of Public 21 5/14/08 - WHOLE - BILL 080465 Welfare.
Thank you. Good morning. SECRETARY RICHMAN: Good morning.
It's always, always a pleasure to see you and Mr. Nardone. Question: Would our hospitals receive more than they will be assessed? SECRETARY RICHMAN: We cannot hold any hospital harmless in this assessment. In other words, it is a knowledge throughout any of the assessments we have done that there are winners and losers. 22 5/14/08 - WHOLE - BILL 080465
So at this point, we don't know, you're saying. SECRETARY RICHMAN: We do have -- we have some ideas, but we're continuing to work with it, but the federal government requires that there is not any type of hold harmless within the arrangement.
I'm sorry. Please identify yourself for the record.
Sorry. Mike Nardone, Deputy Secretary for Medical Assistance. Even though we cannot hold individuals harmless, because of the federal match dollars, the amount coming back to City hospitals in the aggregate is larger than the amount that they pay in by about $40 million.
Well, in your opinion -- although I know 23 5/14/08 - WHOLE - BILL 080465 folks will testify, but why do you think the Health Care Council opposes it if they'll receive more than they give? SECRETARY RICHMAN: There are a variety of reasons, and I've had several conversations with the Hospital Association leadership and am well aware they're opposing this and in many ways truly understand. This is focused only on the Philadelphia hospitals and not on many of the other hospitals throughout the State that could use an infusion of revenue. There are many hospitals outside the City of Philadelphia that are in financial crisis, but this only looks at one group. I believe they have questions around the stability of the funding; in other words, at some point, will the federal government change their mind or do something unintended? which has not been the case in the past, and 24 5/14/08 - WHOLE - BILL 080465 it can't be anticipated in the future, but neither can anyone predict federal government behavior. And I also believe that nonprofits always get nervous when you talk about assessments and not knowing what kinds of exceptions can or would be made. So I think they are all issues they have. They do recognize that this one set of hospitals will get an increase, but they represent hundreds of hospitals across the Commonwealth, not just the hospitals that sit within the City of Philadelphia.
You're welcome. The Chair recognizes Councilman Jones.
Welcome back to Philadelphia. 25 5/14/08 - WHOLE - BILL 080465 SECRETARY RICHMAN: Thank you.
It's always good to see you. SECRETARY RICHMAN: Well, it's good to live in the City of Philadelphia, even though they drag me up to Harrisburg. (Laughter.)
I can clearly understand why you say that. I understand there are going to be winners and losers, but I'm concerned about the entire county, but in particular my district, Roxborough Hospital is the only full -- SECRETARY RICHMAN: I'm sorry. I didn't --
Roxborough Hospital is the only fully operational emergency room and hospital in my district. We have osteopathic teaching colleges and universities in there. Are these assessments going to impact them? 5/14/08 - WHOLE - BILL 080465 SECRETARY RICHMAN: They are a winner.
They are winners? SECRETARY RICHMAN: They are a winner, that particular hospital.
All right, okay. And I want to know if, in fact, these kinds of incentives and if there are winners, is it going to encourage more emergency-room service in some parts of Philadelphia? Will it be enough financial incentive for us to expand the care that we currently have? SECRETARY RICHMAN: I think, if you look at the total amount of money being returned to the hospitals, which I think is about $42 million, our hope is that we're going to use this to enhance health care within the City, and those are the dollars that go directly back to the hospitals as opposed to the dollars that will come directly back to the City. 27 5/14/08 - WHOLE - BILL 080465 And, certainly, it will take -- hopefully, we can develop discussions between the City, the State, and the hospitals to be able to do some look at where's the greatest need, how do we work to make sure that the emergency rooms are not the primary source of care. One of the issues we know is very relevant in the City is the timeliness of OB care, and how do we make sure that's on everyone's radar screen as the hospital plan how they will use these dollars. So I think that, as we approach January and all of the necessary approvals are given between the City, the State, and the federal government that we actually do have some ideas on how people will not only use the dollars but how they will benefit the City.
Well, I'm excited as to the possibilities, and as 28 5/14/08 - WHOLE - BILL 080465 you may or may not be aware, the 4th Councilmatic District does not have a health center in the district, but we are happy that at least Roxborough Hospital has an opportunity to be stabilized and to be helped by this. Thank you very much. Madam President, thank you.
Thank you. Any other questions from members of the committee? (No further questions.)
Thank you again. SECRETARY RICHMAN: Thank you. Great to be back.
Thank you. MR. McPHERSON: Our next witness is Dr. Schwarz. (Witness comes forward.)
