COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING JOINT COMMITTEES WHOLE & HOUSING NEIGHBORHOOD DEVELOPMENT and the HOMELESS - - - Room 400, City Hall Philadelphia, Pennsylvania Monday, March 22, 2004 1:20 p.m. - - - RESOLUTION 040095 - A resolution amending the Fiscal Year 2004 Program Statement and Budget for the expenditure of the Neighborhood Transformation Initiative (NTI) bond proceeds. - - - PRESENT: COUNCIL PRESIDENT ANNA C. VERNA COUNCILWOMAN JANNIE L. BLACKWELL COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN DAVID COHEN COUNCILMAN W. WILSON GOODE, JR. COUNCILMAN JACK KELLY COUNCILMAN JAMES F. KENNEY COUNCILMAN JUAN F. RAMOS COUNCILMAN FRANK RIZZO COUNCILMAN FRANK. J. DI CICCO COUNCILMAN MICHAEL A. NUTTER COUNCILMAN DARRELL L. CLARKE COUNCILWOMAN JOAN L. KRAJEWSKI COUNCILMAN RICHARD T. MARIANO COUNCILWOMAN DONNA REED MILLER COUNCILWOMAN MARIAN B. TASCO COUNCILMAN BRIAN J. O'NEILL - - - VINCENT VARALLO ASSOCIATES, INC. Registered Professional Reporters 1835 Market Street, Suite 600 Philadelphia, PA 19103 (215) 561-2220 2 Resolution 040095 - 3/22/04 P R O C E E D I N G S - - -
This is a public hearing of the Joint Committees of the Whole and Housing, Neighborhood Development and the Homeless, regarding Resolution Number 040095. I would ask Mr. McPherson to please read the title of the Bill. MR. McPHERSON: Resolution 040095, amending the Fiscal Year 2004 Program Statement and Budget for the expenditure of the Neighborhood Transformation Initiative bond proceeds.
We are awaiting Pat Smith. As soon as she comes in, we'll be ready to proceed. Deborah McColloch, why don't you approach the witness table. And perhaps you could give your testimony while we're waiting. MS. McCOLLOCH: Of course. I'll be happy to.
Please 3 Resolution 040095 - 3/22/04 identify yourself for the record. MS. McCOLLOCH: Good afternoon. Good afternoon, Council President Verna and other members of the Committee of the Whole and Housing, and Neighborhood Preservation and Homeless. My name is Deborah McColloch, Director of Housing. I am here today to testify on behalf of the Administration on Resolution Number 040095, which amends the Neighborhood Transformation Initiative Fiscal Year 2004 Program Statement and Budget. Specifically, I'm here to talk about changes in funding sources for the Basic Systems Repair Program and the Adoptive Modifications Programs. The proposed amendment will not revise the total amount of money allocated for these specific programs, but will revise the source of those funds. In some cases, Community Development Block Grant, CDBG funds, will be swapped for Neighborhood Transformation Initiative, 4 Resolution 040095 - 3/22/04 NTI, bond proceeds. The attached sheet which was attached to my testimony -- If anyone needs copies of it, I have extra copies -- outlines the proposed changes. Chart 1 shows budgets for five programs: Neighborhood-based rental production, basic systems repair Tier II, SHARP, Adaptive Modifications, and the Childcare Initiative, as presented in the Year 29Consolidated Plan, as adopted by City Council in June 2003. This chart includes the $15 million NTI bond proceeds added as a resource. The key lines to review in Chart 1 are those for BSRP Tier II and Adaptive Modifications. BSRP Tier II is being funded with $360,000 in state funds and $12.3 million in Neighborhood Transformation Initiative bond proceeds, for a total of $12.6 million. Adaptive Modifications is being funded with $2 million in CDBG funds, $500,000 in state funds, and $2.5 million 5 Resolution 040095 - 3/22/04 in NTI bond proceeds, for a total of $5 million. Chart 2 shows the proposed budget amendment, in which CDBG funds and NTI bond proceeds are swapped between BSRP Tier II and Adaptive Modifications. In each case, the total amount allocated to the program remains the same, $12.6 million for BSRP and $2.5 million for Adaptive Modifications. The purpose of this swap is to reduce the amount of CDBG funding for Adaptive Modifications, so that the lead hazard abatement requirements of Title X will not be triggered. The $850,000 in CDBG funds proposed for Adaptive Modifications will support the program costs only, and the NTI bond proceeds will support the construction costs of the accessibility modification. Because federal funds are being used only for operating expenses, the Title X requirements for lead testing and control will not be triggered. 6 Resolution 040095 - 3/22/04 Council members have expressed concern that the limited funding for the Adaptive Modifications Program is being used for lead hazard control and abatement, rather than creating accessible housing units as was intended. In our experience, the majority of households receiving Adaptive Modifications services do not have young children, so the lead hazard issue is less of a concern. This proposal of swapping CDBG and NTI funds solves that problem and allows the full funding to be committed to the accessibility modifications. Again, it does so without changing the overall funding level of any of these programs.
Miss McColloch, you mention in your testimony that CDBG budget will be amended. When will this amendment be presented to us? And what happens in the interim? MS. McCOLLOCH: CDBG amendments are not brought back to this Council. We follow the amendment process that's 7 Resolution 040095 - 3/22/04 outlined in our Consolidated Plan. It's advertised in the newspaper. And at the end of the period of time under CDBG regs, which is two weeks after the advertisement goes into effect, we can amend the plan.
Thank you. Are there questions from members of the Committee of Miss McColloch? (No response.)
Thank you, Madam President. I just have a question about BSRP Tier II. Is that the targeted basic systems? MS. McCOLLOCH: That's not the Targeted Basic Systems Repair Program. This is the general Basic Systems Repair Program that's carried out by the Philadelphia Housing Development Corporation. 8 Resolution 040095 - 3/22/04
Okay. Thank you. That's all I wanted to know. Thank you.
Thank you, Madam President. Good afternoon, Miss McColloch. I was going to ask the question on the BSRP. You said this is the money targeted for the traditional program, the traditional BSRP, so there are certain income restrictions on this. MS. McCOLLOCH: Yes. On this funding? Yes.
Is it using NTI bond proceeds? MS. McCOLLOCH: It's using NTI bond proceeds, but it's following -- it's following the regulations that we established as if it was being funded with Community Development Block Grant funds.
But that's imposed by the local administration. There 9 Resolution 040095 - 3/22/04 are no HUD requirements -- MS. McCOLLOCH: There are no --
-- with income restrictions under this funding scenario. MS. McCOLLOCH: On the Neighborhood Transformation Initiative funds.
Yeah; I mean, I thought -- MS. McCOLLOCH: I want to make sure I understand the question. Are there HUD restrictions on the Neighborhood Transformation Initiative funds?
Right. MS. McCOLLOCH: No. We're carrying the program out because it's a combination of CDBG and NTI. We're carrying it out in accordance with the CDBG funds.
But we don't have to. MS. McCOLLOCH: We don't have to, that's correct. 10 Resolution 040095 - 3/22/04
But we've made a decision that the NTI funding for this particular program will have certain income restrictions. MS. McCOLLOCH: Yes.
Why are we doing that? MS. McCOLLOCH: We're doing that because the program is funded with a combination of both types of funding. And so, because we have one program, we're following the regulations that are more restrictive.
Okay. What's the difference, in terms of percentages, HUD -- government -- HUD money versus NTI money? MS. McCOLLOCH: There's more NTI money than there is CDBG funds.
Substantially more? MS. McCOLLOCH: Yes, substantially more. You can see by the chart.
So I guess my 11 Resolution 040095 - 3/22/04 question is, why do we opt to impose guidelines? I mean, is there a philosophical reason? MS. McCOLLOCH: Well, the philosophical reason --
I mean, do we have a -- MS. McCOLLOCH: -- is that we're trying to serve the lowest income people, the people in the greatest need. BSRP has really become our biggest homelessness prevention program.
All right. MS. McCOLLOCH: And we're trying to serve those folks --
So there's a need -- MS. McCOLLOCH: -- that have any other --
We have sort of a HUD funded traditional BSRP dollars. MS. McCOLLOCH: Right. 12 Resolution 040095 - 3/22/04
So we would supplement that by using... MS. McCOLLOCH: NTI funds.
And incorporating the similar guidelines as the other one. MS. McCOLLOCH: Right.
All right. MS. McCOLLOCH: And the goal is because the need so far outstrips the resources. We are trying to make sure that the people -- the neediest people are receiving these funds for -- to make home repairs.
Again, that Basic System Repair Program is very dear to me. It helps so many people, so I understand. 13 Resolution 040095 - 3/22/04 The people that are on the list for basic system repairs right now, how will they be affected by this swap? MS. McCOLLOCH: They will have -- There will be no effect. For -- For a consumer of the program, there's no 8 difference in the program. They won't know any difference between what the source of funding is.
But let's just talk about Basic System Repair Program, if we may, just for a minute? Because again, there are so many people. Could you just give us a quick report on the status of that program, how long the average wait is for a person that's in need. And are we up to schedule, behind schedule, ahead of schedule? Where exactly are we with that very important program to I think all of us here? MS. McCOLLOCH: I'm sorry. I don't have that information with me, but I can provide that for you. I have to get it from -- This program is carried out by the 14 Resolution 040095 - 3/22/04 Philadelphia Housing Development Corporation, PHDC. And so, those folks keep all of the figures. So I can provide that report.
But you have no 7 personal knowledge of... MS. McCOLLOCH: I know there is a waiting list, and I know there is a time delay. But I don't know what it is without talking to the staff people.
Thank you. Miss McColloch, for the record, can you tell us what agency is responsible for the Adaptive Modifications Program? MS. McCOLLOCH: The funds are put under contract from my office, the Office 15 Resolution 040095 - 3/22/04 of Housing and Community Development, to PHDC, who in turn holds a contract with the Philadelphia Corporation for Aging, PCA.
Has the entire $5 million associated or allocated been made available to PHDC? MS. McCOLLOCH: No because we haven't had -- until this resolution goes through... Assuming that this resolution 11 is passed, then that will free up the funding to put it all under contract to PHDC.
So the $5 million will be put -- MS. McCOLLOCH: Correct, will go to --
Do you have any indication as to what the backlog is for Adaptive Modifications? MS. McCOLLOCH: The backlog starting this year, at the beginning of the fiscal 16 Resolution 040095 - 3/22/04 year, was approximately 700 people on the -- households on the waiting list. And I know they are moving through that backlog, but I don't know the number as of today that they have treated. But I could provide -- get that information for you.
Thank you. Are there any other questions from members of the Committee? (No response.)
Seeing none, I would ask Miss Pat Smith to please proceed with her testimony.
Thank you, Council President Verna. Good afternoon. My name is Patricia Smith. Good afternoon, President Verna, Councilwoman Blackwell, and members of the Committee of the Whole and Housing, Neighborhood Development and the Homeless. My name is Patricia Smith. I'm Director of Neighborhood Transformation. I'm here today to testify on behalf of the 17 Resolution 040095 - 3/22/04 Administration in support of Resolution 3 040095, which amends the NTI fiscal year 2004 program statement and budget. When the Administration transmitted the FY'04 NTI program statement and budget in May 2003, we proposed spending $28 million on the demolition of dangerous houses. The Administration wishes to increase this line item by $25 million, for a total of $53 million. The additional funds are needed because the pace of demolitions in FY'04 is greater than we projected in the original budget. In FY'04, the City has contracted or has under contract for more than 1,100 demolitions under our targeted area program, and demolished another 336 houses as part of our City's emergency curbside program. In addition, contractor bids have been higher than we estimated in our original FY'04 budget. Bids for the targeted program are averaging about 18 Resolution 040095 - 3/22/04 $22,000. This number includes the cost to remove any asbestos that is identified, demolish the building, stucco party walls, install topsoil, seed and fencing of the demolition lots. A major cost driver has been the significant number of party wall treatments in the bid package. For example, for every 100 demolitions, we stucco about 64 party walls, and that the party wall treatments have been averaging about nine per wall. The additional $25 million in the budget and the appropriation authority that the Administration is requesting will enable us to issue the following NTI targeted bid packages through June 30, 2004. The packages are listed in the testimony and include Jefferson Square, Kensington, a small bid package of scattered sites in Lower Kensington, Grays Ferry, Belmont, a small bid package in West Philadelphia that's a combination of scattered sites, a small scattered site bid 19 Resolution 040095 - 3/22/04 package in West Philadelphia. It would also allow us to set aside approximately houses as part of the 5 third phase of Emerging Contractors Program 6 that is administered by the 7 African-American Chamber of Commerce. 8 Haddington, Ludlow, a small bid 9 package that we're proposing for the Lower 10 Northeast, Allegheny West, Logan, and then 11 another demonstration -- emerging 12 contractors field demonstration training 13 program. 14 There are several demolition bid 15 packages, including APM east and west, Ludlow, Jefferson Square, and Belmont, that are ready to go but awaiting funds that are included in this amendment. We have worked very closely with District Councilpersons on developing bid packages that are included in the $25 million. And I also want to point out that several of the very large bid packages, for example, Kensington, Grays Ferry, Allegheny 20 Resolution 040095 - 3/22/04 West and Haddington, will be breaking up to cover as part of this amendment and would also be included in our FY'05 budget. 2 million for insurance costs, and 250 for asbestos and air monitoring expenses for the remainder of this fiscal year. I also want to talk a little bit about our economic opportunity work. While the primary objective of the NTI demolition program is to eliminate dangerous buildings from Philadelphia neighborhoods, the Administration is committed to using NTI as a vehicle to help create business and employment opportunities for minority business and City residents. The African-American Chamber is helping to build the capacity of minority and women owned firms who are interested in becoming prime demolition contractors.
The Emerging Contractors' Program provides technical, financial and management assistance, helping firms to 21 Resolution 040095 - 3/22/04 negotiate the City's complex procurement processes and grow their business. It teaches participants how to demolish unsafe and dangerous residential buildings by offering hands-on experience in the field. In FY'04 the Emerging Contractors have already successfully demolished about 74 houses under the training program. The proposed amendment will enable the city to allocate additional houses to the Contractors' program for demolition in this fiscal year, about 40 additional houses. In addition, the City continues to satisfy our subcontracting goals that were set out in the NTI Economic Opportunity Plan for demolition activities. Of all the contracts that have been let as part of our targeted program as of the March report, MBEs account for about 49 percent, and WBEs percent of the 24 subcontracts. Plus, minority firms are performing 34 percent of the curbside 22 Resolution 040095 - 3/22/04 demolition work. Philadelphia residents represent more than 75 percent of the work force on the target area demolition projects. This resolution... The following -- Following my testimony I also included a chart which summarizes all the changes to the NTI FY'04 budget, including the swaps and funding between CDBG bond proceeds, state funds for other program activity. Thank you.
You're welcome. Miss Smith, I recall from earlier hearings on NTI that the Administration proposed to acquire every property it treated under the NTI program. That is, for each property demolished, the Administration would acquire it through condemnation. Is this still the Administration's intention?
In our FY'04 program statement and budget, we said subject of funding availability, that we would 23 Resolution 040095 - 3/22/04 prioritize the acquisition of demolished lots, and of course we said subject to funding availability. Even though we've increased our acquisition budget by about $24 million for this fiscal year, most of that money has been set aside for development projects. One of the things the Administration will be exploring is how do we begin to, in a planned fashion, begin to use Sheriff sales as a way to acquire demolished lots because of the fact that we don't have enough acquisition dollars for condemnation.
The acquisition budget is completely committed at this point in time, and there is no 19 available funding for acquisitions after FY'04. Am I correct in assuming that?
In the five-year projection, we did not include any bond proceeds for acquisition. One of the things that we did talk about as a part of this year's program is, 24 Resolution 040095 - 3/22/04 as we begin to file declaration of takings and the City recovers tax revenues that would have been -- you know, that we're entitled to, that we would begin to recycle some of those funds. We didn't include that in the '04 budget because we had not yet filed any declarations of taking. So, I'm hoping to allocate some of those dollars, you know, depending on the pace of declarations that --
Do you have any indication as to how much money that would be?
No because we won't -- First we have to see what's paid into court. Then it would depend on how much in delinquent taxes, you know, are being paid off. And then we give, I think, it's 45 cents on the dollar. Fifty-five cents will continue to go to the School District.
Okay. Miss Smith, Council has authorized the acquisition of more than 4,000 properties 25 Resolution 040095 - 3/22/04 in the last 18 months. Of the total number of properties authorized by City Council since 2002, how many have actually been acquired by the RDA and turned over for development purposes?
Okay. The RDA is in the process of some notes that were given to me by the Office of Housing and Neighborhood Preservation. I want to make sure I get this right. Okay. In FY'03 and '04 we authorized condemnation of about 5,512 properties.
5,512. That's the number I was given. We've met with the Office of Housing and Neighborhood Preservation, Mr. Hanna and Miss Califano; have met with District Council representatives to review these projects. And from these priority meetings we expect they're giving priority to 642 Resolution 040095 - 3/22/04 parcels, representing development projects. And the RDA expects to have declarations of taking issued for these high priority parcels by the end of this fiscal year. In terms of the specifics of each development project or priority project that's going forward, I don't have that detail. Unfortunately, Mr. Hanna had a death in his family and wasn't able to be here with us today you.
Very well. 14 I have several questions that I'd 15 like to ask but I see that a number of 16 Council members have their lights on. I'll 17 just ask one more question. 18 We've heard repeatedly about the 19 proposed consolidation of the housing 20 agencies. Can you tell us the status of 21 that consolidation? 22
Again, I have not been -- As we bring on Mr. Hannah... He's been the point person on the reorganization. I know there have been a 27 Resolution 040095 - 3/22/04 series of discussions with -- internally about that, particularly in light of the fact that the City's block grant resources are going to be lower this year. Those are probably ongoing conversations, both with the labor unions, as well as management staff. I'm not privy at this point to the details of that conversation.
Thank you. At this time the Chair recognizes Councilman Nutter.
Thank you, Madam Chair. Good afternoon, Miss Smith and Miss McColloch. Miss Smith, I just have some preliminary questions to try to understand the process a little better. Who constructs the budget for the NTI program and the various amendments to it?
My office -- My staff does, myself, working with Jacob Fisher. 28 Resolution 040095 - 3/22/04 We work with the various, you know, operating departments, looking at where we are in terms of the expenditures.
So it's yourself. You mentioned a Fisher person; is that it?
And who decides how much you allocate to each budget item and to each District per item?
Well, with respect to the demolition activity, when we first unveiled the NTI program statement and budget, what we looked at was first --
Are you talking about the current year's budget, FY'04?
Yeah, FY'04. And I believe it's a carryover from '03. But we looked at the level of vacancy and dangerous buildings within a Council District, and then tried to project 29 Resolution 040095 - 3/22/04 the number of demolitions we could anticipate within that given budget year. So if we allocated $30 million, we try to look at a range of expenditures, as well as houses. It's -- Again, it's a financial projection and budget that we were putting together. And we do that almost, you know -- about this time of year. In fact, we're beginning to work on the '05 budget.
So that's an internal process, for the most part? I mean, when you put together the FY'04 budget and looked at the number of vacant buildings, unsafe and dangerous, may... put the numbers down by District, the number of buildings you thought you would on average demolish or you'd developed a range. And then you allocated the dollars based on... At the time you were using, I guess, the 14,000 average per property demolition costs, and just multiplied times the number of properties? Is that the way 30 Resolution 040095 - 3/22/04 you did it?
Yes. That's -- Yes. It's an internal process. And then we transmit a preliminary budget. Then we have meetings, individual meetings, with Council people to answer questions, discussed what we were suggesting. And then sometimes we make some adjustments for the final budget.
Okay. And then we approve that budget and the various schedules in accordance with the NTI bill 14 that I think we approved in '02, laying out, for instance, on , total number of buildings, the amount that are dangerous, what you estimate on a demolition, average demolition costs. And then you get your totals. And that was the $19.6 million; is that correct?
Okay. And just so I make sure that I'm looking at the same 31 Resolution 040095 - 3/22/04 material, in the proposed amendment before us in the Resolution, it makes reference to Exhibit D, proposed amendment to . Is that -- Actually, it should be ?
Well, no. Actually, , if we were to go back to the original... I guess the pink bill?
The actual Council Ordinance, the number of pages is different than this Bill. So that's why there's a discrepancy. So, it was actually in the 14 ordinance. 15
Well, you can say 19. But 19 and 13 is the same, because we all have our books in front of us. I don't have the original Ordinance --
All right. So in the processed amendment, which seeks to increase the demolition budget by $25 million, who then made the decision to decrease the line item for the Fourth District by $1.1 million?
What we did at that time, I made a decision, looking at what I knew to be real bid packages that had already or -- had already been let or about to be let, and what was in the pipeline. I was looking at how do we cover those costs. For the Fourth Councilmanic District we had not yet completed the field survey in the decision meeting. And therefore, I just projected a range and an average.
Well, I understand that. But why would you in the same amendment seek to increase the total amount of demolition money, while at the same time taking money away from a particular District, even if you didn't think for some 33 Resolution 040095 - 3/22/04 reason that the dollars were going to be spent in the course of that fiscal year? Why would you make the cut? We already approved a larger amount.
I didn't view it as a cut, in that that means the money is gone. It just meant that we didn't expect spending it at that time, given where the project was, you know, how much we were going to actually be spending in this fiscal year.
Well, I can appreciate your perspective, but generally when you start a budget with one amount of money and you seek to change the budget to some other amount of money, and if the number is lower, which from my perspective it's a cut. You don't have as much as you started out with. So it's less, right?
And what we are now proposing, since now that we've gotten the new numbers in for your District, it actually is an increase even over what --
I gotcha. We'll get to that. The secondary concern with that is -- And I... You may be alluding to -- You can pick it up later on. But your own testimony indicates that we're spending through the demolition collars obviously much quicker than the Administration had anticipated. And so, even with the best of intentions, at a later point in time we could find ourselves in a situation where there's no money left to make up what had been taken away. Isn't that possible?
Well, again, it's -- it's -- it's... It's going forward. It's sitting down -- You know, again, looking at the vacancy levels and trying to project how many bid packages we can do.
I understand that. But the vacancy levels aren't going to change. 35 Resolution 040095 - 3/22/04
So... I mean, there are a number of people from the community who have concern about this; and as... I mean, again, if you read one number when you start and you read another number when you end, and if there's a significant difference between them, in excess of 40 percent loss, then that's a problem. It's a 43 percent, quote unquote, cut in the current fiscal year. You may seek, again, with the best of intentions to make it up at a later point in time. But we're here for the purpose of increasing this budget by $25 million because we've obviously blown through in the first half of the fiscal year the entire demolition budget that you expected to go for the entire year. You allocated $28 million for FY'04. 36 Resolution 040095 - 3/22/04 We've now realized, halfway through the fiscal year, that that's all gone; and you seek to increase it by 25. We don't have an endless access to resources at the tail end of the process here. And we're already front loading a number of the items. And so, by the time we were, quote unquote, ever able to catch up, or the rest of the process caught up with us, or people did whatever they needed to do, you could literally have run out of money. And so... I mean, when we started this, we said that everyone should get some base amount of dollars. And then there are always going to be other Districts, certainly beyond the Fourth, who have greater needs. But I mean, I must strongly object. And then we can move on to the next part, that, without consultation, without a discussion, without an explanation, that an amendment would come in -- and only by searching through it, and then comparing it 37 Resolution 040095 - 3/22/04 to the original FY'04 budget did we find that there was a difference between the items. Now, there's supposed to be a general agreement that there will be no 7 defunding of items or projects that's in the Bill without a consultation with the member. And so it has caused a great amount of consternation. If the people from the Fourth District who have come who want to testify, if you could stand and have Miss Smith better understand what your concerns are through this process, there is a feeling of unfairness about this. And we can go into details of that a little later on. But the basic message here is, I want the money back. (Laughter and applause.)
And when you look at the proposed amendment, you will 38 Resolution 040095 - 3/22/04 see that there is a range of how the $25 million is allocated. I think million goes to the 5 curbside, and the balance goes to the other 6 Councilmanic Districts. Some got more. 7 They have more need. Some received a 8 little less. 9 In many instances, there is a 10 significant amount of similarity between 11 the Fourth District, in some instances, and 12 the Ninth Council District. I believe, at least according to the amendment, there's an anticipated increase to the Ninth of about $805,000. And so, from my perspective, where I would like to be, at a minimum, when this process is done in the course of the day -- And there are other issues, I understand, that may get raised -- is, I want the $1.1 million back. And I want the same amount of increase that a comparable District, which is on the low end of things because other Districts, as I indicated, receive more. 39 Resolution 040095 - 3/22/04 And they should get more because they have more need. But I at least want the 1.1 and I want the 8'05. And so we're really talking about a $1.9 million increase, based on the amendment in front of us. And we can go through those numbers again. Now, you'll, I'm sure, want to tell me about your proposed Haddington package. And maybe the process is catching up with us. And the testimony has numbers in it on which... I mean, I've spent a fair amount of time and my staff spent some time trying to reconcile the numbers in your testimony on with the proposed amendment to . And I could not figure out how these numbers match up in any way, shape or form. When you go through all the analysis, it... at least for my purposes, it did not make any sense. So could you explain the difference between the proposed amendment to Resolution 040095 - 3/22/04 and the numbers in your testimony?
I'll be happy to. When we transmitted the Resolution 5 to Council, again, we were doing a projection, a range of houses. And we were using an average number in that budget amendment that you reference on . Since that time, what we've done is that we've gone through all the bid packages and actually looked at the actual cost that we are estimating, or based on awards of contracts, or contracts being bidded. And so, for example, we had Haddington listed as a project for this year, for this fiscal year. We, at the time that we transmitted the Resolution, even internally, didn't flow exactly how many properties would be slated for demolition activities in Haddington. Since the transmittal of the Resolutions, we have both completed the field survey, and a decision support meeting, where we identified working with 41 Resolution 040095 - 3/22/04 the District Council office, 195 properties. And then that number... We cost estimated that number that's transmitted to the District Councilperson for signature -- review and signature. Then we proceed with putting together bid packages based on those numbers. So, 195 properties were identified as demolition candidates that were approved by the District Council. I allocated out of the $25 million 100 properties at a cost of 3.3. That number doesn't -- You know, one of our challenges is that while we can use an average number when we do get hard numbers -- because we know party wall treatments and the like -- we adjust that. So that's why the number for Haddington in fact has gone up, the 3.3 million. So we also adjusted, since we only had $25 million that we were seeking appropriation authority for and what remains in this fiscal year, we made some 42 Resolution 040095 - 3/22/04 adjustments, you know, with the emergency curbside number, and the like, so that we can meet that -- you know, part of that obligation in this fiscal year. Again, you know, these are, you know, budget and financial projections. As we get actual numbers in, we make adjustments to reflect, you know, what in fact, you know, the actual numbers are.
In view of what you just said, are you going to be offering an amendment to Exhibit D?
We can put in the specific numbers. I hadn't... To be honest with you, I didn't really think about the formal amendment of that. But this is what we actually are proposing, in my testimony, how the $25 million will be spent.
But that doesn't equate to what we have in the 43 Resolution 040095 - 3/22/04 Resolution in Exhibit D. And that's --
I apologize for that, Council President. We'll mark up the Bill 8 so that when we go into public meeting...
Two other comments on this issue, Madam President. You've been very generous. First, Miss Smith, I appreciate what you said. And we can go through those components. I just wanted to mention to you, because you seemed a little perplexed at a comment that I made earlier... I just want to mention to you, from of Bill 20 020036... This is the bill that created the NTI program... there is a bullet point that says, when a project is defunded, the Administration, in consultation with the District Councilperson, will reprogram the unexpended funds allocated for the project 44 Resolution 040095 - 3/22/04 to support another project within the Councilperson's District. I think most of us have generally taken that to mean that if something were to happen, even with funding for a particular item or a particular project, you don't lose the money. And so again, I don't want to totally beat this horse into the ground, but if there were some issue about the 1.1, I think we have to figure out a way not to on paper have the dollars go away, and still have them allocated to the District so as to not cause this kind of consternation and worry, that if the process is moving a little slower -- and we're getting towards the end of the fiscal year -- that somehow you don't lose money. It's not like it's going anywhere or should disappear. So I offer that to you as a way of dealing with this situation.
Yes. And I think when we give you the corrected amendment, it will in fact show the increase instead of 45 Resolution 040095 - 3/22/04 the decrease it's still our projection for a hundred properties is about 3.3 million.
And I understand that. And the whole package is about 6, and --
Yeah. It's six five. But when this program started, I thought the first budget had demolitions at an average of about ten or eleven thousand dollars. The last budget or the current fiscal year is showing fourteen, and now you're expecting to go to twenty-one? I mean, as you will probably painfully recall, through many hearings there was a lot of discussion about demolition costs. And one of the features that was at least proposed in this is that there would be so much demolition that it should 46 Resolution 040095 - 3/22/04 actually destabilize the costs or drive them down. Now, when I first arrived in Council -- And I know that bid specifications and the quality of work that we're demanding has changed. But I seem to recall that demolitions were at about the seven, eight thousand dollars standpoint. Now, maybe that's not good enough for us any more. And certainly things do change over time. But I mean, we're talking about over the past seven, eight, nine years, like, a 300 percent increase in demolition costs, when we have clearly put more supply, if you will, out on the market. I mean, this situation defies every principal of economics that, I mean, anyone would learn. Why do the costs keep going up when we're putting so much supply out on the street?
There's a couple of things that have been happening. We put a lot of supply out on the street; you're 47 Resolution 040095 - 3/22/04 absolutely correct. First of all, when we were doing the... again, our projections, we didn't have the experience of actually letting bid packages. I mean, historically the City had not -- I'm just saying, historically the city had not let as large a bid packages that we've been doing. And we have not -- We've been getting mixed responses from the contracting community. In some instances we may have only had three bidders bid. Last year we didn't have a lot of participation. We're getting more contractors now bidding in some of the later projects. We're starting to put out -- go back to putting smaller bid packages out so that more people can respond. But the bottom line is is these numbers are now benchmarked on our past experience, and what are being bidded and what's being bid at the lowest number. I 48 Resolution 040095 - 3/22/04 mean, this is based on the low number that's taken. We believe -- are disappointed that, you know, we have not gotten smaller numbers because of the number -- the larger amount of work being put out.
Well, okay. I mean, I guess the last thing is -- I mean, what --
-- of Council members are still -- 49 Resolution 040095 - 3/22/04
Thank you. The Chair recognizes Councilman Goode.
Thank you, Madam President. Let me pick up where Councilman Nutter left off. In your testimony, Miss Smith -- Good afternoon, by the way.
You talk about how the estimated bids for fiscal year '04 have risen since presentation of the budget which is less than a year ago. Talk to me a little bit about how the costs of demolition have risen since the original NTI legislation.
I mean, we've been keeping the records every time we put a package out to bid. And this goes through 50 Resolution 040095 - 3/22/04 the traditional procurement bid package, you know, process. So it's put out. You know, we solicit bids...
My question more so is, what was the projected estimated cost of demolition per building when you originally proposed NTI, in light of the fact that it's now $22,000 per building?
Right. It's doubled. Back in, I think in FY -- When we put the budget together for the first full year of NTI, which we --
I'm not talking about actually when you proposed the legislation originally, not in the first budget. But when the legislation was proposed, what was the anticipated cost of demolition per building?
I believe at that time we thought it would be around $11,000. I'm not absolutely...
I believe it was probably slightly lower. But if we take 51 Resolution 040095 - 3/22/04 the $11,000 figure, it's now double that cost. Does that mean you can do half the number of buildings?
We're going to do -- Yes, it does mean that we'll do less number of buildings than we originally projected.
I would say this point -- I mean, our original range we said somewhere between 10 and 14, based on that average number that we were using. So you can have that. So I would say now between 5 and 7.
Following up on what Councilman Nutter said -- And I'll be a little more direct about it -- do you or do you not control the market with regard to demolition in NTI areas?
I -- I -- We put the City -- The City, you know, puts out a bid package. We get responses.
Is there anyone else doing demolition of residential properties in NTI areas at that sort of 52 Resolution 040095 - 3/22/04 critical mass?
So you do control the market or should control the market with regard to demolition in NTI areas?
Well, we're the only -- I mean, the City is the only, you know, entity that puts out these large demolitions. We're the only ones that are doing that.
In light of the fact that you control the market -- (Councilman Cohen began speaking, out of the range of the microphone, not reportable.)
I'm just saying, yes, I mean, you know, we are the only the City, the only one that has the... For example, the state -- We have the power to let out bids for the demolition of dangerous buildings.