Good morning, Doctor. Welcome. 29 5/14/08 - WHOLE - BILL 080465
Good morning, Council President Verna and members of City Council. I am Donald Schwarz, Deputy Mayor for Health and Opportunity and the Health Commissioner of the City. Thank you for the opportunity to present testimony today on Bill No. 10 080465 that represents a critical first step in a partnership between the City and the Commonwealth to improve the quality of primary care we provide in our Philadelphia Department of Public Health, ambulatory health centers, and to help Philadelphia's hospitals better target care to those most in need. As you heard, the bill will levy an assessment on certain net operating revenue of general accute- care hospitals in Philadelphia, the revenue from which would be transferred to the Commonwealth of Pennsylvania Department of Public 30 5/14/08 - WHOLE - BILL 080465 Welfare to be matched with federal dollars that would augment Medicaid reimbursement for emergency-room care provided by Philadelphia hospitals. A fixed portion of the tax revenue collected would be retained by the City to help pay for care for Medicaid-eligible and uninsured patients using the Department of Public Health's ambulatory health-care centers. In my Fiscal Year '09 Operating Budget testimony before this Council, I spoke of several issues that were critical to our continuing to provide quality care and patient services at our eight primary-care health care centers. Increases in the Fiscal Year '09 budget will allow us to make substantial improvements in many areas of our operations, although reaching the two goals I mentioned in my testimony -- that is, reducing the time that new patients wait to get an 31 5/14/08 - WHOLE - BILL 080465 appointment and putting a state-of- the-art electronic medical-records system in place -- would require a substantial infusion of additional funding. We believe additional funding in the amounts specified in -- by Secretary Richman would provide us with the resources necessary to substantially reduce the clinic appointments, scheduling time, and bring us closer to the point where we can complete the institution of an electronic medical record that will include an interactive system for patient-registration, appointment- scheduling, laboratory testing and reporting, and prescription services at the health center pharmacies. By undertaking better-quality improvement paramounts, streamlining care, and reducing the use of paper records, the electronic medical- records system will also assist those 32 5/14/08 - WHOLE - BILL 080465 being released from prison or from the Youth Study Center when seeking care at the health centers, where their medical records would be available electronically. I feel strongly that this legislation provides us with a great opportunity to strengthen the health- care delivery system to uninsured and Medicaid-eligible Philadelphians, easing the burden on Philadelphia's hospital emergency-room services while supporting needed improvements in the Department of Public Health's ambulatory health-care centers will increase our capacity to provide a medical home for patients needing routine primary-care, which is in accordance with Governor Rendell's health-care plan to provide a medical home for all. It will also provide an increased ability to improve the quality of care provided by our 33 5/14/08 - WHOLE - BILL 080465 hospitals by shifting those needing primary care from emergency rooms to an appropriate health-care setting. Thank you for allowing me to present testimony on this critical issue. I'm happy to answer questions you may have on the proposed legislation.
Thank you very much, Doctor. Are there any questions from meetings? (No questions or comments.)
Thank you, Doctor. Our next witness, Sue Rosenthal, chairperson, Health Care Center 10.
I beg your pardon? I'm sorry. I can't hear you. Please approach the witness 34 5/14/08 - WHOLE - BILL 080465 table. (Witnesses come forward.)
Could Walter Palmer, who chairs Health Center 2 also -- I think he's on the list. Could we testify together?
Thank you very much. Good morning, Council President Verna --
-- and members of City Council. My name is Sue Rosenthal. I chair the Health Center Community Board at Health Center 10. Thank you for the opportunity to present testimony today on Bill 080465. Health Center 10 is the busiest in the City. In 2007, there were more than 56,444 visits made; compare this to 2004, when there was 35 5/14/08 - WHOLE - BILL 080465 47,716 visits. These visits were for a wide range of preventive and curative health services: adult and pediatric care, prenatal, family planning, and dental services. In addition, each year, between October and March, more than 6,000 flu shots are given at Health Center 10. The demographics of the Northeast change and continue to change. The proportion of Health Center 10 patients who are of limited English proficiency doubled within a one-year period from 10 to 20 percent of the total persons served. New clients who have been released from hospital care often are directed to come to our health center by the hospital, with instructions to get continuing medical care. And more and more community residents need and seek out our services. Despite renovations to the center, there continues to be -- and 36 5/14/08 - WHOLE - BILL 080465 we've talked about this before -- a six-month delay for new-patient appointments at Health Center 10. The delay is caused by the lack of physicians who provide care to those in financial need in this section of the City but also because the health center has simply outgrown the need and the demand. We serve the highest number of working people who cannot afford insurance of any of the public health centers in Philadelphia. Additional funding is desperately needed to expand our facilities and increase staffing to ensure the availability of primary-care services in a reasonable time frame. This hospital assessment offers a creative and unique opportunity to substantially increase funding to our health centers. As City Council knows, the health center community boards have worked very hard to improve funding 37 5/14/08 - WHOLE - BILL 080465 for the health centers. I am here today to strongly encourage Council to pass this legislation. It will improve services to Philadelphians who rely on our health centers and will increase the capacity to provide care to additional people in need, because we know they are coming. You may remember, Madam President, that when I spoke to you the last time, I said if you find an extra $1.3 million, that would make everything perfect for us. Well --
Well, you won't have to worry about that if you pass this legislation.
Thank you for offering me the opportunity to testify on behalf of our Philadelphia health centers and specifically for Health 38 5/14/08 - WHOLE - BILL 080465 Center 10.
Thank you very much, Miss Rosenthal. I think this is wonderful. You testified that the waiting period had been six months for the first appointment, and Dr. Schwarz really worked very, very hard on this, and he said he was hoping to get it down to 30 days, if I recall.
So I think with this bill, it would probably be less than 30 days.
And I think it's wonderful. It's something we've all been hoping for for many years. Thank you.
Good morning, Council President Verna and also Chair of the Health Committee here, Councilwoman Tasco as well as members of Council. My name is Dr. Walter Palmer. I am the Chair of the Health Center Community Board at Health Center 2, which is located at 1720 South Broad Street -- that's Broad and Morris -- where I've been a patient there for 13 years and chair for ten. Thank you 14 for the opportunity to present 15 testimony today on Bill 080465. In 2007, there were more than 49,800 visits made to Health Center 2. More than 41,000 of these visits were made to adult medicine or pediatrics. The remaining 8100-plus visits were made by prenatal, family planning, and dental services. We are one of the busiest of the eight health centers offering daytime, evening, and Saturday hours. 40 5/14/08 - WHOLE - BILL 080465 The health center plays a vital role in the community as a one-stop shop ambulatory care center. It provides high-quality medical service, offering patients the opportunity to see a physician, get lab, X-ray, and even pharmacy services under one roof. In our neighborhood, we have seen health care sites close and services curtailed: Graduate Hospital, which had a medical clinic close; St. Agnes Hospital is no longer offering acute care; and Methodist Hospital closed their OB clinic. This has put an increasing burden on the health centers. The staff at the centers work hard to find provide high-quality care to the residents of Philadelphia. In a soon-to-be-released patient satisfaction surveys, 93 percent of the Health Center 2 patients were surveyed, and they said that they would refer a family member 41 5/14/08 - WHOLE - BILL 080465 or a friend to the centers. This is an excellent barometer. It's a barometer. It's a barometer that gives satisfaction with the care at the health centers. We need the health centers to be able to continue to provide quality care for all of Philadelphia. As we all know, the health center staff works very hard. Additional resources will be well utilized to serve the community and to decrease the waiting time for a new- patient appointment. The hospital assessment that is under consideration today offers a wonderful opportunity to increase funding to the health centers. This will allow the additional resources, which will help to reduce waiting time in the health centers and increase the capacity as well. Citizens of Philadelphia who lack financial resources rely on the 42 5/14/08 - WHOLE - BILL 080465 health centers. The legislation is a unique opportunity to enhance the ability of our health centers to provide excellent care to these citizens. In closing, I'd like to say I lived under the period of time when Philadelphia General Hospital really was the primary provider for poor people in this city. And I lived during that period of time when many hospitals discriminated against the poor. And in that time, the apothecaries and the pharmacies were really the primary caretakers of the poor. We lived that entire period seeing Philadelphia Hospital, no 20 longer exists, to a point where now the CVS and the Rite Aid and the Eckerd's have become the primary people who take care of our poor. I think that what's being offered today offers us a great opportunity to 43 5/14/08 - WHOLE - BILL 080465 really look at these centers. These centers are providing care to people who, for the most part, would be turned away, and I hope, Councilwoman Verna, that this Council will pass this legislation. Thank you.
I think we totally agree with you. Thank you so much. Any questions from members of the committee of the witnesses? (No questions or comments.)
Again, thank you for coming in. Our next witness? MR. McPHERSON: Alisa Simon? (Witness comes forward.)
Good morning. Kindly identify yourself for the record.
My name is Alisa Simon, and I am the Health Policy Director at Public Citizens for 44 5/14/08 - WHOLE - BILL 080465 Children and Youth, PCCY. Thank you so much for allowing me to testify today. I am here to represent the many children and families in this region who struggle with access to health-care services. Over the last few years, Philadelphia has experienced increased waiting times at our City health centers as well as a decrease in health-care providers who are available for prenatal and obstetrical services. And every single year, we come together here and we try and talk about how we can strengthen the health centers for the City's most vulnerable children and citizens, and yet we are often left without the necessary resources to implement the real changes that are needed to improve services. PCCY hopes that the passage of the proposed ordinance will move our city forward in its ability to provide 45 5/14/08 - WHOLE - BILL 080465 high-quality, timely health-care services to low-income children and their families. We understand that the proposed ordinance, No. 080465, will benefit the City's health districts by helping to shorten the time patients have to wait to make appointments and to receive care. As you know, and as other people have already testified, the Health Department testified earlier this year that wait times in some centers for services need to be shortened in order to better meet the needs of patients. In addition, the City Controller has reported that the average wait time for an appointment in health centers is 55 days, and that the wait can be much, much longer in some centers, up to six months, as was mentioned, in the Northeast District Health Center. No Philadelphia resident should be forced to wait weeks for 46 5/14/08 - WHOLE - BILL 080465 health care, particularly when she is a pregnant woman in need of prenatal care. Tens of thousands of children in this city rely on the health centers for care, yet without additional resources going towards them, we expect the waiting time for services to continue and perhaps to even worsen. In addition to helping to reduce waiting times for health services, the funds generated by this proposal are also slated to support the implementation of electronic medical records, and this is a system that would be around all the health- care centers and help streamline patient visits, improve communication between clinicians, patients, and administrators. The electronic medical records will also, for the very first time, give the City the capacity to identify and quantify data across the all of 47 5/14/08 - WHOLE - BILL 080465 the health centers about prevalent health conditions, to better identify areas of need, improve the Health Department's ability to raise public awareness related to disease prevention, and potentially to stimulate more resources to reduce health-care problems. It is time for the City's health centers to join the rest of the medical community by moving towards electronic medical records. Finally, this ordinance will allow those Philadelphia hospitals which serve the largest number of low-income children and adults to strengthen and increase the capacity of their emergency departments to care for individuals with low incomes. Strengthening the health-care safety net in Philadelphia is more important than ever, given the economic downturn nationally and the increase in poverty among families in 48 5/14/08 - WHOLE - BILL 080465 this city, particularly among children. Between 2002 and 2006, nearly 12,000 more children in this city fell into poverty. In addition, states and cities must respond to the continuing barrage of policies issued at the federal level to dismantle our health-care safety net for children and families. This ordinance allows Philadelphia to identify new revenue sources to support families with low incomes to access vital health care services at the City's health centers and our emergency departments.
PCCY would like to be clear that we expect this revenue that is generated from this ordinance to be above funding allocated for the health centers in this year's budget, as additional support is needed right now again to address the issue of wait times for services as well as other difficulties experienced at the 49 5/14/08 - WHOLE - BILL 080465 centers while we wait for the ordinance to be passed and implemented. Ensuring that children and is families have access to affordable quality health care now means that kids will have a better chance to grow up health and avoid health care problems in the future. We cannot wait. We must find the resources for our city's health centers now, and we are lucky because we actually have a solution. Thank you so much for the opportunity to present testimony about this important ordinance, and we look forward to working with the City to improve health-care services for our children and families.
Thank you very much. Any questions from members of the committee for this witness? (No questions.) 50 5/14/08 - WHOLE - BILL 080465
Our next witness? MR. McPHERSON: Kevin Braithwaite. (Witnesses come forward.)
Good morning. Kindly identify yourself for the record and proceed with your testimony.