And to a certain extent, you control the market because this is a market that you created. 53 Resolution 040095 - 3/22/04
Well, I guess I'm a little reluctant to use the word market, in that we're doing public safety type activities. We're the only --
Well, that's my next question. But I'm just going to deal with the fact that you're putting out to bid a significant amount of business that would not exist if NTI was not created. Therefore, you created the market. So to what extent do you control the market you created?
I mean, the way I look at it, Councilman, is that the City carrying out its police powers, you know, can control how many, you know -- And given the amount of money we have, how many buildings we can demolish.
Can I interject here a minute, please? 54 Resolution 040095 - 3/22/04 I know that with demolitions of one property, we went from 9,000 to 12,000. Now, it's questionable whether it's 21,000 or 22,000. I think you're missing what's being said or maybe I'm missing something.
I think before when we demolished, we simply demolished a building. We waited a couple of years before the side walls could be stuccoed. Am I correct?
So in this new contract that you let, it's not only the demolition; it's the stuccoing of the party walls; it's the cleaning of the lot; it is the grassing of the lot; and it's the erection of the small fence.
So would you say that is the reason why it is now 55 Resolution 040095 - 3/22/04 costing $22,000 per property?
It's -- It's -- It's part of the reason. And another big part is that we're doing a lot more stuccoing of party walls than we anticipated in these bid packages.
I think that's what your answer should have been.
The Chair recognizes Councilwoman Tasco for a point of order.
When you initially developed the package for demolition, were these features included in the specifications?
We had contemplated doing it, but we did not have any experiences to the cost. Like, we -- we made a couple changes in the methodology.
So when you put the specifications together, did you have any idea of what you want done to the house 56 Resolution 040095 - 3/22/04 and the party walls, and all of that, when you demolished the property?
Yes. And we made -- we made an estimate. We have not had any experience doing this type of --
I mean, L & I have been doing this for hundreds of years, forever. And I think an issue was raised during the course of the discussion about why they weren't doing it. Because they work from a basis of experience and understanding what needed to be done, and also had some idea of the cost that -- what it should cost. And so I asked you that question. And did you have the specifications? And you don't have the experience in dealing with that, so that may take care of that answer. The other question is, did you put a 57 Resolution 040095 - 3/22/04 cap on the costs that you would pay for this? Because right now we're talking about 21,000. In the spring you may come back and say, well, it's gone up to 30,000. Where is the control?
Well, again, the control is if we get in numbers that are above our revised estimates, we can reject the bid.
Going back to Councilman Goode says, we're the only game in town. Why can't we control it?
Because part of it, I guess, is that tension between if the building is dangerous and needs to come down. And the numbers before, under the emergency curbside, we were just looking at the costs to take down the house, as opposed to the other costs. Now we look at all the costs in its entirety. So we weren't actually comparing apples to apples 58 Resolution 040095 - 3/22/04 before. And to the extent that, you know, we stopped -- we can stop the targeted demolition program, but that does not eliminate the fact that there's still dangerous and imminently dangerous buildings that need to be demolished. So I don't know that we can kind of not do those. Do we just do the extreme cases and not bid that out? But, you know, we're trying to, you know, be responsive to -- when we go out into the neighborhoods with Council staff identifying properties, you know, making sure we get all as many we can within the targeted area. That was one of the changes we made in the program. So, you know, we can go back and, of course, look at not carrying out a targeted program any more. But we thought that was one way, instead of, you know, kind of scatter site, you know, where we've just been here, there, and everywhere, try to sort of, like, you know, much more 59 Resolution 040095 - 3/22/04 comprehensively work in the neighborhood.
That's why the costs should be less, if it's targeted, and you're not running all over City. You're into the community --
But these are the numbers that we've been getting in, Councilwoman, both --
We just -- Well, we have to give the budget as part of this process.
So the costs to demolish the building has gone from $11,000 to $22,000 --
The number of buildings has gone from 14,000 down to, you estimate, five to seven thousand. The next question is, are you demolishing now simply based upon dangerous buildings or are you demolishing for land assembly?
We've always demolished for the public safety dangerous buildings.
My question is, what percentage are you doing with regard to dangerous buildings, and it being a public safety issue? And what percentage are you doing with regard to land assembly, in view of the fact that the cost has doubled, and the amount of buildings that you originally intended to do when you first submitted the legislation to Council has decreased from 14,000 to five to seven thousand?
So does that mean 61 Resolution 040095 - 3/22/04 a hundred percent? Because the question was what percentage.
So what percentage of the work that has been done was land assembly before you realized that your costs had doubled?
We... Let me -- The number of dangerous -- We have, like -- When we did the 2000 survey, we had about 26,000 vacancies. And before what we -- what we did last year was primarily focused on... was -- I mean, we didn't get that much off the ground. My understanding is we're primarily focused on dangerous buildings.
We haven't done unsafe buildings or things like that. Or if we have, it's --
My question is just simply what percentage -- 62 Resolution 040095 - 3/22/04
Yeah, you can get back to me on it; but that's the question, I would think, that you would have the answer to, to know what percentage you did for land assembly versus just because it was dangerous.
We didn't do any for land assembly. We have always said that the focus of the NTI bonds for demolition is -- and that's the objective of the program -- is demolition of dangerous properties.
So what we're doing now -- I'll just accept what you're saying, even though I that the land assembly numbers may be higher. 63 Resolution 040095 - 3/22/04 So what we're doing now is just knocking down dangerous buildings.
And in light of the fact that we're just knocking down dangerous buildings, not necessarily dealing with hyper vacancy and land banking and land assembly. Can you tell me, for the record, since the NTI program was approved, has housing production gone up, gone down, or stayed the same in those areas?
No. Since the NTI program was introduced in City Council and passed --
-- has housing production in those areas gone up, gone down, or stayed the same?
I would say, depending on the area, last year -- Remember, this is 64 Resolution 040095 - 3/22/04 only the second year.
-- in terms of the program. It's a comprehensive program. Where first you said 14,000, now you're saying five to seven. First you said for a combination of dangerous buildings and for land assembly, now you're saying just for dangerous buildings. I mean...
Well, just, if I may, Councilman, again, we've always said the objective of the residential demolition program was the demolition of structurally dangerous buildings. We've never said that the objective of the demolition program was for land assembly and development.
If I may -- If I may, what we said -- What we said is, of course, 65 Resolution 040095 - 3/22/04 if we're -- have, you know, vacant land available, and can get --
I don't believe that anyone who has even been a supporter of NTI within this body or across this City believes that you're just doing it to make the City safer. They believe that you're assembling land to transform neighborhoods.
We do have money for land assembly, that is correct. But again, in both years when we have written the program statement and budget, and we described the residential demolition program, we said that, you know, the focus of this was that demolition was to protect the health, safety and general welfare of the City --
Miss Smith, but you cannot answer the question directly whether the housing production has actually increased, decreased --
In the demolition target areas in some areas there is increased development activity. For example, one of the demolition target areas --
I actually need a comprehensive answer, in terms of whether as a whole production is up under NTI across NTI areas in general or whether it's not -- I don't want to here piecemeal it's up here, it's down there. I'm not interested in that type of comment this afternoon.
I would say that on the whole it's probably about the same. I would say it's about the same.
Can you tell me how much in private dollars have been leveraged from NTI investment?
$295 million in bond proceeds are going in in public money. How much in private money has been leveraged?
We have, for example -- I'm just giving this as an example. In land assembly, I would say that we would have --
Miss Smith, this afternoon -- I'm not trying to be rude, but this afternoon I'm not looking for any for examples. I'm not looking for in this part of town it's working this way. I'm looking for a comprehensive overview of the program. And you asked us for $25 million more. 68 Resolution 040095 - 3/22/04
I can get that number back to you. I just -- I'm sorry, Councilman. I don't have it in my -- off the top of my head.
Excuse me; excuse me; excuse me. Since last spring when you asked for the money you asked for last spring?
Can you tell me what money has been leveraged last spring in terms of private dollars, since your last request for private dollars.
There were a number of low income housing tax credit projects that were approved that we used -- that NTI bond proceeds will be doing the land -- paying for the land assembly. That's an example. I don't have the exact number in my head. That's something I would get back to you on. 69 Resolution 040095 - 3/22/04
Lastly, there was an excellent article in today's Inquirer about the Pennsylvania housing finance agency program, that basically said that they had allocated $27 million. And their return, in terms of additional investment -- I believe it was $184 million. I would expect this afternoon when you're asking for $25 million this same type of measurement to be offered, in terms of what your success is so far.
Generally, from my standpoint -- And I did deal more with business and economic development than housing. But just in terms of housing, I would think you would look at whether housing production is up; be able to compare on an annual basis, in terms of unit production. I would think you would look at how 70 Resolution 040095 - 3/22/04 much is leveraged, in terms of private dollars. I would think that you would know more definitively, in terms of demolition, if you're just doing demolition right now, in terms of dangerous buildings, whether that's going to positively or negatively impact your original goals.
You're welcome. The Chair recognizes Councilman DiCicco. COUNCILMAN DiCICCO: Thank you, Madam President. And good afternoon, Miss Smith and the other members of the panel. I'd like to take a slightly different approach to this. When the NTI program engages in the demolition of either a single property or a multitude of properties, what is the actual process, in terms of identifying who the owner is? And it's a multi question I have for you. And 71 Resolution 040095 - 3/22/04 what have we done or are we doing to recoup some of the costs?
What we do is, we first look at a target area. We go out and do an updated field survey. And there are a number of different departments that participate in that. And we work with the Council District office on the field survey. At that time we're looking for, you know, different conditions: Dangerous, imminently dangerous, vacant lots. We update our data bases. And we start putting out new violation notices. I mean, one of the things we've tried to be very careful about is make sure that we issue violation notices. And that's when the orange sticker a lot of times goes on the property. After that, there is a series of meetings that takes place, where we actually go through and look at the buildings that are going to be candidates for demolition because they are in fact 72 Resolution 040095 - 3/22/04 dangerous and need to come down. And then once we've identified those buildings, that list is put together with the, you know, estimated budget and submitted to the District Council's office for signature. Sometimes, depending on the District Council office, there may be a couple of community meetings or there could be leadership meetings with different offices that work that part of it slightly different. So, that's the first thing. So, everybody gets a notice, even if their building isn't going to be... COUNCILMAN DiCICCO: Everybody meaning the owner of the property.
Yes, the owners. And notices go to the... you know, the last known record that we have. COUNCILMAN DiCICCO: And the notice if I'm... Correct me if I'm wrong --
Comes from the -- COUNCILMAN DiCICCO: -- basically 73 Resolution 040095 - 3/22/04 identifies the owner, and identifies the condition of the property, and what --
It lists the violations. COUNCILMAN DiCICCO: And lists the violations. And then there's a certain fine that is imposed if the owner does not make the necessary repairs to those violations.
Yes. Usually I think it reads something either, you know, if you don't -- It's like a repair or demolish. COUNCILMAN DiCICCO: You have a certain amount of days to make these listed repairs; and if not, there's a fine imposed.
Mm-hmm. COUNCILMAN DiCICCO: Are you familiar with a bill that I introduced and this Council passed about three years ago, which I always refer to as the broken window bill?
Yes. Mm-hmm. COUNCILMAN DiCICCO: To date has the NTI program in any way, shape or fashion 74 Resolution 040095 - 3/22/04 enforced that legislation?
The Department of Licenses and Inspections I know has made some suggested changes to that Ordinance 6 and has gone into equity court in some limited cases trying to get -- COUNCILMAN DiCICCO: Actually, I was in court on one case. Deputy Commissioner Sivigli (phonetic) is here, and he can attest to it. The maximum fine imposed -- that that court will handle is $10,000.
Mm-hmm. COUNCILMAN DiCICCO: My concern is that when that bill was originally drafted, the intent of the bill, at least as far as I understood it, was to make the fines so exorbitant that the owner of the property would have to do one of maybe three things: Either make the necessary repairs, either decide to sell the property, or to give the property up to the CDC. And again, to date, with the exception of one property at 639 Catherine Street, I don't know of any other property 75 Resolution 040095 - 3/22/04 in the City of Philadelphia where that legislation has been used as an enforcement tool. And the reason why I'm concerned is, if we were using that legislation as an enforcement tool, the fines on those properties would be well over the actual value of the property. And because earlier in your testimony you testified something to the effect that we don't have -- may not have enough money to acquire all these properties because once we go through the demolition then we have to pay someone for the purpose of acquiring that property. If we were enforcing that legislation, the fines would certainly exceed the value, the market value, of those properties, and we wouldn't be spending a penny. In fact, in the best case scenario, we would be recouping the cost of the demolition. And that's where my concern is. 76 Resolution 040095 - 3/22/04 It is one thing -- And I can understand in the public's interest that we need to identify and remove dangerous properties in a timely fashion, whether or not we can identify the owner or we can get the owner into court in a timely fashion. But there are hundreds, if not thousands, of buildings throughout this City that have remained blighted and vacant for a number of years. And I'm not faulting this Administration because this Administration inherited them, as the last Administration, and probably the one before that. But here it is, we have a piece of meaningful legislation that would have and would address this very issue. This building I'm talking about at 639 Catherine Street has about 33 doors and windows. And in a round figure, if the bill -- the legislation that we put in when that bill was being enforced, every single day there would be $9,000 in fines on that building. 77 Resolution 040095 - 3/22/04 We're finally getting that owner, who has left the condition of this building in the condition that it is today for 5 years, has left this building sit in the 6 middle of Bella Vista for 22 years. 7 And up until this point his fines 8 may have been less than $10,000 over 22 9 years. So for his purpose this building 10 that he purchased 22 years ago for maybe 11 $40,000, the recent fair market value that 12 the Department of -- Redevelopment 13 Authority imposed on this property is 14 $500,000. 15 So, if we were -- And we want to 16 work on this because I have the developers 17 interested. We're going to have to go out 18 and lay out out of my NTI funds a half a 19 million dollars to take this property, so 20 that this owner and his estranged wife, who 21 have been claiming the reason they can't 22 sell this property is they're involved in a divorce for 22 years, want to profit on the taxpayers of this City, to the tune of $450,000. 78 Resolution 040095 - 3/22/04 So... I mean, that's just one example. But there are other examples, many examples, thousands of them out there. And I just can't believe that it's been taking us all this time to utilize a tool that was available to the Department. I don't mean this to be critical. It's just one of those things that government just kind of gets hung up about. We should be fining these people who let these properties deteriorate to the condition that they're in, that they become imminently dangerous. ) COUNCILMAN DiCICCO: And every effort should be made to recoup the cost of maintaining and demolishing that property, not at the expense of the taxpayers but at the expense of the person who owns it.
And I don't see any of that being discussed in this conversation because it could certainly -- And I'm not suggesting we're going to collect from everybody; I understand that. 79 Resolution 040095 - 3/22/04 But a small -- percent of what's out there would probably cover the cost of the $25 million we're looking for, and have money left over. And why are we not doing it, I guess, is my good question.
Again, I know we started 8 using it. I know that the court wouldn't 9 go over a certain amount on the Catherine 10 Street property, and -- COUNCILMAN DiCICCO: We got up to $10,000. Anything over $10,000 we can't -- the Municipal Court does not have the authority to hear the case. So now we have to go back --
So it should probably be -- COUNCILMAN DiCICCO: -- and Bob and his team have put together a whole list. We're up to about a million dollars in fines.
Mm-hmm. COUNCILMAN DiCICCO: We're going to 80 Resolution 040095 - 3/22/04 get into court, I think, sometime in April, hopefully. But I just think we've made this thing a lot more difficult. And when I did the bill originally, it was before NTI. And then when NTI was being thought of, I thought this was a great opportunity for to us take advantage of this. And we really haven't done it. And if we're going to go out with these teams of people that you spoke about, identify blighted properties, dangerous properties, make a list, record them, notify the owner, from that day going forward the clock should start ticking. $300 for every door and window that has gone unreplaced should start ticking. I mean, I'm not a computer buff. But you've got to be able to figure out -- You plug the address in, and from day one $300 per opening. And if it's six openings, $1800 a day. And I'll tell you what will happen. Because the only other incidents that I 81 Resolution 040095 - 3/22/04 know that this took place in my District is at 708 South Warnock Street. Within 48 hours after the owner of that property received notice about the $300 a day, he put the property up for sale. And he sold it in two weeks because he didn't want to be stuck with all those fines. So this is a tool that we should be using in conjunction with what we're trying to be doing here, and not always -- I mean, we're asking the taxpayers to pay for all this stuff. It's the City's responsibility removing these properties, but the owners have never been held accountable, that I can see. (Applause.) COUNCILMAN DiCICCO: So, somewhat of a question; more of a statement, I guess. But that's something I would really like to see happen.