Yes, ma'am. My name is Kenneth Braithwaite and I am the Regional Executive for the Delaware Valley Health Care Council and the Senior Vice President for the Hospital and Health System Association of Pennsylvania. ) to my left. Council Chair Verna and members of the City Council, as I've 51 5/14/08 - WHOLE - BILL 080465 identified myself, my name is Ken Braithwaite, and I'm here to represent our hospitals in the Greater Philadelphia Region this morning. As you know, the Hospital and Health System Association of Pennsylvania represents and advocates for nearly 250 acute and special-care hospitals across the great Commonwealth of Pennsylvania. We here in the Delaware Valley Health Care Council (DVAC) represents 100 general acute-care, psychiatric, rehabilitation, and other specialty health-care facilities in the greater five-county southeastern region of the Commonwealth. My remarks today will focus on questions and concerns that our regional hospitals have, raised by the recent proposals to establish a tax on general acute-care hospitals in Philadelphia County. I appreciate this opportunity to present the views 52 5/14/08 - WHOLE - BILL 080465 and concerns that Philadelphia hospitals have on this issue. 93 percent tax on the net patient revenue of general acute-care hospitals, excluding Medicare. This would apply to hospitals in 12 Philadelphia County. The day prior, 13 State Senator Vincent Hughes 14 introduced related legislation at the 15 State level authorizing the City ordinance to progress. The purpose of this task, as I understand it and as stated in the act and ordinance, is for generating additional revenues through federal matching funds for assuring medical assistance recipients access to hospital and emergency services. As you know, Medicaid, called "medical assistance" in Pennsylvania, 53 5/14/08 - WHOLE - BILL 080465 is the United States government's health-care program for individuals and families with low incomes and resources. It is an entitlement program that is jointly funded by the states and federal government and is managed by the state. Among the groups of people served by Medicaid are eligible low-income patients, children, seniors, and people with disabilities. Medicaid is the largest source of funding for medical and health-related services for people with limited income. In concept, as we understand this proposal, the City of Philadelphia would levy a tax on general acute-care hospitals, psychiatric, rehabilitation, children's, long-term care, cancer, Veterans Administration, and the Shriners Hospital would be exempt. In addition, this ordinance would exempt 54 5/14/08 - WHOLE - BILL 080465 hospitals that provide over 100,000 days of care to Medicaid patients per year; and, as we understand that, that applies to one hospital in Philadelphia County. Additionally, as we understand it, the City would keep a portion of these assessments and send the remainder to the State. The State would then aggregate these funds and retain a portion for State purposes. However, by targeting a portion of these funds for the Medical Assistance Program, the Commonwealth would be able to seek matching funds under the Medicaid program. This funding would then be returned to Philadelphia County hospitals as medical-assistance payments, including additional payments for services such as emergency care where certain hospitals would require such subsidies. According to Pennsylvania's Department of Public Welfare, this 55 5/14/08 - WHOLE - BILL 080465 funding mechanism would raise approximately $126 million. The Commonwealth is proposing to retain million of these monies, and the 6 City would retain 7 to 8 million. 7 DPW also proposes, as part of 8 this funding scheme, to implement a 9 hospital emergency-room payment to the 10 15 hospitals based on medical- 11 assistance outpatient revenue of each 12 acute-care hospital with an emergency 13 room.
The legislation clearly 14 states -- and as Secretary Richman 15 reiterated this morning -- that there 16 will be no direct guarantee of 17 repayment to any hospital. 18 Also in accordance with DPW 19 calculations, as currently proposed, 20 12 hospitals may see a net gain. 21 However, we know for sure that three 22 hospitals would see a net loss. Keep in mind that this would also be a starting point for DPW's negotiations with the federal 56 5/14/08 - WHOLE - BILL 080465 government. There would likely be more net losers when this was resolved. And, again, the legislation clearly states that there will be no 6 direct guarantee of repayment to a hospital of its assessment. To clarify and expand on these broad questions, I have some specific questions that I would like to raise: Does the proposal set a dangerous precedent for the taxation of not-for-profit hospitals and organizations who already provide a great community benefit to Philadelphia? Does this ordinance become useful as a funding mechanism? This proposal would assume the receipt of matching federal dollars for some of the tax dollars received from hospitals, yet many aspects of this proposal make it highly questionable as to whether the federal government would approve these matching funds, 57 5/14/08 - WHOLE - BILL 080465 and especially as we as a federal government face such massive deficits. If the federal government does deny the matching funds or if the funding conditions deteriorate, will the tax be reevaluated or discontinued? Will hospitals continue to receive increased medical assistance support even if matching federal funds are greatly reduced or eliminated? The City ordinance and state legislation do not currently address this important issue. And, finally, the proposal raises many issues of fairness and transparency in regards to hospital payments. And I've also taken the liberty to put even more in-depth policy questions in my submitted testimony. So where does this leave us? As the Delaware Valley Health Care 58 5/14/08 - WHOLE - BILL 080465 Council, we have many issues, concerns, and a lot of questions. And as Secretary Richman indicated earlier, they do not have all of the answers to this proposal as of yet. So we at this time cannot fully support this proposal as it has been presented until we are in receipt of the answers to our questions. It's been a pleasure to be here this morning, and I stand by for your questions.
Yes, ma'am, we have. At the State level, the President of the Pennsylvania Hospital Association, Carolyn Scanlon, has met with her.
Okay. Any questions or comments from members of the committee of this witness? (No questions.)
Thank 59 5/14/08 - WHOLE - BILL 080465 you very much.
Do we have anyone else who would like to testify on this bill? (No response.)
Do we have anyone else who would like to testify on this bill? (No response.)
Seeing no one, this will conclude our public hearing. * * * 60 5/14/08 WHOLE - PUBLIC MEETING
We will now go into our public meeting, and the Chair recognizes Councilwoman Tasco for a motion.
Madam President, I move that Bill No. 080465 be reported out of committee with a favorable recommendation and that the rules of Council be suspended so that this bill can be heard at Council's next session. (Motion seconded.)
It has been moved and properly seconded that Bill No. 080465 be reported out of committee with a favorable recommendation and further that the rules of Council be suspended so as to permit first reading at our next session of Council. All in favor will indicate by saying aye. Those opposed? The ayes have it, and the 61 5/14/08 WHOLE - PUBLIC MEETING motion carries. And that concludes our public meeting on Bill No. 080465. * * * 62 5/14/08 WHOLE - 080022-080168, Res. 080173
The Committee of the Whole will now go back into a public hearing regarding the following bills which, Mr. McPherson will read. MR. McPHERSON: Bill No. 8 080022, an ordinance amending Section 9 19-2604 of the Philadelphia Code relating to tax rates, credits, and alternative tax computation for the business-privilege tax by reducing certain tax rates, all under certain terms and conditions. Bill No. 080154, an ordinance 16 to adopt a Capital Program for the six Fiscal Years 2009 to 2014, inclusive. Bill No. 080155, an ordinance 19 to adopt a Fiscal 2009 Capital Budget. Bill No. 080156, an ordinance 21 adopting the Operating Budget for Fiscal Year 2009. Bill No. 080157, an ordinance 24 amending Section 19-2604 of the Philadelphia Code relating to tax 63 5/14/08 WHOLE - 080022-080168, Res. 080173 rates, credits, and alternative tax computation for the business-privilege tax by reducing certain tax rates, under certain terms and conditions. Bill No. 080158, an ordinance 7 amending Section 19-1801 of the Philadelphia Code, entitled "Authorization of Tax," to further authorize the Board of Education of the School District of Philadelphia to impose a tax on real estate within the City of Philadelphia, all under certain terms and conditions. Bill No. 080159, an ordinance 16 amending Chapter 19-1800 of the Philadelphia Code, entitled "School Tax Authorization," by amending Section 19-1806, entitled "Authorization of Realty Use-and-Occupancy Tax" to further authorize the Board of Education of the School District of Philadelphia to impose a tax on the use or occupancy of real estate within the School 64 5/14/08 WHOLE - 080022-080168, Res. 080173 District of Philadelphia. Bill No. 080160, an ordinance 4 amending Chapter 19-1200 of the Philadelphia Code, entitled "Parking Tax," by establishing a rate of taxation on parking transactions for Fiscal Year 2009 and thereafter. Bill No. 080161, an ordinance 10 amending Chapter 19-1500 of the Philadelphia Code, entitled "Wage and Net-Profits Tax," by revising certain tax rates and making technical changes, all under certain terms and conditions. Bill No. 080168, an ordinance 17 amending Chapter 19-2600 of the Philadelphia Code, entitled "Business- Privilege Taxes," by revising certain types of business-privilege licenses, under certain terms and conditions. And resolution No. 080173, a resolution providing for the approval by the Council of the City of Philadelphia of a revised Five-Year 65 5/14/08 WHOLE - 080022-080168, Res. 080173 Financial Plan for the City of Philadelphia covering Fiscal Years 2009 through 2013.
Thank you very much. Do any of the Councilpeople have any departments that they would like to question prior to our hearing from the Administration? The Chair recognizes Councilman Rizzo.
Madam President, during the proceedings, there were three departments that indicated their willingness to come back. And for the record it's the Fire, Police, and the Department of Licenses and Inspections. You can have them in any order you choose, Madam President.
Thank you very much. Is the Fire Commissioner here? (Witness comes forward.) 66 5/14/08 WHOLE - 080022-080168, Res. 080173
Good morning, Commissioner. COMMISSIONER AYERS: Good morning, Council President.
Thank you, Madam Chair. Good morning, Commissioner. Commissioner, last time we got together, there were some questions about staffing paramedics, et cetera. I'm sure you're prepared, knowing you, with the response to those questions. Could you tell us the status today of our emergency medical services? COMMISSIONER AYERS: Yes. On the staffing, we currently have 72 vacancies; that is, 28 in our current configuration, plus 44. That will bring our configuration up to 10 basic units and 40 full-staff units, which would bring all of the units that we 67 5/14/08 WHOLE - 080022-080168, Res. 080173 took down before the basic back to all advanced life units.
Commissioner, let's be real clear. I think the last time we were using some -- maybe not you, but it wasn't as clear as it could be. Commissioner, do you presently have personnel in the Fire Academy that will be graduating to become members of the Philadelphia Police Department? Are part of your numbers people that are in training outside of the Fire Department to become paramedics that aren't even on our radar yet? COMMISSIONER AYERS: That are not in the Fire Department, yes.
How many people of the 72 vacancies are employees of the City of Philadelphia, the Fire Department, that will be prepared to be paramedics? COMMISSIONER AYERS: The 68 5/14/08 WHOLE - 080022-080168, Res. 080173 students that are studying in schools, they're in three schools --
Commissioner, I don't want to hear about that right now. COMMISSIONER AYERS: Okay.
I want to know how many people you have in the Philadelphia Fire Academy prepared to be paramedics if they passed test or whatever you give 'em, that are currently in your immediately pipeline. COMMISSIONER AYERS: We do not have a paramedic class in school right now. We have a paramedic class on -- scheduled to go in on June 19th.
I've learned to ask years. COMMISSIONER AYERS: I beg your pardon? 69 5/14/08 WHOLE - 080022-080168, Res. 080173
I've learned to ask what year. So you're talking about this year, correct? COMMISSIONER AYERS: That is correct, sir.
So you have a class of how many? COMMISSIONER AYERS: That will be a class of 13.
Thirteen. And we have 72 vacancies. COMMISSIONER AYERS: Yes, sir.
And we have not considered -- or have you considered a residency waiver? COMMISSIONER AYERS: It has been considered, yes, absolutely.
How 70 5/14/08 WHOLE - 080022-080168, Res. 080173 many of the have been given waivers? COMMISSIONER AYERS: These 13 are not on waivers. They are Philadelphia residents prepared to go in on June 19th.
But, 8 Commissioner, I think I heard, and I 9 don't know in anybody else heard, the 10 same information, that there were 111 11 vacancies? And I think we're mainly 12 interested in the EMS unit. Now you're 13 saying there are only 72 vacancies? COMMISSIONER AYERS: Yes. In our current configuration, the way we run our units now, there are 28 vacancies. With the funding, the $4 million that you and the Mayor gave to us, we will now fill those vacancies to 40 full-time ALS units and 10 basic units. We're using that money to bring that configuration up to the four -- I mean 40 and 10.