And I think we're beginning to get the mechanism in place. I 82 Resolution 040095 - 3/22/04 know it took us longer than it probably should have. But I know we started -- COUNCILMAN DiCICCO: Mr. Sivigli walked over to me right before this hearing and said that they're going to start enforcing it. But, you know, we have a list... I assume we have a list of those vacant, derelict properties because those are the houses that are on this list for demolition. You can guesstimate that everybody has at least six windows and a door just in the front of the building. Forget the back. So you got $1800 a day on every property that's on this list that we should be imposing those fines, and let the owner -- Let the owners -- Put some responsibility on the owner. Let them have to come and plead their case in front of a Judge.
Okay. COUNCILMAN DiCICCO: Okay. Thank 83 Resolution 040095 - 3/22/04 you. Thank you, Madam President.
You're welcome. Yes. MR. McCALLA: Good afternoon. I'm Jay McCalla (phonetic).
Councilman Cohen. I'm sorry I didn't hear you, Councilman.
I said I'm anxious, as one of members of the committee, to be recognized.
We have Councilman Clarke, Councilman Rizzo, Councilman Nutter, Councilwoman Tasco, and 84 Resolution 040095 - 3/22/04 you. Councilman Nutter had his first go-around so we'll recognize you before that.
I know. You know, now your light's not on at all. Please proceed. MR. McCALLA: I'll pass for the moment. Thank you.
Thank you. The Chair recognizes Councilman Clarke.
Thank you, Madam President. Good afternoon again. Earlier in the discussion there was a reference to using Sheriff's sales as an acquisition process. Can you run me through the Sheriff sale process and the time frame versus condemnation?
I've heard so many 85 Resolution 040095 - 3/22/04 different stories about the time frame for Sheriff's sales. At present, my understanding, it can take about two years almost from start to finish. One of the things, that we're going to start working with the Law Department and the Revenue Department, beginning to look if we can move packages, maybe move a group of properties together through the process. A lot of times what happens, if -- if -- you know, making sure we have all our liens in so that we can bid it up and try to move groups together, instead of let them kind of straggle through. That's one of the things that we're starting to look at.
So you'll have a group of properties taking two years, as opposed to a single property.
Well, it's -- Yes. In other words, trying to do them as a bundle -- 86 Resolution 040095 - 3/22/04
Some Council members are having difficulty hearing you.
But in terms of the time frame, I mean, generally people say about two years. But there's been horror stories about it, taking up to five years. But I would say --
So that's not really a feasible approach to development.
I mean, there's a couple of challenges when you're doing development. If, for example, let's say you take ten properties through at a time, and you 87 Resolution 040095 - 3/22/04 can -- the City gets site control of nine and gets outbidded on its equity on one, that can make it more difficult. But it might be a good way to take, you know, lots that have been demolished. That's what we're starting to look at. If there's a group of developers who may be interested, say, in a particular neighborhood, can we take, you know, five or ten properties through, you know, with as many liens on them as possible, including fines and the like, and take them through as a group, we might be able to have more equity interest and maybe control the package.
So, I mean, it was suggested earlier that possibly, particularly as it relates to land 88 Resolution 040095 - 3/22/04 assembly -- and I'm assuming that you're only assembling land for purposes of development --
I mean, we're not aggressively looking to bring property into the City's inventory, unless there's a reasonable possibility of a -- of a...
So that Sheriff sale thing is off the table. I mean, realistically, it's not a strategy.
I mean -- And since we don't have enough acquisition dollars, there are a lot of demolished lots that there may not be an immediate development interest, so the fact that it takes two years is not as critical.
I mean, why would we -- If we're not going to... 89 Resolution 040095 - 3/22/04
If we're not going to develop the lots, why are we acquire the properties at all?
So that if in the future someone comes along, we'll already have title. I mean, I think that's still a very important principal around this concept of how to begin to bank land. Right now, though, you know, we're out of money to condemn every vacant lot that we demolish, I mean, because we've given priority to development projects that are going forward, and other priorities in different Council Districts. But there's still going to be a lot of vacant lots that just sitting there. And we're looking at the feasibility of just starting to use Sheriff's sale. And I'm not even sure at this point how many properties the system can even manage at this point in time. That's one of the things that we're going to be looking at. 90 Resolution 040095 - 3/22/04
Okay. With respects to participation in the demolition process, you indicate that you've reached your goals. Where are we at with creating prime contractors? I know a lot of the subcontractors in some of the employment goals, obviously we've done okay. But I'm concerned about the possibility of creating primes. I know early on in the process we thought, because as we thought we controlled this process, and hearing some of these numbers on the demolition I'm not really sure about that, but we thought we had some level of control. We thought that the likelihood of creating opportunities for prime contractors, minorities, disadvantaged is pretty high. And some of the things that I've been hearing, that that's not necessarily the case, that we're getting some decent numbers on the subs, but we're not really 91 Resolution 040095 - 3/22/04 getting minorities coming in as prime contractors.
As part of the Emerging Contractors Program there were about 9 companies or businesses that completed the 10 classroom training component. And that was 11 in August of last year. 12 Since that time, we've been working 13 with up to about 14, I think, at this point 14 who have been doing what we call in the 15 field demolition. 16 It's not fair to expect someone to 17 go immediately from the classroom to 18 actively bidding on demolition projects. 19 So so far about 47 houses has been 20 demolished, with about... about 14 small, prime -- I mean, contractors out of the chamber program. We are... also begun to let some smaller bid packages for individuals to bid as part of the City's procurement process. 92 Resolution 040095 - 3/22/04 There's still some procurement issues, like surety bond things, that we have to work through. But we started to break up some of the larger bid packages into three, six, five property bid packages so that these new contractors are in a position to bid on them.
Let me back up a little bit. Aren't there a number of existing demolition firms, minority firms, that were in place that would not have had to have gone through the Emerging Contractors Program?
Yes. We've been getting -- I know in the last couple of bids, there's been one contractor that's been bidding on the regular larger packages. Some of the other ones have not maybe partnering with a couple of people, but a lot of them were coming under the subcontracting. Then there's the field minority contractors -- 93 Resolution 040095 - 3/22/04
Hold on. Hold it; hold it; hold it. Hold it, Miss Smith. So prior to the implementation of this program, we had a number of existing demolition contractors --
-- who were not required to go through the Emerging Contractors Program.
Did we work with those companies to position them to bid as a prime on the contracts that have been coming out --
-- there were a number of conversations, and some were working bidding on the emergency curbside program, 94 Resolution 040095 - 3/22/04 as opposed to the procurement -- the targeted -- the target area program. So some continued to -- or went and worked on the emergency contractor program. But I think it was about two or three prior to NTI that was bidding regularly, from what I recall. I can check on that.
Well, what I'm trying to get at, because it was our belief that there would be opportunities to enhance the companies, these particular companies. And I'll ask it again. The companies that existed prior to the Emerging Contractors Program, who had the wherewithal to bid on projects, maybe not as large as we would have liked, did we work with those companies --
-- to put them in a position to bid on these large bid --
-- packages that 95 Resolution 040095 - 3/22/04 are coming out --
That's -- I'll ask maybe Jay to talk about the specifics of that. But we did work with, talk with a number. Some elected to stay in the emergency curbside program and prefer bidding under that one, as opposed to going through a tradition of procurement process with the City, which is a much more complicated process.
And you had more of the contractors meeting. MR. McCALLA: Councilman, could you restate it, please -- I'm Jay McCalla, Deputy Managing Director -- for the record.
Do you want me 96 Resolution 040095 - 3/22/04 to repeat the question? MR. McCALLA: Please.
The question was, prior to the implementation of the NTI program and during its inception there was the thought, at least in my mind, that there would be opportunities for existing demolition contractors: Minorities, females, disadvantaged, to grow their company because we controlled this process. And while I understand the Emerging Contractors Program and the classes -- why that essentially brings people who are either workers or very small capacity to bid as subcontractors, what I wanted to know, have we and did we seek contractors -- preexisting contractors who had the wherewithal to bid on the contract but not necessarily at a large level, as some of these bid packages are, that we work with them to put them in a position to bid on a 100 to 50 bid package number or something like that? MR. McCALLA: Councilman, we -- 97 Resolution 040095 - 3/22/04
If so, who were they? And what did we do to assist them to bring them to this level? Because what I'm hearing is that, at least on the street, that there has not been a successful bid by a minority as a prime on a demolition contract. And moving -- I mean, we've been in this for two years now. I want to know why not, and what we're doing to accommodate that. MR. McCALLA: Councilman, we have consciously created small bid packages, with the intention of escalating them in size. The first would be bid packages of 3 to 7 houses. And then the next step would be a series of demolitions, 7 to 15 houses, and then 15 -- excuse me -- to about 25 or 30. And then that would result in the mainstreaming of a small firm's ability to compete for the larger and larger packages. There's supervision questions. That is to say, a small firm hiring an additional supervisor. There is the 98 Resolution 040095 - 3/22/04 escalation in the bonding requirements, the more properties that are in a demolition package. So we wanted to have the smaller firms demonstrate for themselves the ability to grow in these steps three to seven --
Do you have any larger minority firms? MR. McCALLA: One large firm that has been bidding is LLP. They're in demolition. They have bidded very competitively, very aggressively over the last several packages under NTI. They're able to do the larger ones. But we've had conversations with ABC, owned by Luther Johnson, and at least one or two others about how to -- And one firm I've tried to vigorously encourage is Eugene Pullins.
Right. MR. McCALLA: I don't know exactly the name of the concern, but it's one of the best demolition contractors we have in Philadelphia. 99 Resolution 040095 - 3/22/04 He's found his niche with curbside demolitions. And there is -- The difference between curbside and NTI targeted is, a curbside firm posts one nominal bond that's renewable annually because they're not doing a large scale. They may do five or six at a time, at the best, because these are emergencies. But when it comes to the mainstream targeted demolition, where they may be getting 50 now, then another 50, and then another hundred, the bonding requirements are different because the performance and liability differences are higher. So --
What are we doing -- MR. McCALLA: -- the key is bonding.
What are we doing to support the bonding requirements in the City?
Yeah. Well, that has been a consistent issue. One suggestion is, instead of the City using its standard performance bond and language, which is 100 Resolution 040095 - 3/22/04 very -- some people feel it's very onerous, it's been suggested that we look at the AIA bond form. Both the Law Department's working with the Procurement Commissioner and the Risk Manager about trying to come up with a different kind of performance bond for our procurement projects. And I'm hoping to have that issue resolved by the end of this month. They've been working diligently on that in the last couple of weeks.
Okay. I'd like to, through the Committee Chair, be kept abreast of that, because it was the full intent of at least this member to give contractors the opportunity to grow. I would hate for us to spend this much City dollars, and at the end of the day you come out with companies that are at the level that they were prior to the implementation of this program.
That would not be 101 Resolution 040095 - 3/22/04 a good thing.
And there have been -- there have been, while not in the prime area, there have been a number of contractors that have been bidding or being made part of subcontracting opportunities of significant size, with respect to the NTI demolition work. In fact, that was one of the reasons why we changed the... instead of letting separate prime contracts out, why we changed the methodology for bidding out the targeted program because it would offer more subcontracting opportunities.
I was passed a note to ask you about wrap-up insurance.
That's the OCIP, Owners Control of Insurance Program. That's -- Because of the scale of the demolitions in the targeted program, we approved the... the City... So, like buying, I call it bulk insurance, a group insurance, that does not relieve the contractor from submitting paperwork to 102 Resolution 040095 - 3/22/04 demonstrate that they're, you know, are able to carry out the job.
-- still an administrative function required, but this does in fact enhance the ability to get the level of bond that is required, right?
Well, it's insurance. That's different from the performance bond. It's insurance, like if somebody falls on the job type stuff versus the performance bond which is like completing the project.
Okay. One other question. In earlier discussion with Councilman Goode, there was some talk of demolition as a part of land acquisition in preparation for development. I believed earlier, in the discussion on the implementation of NTI, that this would be just used as a tool for site prep for development. As a matter of fact, in my District, in the Cecil B. Moore Area, I believe that 103 Resolution 040095 - 3/22/04 we're utilizing NTI bond proceeds to demolish and acquire property.
I mean, I -- That was a part of the process that I thought it enabled to us offset the traditional strategy of spending Community Development Block Grant dollars which were diminishing as we speak.
And we would leverage it with NTI dollars, so we can demolish and prepare land, as opposed to spending a million dollars for site preparation for development...
It's -- It's -- It's almost I don't want to say splitting hairs; but, you know, we do -- when we -- because of the type of bonds we're using, the demolition is for public safety. Now, once the building is down, we use another type of resource to take the land in. So it's a question of making sure that they all fit it together. But in every area of the City we may not immediately have a development plan. Some of the examples I was going to site --
-- was Cecil B. Moore Moore and Strawberry Mansion, and some of the projects in Mantua that's coming up, and things of that nature.
So we have to say in public that all -- that it is for public safety, although we clearly know internally that there is a strong likelihood that this --
Sometimes there are development projects that are being cued up 105 Resolution 040095 - 3/22/04 to take advantage of the land that once it's demolished and acquired.
Okay. Okay. In view of fairness, Madam President, I defer to the next member in line.
Miss Smith, since I really want to make sure I understand what you said earlier about demolition cost, let's cut out all of the new additions to what we used to call a demolition. Forget the fence, the land. Are demolitions at the same amount to do what we once did, that L & I --
They're pretty close to it. We're at about 13,000 if you just take down the house. And L & I under emergency curbside, it's a little bit less than that to just take down the house. One of the differences is the fact, for example, under the emergency curbside program, the prevailing wages and triggered if you're under 25,000. But when we start packaging that, we're above that. There is other insurance related and other costs that get built into the planned demolitions or the target demolitions, as far as emergency curbside. But if you look at the cost of just taking down the house, you know, what it was, we're pretty close to that.
Tell me... It makes sense that there's so much business that the costs of demolition should come 107 Resolution 040095 - 3/22/04 down. And again, I'm not asking you to point a finger at anyone. But is there a way that the demolition business could, instead of us controlling it, that they control us? Is there a way that there's: Well, you get this group over there; we'll get that group? It sounds to me that the prices should be coming down, rather than going up. And I can't imagine how we're not able to do this with --
Well, one of the -- I think one of our challenges is that earlier on, and particularly for our larger bid packages, we only had three firms actively bidding. We've started to, you know, break the larger bid packages and put them out in some smaller subsets. In the last couple of bid packages we put out, we're getting more people bidding on them. And I think we have more 108 Resolution 040095 - 3/22/04 people bidding. You're getting more competition. There was -- Early on we had one bidder that came in very low, but he didn't stay in, doing the work, that initially we thought we would have lower numbers, based on their bids. But they did one project and haven't really bidded since then. So I think, you know, there's a number of players in the field. You know, we're hoping as we bring on some more of the smaller bid packages, that those numbers would be lower because more people can bid on them.
My final question is about the land assembly. And I believe -- What is it $15 million additional for fiscal year 2004?
Could you give us an example -- With all the land and all of the already City owned property, could you give me an example why we would need to go 109 Resolution 040095 - 3/22/04 out and spend $75 million for land acquisition? Give me an example of what you're going to spend $75 million on.
I think one of -- I mean, while we do have some properties in City ownership that's out in the vacant -- in -- in -- in these areas, a lot of them may have one publicly owned or City owned property, and then five privately owned properties. And then... So you can't do anything with just the one City owned. And with the condemnation, if there's a project that's involved, we'd be taking title to the privately owned, so we can amass bigger parcels of land. So that's why we're allocating money for the condemnation of vacant -- of privately owned vacant properties. I think one of the things -- I know a lot of people think the City owns a great deal more than we, in fact, do because we demolish it. Just because we demolish it doesn't mean we own it. 110 Resolution 040095 - 3/22/04
But don't liens get -- get applied to that demolition? And don't eventually, because of the value of the property, that we become the owner of that? I can't imagine us --
I can't imagine us going out and paying for a property that we've spent to demolish, that we haven't collected taxes on. We're not doing that, are we?
What happens is, the money comes back to the City. The way the law sets up, you have to pay the money into court. And then the first thing that's taken off is whatever delinquent real estate taxes or property liens on demolition or other municipal liens that are owed to the City. So that comes off the top. So... But you still have to pay the fair market value of the property in the court. That's the way the state law is 111 Resolution 040095 - 3/22/04 written. If we go through the Sheriff sale process for development, if you have ten lots you want, and we have liens on all of them and some tax delinquency, and somebody outbids you on one property, then you're not able to cause that full development. So we've been historically, the City, I guess for the last five to ten years, has been using eminent domain as their primary acquisition tool for development, so that we're assured of title.
What you just described about losing that one property, isn't there a legislative process that could help you prevent that from occurring? If one out of ten is going to interfere with development, you would think, other than eminent domain, that there would be a way not to have a developer or some other interested party outbid you for that particular parcel.
But then the City would 112 Resolution 040095 - 3/22/04 be just bidding -- I always call our equity is the lien. So if someone outbids the City's liens, then we, the way the law is written, it would go to that person. So there's a little bit more risk when you're using foreclosure as the method of acquisition. You may not get title to everything that you want. Also, the other thing is, when -- you get a clean and marketable title through eminent domain.
You're welcome. The Chair recognizes Councilman Cohen. Councilman Cohen.
Thank you, Madam Chair. Were you part of the group that decided on how much money was going to be needed for the original NTI loan? When we made the $295 million loan -- is that what we made -- were you in the decision making. 113 Resolution 040095 - 3/22/04
Yes, I was part -- By working with the financial advisors, we did the projections. And again, one of the challenges is that we use different types of bonds that carry different repayment terms and interest rates. And so, each year what we've been doing is, we've been recalibrating what we think we can raise, because we didn't issue all the debt at one time based on how we could --
Well, did you think at that time, based upon your projections at that time, what was it going to cost, in terms of ultimate bond issues, to do the work that the Mayor or the NTI team or both groups thought would be needed to end blight in Philadelphia? What was your final projection projection as to cost? I'm under the impression -- I could be wrong. My impression was that you presented a proposal of what basically you 114 Resolution 040095 - 3/22/04 thought or the group thought or the Mayor thought -- Whoever was working on NTI reached a conclusion as to what it would cost. And for that you were announcing to the people of Philadelphia it was going to cost that much money, and Philadelphia was going to undertake what many people thought was a very heavy bond burden of $295 million. And people did figure whether it was worth it or not. I happen to think it was worth it, $295 million. But what was contemplated that would be gotten with that 295, as far as demolition was concerned?
At the time when we introduced that budget, we were projecting between 10,000 up to 14,000 demolitions at that time.
That's a pretty broad grouping, isn't it, 4,000? 115 Resolution 040095 - 3/22/04
Well, again, it was a projection based on an average. We didn't have any experience in the field at that point.
Well, but you had made studies. And you knew what it cost with L & I. So you felt pretty confident about your projections that you --
Well, at that time what we said that L & I cost to demolish a house was around $10,000, $11,000. So we were using that as a benchmark, yes.
And you also probably included in your study what you thought might be some price rises at the same cost of living levels, that the cost of living seems to go up.
Well, what we started to use is our actual experience, what we were actually getting in bids from contractors. So, in the first-year budget, you know, it's our best estimate. And we looked at what had been the prior -- City's prior history under the emergency curbside 116 Resolution 040095 - 3/22/04 demolition program.
-- was not the first-year budget, was it? Was not supposed to be the total program? The $295 million, wasn't that to cover --
That was in '03. And this year we revised it downward to 275. But in '03 we were projecting $295 million over five years.
I missed that. You said you moved the goal down from 295 million to 275 million?
That's correct, because we made some changes on what type of bonds we would project to issue. For example, we increased the demolition -- the acquisition budget from 50 million to 74 million. That requires a certain type of bond that has a shorter term and different interest rates. So, we made -- 117 Resolution 040095 - 3/22/04
Well, please spare me, because I'm no expert on the different types of bonds. And therefore, it doesn't mean anything. You were telling people when NTI was first proposed, that the Administration thought that a total cost demolition included, as part of the cost but the total costs would require a $295 million bond issue.
Right. That was our -- COUNCILAN COHEN: And you had in mind --
-- 10 to 14,000, pretty body range, of the number of demolitions you would get.
Now, what would be the figure -- In place of 295 or 275, what would be the figure now, based upon the new demolition figure and your experience? How would you estimate the 118 Resolution 040095 - 3/22/04 costs of to 14,000 demolitions would cost?
I would say between five 5 to 7,000. It's almost exactly half because 6 the cost per -- the average cost is now 7 around 22,000, based on experience. So 8 we're looking at five to 7,000, instead of 9 10 to 14,000. 10
So you're looking at only achieving half of the demolition.
Has there been a statement to that effect made to the people of Philadelphia?
Again, what we do is, we've made -- When we made -- When we made the revised budget, I tried to keep those numbers in line. So I'm not sure what I said... We said we revised it downward, I believe, in the '04 budget.
I'm sorry. You're going to have to look in this direction when you address me because when you addressed Councilman Clarke, I get in 119 Resolution 040095 - 3/22/04 every other word. So, please...
When we presented the FY'04 budget to Council? That's this fiscal year. We said in FY'03 the City set an ambitious goal of about to 14,000. 7 We said based on '03 experience, and the 8 number of demolitions we've done to date, 9 we are now revising that, we said seven to 10 9,000 or about 1400 or 1600 per year. 11
Has there ever been a statement made by the Administration --
-- that the amount of money we borrowed we now learn at present rates is only going to cover half of what we wanted to cover?
Yes, as a part of our annual program statement and budget that's submitted to City Council.
Could you direct me to when that was told to the people?
Yes. Because this is a 120 Resolution 040095 - 3/22/04 publicly available document, I make it available to anyone on request. It's on record with the Clerk.
Was the publicity given to the fact that it's going to cost us twice as much to carry on the blight program as before had been predicted? Was that given the same publicity that the original announcement was given, as to the beginning of this blight program, the anti-blight program?
I mean, it's always a dodge of government agencies, and I guess business corporations, they say -- business groups say, well, we filed it in the report to the SEC, which nobody looks at. But when there's good news, they announce it publicly. Now, the City went to great lengths to announce the beginning of the NTI program. They generated a great deal of enthusiasm. They said it was going to be economic. 121 Resolution 040095 - 3/22/04 A member of Council earlier this morning talked about the fact that many of us in Council were disconcerted at the thought that you were bringing in other groups with no experience whatever originally in hiring demolition groups to run the demolition. We thought L & I ought to run it because they've been doing it, and they know what the situation is under different situations. And therefore, we thought that that would be the best ones. We were talked out of it. We were told, no, that L & I only did two or three thousand a year sometimes and -- or whatever the number was. They're not experienced enough; we've got to develop our own experienced team. And the experiment seems to have been going just the wrong way. It seems like Councilman Goode said before, instead of our controlling the market, which we all thought was going to happen, the market began controlling us. 122 Resolution 040095 - 3/22/04 And apparently the feeling was developed that the government, the City government, is really sucker number one. My God, we can charge them anything. Maybe we'll give campaign contributions; maybe we won't. I don't know what that story is. But I have no idea of how this small group of people who had had previously a very small amount of experience became the important group. And then we were assured that by hiring -- Is it L and company? Or some company was hired to oversee the whole thing, all the demolition. I'm not sure what the details were. But we've seen the worst has happened. And now we're only going to have enough money for half an NTI program, because... I saw nothing in the budget for any major increase, in terms of doubling the amount of NTI money. Isn't that right; there's nothing in the Mayor's new budget to expand the 275 or the 295 figure to 123 Resolution 040095 - 3/22/04 cover? That it's going to be double that cost instead of that simple cost? And the simple cost was extremely high. It wasn't low. Made a lot of people gulp a few times, because we have to -- Since we've borrowed the money, we're paying interest over -- Is it or 30 years for that? 9
It depends. Some of 10 them are as short as 10, and some go out as 11 far as 25, with respect to the term. It 12 depends on the type. 13
One of the things that I 16 just -- You know, when we unveiled NTI and 17 talked about trying to do geographically 18 targeted demolition, we had never really 19 done that on the scale that we've done 20 it -- we're doing it today. It was an --
I mean, that was something that we wanted to try. We thought, you know, it made sense to try to 124 Resolution 040095 - 3/22/04 go into a community, instead of going from a reactive to more of a proactive. It's still L & I managing the emergency curbside work. And a significant amount of demolitions are still being done by licenses and inspections. For example, they would this year probably be around 500, just in terms of the emergency curbside work. So --
So -- So -- So it was something that was new, it was different. And we're learning from that, and I will be willing to admit that.
But you didn't say that. I don't remember anything in the original statement saying, now we want everybody to know we're learning. (Laughter.)
And we may learn that the cost is going to be double. Because don't the people of Philadelphia have a right to make a decision as to whether something that may 125 Resolution 040095 - 3/22/04 be worth to them $295 million, but it's going to be worth almost $600 million or more likely a billion, in my judgment, because there's nothing even that guarantees that the figures, which have already doubled, won't double again in the next year or two, as you gain even more experience because of something fatally flawed in how you're proceeding, if the market has begun to control the City, instead of the City being able to control the market. And we don't know what it is. And I think we have a duty to try to find out; don't you agree on that?
And don't you think the people of Philadelphia ought to get the opportunity to express their opinion: Is the blight program -- the anti-blight program worth twice as much? Because now we know it's going to cost at least that, and maybe it will cost even more than that. Because we're paying for the NTI 126 Resolution 040095 - 3/22/04 people to gain the experience to know how much it's going to cost. Because what you're indicating is that when you came to the people and said, this is going to cost this, you maybe didn't mention that, you know, we're amateurs at this because we don't have any experienced people working on it, and others may take advantage of us. Or for other reasons maybe the costs will double. I think that something is due by the Administration coming out openly and telling us what as of this time and on what basis they think the costs will be. Because I think the people of Philadelphia have a right to reconsider that and decide whether that's worth that money and worth the risk of that amount even increasing, you know, dependent upon how the Administration raises it. Don't you think that's fair? Don't you think government ought to be fully open?
We try to be. Again, I've gone to a great deal of detail in our 127 Resolution 040095 - 3/22/04 program statement and budget. We have hearings when we go to community meetings, talking about, you know, the strategy we're using, the reasons why we're using, the objective of the programs. You know, I'm more than -- I try to be as transparent as we possibly can. And we have stated each year in pretty much detail -- I think a great deal of detail --
-- how we're going to run the program and what we're learning.
You make a statement, and the Mayor makes the statement, because when Pat Smith or Dave Cohen or I don't want to mention all the Council members individually -- When we speak, the people don't pay the same attention to it as they do their leader. A Mayor a very important person in government. Next to a President of the United States, I think a Mayor is 128 Resolution 040095 - 3/22/04 considered more sort of Presidential than anybody else. And when the Mayor speaks, people listen because they know he's talking to his -- the group that elected him. And the Mayor, in my judgment, is the second most important person to people generally. First is the President and second it's the Mayor. And people trust the Mayor. Whether they should or not doesn't make any difference. They trust that the person chosen by them to be the Mayor is going to level with them. I'm suggesting that on this money thing, I'm very disturbed. But I think if the people think it's all right, and if they think it's worthwhile, that's one thing. But if the people feel that they've been played for as fools, that they didn't understand that $300 meant maybe undertaking an obligation of $600 million, the people, unless they're fully informed 129 Resolution 040095 - 3/22/04 and have a chance to be told why the increase has occurred, and what other increases may occur, unless they know that and make a decision, they're going to feel as if they're not properly treated. So I'm suggesting to you, I think you ought to do what -- in whatever fashion you do, communicate with the Mayor. Let him know that if his statements don't comport with what the facts are now, that I think at least -- and I think many people agree with me -- that all the facts ought to come out and let the people know there's going to be a very substantial increase, maybe double, maybe even more than double the original cost. And let the people decide whether we should go on, particularly in view of this terrible emergency the Mayor presented to us last Thursday when he gave us the budget. I did not see anything in there that would account for how we're going to deal with the double costs of the anti-blight 130 Resolution 040095 - 3/22/04 program. Now, maybe it's hidden somewhere, and maybe somebody like you are going to be able to point out that in some line somewhere something was said about that. I don't know what whether it exists or not. I haven't seen it. But that's not enough. The Mayor's got to level with the people and I think that ought to be the number one priority right now. You ought to tell us what it's going cost. You ought to tell us about why the mistakes were made on the costs, and what he proposes to do to control the market, because nobody understands how the City lost control and why the City's paying these huge amounts for demolition. And I ought to end my questioning on the funds that way. Because now I want to raise the question of who is responsibility -- who has the responsibility for minority contracting and subcontracting in the NTI program.
It's overseen by Mr. 131 Resolution 040095 - 3/22/04 McCalla and myself. We have the NTI Economic Opportunity Plan which set forth subcontracting goals for minority participation under the NTI demolition program. And the goals were 35 percent, I believe, and 2. 9
As to minority 10 contractors, was it plainly stated of 11 becoming, some of them at least, prime 12 contractors, that that ought to occur in the natural course of events? But we haven't seen that. And secondly, I don't get any sense whatever of the slightest interest of the City of Philadelphia in furthering the employment of minority subcontractors. In fact, Mr. McCalla, who is actually sitting up here at the table with you, who is described as the Deputy Managing Director of the City, I raised some issues about a problem a minority subcontractor was having. He said the City owes no obligation 132 Resolution 040095 - 3/22/04 to minority subcontractors. They have to learn on their own to protect their own interests.
And I'm not criticizing him, but that's his view. But I think the City has a very clear obligation that we make it as crystal clear, because I did not succeed in influencing Mr. McCalla one iota by my statement. But I think others have to know that it's my belief that there is no program that exists in the City of Philadelphia today that is truly aimed at advancing minority employment. I find none because by definition most of the minority firms are brand new firms. People have had no experience. Their workers, when they've been able to get work, often haven't been able to get much work. 133 Resolution 040095 - 3/22/04 And they come in, and they meet other companies who deal with prime contractors who have had many years experience, who have great wealth. Seems to me the government owes an obligation to take these minority subcontractors, to protect them in every way in dealings, to make sure they know everything they know about becoming a minority subcontractor, help them every step of the way, to guarantee that the bidding is soundly based, instead of saying: Well, they bid; it's their responsibility. Now, I think a minority program that's going to be successful has to deal with reality. And the reality is that minorities, because of discrimination practiced against them all these years, are not as well equipped as the big old-line prime contractors, to deal with prime contractors. So that if we're serious about wanting to encourage minority 134 Resolution 040095 - 3/22/04 subcontracting and ultimately hope to advance of being prime contractors and employ African Americans, Latinos, and women in their jobs, and other minorities, to achieve that, the City has has to take an active hand -- not being a neutral -- between the prime contractor and the subcontractor, but actively holding the hands, guiding them, and insisting that the minority subcontractors know enough and get the protection of the City in their dealings. And I find, and I think Mr. McCalla will agree on the last part of what I said. But if he doesn't, I'd like to hear it. But to my knowledge, in trying to deal with a minority subcontractor who comes from my area who complained to me. It was his first experience. He's a plain working man, never had any experience. And suddenly he's told, well, you underbid a job, for example, by a large sum of money. It's your responsibility, and you owe large sums of money. 135 Resolution 040095 - 3/22/04 And the City takes the position, well, it's tough. He should have known better. And that's -- That's the way to discourage minority employment.
This is a substantive issue I wanted to raise with you.
At the request of the stenographer, we're going to take a five-minute break, please.
Right. That will 136 Resolution 040095 - 3/22/04 give them an opportunity to answer the questions. The questions will remain on the floor.
And Miss Smith will be prepared then to answer your questions.
All right, Councilman Cohen. Councilman Cohen, we're back in session. Miss Smith, I have to interrupt you, but would you respond. I'm sorry. The noise level is much too high. I'm sorry. Anyone who is not a Council member will have to get off the floor.
You asked me a series of questions about minority participation under NTI. As I stated, the plan calls for 35 percent participation of subcontracting opportunities, and I believe 80 percent residency --
Let me ask you to 137 Resolution 040095 - 3/22/04 stop right at that point. It may call for a 35 percent. But do you just look at the numbers and say, they're 35 percent but we don't care what happens to them?
We're not going to help them? They're on their own? And Jay McCalla told me plainly.