Commissioner, Commissioner, let's talk 71 5/14/08 WHOLE - 080022-080168, Res. 080173 about -- you're hitting us with a new word today, "configuration, present configuration." The last time you testified -- we have the record, so save us from looking it up. How many vacancies did you say there were in the EMS organization, 111? COMMISSIONER AYERS: I did not. And if I said 111 --
Well, how many did you say? COMMISSIONER AYERS: I just said that there are 72 vacancies that we have.
I don't -- I -- that's not -- the number that we calculated the last time that you were here was greater than 100. Could somebody help us recollect this, or do we need to recess the hearing to get a copy of the testimony? Something's not jibing here today. 72 5/14/08 WHOLE - 080022-080168, Res. 080173 COMMISSIONER AYERS: I'm giving you the numbers that I have that are the current numbers.
Well, where did the numbers come from a month ago that we dealt with here? COMMISSIONER AYERS: Well, I don't have that testimony in front of me that said 111.
At the time of the budget hearing. MR. McPHERSON: Councilman Green has a point of information.
Thank you, Madam Chair. Just to clarify the point that 73 5/14/08 WHOLE - 080022-080168, Res. 080173 the Councilman was making, there are 72 vacancies is one number we're getting, and then the other number is, in your current configuration, there are only 28 positions to fill. And I don't understand the difference between those two numbers. Did you change the configuration to eliminate positions? And how many positions from EMS are budgeted for? COMMISSIONER AYERS: Yes, we did not change the configuration to eliminate positions. The configuration that we talked about before was a configuration that we were at due to the lack of full staffing for paramedics. Those positions were being filled by firefighters working overtime. And that is how they were being filled. But all of the medic units are still in the street. They are not staffed full -- all of the medic units are not staffed by paramedics. One of 74 5/14/08 WHOLE - 080022-080168, Res. 080173 our goals that we were going after is to recruit and hire more paramedics. Currently, in three schools, we have identified 86 paramedics that are Philadelphia firefighter residents, 50 who are nonresidents that will be applying. And we have actively recruited those paramedics, we are monitoring those --
You know, I understand. I just -- there are 72 vacant paramedic positions; is that the number? COMMISSIONER AYERS: That is the number based on where we are taking our units.
I didn't understand the difference between that number and 40 or -- and 28. COMMISSIONER AYERS: Well, the 28 vacancies would be the number of vacancies of paramedics that are needed to fully staff the way we currently configure. 75 5/14/08 WHOLE - 080022-080168, Res. 080173
Let me just see if I can translate that. COMMISSIONER AYERS: Sure.
That meets you have EMTs in paramedic positions currently in the ambulance units, and that is what is -- why you have 28 vacancies in your current configuration; is that correct? COMMISSIONER AYERS: That is correct, sir.
Okay. I just wanted to understand that difference. Thank you, Madam Chair.
Madam President, thank you. Commissioner, about two weeks ago, I sent you some questions that we have not yet gotten answers to, so I would appreciate the answers to those questions eventually coming because this budget is not yet getting ready to pass. 76 5/14/08 WHOLE - 080022-080168, Res. 080173 Let's go back. Where did we come up with the -- your configuration that you're talking about is that you're using firefighters to serve as paramedics; is that correct? COMMISSIONER AYERS: Yes, sir.
And the word that you used is your current configuration of how you're doing business right now. The last time we met, we asked if -- COMMISSIONER AYERS: May I correct something?
Oh, sure. COMMISSIONER AYERS: We're using emergency medical technicians instead of paramedics. We are not using firefighters. They are firefighters but they're also emergency medical technicians.
Aren't all firefighters emergency technicians? COMMISSIONER AYERS: No, sir. 77 5/14/08 WHOLE - 080022-080168, Res. 080173
What's the difference between a firefighter and an emergency technician? COMMISSIONER AYERS: Firefighters that have their emergency medical technician certification with the State of Pennsylvania. Some of our firefighters do not have that certification.
That's some of the older firefighters? COMMISSIONER AYERS: That is correct.
So all of our current firefighters are in the category that they can serve as a paramedic. COMMISSIONER AYERS: That is -- no, not as a paramedic.
As an -- COMMISSIONER AYERS: As an emergency medical technician.
But you have them filling in as paramedics. 78 5/14/08 WHOLE - 080022-080168, Res. 080173 COMMISSIONER AYERS: No. I have them serving as emergency medical technicians.
Instead of a paramedic. COMMISSIONER AYERS: Instead of a paramedic.
So we don't necessarily agree with substituting technicians as paramedics. Don't you think that's the issue that we're really talking about here? COMMISSIONER AYERS: Yes. And we have classes scheduled up until the third quarter of the next fiscal year, and we will have entered a March -- I would say February, March, putting it that class that will give us a total of 103. A class in June, 13; a class in September, 30. We're actively recruiting a class in November of 30 and a class in February or March of 30 as well. 79 5/14/08 WHOLE - 080022-080168, Res. 080173
Is it safe to say that you are recruiting -- I think I heard you say that some of people that you're recruiting that are in the paramedic school, for lack of a better word, is -- there are some nonresidents in that? COMMISSIONER AYERS: Yes, residents and nonresidents alike.
So then for the record today, are you -- you are going to be hiring people that are in the school as nonresidents, but you have not reached out to people that are already qualified to come join your department, that work for other volunteer or other departments throughout the Commonwealth. COMMISSIONER AYERS: We have not actively -- a recruitment campaign of paramedics have not gone out and sought other townships to get their paramedics to come in.
Do you need 80 5/14/08 WHOLE - 080022-080168, Res. 080173 paramedics? COMMISSIONER AYERS: Yes, we need paramedics.
Then why aren't you doing that? COMMISSIONER AYERS: I believe that we will be doing that. The first thing that we wanted to do was to identify the paramedics that were in the schools that we had, and we will actively employ paramedics that apply to the City of Philadelphia, and we will employ them.