I think there may have been some misunderstanding, Councilman Cohen. No, they're not on their own. I mean, we --
Because I know the numbers game. It's very easy to play numbers and say that so many people are employed, but you don't deal with the substance of that employment. When we talk about minority employment, we mean business on that. We mean that they ought to have full rights. The City should not have the right to treat them as if they're dispensable because that's not what this Council means on minority employment. 138 Resolution 040095 - 3/22/04 We owe a duty to minorities to help them overcome their years of discrimination. They're not playing on a level field when they go into minority --
-- subcontracting for the first time. They're no match for the big companies that have been around for years.
Because I know the numbers game well. It means absolutely nothing. Give me the substance. What happens? I'm a minority contractor. I'm a minority worker, and I have ambitions, like most Americans do, to go into business for myself. How do I get 139 Resolution 040095 - 3/22/04 into minority subcontracting? And how does the City help me do that?
And will the City be by my side all the way through? I want to do an honest job, but I don't really know much about it. And I'll tend to believe everybody who talks to me. I think they're honest, until I find later that they have me on the chopping block.
We've had a number of contractors who were successful bidders on demolition projects who ran into problems on the job. When we do get problems on the job, we try to do as much as we, the City, can do. For example, you know, meeting with the person, identifying resources for working capital. You know, I myself made a couple of personal referrals to loan funds that I knew that was available. The African American Chamber of Commerce has worked with and the City is funding a technical 140 Resolution 040095 - 3/22/04 assistance center --
Who does the minority subcontractor go to for this kind of help? They leave the City as soon as they find a new name which means a new minority subcontractor. What does the City accept as its obligation to that group?
One of the -- One -- One place that we're funding is the African American Technical Assistance Center. We -- We -- We executed a second-year contract. They're one resource that contractors have gone to. And I know a number of people may access that for working capital. There are a number of banks that pooled money for working capital loans. We -- You know, as I said, we're working on issues trying to change the performance bonds which we understand can be a barrier to participation. Now, there have been some incidents where people who have contracts have not been able to do the work or ran into 141 Resolution 040095 - 3/22/04 problems while doing the work. And again, we -- you know, to the extent that we can, we work with them, trying to work through that issue. We can't guarantee -- We can't -- You know, if the work is unacceptable, we do have some responsibilities as a City to say --
-- that it's begun to -- The City's present policies make it very difficult for minority subcontractors to meet all our obligations, because nobody helps them.
And Councilman, we all recognize that. We all recognize that we have a very onerous procurement process, that it doesn't make sense for smaller businesses. And as -- You know, we've been tackling these issues. We've been making adjustments where we can come within the 142 Resolution 040095 - 3/22/04 context of a publicly bidded procurement process. As I said, we, you know, worked with the African-American Chamber of Commerce on the Technical --
The one Technical Assistance Support Center has been the African-American Chamber of Commerce. They can also identify, you know, resources for working capital.
But the City funds them. I mean, sometimes -- sometimes I find it better when we give the contract to somebody else to work with them than us, trying to work through those problems.
Then who in the City has the responsibility for promoting the welfare of these minority subcontracting teams, not only in protecting people that don't believe in 143 Resolution 040095 - 3/22/04 doing their job? I mean, protecting the people who are being prevented from doing their job by the City's aloofness, not wanting to help, pointing the finger at them saying they have no business getting into this without you're learning more about it.
Well, again, what I've been doing in NTI, I've been primarily the point person on the relationship with the African-American Chamber of Commerce. If there's somebody specifically that we can talk with --
Well, I think I'm part of the City. I think we are accepting responsibility.
But not by sending them out to someplace else. I want somebody in the City who says, I represent the City of Philadelphia, and I'm determined to see that this minority firm gets fair treatment, gets the help it 144 Resolution 040095 - 3/22/04 needs. If I have to call people, I'll call other people for their help; but I in the City take the responsibility for making sure the minority firm feels it's getting a fair, square deal.
I'll work with them within... But again, if it's an active contract and they're not... I mean, one of the tensions we do have is that we, the City, need to get the job done. And then you need somebody to work very closely with that person. If they come to me, I can see what resources in the City we can refer them to. If we don't have resources in the City, which sometimes we don't have the right resources, then I think it's best that they go to a group that the City funds, like the African American Chamber of Commerce, who's 145 Resolution 040095 - 3/22/04 set up a Technical Assistance Center, and with whom we're funding specifically the work not only with contractors in their programs, but they also provide a lot of support to contractors outside of their program.
See, I think the problem on funds that I raised originally is because the City has not accepted responsibility because you turned over the job to somebody outside the City to do the demolition work. And I think there's lots of reasons to be concerned about that arrangement. The reason we wanted L & I is because they're City people, and we can talk to them. But you can't talk to these outsiders. And it seems to me the City shunts its responsible by hiring somebody else to do the job for them. These people you hire are not government people. They don't know anything about the responsibility that a government ought to have for execution of 146 Resolution 040095 - 3/22/04 its policies. I'm asking who in the City, a permanent employee of the City, who has the job of seeing to it that minorities get fair play. In the City Council we have somebody. We have somebody on the payroll of City Council who has the responsibility for minority employment and for furthering it. And the city ought to also have somebody like that --
-- not somebody who looks at a distance and says, they're on their own. They choose to bid; they're on their own --
I mean, there is -- COUNCIMLAN COHEN: -- we have no 22 responsibility to them.
I mean, there is the -- at the MBEC, Minority Business Enterprise Council, that's also available. And that's 147 Resolution 040095 - 3/22/04 being overhauled, I believe, to expand some of the resources, that they can work more on providing technical assistance support.
But in the interim, with respect to any issue on the NTI project, you know, I can explore what, you know, what we can do. But sometimes -- There are some times when there are times when there's not much that we might be able to do. That may not be the case in this instance.
Well, it may. It may or may not be the case. I don't know. I don't want to judge it. But all I'm saying is, if the City has an interest and if the City says it has an interest, it passed a bill. The Mayor issued an executive order to guarantee fair treatment among minority subcontractors to reach the goal that Councilman Clarke stated he's for, I'm for, I think all of us are for. What we want to be a part of the 148 Resolution 040095 - 3/22/04 City government that has an interest in fair play for everybody and giving everybody an equal opportunity, not by looking down at a group of people and saying, you're on your own. But let's hold that issue now. And I can talk to you afterwards. And we come back if necessary to that. But the last issue is, in other areas we have dealt with the question of a possible moratorium on the taking of property where people are living in the property and -- (Applause.)
We understand that NTI is interested in eliminating blight, and we support it. But we understand that that's playing the interests of people living in a home that is satisfactory to them, that appears to be okay in every point of view, 149 Resolution 040095 - 3/22/04 just is disregarded by NTI. Tell me how we deal with that. There's a witness here from the group that's sitting in the audience, has been here, and other takings by the Redevelopment Authority. We've called upon them to change their method of operation, and not to deal with citizens of Philadelphia as if they're enemies, because that's what what happens when people live in an area a while, and suddenly they get a notice they're going to be thrown out, and they know nothing about it. And they don't understand how their government can turn so on then. NTI is supposed to be a program that's in everybody's interests. What are you doing to avoid that? Does a group that is concerned about the taking of certain houses have a place to go and say, do you, Miss Smith... This is a perfectly fine house. It should not be included in the taking. What would be the response that you would give then? 150 Resolution 040095 - 3/22/04
As you know, we cannot approve the acquisition through condemnation of any property without the approval of the City Council. And that's -- that's the ultimate, you know, arbiter of that issue. There have been numerous meetings with representatives regarding the relocation -- potential relocations. I know there's ongoing conversations. I have not been privy to the most recent group of conversations, but I can have Mr. Hanna get back to you with respect to details. But ultimately, you know, the Redevelopment Authority cannot acquire any property without the approval of the City Council of Philadelphia.
But that doesn't get the Redevelopment Authority off the hook, because they have first the power to recommend. And they ought not to recommend the taking of any houses, because if they recommend the taking of a house that people 151 Resolution 040095 - 3/22/04 are satisfied to live in, that maintains the proper L & I Code compliance features and the families live there, those people deserve the ability to go to sleep at night not worried that this government is going to act like some uncaring developer who might for profit reasons want to take the house for development. The City ought to be the friend of the people. (Applause.)
The City ought not to be taking property away from people... (Applause.).
...who want to stay there and who are playing by the rules. Now, I'm asking, if something comes to the attention of these people that there's a problem, who do they go to? Can I send them to you?
No. You send -- The acquisition work is being led by Mr. Kevin Hanna, with the Office of Housing and 152 Resolution 040095 - 3/22/04 Neighborhood Preservation, working with the Redevelopment Authority. So in that instance... And I know there's been meetings. I was into earlier meetings. But I know there have been ongoing meetings and letters back and forth.
It's not that -- Again, I mean, I'm one person, a small shop. You've been funding the acquisitions. But the leadership, in terms of actually managing that work, is in Mr. Hanna's shop. He's the person in the City that would deal with that issue.
In other words, NTI is not an agency that's really devoted to the welfare of all the people.
But with respect to what may be a difficult job or dirty work, some people call it, of really acquiring the property, NTI shuts its eyes 153 Resolution 040095 - 3/22/04 and has nothing to do with that and says, let the other agencies handle it.
I'm familiar with the issue, but when it comes to the detail -- You were asking me who in City government, just like before, that, you know, people would sit down with, the day-to-day operational work is handled by the Redevelopment Authority and the Secretary, Housing Neighborhood Preservation oversees the RDA, and the other --
-- housing and community development. I have been in meetings myself. I haven't been to all the meetings. But I'm part of the, you know, the Mayor's staff. And I work primarily on the budget, and the planning, and of the initiative. 154 Resolution 040095 - 3/22/04 But when it comes to the nitty-gritty of that redevelopment work, that's where that is. And I just have not been in recent months privy to conversations. I received a copy of the letter that was sent. You know, in response to letters, I sat in some earlier meetings with individuals from the coalition, and am happy to sit in some more meetings.
Would you object to an Amendment to your bill to add a small clause to it saying --
-- owner or tenant be required to move if such tenant or owner wishes to remain?
The Urban Redevelopment Law specifies -- and that's state law -- you know, the Council approval or disapproval as part of that redevelopment 155 Resolution 040095 - 3/22/04 proposal. I don't think this would be an appropriate vehicle for that type of an amendment. Again, every acquisition has to go through City Council and be approved by the City Council of Philadelphia.
Well, then, I've misunderstood. I thought NTI had as its main interest the elevation of the quality of life for Philadelphians. And I thought we were bringing in a new goal. And a new goal requires people to be reevaluating things and not using the same forces that have brought a lot of unhappiness to the people. Our experience with the Redevelopment Authority has been a very unhappy one because only recently have they begun to show the slightest bit of sensitivity. And that's only after enormous pressure from communities. And that ought not to be. If you're bringing in a new program, you ought to bring in a new group of people 156 Resolution 040095 - 3/22/04 that are going to consider the thing from the point of view of the new program, not do it the same way it's always been done in the past. And you're telling me basically that the NTI is the same old program, just a new way of giving Redevelopment Authority the power to take property. And if that's the case, it's not worth very much. It's certainly not worth $600 million or $500 million or probably not even worth the $275 million you say it's now going to take or was going to take originally. Well, I thank you. We'll follow that up later.
Thank you very much, Councilman. The next Councilperson to be recognized on the first go-around will be Marian Tasco.
Excuse me. 157 Resolution 040095 - 3/22/04 I would just like to remind the Council members that we do have a number of community people here to testify. So, I would ask that we try to be a little brief with our questioning. Thank you.
I'm sorry. I had to leave the Council to go to a meeting that was previously scheduled. And you may have answered some of the questions, so I apologize if you have been asked these questions before. In looking at the budget for Council District Nine, there are listed 996 vacant buildings, safe and dangerous -- unsafe and dangerous. And then there are a total of 207 buildings that are identified as dangerous. But the estimated number of demolition for 2004 is between 75 and a hundred. And then in the new budget it went from a hundred to 150. But even so, if we had 207 dangerous buildings, and you do the maximum 150, what happens to the 57?
Again, what we've been 158 Resolution 040095 - 3/22/04 doing on each year is looking at what we can -- what we're covering in that -- that year. And we've never indicated that we would be able to fund the complete demolition of every single dangerous building. This was based on our survey in 2001. When we go out on the targeted program, we update that. Sometimes we find more dangerous buildings than we initially had, and we reflect -- we try to revise the budget at that time, to reflect what is in actuality. So for here, this was for me a benchmark to show kind of the level of vacancy by Council District. That's how we used those numbers, in thinking about, then, how do we allocate resources among Council Districts?
So, when we... When we finish with the number of 7,000 buildings, dangerous buildings that you have targeted here, that's the total 159 Resolution 040095 - 3/22/04 number. How many do you think you plan to do? I think Councilman Goode asked that, in terms of demolition, with this amount of money. And then at the end of the day, when the $53 million is gone, what do we do for demolition money?
At that point, you know, we would probably have to begin either looking -- I mean, I guess there are a couple of options. One is just go back to emergency, you know, curbside -- the way we were doing it before, City wide, and funding out. You know, you look to the general funding. You look at, you know, additional other resources from, you flow, do we want to do another bond issue, if that's the intent there. But right now, you know, we've budgeted, and have in fact zeroed out for bond proceeds '07. And we've been budgeting -- assuming that we're just 160 Resolution 040095 - 3/22/04 doing -- We're not sure how much -- Depending on how many demolitions we line up for next year, maybe looking at $32 million or even more, if we can continue at the same pace. I mean, the other thing that happened was that we also reduced the amount of the overall demolition budget from initially we were allocating about 140 million. And this was back in '03 when we first unveiled the program. And it dropped it to 117, because we put some resources into the Basic System Repair Program. We put more resources into acquisitions, so that impacted the total amount that we had available for demolition. I'm going to be sending out the Budget Director to talk about the outlying years, in terms of demolition activity and resources.
So in the initial budget we passed, we had an 161 Resolution 040095 - 3/22/04 estimated 1200 to 1400 demolitions. And now --
And that also assumed 140 million at that time. Because remember we had --
But I mean for the whole five years we were looking at 140. Then that got scaled back to 117. Because some monies were put into acquisitions, and other monies were put into things like Basic System Repair Programs.
But I'm looking at your... I'm looking at your... On 13.
Right. Initially we were looking at 19 million in this year, but I was referring to the five-year budget. I'm sorry. I'm probably not understanding the question.
Well, no. I'm 162 Resolution 040095 - 3/22/04 just looking at the request -- the amendment that's before us now. We were going to do 1200 to 1400 for million 600. And the new budget you've 6 given me is 750,000 for 20,000 -- $20 7 million. 8
In your testimony 10 you have attached a table where you have 11 the bids going out for 750 houses. Your 12 testimony? 13
I'm talking 16 about totally, the total number of houses 17 in all the areas that you've targeted -- 18
For the -- That's just 19 the 25 million. That's what I was looking at. So the 25 million... This breaks out how we will spend the 25 million that we're asking for, the additional money. So I'm going to replace this which I -- My mistake was not putting this in amendment form -- to substitute for what we submitted to 163 Resolution 040095 - 3/22/04 Council, which was ranges, because we did not have all the numbers in detail at the time we transmitted the Resolution. It was just a projection. So we're looking at 125 properties to be funded out of the Logan package which I believe we have approval on now, at somewhere in the area of 3.9 million, based on what's been approved to date.
And I really apologize for that. I should have put this also into a revised amendment.
So the money -- some of the money we have here, you're -- it -- The money we originally voted on in 2004, I had $1.4 million designated for 75 to a hundred houses.
Now we got you at 125 at 3.9 million because now we have the actual Logan bid package live active. We have 164 Resolution 040095 - 3/22/04 hard numbers. We know how many properties are in that bid package. So that's the budget number.
I want to ask a question about the Emerging Contractors Program. Could you tell me what that means, how you define emerging contractors and what do you -- what is the proposal to provide them support?
Okay. One of the questions that came up, as Councilman Clarke, I think, had pointed out was, in addition to subcontracting opportunities. I mean, historically the City's looked at minority participation, in terms offer subcontracting opportunities. So when we wrote the NTI economic plan, it really talked about subcontracting opportunities. The African American Chamber also wanted and made a proposal to the City about how do we begin to groom people to bid as the prime contractor and not just as a subcontractor? 165 Resolution 040095 - 3/22/04 So, we basically, you know, accepted their proposal to create what we call the Emerging Contractors Program. The objective of that program is to groom contractors to be able to bid as prime demolition contractors. The first, I would say, cadre of businesses that went through last -- I think it was around July of last year -- They go through about a six- to eight-week training program that's classroom based. It covers everything from the actual, you know, technical information on demolishing a property; but as important, it focuses a lot of its technical assistance on and training on things like managing a business; you know, procuring bonds; you know, credit -- credit checks to make sure that, you know, you got the right -- you know, your credit history is into place. So they really were very hands-on. Once the group of -- That 20 businesses graduated out of the classroom 166 Resolution 040095 - 3/22/04 program. So then the next piece that we put into place -- because I don't think it's fair to expect someone to go from the classroom to demolishing a house -- is that we begin to give them properties for the people who graduated from the program to demolish in the field. And we've been putting out, you know, groups of properties to them, allocating that, as part of their training program. They demolish -- The chamber provides extra support in the field, safety managers, so forth, and so on. Now we're at a point where that, okay, in addition to demolishing houses as part of the training program, how do we make it so that they can bid as part of the City's procurement process? And one of the challenges is, we need smaller bid packages. So now we're starting to do smaller bid packages that are more suitable to their business size. And then the second thing we're 167 Resolution 040095 - 3/22/04 looking at are other impediments in our procurement process. And one of the big ones has been the surety bond issue, what they call the performance bond.
That will always be a problem. And until you solve it, you will always be in a training program.
The people who are in training, are they being funded out of the money you have identified in here?
Just the houses. They're almost acting -- For example, the money -- There's a, I think, a -- Commerce Department contracted funds, the technical assistance. When they bid, they submit a proposal to demolish the houses. And we pay them for the demolition of the houses out of here, but we don't pay for the technical assistance.
But do they get the same rate that the -- 168 Resolution 040095 - 3/22/04
It's been competitive -- A little bit lower in some instances.
But they're cost estimating, you know, based on the experience in the field.
What is the level of communications between the NTI administration and the City Council, specifically the President's Office, with regard to MBE and DBE contract participation?
We've included this information in, I believe, our quarterly reports on that. And I actually just got an updated report for March that I'll be able to send over.
Yes. I'm quite sure we 169 Resolution 040095 - 3/22/04 do quarterly reports. I believe we include that information in that.
These reports are supposed to be on a monthly basis, Pat. The MBE, WBE is supposed to be on a monthly basis.
Well, yeah. I haven't been quite getting them myself on a monthly basis, but --
On the business side of 170 Resolution 040095 - 3/22/04 it, MBEC, you know, monitors it. On the employment side it's GPUAC.
So how do we know if these companies are in compliance, and who --
Well, I do have -- I mean, I can send out -- I mean, I actually -- Someone just handed me a summary of the current, up through March, that we just got. I just got something from Miss Simmons the other day. And I haven't even looked at it myself. But they are in compliance. And in the most places we're exceeding our 35 percent goal on subcontracting.
Do you have a company large enough to bid on the demolition contract without subcontracting?
There's one company that's been actively starting to bid but has not been a successful low bidder at this point on the larger bid packages.
So you plan to 171 Resolution 040095 - 3/22/04 break the packages up. Now, how much more is that going to cost? Will there be a cost to --
I think it will bring... Hopefully, by having more people bid on it, it will bring the number down. I think part of it is how many people are expected to bid on it. If you only get two or three --
We believe you can bring the number down because you control the process.
...we're 172 Resolution 040095 - 3/22/04 supposed to get that information on a monthly basis.
Thank you. The Chair recognizes Councilwoman Krajewski.
Thank you. Pat, regarding the vacant lots, what is being done to speed up the acquisition of the vacant lots? Because it seems like I've been waiting for two years for ten lots. And they come under Act 94.
Right. I've had a couple of conversations about... One of the things I think we need to do is, we took in so many vacant lots and houses last fiscal year, that what the OHMP folks staff are doing is sitting down with each Councilperson and prioritizing, so that on the disposition side --
Well, one of the things is to make sure that those ten lots have been made a priority.
What's the status of the side yard programs? For the better -- You know, it would help to know exactly where we should handle requests for vacant lots and side yards.
Well, for side yards there's -- If it's already in City ownership, it goes through VPRC, and that's --
No. I -- Mr. Coates -- Mr. Coates and the RDA still handles what -- If it's in City ownership already. If it's not in City ownership, our biggest challenge right now, unless there's resources in each Council budget, is to condemn it or to Sheriff sale it. So if you want a side yard and you 174 Resolution 040095 - 3/22/04 have money in the District Council budget, that request is supposed to go to OHMP, to Miss Califano.
As part of -- Yes. And we -- It's called the Interagency Acquisition Review Team. They put -- We ask each District Council to submit properties that they want to acquire and the purpose.
Well, I believe our office has been working on that basis --
Where we just don't seem to be getting anywhere on this.
One more question. Well, in fact, I have two. How 175 Resolution 040095 - 3/22/04 long after a place or house or business is demolished when they put the lien on?
If it's part of the big targeted program, where we're doing like a hundred, we close out everything, the information gets translated -- translated -- transmitted to L & I, and they're in the process of putting liens on, I'd say it could probably --
It's been a long time before they put the liens on the property itself.
I will look into the time frame. But I guess you're talking about the group that was done in Frankford in the early --
I have to look. I know there have been lots of meetings around liening of properties, but I don't know the status.
It just seems like it takes a long time for them to 176 Resolution 040095 - 3/22/04 put the lien. Then it seems like the owner is getting away with, well, a free ride.
Well, we plan -- We have to put the lien on it because the bond proceeds require putting the lien on it.
One more question. As you know, my District doesn't have too much blighted areas for blighted land acquisition. What I do need is assistance in acquiring land along the riverfront from private owners for development. Riverfront development is the biggest issue in my District. How will the NTI use funds to acquire land that may not be blighted but is needed for development?
Well, I know there's been conversations about looking at resources for the North Delaware Riverfront, infrastructure dollars, and some of the economic stimulus dollars that are out of the new economic development fund. 177 Resolution 040095 - 3/22/04 We didn't -- Other than what's in your Council budget, had not budgeted for acquisition for the riverfront in this. But people are looking at other resources, I think.
I intend to put amendments to this bill because it just doesn't seem like there's much there for the District. So I will be putting amendments in, Madam Chairwoman.
Thank you. The Chair recognizes Councilwoman Miller.
Thank you, Madam Chair. I really don't have a question. I just have a statement that I think sometimes might make these proceedings go maybe just a little bit smoother as relates to NTI. 178 Resolution 040095 - 3/22/04 If we could get a status report. You know, the NTI came about as a result of Mayor Street's idea. And a lot of us were actually out there wishing that there was some money in the City to help begin to address some of the cancer and the blighted properties that was developing in a lot of the Council Districts. In my District I have about five or six areas that need demolition. People out in the neighborhoods in my District -- and I can only speak for my District -- are very happy and very pleased to see some of these blighted buildings finally coming down, and there's a glimmer of hope around neighborhood stabilization. My main concern is on preserving what we have that hasn't been demolished but figure out a way that we can get, you know, aggressive or at least consistent code enforcement that will help people maintain their properties so five years from now we won't be looking at the same condition just on a different part of the 179 Resolution 040095 - 3/22/04 block or different blocks. But I would hope that when Miss Smith and the NTI team comes back, either for budget hearings or whatnot, that if they came back and gave us a report on, where appropriate, the NTI framework goals, the NTI's guiding principles, the NTI bonded fund activities, and a specific EOP report, that it might cut down on the need for a lot of questions, and unanswered. And there has been a lack of communications. Sometimes we just feel like we don't know where we are. That's why I call and schedule meetings so we can figure this thing out. And as far as MBEC, I personally attended some of the receptions where they've been out recruiting minority contractors. My staff has gone to some of those recruitment... I guess I'll call it a workshop. I know the first one they attended was at Ben Franklin High School. 180 Resolution 040095 - 3/22/04 And there was a NTI -- There was a reception maybe about four weeks ago downstairs in the Mayor's Reception Room, that I found out about at the last minute and went down. And I saw lots of minority contractors there. So I do know that there has been an effort to recruit minorities. We have personally made an effort in our office to try to keep the minority contractors that we're aware of informed. And also we've been out recruiting people, because they just had an emerging contractors workshop in a part of our District to reach out again to minority contractors. Because if the goal is to reduce -- And I guess -- I missed the number -- but I guess if the goal is to demolish at least 20 to 25 percent of the structurally dangerous properties in Philadelphia... And we got to -- You know, we have to keep moving forward, because, quite frankly, when I drive through certain parts of my 181 Resolution 040095 - 3/22/04 District now that had -- that was -- that was just filled with blighted, dangerous, abandoned buildings for 10, and 5 years, it feels good to see those down. 6 We're ready to move forward with the 7 next step. And that's for acquisition and 8 renovation. We have been stabilizing those 9 neighborhoods. 10 I just hope that there's enough 11 money left that we can actually do 12 something in the end of all this. And I'm 13 just worried that we're going to run out of 14 money. 15 So that's basically my statement. 16 But I do think we have to do strong quality 17 of life enforcement codes so that we won't 18 turn around in five years and have a whole 19 bunch of neighborhoods again filled with a 20 whole bunch of abandoned, blighted buildings. Thank you. But if you come back with those kind of specific answers maybe we can...
Thank you, Madam President. Prior to the advent of our NTI CDCs were principally responsible for doing much of what NTI is doing now. Could you please speak to the nature of the relationship that NTI has with CDCs across the City now, what the impact of the work you're doing has been on CDCs that have been in the business for a long time?
I'm going to ask Deborah to talk a little bit about that. Excuse me. Her shop really handles most of the interaction with the CDCs. MS. McCOLLOCH: Good afternoon again. We're continuing to work with the Community Development Corporations that we've been working with. And in most cases the development 183 Resolution 040095 - 3/22/04 proposals that they've submitted are being reviewed, and we're working through whatever the issues are with them. I don't... I guess I'm not clear in what way the perception is that NTI is taking over what the CDCs have been doing because we've been continuing to work with the CDCs.
Okay. Define what that means. Break that down for me. Continue to work with them. What does that mean? MS. McCOLLOCH: We hold -- Well, Through OHCD, we hold contracts with them, in some cases for programs such as the Targeted Basic Systems Repair Program. We put out a request for proposals. Folks responded to that. Ten groups were selected. We're working with those groups now to get that -- those programs implemented in those neighborhoods. In other cases, the contracts are actually administered through the Redevelopment Authority, where the funding 184 Resolution 040095 - 3/22/04 is put under contract of the Redevelopment Authority, and then the Redevelopment Authority holds in this case loan documents with the CDCs to provide subsidies for the developments that they're carrying out. We've done some planning work with CDCs. We've worked with them through the acquisition request that Pat referred to earlier that are being reviewed. And then they come back to this Council for approval.
So, what has been the spirit of the meetings along the way around the issues you just cited, in other words, what response would we get from the CDCs to the same question? MS. McCOLLOCH: I think the CDCs would condition occur that we've been working with them.
It was acknowledged that the number of demolitions, the goals were not achieved, for reasons that we've learned about. How many people do Act 94 at RDA? How many 185 Resolution 040095 - 3/22/04 staff persons are principally charged with that function? MS. McCOLLOCH: I'm sorry. I don't know exactly.
Okay. So given that -- MS. McCOLLOCH: I can get that information for you. I don't want to give you the wrong number. I don't know how many staff people are working on it.
That would be helpful, in terms of coming to grips with what had been some of the impediments to achieving the goals. MS. McCOLLOCH: The acquisition goals you're talking about.
I mean, just to give an example, we're using the same amount of staff, for the most part, who -- I think prior to NTI and the 74 million and the 5,000 acquisitions we approved, we -- I think in any given year, we made -- the maximum number may have been 300. 186 Resolution 040095 - 3/22/04 Prior to the NTI bond program all acquisition work was funded out of CDBG. It usually was done by RFP, if I remember correctly. And the level was significantly lower. We -- You know, it was almost a thousand percent increase. And from a staffing perspective, we're doing the same work. And I think one of the things that the RDA working this year with Cathy Califano and Mr. Hanna, is beginning to prioritize, do a little bit better job of saying what are the major development projects we need to move forward, what are the -- They've sat down with District Council people to identify their top priority projects, and then devote their energy to getting from the approval stage to the declaration of taking. And that would include some of the Act 94 condemnations. One of the other things that we found in practice is that, for example, 187 Resolution 040095 - 3/22/04 appraisal reports are taking -- You know, we a finite number of appraisers familiar with the Philadelphia real estate market. And, you know, we've got a backlog there. We have backlogs in title reports. So people have really been trying to really come up with a prioritized work plan with the District Council to say what are the top priorities. There's some things that, you know, will -- And then once put together -- we talked about putting together a major time line so that we can deliver on that. But part of it's been absorbing, you know, the 5,000 acquisitions that we approve because this is the first time that --
Are you talking about hearing that there were no staff in --
That's about the same 188 Resolution 040095 - 3/22/04 level, what whatever that number is, because I don't know if we added any. MS. McCOLLOCH: No. There were some -- There were some people that were within the Redevelopment Authority transferred from one division to another, to increase the number of folks working on the acquisition side. But one of the challenges, as Pat just mentioned, has been also the activities that are carried out not by RDA staff but through contracts, the appraisals, the title reports. This sort of bubble-up work has had an impact on that as well. But there aren't as many appraisers that are working on our work because there's so much more of it. And the same with the title reports. So it's taking -- So along the way there have been bottlenecks, some of which have been a result of the outside contracts, some of which have been a result of the internal staff having not -- 189 Resolution 040095 - 3/22/04
So -- So are we hearing, then, that you've bypassed the learning curve. The learning curve is over, in terms of matching staff with handling the needs or meeting the goals; and you're ready to put some changes in place so that when we sit down next year at this time we'll have a better assurance that goals have been met. Is that what I'm hearing?
Yes. Particularly around prioritizing the workload at this point.
Thank you for your testimony. Thank you, Madam President.
Thank you. How many community members are still here? If you would just raise your hand. (Indicating.)
Okay. 190 Resolution 040095 - 3/22/04 We'll complete our first go-around. And then I think it only fair that we hear from the community. They've been sitting here since 1 o'clock. As a matter of fact, Councilman Kelly, you would be next, and then Councilman Ramos. Would you mind if we heard from the community first? Gentlemen?
And then it would be Councilman Ramos on our first go-around.
-- if we heard the community first before you were recognized?
They're not going anywhere. They're not going anywhere. They're going to be here as long as we will.
Madam President, I just have a statement I would like to make; that's all.
Thank you, Madam President. I just want to commend, of course -- I want to commend Pat Smith and Miss McColloch and Mr. McCalla for their testimony today. I know it's a very, very difficult thing to come in here all day long and hear -- well, respond to a lot of questions. But I think that the NTI program is 192 Resolution 040095 - 3/22/04 very admirable. I think it's great. But I want to see -- I want to touch -- I want to touch on something that Councilman Goode referred to earlier. And that has to do with the private investment. The private investment. I think that just by tearing down buildings, even though a lot of them are hazardous, a lot of it's a safety issue, but I think we have to do more than just tear down buildings and demolish them. I think we have to look at what's going to replace them. I think the overall, I think, objective of NTI is to make this a better City. And what I want to do is to assure you that you're doing -- you're on the right track, is to get developers and builders, and a lot of private investment to come into these neighborhoods and start developing them because that's the only way you're going to fill them. And I think that's going to be an overall improvement of this City. 193 Resolution 040095 - 3/22/04 And I just again want to thank you. I know you've... Most of the questions that I had were already asked by other Council members. And you have answered them, I think, most of the time, I think, quite admirably. So, again, thank you. And thank you, Madam President, at this time.
Madam President, I have only a very short question that won't be as long as my esteemed colleague, Mr. Cohen. My question is in line with Jack Kelly, concerning an issue that Councilman Goode brought up a couple hours ago. Over a year ago Citizen Bank offered $105 million in loan and mortgage guarantees, as well as small business development money. And the issue was brought up by both my colleagues. That was the issue of 194 Resolution 040095 - 3/22/04 private sector investment and leverage. Because I think we all want to see NTI go beyond the years that we anticipate this work to go on. And only we have -- If only people will pick up on this model. I heard Citizen Bank, when they presented this award, you know, little over a year ago, say that the reason why they were making this award was because they had a model to go to. Are there any other Citizen Banks in this City that have -- And how have you been able to leverage a partnership as the one Citizen Bank presented to you a little while ago?