Well, I don't want to continue this any longer, but I'm still not satisfied, and I know that there are some of my colleagues that share my opinion that we are, in my words, dragging our feet in filling these positions. You have the money. It's not a matter of money, is it, Commissioner? COMMISSIONER AYERS: Sir, we 81 5/14/08 WHOLE - 080022-080168, Res. 080173 have the money and we will be actively recruiting those townships, like you just asked. We will be doing that. We have not done it yet. We are looking forward to going out and doing that recruitment.
So as of today, we're going to start recruiting for paramedics? COMMISSIONER AYERS: I can't say as of this moment.
Well, let's not split hairs. This week, next week, we're going to start a process to fill these positions with paramedics that are listening to this that have e-mailed me saying they'd love an opportunity to come work for you. COMMISSIONER AYERS: Well, all of those para -- if you'll send me those e-mails, I'll start that process.
Thank you. 82 5/14/08 WHOLE - 080022-080168, Res. 080173 Thank you, Madam Chair. That's all I have --
Commissioner, I know you said you have many people. How many people will be staffed on overtime? Are you talking about the emergency medical technicians that are placed on overtime? Who's placed on the overtime? COMMISSIONER AYERS: The emergency medical technicians, yes.
Okay. Well, I'll tell you, I am one who feels very, very disturbed about this. I think we're talking about a matter of a life and death. We have been talking about this now for a couple of years. This is the time that we're going to be addressing that problem. The Mayor 83 5/14/08 WHOLE - 080022-080168, Res. 080173 says "it's a new day and a new way." I am suggesting, sir, that you find a new way of doing this. I read in the paper that there are firefighters who -- in fact, there was a recent article in the Daily News where a firefighter in Jersey said he would love to come to Philadelphia and be a paramedic. Let's get on it. It's time, it's time. It's very frustrating. And we're going to deal with this problem sooner than later. And I'm going to stay on this because I think it's a disgrace that in a city of this size that we cannot address such an important issue. So, Commissioner, I hope we don't have to call you back midyear to find out what's going on. You're going to have to get one class after another if you have to. COMMISSIONER AYERS: That's what's scheduled, Council President. 84 5/14/08 WHOLE - 080022-080168, Res. 080173
Well, let's meet that schedule, please. I'm urging you to do that. COMMISSIONER AYERS: Thank you.
Thank you. Do we have someone here from the Police Department? Thank you, Commissioner. (Witnesses come forward.)
Good morning. COMMISSIONER GAITTENS: Good morning, Madam President and Councilmembers. I'm Deputy Commissioner Jack Gaittens with the Police Department. And with me today is my administrative services director, Mr. Tom Dewall, and my budget officer, Scott (indiscernible).
Good morning. COMMISSIONER GAITTENS: Good morning. 85 5/14/08 WHOLE - 080022-080168, Res. 080173
Thank you, Madam Chair. Good morning, Commissioner and staff. COMMISSIONER GAITTENS: Good morning.
There's three issues that I would like to discuss with you. When Commissioner Ramsey was here, Commissioner, you remember I asked a question about a program that got into a lot of trouble that was not managed very well, the police reimbursable overtime program, where police officers worked for the private sector, the police officers got paid, and millions of dollars of debt was written off because of the mismanagement of this program. I constantly get assurances that we're back on track, but I was told by a good source that there's 86 5/14/08 WHOLE - 080022-080168, Res. 080173 still some need for conversation in reference to this program. Could you bring us current on exactly what is going on with the police reimbursable program? COMMISSIONER GAITTENS: Yes, sir. In Fiscal '08, year-to-date for non-government billings, we've billed out approximately $17.4 million. Of that, 16.8 million has been collected, which leaves an outstanding balance in Fiscal '08 for non-government of about $635,000, so that equates to about a 91.5 collection rate. Of that 635,000, that's spread out between 30, 60, and 90 days delinquent. Anything that gets to 60 days delinquent, service is cut off for that particular person who's trying to get the service. At 90 days, it is sent to the Law Department for collection.
Go back. When you use the term "non- 87 5/14/08 WHOLE - 080022-080168, Res. 080173 governmental," what's that mean? COMMISSIONER GAITTENS: That means other than, say, the billing that we sent to the Pennsylvania State for our MPO and for our officers in the Police Academy.
Okay. How do you account for that, what is it, $600,000 that's still on the street? Why are we still doing business with these folks? COMMISSIONER GAITTENS: Well, that's between 30, 60, and 90 days. Everybody doesn't pay the next day. We have a process in place where, if it is a first-time user or a one-time user, they actually have to pay upfront. For people that we've done business with before, they will actually pay as we bill them, because we've done business with them before. Some people pay sooner than others. As I said, there are accounts that are either 30, 60, or 90 days 88 5/14/08 WHOLE - 080022-080168, Res. 080173 delinquent. So 60 days, they get cut off; 90 days, it goes to the Law Department.
So we have folks that on a weekly basis get cut off from this service? COMMISSIONER GAITTENS: Yes, sir.
Good. The last issue is the -- and I think this decision possibly wasn't made by you but it might be, but I would like to know why, after so many years of Philadelphia police patrolling the I-95 Vine Street Extension Schuylkill Expressway, that finally, the Commonwealth of Pennsylvania agreed to take over that patrol, and that saved the City of Philadelphia between 8 and $10 million a year. And recently, there was a decision made to put police officers, Philadelphia police officers, that 89 5/14/08 WHOLE - 080022-080168, Res. 080173 many people suggest that we desperately need in our neighborhoods back on the street -- back on the I-95 and back on the Schuylkill Expressway. Again, the comments that -- and even from the State police, they just can't believe that we would do something like that, putting Philadelphia police back on a road that is already patrolled well by the Pennsylvania State Police. Could you comment on that? COMMISSIONER GAITTENS: I was at an Unfair Labor Practice hearing with the Pennsylvania Labor Board at the time. As you're aware, the FOP opposed the Pennsylvania State Police taking over the highways at that time. On the day of the hearing, while I was there, I was informed that an agreement had been made with the FOP that three officers would go back onto the highways; whereas, in the past, we were -- we had a lot more per 90 5/14/08 WHOLE - 080022-080168, Res. 080173 tour on there. So there are three officers per tour back on the expressways now. The rest are still in the rest of the City.
That's a total of six, and the communication that I got that there's a fourth very soon to be assigned there? COMMISSIONER GAITTENS: My understanding is it's only three officers per tour, sir.
Three on the Delaware, three on the Schuylkill. COMMISSIONER GAITTENS: No, sir. Just three, three on I-95 per tour.
So none on the Schuylkill. COMMISSIONER GAITTENS: Not -- to the best of my knowledge, no, sir.
So could you get back to me if that's -- I was told from a good source that it's three on 91 5/14/08 WHOLE - 080022-080168, Res. 080173 each and one more soon to return. COMMISSIONER GAITTENS: I will check into that today and I will call you today.
Because, as you can imagine, that isn't -- just a -- I just can't imagine that we did that. COMMISSIONER GAITTENS: Mm-hmm.
There's a lot of unfair-labor complaints sent out that don't necessarily -- you know, we're assuming that that was going to be one, but I'll leave it at that until you get back to me on exactly how many officers we have out there. COMMISSIONER GAITTENS: Yes, sir.
And the last thing is -- I'll talk to you on this one privately. COMMISSIONER GAITTENS: Yes, sir.
Thank you, 92 5/14/08 WHOLE - 080022-080168, Res. 080173 Madam Chair.
How are you today? COMMISSIONER GAITTENS: Good morning.
Did I understand you to say that you have an outstanding receivable, I believe, from the State that exceeds sometimes $600,000? COMMISSIONER GAITTENS: No. 15 This is non-government with 600,000.
It's non-government. COMMISSIONER GAITTENS: Right. These are private companies, individuals, construction companies, whatever. That's non-government.
And how reliable are those receivables? You're saying in 90 days sometimes outstanding. 93 5/14/08 WHOLE - 080022-080168, Res. 080173 COMMISSIONER GAITTENS: That's correct, some of 'em.
So pretty much, what -- are they good receivables? Is it money that eventually does come? COMMISSIONER GAITTENS: Now, it is, yes. Going back to Fiscal Year '07, the collection rate was a lot worse than that; we were down around 65 percent. Now we're at 91-and-a-half percent. So it has been much improved. And that was because of the policy change where first-time or one-time users must pay upfront, and that's where we were running into a lot of problems before. You know, a lot of people were signing up for it and then they just never got around to paying us.
And when that money comes back, it goes back 94 5/14/08 WHOLE - 080022-080168, Res. 080173 where? COMMISSIONER GAITTENS: It goes into the General Fund.
So there's no way we can incentivize or even factor or finance through some institution that receivable so that we get the benefit of that money upfront and let them on the tail-end collect it? COMMISSIONER GAITTENS: That's something I believe the Law Department could discuss. You know, we have the contracts in place, and the Revenue Department does the billing, and we just provide the service.
Are there any other questions from members of the committee of the Police Department? (No response.)
95 5/14/08 WHOLE - 080022-080168, Res. 080173 Seeing none, I thank you. COMMISSIONER GAITTENS: Thank you.
Is the Commissioner of L&I here? (Witness comes forward.)
Good morning. COMMISSIONER ELFREY: Good morning.
The last time you were here, we asked you to come back because I think President Verna was the one that really identified the fact that there were some positions, inspectors especially, that needed to be hired. So if you could just give us an update, Commissioner, on where we 96 5/14/08 WHOLE - 080022-080168, Res. 080173 are with that question. COMMISSIONER ELFREY: Sure. Actually, our hiring plans --
Commissioner, please identify yourself for the record. COMMISSIONER ELFREY: I'm sorry. I'm John Elfrey, Acting Commissioner for Licenses and Inspections. Our hiring plan is going very well. We expect to have all on board, with the exception of two positions, by June 30th of this year. Interviews are ongoing, we have established lists for all positions except two, and we're pretty confident that one of those two we will have an established list for. So we're in pretty good shape right now.
So these hearings do serve a good purpose. COMMISSIONER ELFREY: 97 5/14/08 WHOLE - 080022-080168, Res. 080173 Absolutely. (Laughter.)
And we appreciate that, Commissioner. We appreciate the fact that you responded to the Council's interest in this issue. COMMISSIONER ELFREY: Thank you.
So right now, when we go back and check the notes of testimony from when you were here before, all of those vacancies are filled but two. What are the two that you're having a problem with? COMMISSIONER ELFREY: Actually, it's not a problem. One is a contract clerk. There needs to be a list established. The other is a graduate engineer. And that's a continuous testing system with Central Personnel, and we're confident that they can get that rolling for us in the next week 98 5/14/08 WHOLE - 080022-080168, Res. 080173 or two.
So you'll be again up to full complement except two positions by when again? COMMISSIONER ELFREY: June 30, 2008.
That's wonderful. Thank you, Commissioner. COMMISSIONER ELFREY: Thank you.
That's it for me, Commissioner. COMMISSIONER ELFREY: All right.
Thank you. Do any members have any other 99 5/14/08 WHOLE - 080022-080168, Res. 080173 departments that they would like to hear from? (No response.)
Okay. Mr. Dubow? Mr. Dubow? (Witness comes forward.)
Good morning, Council President and members of the committee. We have a series of amendments to offer today. I'll start with amendments to the Operating Budget. We've made a number of changes here. I think everyone has copies --
Excuse me, Mr. Dubow. Do we have copies of the amendments? MR. McPHERSON: Sharon has them and is bringing them in with her.
Oh, okay. If you'll bear with us a moment, please. 100 5/14/08 WHOLE - 080022-080168, Res. 080173
Sure. (Copies of amendments are circulated among Councilmembers.)
Does everyone now have a copy of the amendments? Mr. Dubow, what bill are you going to be addressing first?