There's other examples of leverage. I mean, for example, Citizens Bank partnership, and they've actually exceeded their first year of goals. And we're going to be bringing that information back with us when we come back the '05 budget. They're putting it together. But for example, there's one program that was new this year. It deals with 195 Resolution 040095 - 3/22/04 predatory lending. I mean, one of the issues we heard was that there's only so much -- Not every individual can qualify for a traditional Phil-loan. And under this predatory lending program, we're putting up $500,000 and the banks are putting up close to 3 million to make loans to individuals who credit was not -- who's FICA scores would not have qualified them for our traditional Phil-loan program. To me that's an example of a leverage. And I was trying to recall some of those -- That's why I wanted to go back and get specific numbers. So that's -- I'm not -- You know, like, almost a three to one -- little more than a three to one leverage just off of that one loan program. And it's reaching and it's designed to reach people who we wouldn't have been otherwise able to serve. So that's a perfect example. And what we did in that instance was 196 Resolution 040095 - 3/22/04 to play more of a loan loss reserve. So that gave the banks the incentive to take a little bit more risk than what they normally would have. Even the Phil-loan program is a leveraged program. I think we put in about 2 million of CDBG. I forgot how much of bond proceeds. Maybe the same amount. But that generates the building for the City to do close to $20 million in loans under that program. And that's going very well. And I think we've done as many Phil-loans in the first six months, the last seven numbers I looked at, as we've done in the entire prior year. So those are some examples just where private dollars are being leveraged by the NTI bond proceeds. And then there's dollars that we use for, you know, the land assembly or a specific project. And I would have to go back. Like, we've gotten, I think, a 197 Resolution 040095 - 3/22/04 number of tax credit approvals this year on low income housing tax credits approval, but I don't know the exact number. I think it was about at least eight or nine projects that were approved. MS. McCOLLOCH: For example, we just were awarded -- the City was just awarded $1.75 million from the State -- the Philadelphia -- I mean, the Pennsylvania Housing Finance Agency, PHFA, for a specific development in the Norris Square neighborhood. And there again, that's a specific example of where our funding is leveraging the state money, and there will also be some private money in that particular --
I'd like to continue again later on to get further into that, because the public needs to know about these partnerships in the private sector and with other entities of government. But we need to let the people know about them, and -- because there is a tremendous amount of work that NTI has done 198 Resolution 040095 - 3/22/04 that the public does not know about. It's obvious today. And I'm very open to your amendment. But it's obvious that we have a lot of questions. And some of those questions have now been answered here. But we know that the future of Philadelphia in the last few years has been staked out by this Administration on the success of NTI. And I think we're all in agreement that this program should be continued to succeed, and that other parties and other partners join us in this endeavor. Thank you, Madam Chair.
You're welcome. And thank you. As I said, before we do our second go-around, we will ask the community to testify. So if you would just move to the side and please remain. Thank you. MR. McPHERSON: First witness is Louis Agre and Ralph Wydner. (No response.) 199 Resolution 040095 - 3/22/04
Are they here? Continue to call. MR. McPHERSON: The next witness is Ronald Johnson.
I'm sorry. Thank you. Both Mr. Wydner and Low Agre -- Mr. Wydner is the 38th Ward ward leader and Mr. Agre 21st Ward ward leader, were both here earlier. They expressed their regrets at not being able to stay. I do know, because of conversations with them, their primary focus was on the proposed amendment in front of us which, at least according to the document, would have resulted in a $1.1 million reduction in the Fourth District. And they were both here to testify in opposition to that, and to support our requests for restoration, as 200 Resolution 040095 - 3/22/04 well as additional funds. I don't know if either will be able to return, but that they were here earlier and wished to express that.
Thank you. MR. McPHERSON: Ronald Johnson, Judith Robinson, Miller Parker.
Judith Robinson is approaching the table. MR. McPHERSON: The next person is Miller Parker.
He just left a few minutes ago. There are... Mr. Parker and Miss Ogilvie are the Presidents of the -- Miss Ogilvie is the President of the Park Side Business Association. Madam President, at the appropriate time there are letters and petitions that I wish to have entered into the record as if they were read into the record, from a variety of constituents in the Fourth District. And I'll give them to the Sergeant-at-arms at your direction.
Thank you. 201 Resolution 040095 - 3/22/04 And we'll make certain that they are made part of the record. Good afternoon. Thank you so much for your patience. Please identify yourself for the record.
Yes. Good afternoon, all. My name is Judith Robinson. I am here to testify regarding Bill 10 number 040095, Neighborhood Transformation Initiative, NTI. I would be remiss if I didn't note that this hearing is being convened by a Joint Committee. Hopefully that will be of value to your constituents. Maybe two committees -- two committees will be able to examine and then correct some of the many flaws of this process. Last June 3rd, at a City Council hearing, Kevin Hanna, the Secretary of Housing and Neighborhood Preservation stated that the process, especially of taking occupied properties and of relocation, was severely flawed. That was an understatement. 202 Resolution 040095 - 3/22/04 Be clear. When you vote for the NTI process, you need to know that your vote will result in... a process... will result in a process on occupied properties where people are not being fairly compensated. The process, first of all, of demolition takes away the property, so therefore no appraisal can be fairly completed. So I'm requesting that there be some process to better determine how fair market value is being calculated. I am a licensed real estate broker, so that's an area of expertise. The value of a lot, I'm finding, as it's being appraised is certainly being appraised at less than a house. But something strange I'm seeing -- and I've been attending RDA's board meetings. Although they are willing to accept an appraisal for an occupied property that someone has owned for 30 years, they're willing to accept an appraised value of $3500. That's $3,500. I've seen where they've turned 203 Resolution 040095 - 3/22/04 around and selling the property -- a piece of vacant land to someone that's acquiring it, and they're charging them $2500. Its just doesn't add up. I brought a copy of RDA's December the 9th board meeting hearing. I want to put this in the record. For anybody that thinks that I'm just making up numbers, it's here in black and white. And I want to leave it here for public record for everybody in the public to review it, because it's very, very much out of order. RDA is our agency that's used -- that's being used to implement this process. The process is not transparent, and people are not being fairly represented. First you have an RDA appraiser. There is a list of appraisers that are selected by RDA. There should be an independent appraisal by every person that's receiving a letter for acquisition or demolition or condemnation of their property. 204 Resolution 040095 - 3/22/04
There is a major, major disconnect. When one receives a notice from government that they want to acquire your property, the average person hasn't been in the real estate market or at any -- or has any reason to have any contact with anybody related to the real estate industry, unless they're going to sell their home or refinance. So, you're asking a person that has had no contact with anybody related in any way to real estate, you're asking them to make a decision about whether this is a fair market value for their home. You're asking them to make decisions about where they will even be able to use these small resource to buy a new home. There is no one at the table advocating for the homeowner, and that is very much out of order. Because what is happening is, people 205 Resolution 040095 - 3/22/04 are being sort of steamrolled over. And it's going to result in lawsuits in the future. I can guarantee you that. RDA is asking to... is being asked to take on a process which they're ill equipped to handle. And this is after me meeting with several members of their boards, their attorneys. If you will look in that document, you will see that you have an attorney at RDA negotiating back and forth with some private homeowner who hasn't been in the market a year. It's going back and forth about whether they can get additional money on their property. I even took time out of my busy schedule to show them in -- for the North Philadelphia area -- I couldn't do it for all areas, so I figured just use North Philadelphia as a demonstration area -- to show them how out of order they were. I used my time and resources to show them that there was a market value for the properties in question that was well over 206 Resolution 040095 - 3/22/04 the amount that they are down at RDA negotiating back and forth. For instance, one person came in requesting or thousand for their 6 property. The lawyer at RDA went back and 7 fought with them and negotiated 6,000 for a 8 property. 9 I found out that the property is 10 worth well over 35,000. There's a 11 market -- has been -- for several years. 12 There needs to be very close examination of 13 that process ASAP. 14 It's... I'm going to leave that 15 alone, because I'm going to work on that. 16 And I'm going to write some letters to some 17 of you all asking and making some 18 suggestions, and requesting an opportunity 19 to be an advocate. 20 But regarding the minority participation piece, it is truly unfortunate that with all of this money being spent -- I mean, we have, you know, bankrolled the future, really, in that our children will be -- grandchildren will be 207 Resolution 040095 - 3/22/04 paying for this $295 million back in the future. But it's unfortunate that we haven't planned more. If -- You know, I'll just digress for a second and say this. We're just finding out that the Planning Commissioner, Mr. Gary Hack (phonetic), a world-renowned planner, has resigned back in November because of some of these issues. I'm sure he has kind of heard the rumblings of people coming down to the Planning Commission saying, we have not as a community participated in this process. That's the flaw right there. It's not enough planners, like we ran ahead in the process like we were hell bent on knocking down properties, and have not taken the time to plan how it's going to affect the outcome of people, first, the overall neighborhood, and all of these other issues. With the minority participation, to get back on that issue, I know you all 208 Resolution 040095 - 3/22/04 remember the $13 million that was supposed to be for wrap-up insurance. That was supposed to be to help the minority. I remember you all kept asking, what is this million for? It was to help the 7 so-called minority contractor that didn't 8 have the resources. 9 We got Temple University Business 10 Institute. We got University of Penn. We 11 got MBEC.
We got all of these agencies 12 that are already being funded in the name 13 of minority participation. We didn't need another one, for real. What we needed was more business to be connected to the contractors that are skilled and can get the job done right now, because there are many there. This process is not inclusive in that regard. And to throw money somewhere where people that don't have skills to get the job done, it's not going to help us. We're going to still be in the same condition trying to figure it out. I'll leave that alone because I know 209 Resolution 040095 - 3/22/04 we're going to go there again, in the interest of time. But I just want to briefly talk about PHA because I heard the question asked, has any of these housing agencies been consolidated? Have they been streamlined, like this whole process was supposed to do? I would say absolutely not. PHA is a major problem in that whole process because a lot of the properties that are being demolished that are marring our community are PHA. I live in Susquehanna Section which has the second highest concentration of PHA properties. And a substantial number of them are being demolished, after 30 years, with millions of dollars being -- supposedly being spent in maintaining these properties. It's just so just disrespectful to all the people, all the families that need housing that we are now after 30 years and after many years of using up dollars in the 210 Resolution 040095 - 3/22/04 name of maintaining these properties, we are now tearing them down, except... except when you decide you want to pull some of these PHA properties into a development, ala Temple student housing. In the and 1600 block of North 8 15th Street, I found out in a zoning 9 hearing when I asked, why are you using PHA 10 owned properties in this student housing 11 only development, they said to me, Joyce 12 Wilkerson, the Mayor's Chief of Staff, was 13 going to write to HUD about pulling those 14 properties into this process. 15 Well, in that case, I wondered, why is it that the $48 million in vouchers and whatnot went back to HUD that could have been used for women and children and families in the name of PHA? Okay. And why is it that properties are being demolished that are PHA owned? Why couldn't those vacant properties in my neighborhood be given to some developer that would not be restrictive, but in fact would open up other opportunities for 211 Resolution 040095 - 3/22/04 people to get housing as quick as possible? You have a long waiting list. So I want you all to look into how Temple student housing can take on PHA houses, but poor families that's been on a waiting list have been still waiting. Also, the committee... New name is Homeless. It has the Homelessness -- What is it? Neighborhood... Neighborhood... Yeah, Neighborhood Development and Homeless. But in all of the NTAs... NTI hearings, I should say, I have not heard how homelessness was going to be reduced. So I'm just wondering, how is this new title on the name of a committee going to help in that regard? I'm really much concerned about the land banking, because, yes, we all did hear that this whole NTI and all this money was to go for future development. So I'm concerned about there's not being land banked for developments. And I'm concerned that we have a lot of 212 Resolution 040095 - 3/22/04 properties being demolished in little blocks where no developer will ever want to be. So I think we need to be real careful about this increase in money for demolition, because I contend that it's not needed in this regard. Whenever I check the records of Licenses & Inspection to see what blight and damage is to a particular house that's to be demolished, I can never get the list to match up to say, this house is so unsafe that it has to be torn down. And I'm going by the records at Licenses & Inspection where the violations come from.
So I really am concerned that a lot of money is being pushed up for demolition, and properties are in fact being demolished. But do they have to be? That is the question. And with that, I thank you very much for the time. )
Thank you. 213 Resolution 040095 - 3/22/04 Thank you very much. Our next witness. MR. McPHERSON: Ralph Wydner.
Good afternoon. Council President, other members of Council, to the Administration who are still left, community people, and all those in attendance. I was here a little earlier, and I waited as long as I could. And I had to leave. And I do appreciate this opportunity to come back and speak. I have for you all the papers here for you. I have a very brief statement. These papers are for something else.
And my statement essentially is brief because I know that the hour is late. And so therefore I will try not to hold people up. I'm here to express my opposition to cutbacks of NTI funding throughout the 214 Resolution 040095 - 3/22/04 Fourth Councilmanic District, to that District in general, but also in particular to the neighbors and constituents who I represent as the 38th ward leader. In four community meetings that I've attended recently, neighbors in North Philadelphia and East Falls have expressed anger and outrage over the fact that our District lost $1.1 million that was removed from our NTI funding. I believe that the City Administration... Oh, for I -- I'm sorry. I for one cannot believe that the City Administration would condone such a blatant revision in this City-wide program. To increase funding for NTI in eight out of ten Districts, with one remaining the same and with the Fourth Councilmanic District being the only one that was significantly cut -- significantly cut by 43 percent, we feel this is a disrespect to every man, woman and child in that District and in those communities. I know and respect most of the 215 Resolution 040095 - 3/22/04 Councilpeople in this room, and I respect not only this committee, but the Council as a whole. I've worked and supported many of you and appreciated your service and support for those who you represent. And I know none of you would take this type of a slight in your District sitting down. I support the request of my Councilman, Michael Nutter, and echo his earlier statements that we want the money back. To the full Council, we would like to ask that the full Council recommend the restoring not only of the $1.1 million, but the additional -- but putting in an additional $850,000 in order to bring our District in harmony with other Districts across the City. Knowing most of you, I trust that that will be done. I think that you will, as you have for the most part in the past, do what is right. Blight and unsafe conditions do not 216 Resolution 040095 - 3/22/04 discriminate. They do not discriminate by District, not by race, not by religion, or political affiliation. I and many others view these cuts as wrong, and as an injustice to the people of our area. It is the right of people to disagree, even to quarrel with one another at times. But when such quarrels begin to affect the constituents of their District, the people who they represent, then we think that these quarrels have gone well beyond your right to be upset with one another, and that you have begun to tamper with the people's business over matters that do not concern the people. So we are asking that these cuts be restored in order to bring justice to those who are living in the Fourth Councilmanic District in order to do -- to right a wrong that we feel has been done by those who have investigated this and have recommended this to you. And we would appeal to the 217 Resolution 040095 - 3/22/04 administrators, the NTI administrators, who have recommended these cutbacks, that they in fact go back and reconsider, and to do what is right. And if they do not do so, then we ask that this committee recommend to the entire City Council body that these cuts be restored, and in fact that the additional 850,000 be placed into that budget so that you will be seen as the people's -- the people's hero, so that you in City Council will be seen not only looking at your own interest but the interest of people throughout the city. And that in effect is my statement. We are calling upon the City Council to restore the 1.1 million and to consider an additional $850,000 to the Fourth Councilmanic District.
Are there questions or comments from any members of the committee? 218 Resolution 040095 - 3/22/04 (No response.)
Thank you. MR. McPHERSON: The next witness is Doris Gwaltney. Louise Smith and Donna Griffin.
You've been extremely patient. Thank you so much. Please identify yourself for the record.
Actually, I'm neither Louis Smith nor Donna Griffin, but I'm from the same organization. My name is Lucinda Hutchinson. I'm the President of Park Side Association of Philadelphia. I'm also the committee person for the First Division of the 52nd Ward. I just have a statement I would like to read.
We, the board of the Park Side Association, located in the Fourth Councilmanic District in the West Park Side area are offended that our 219 Resolution 040095 - 3/22/04 District has been the only one cut in the Neighborhood Transformation Initiative budget, while most other Districts will see an increase. We held a community briefing which involved the whole community, and they were outraged at the fact that a District will be losing our own NTI dollars, giving the monumental need in West Park Side. At least 50 West Park Side homes are vacant and dilapidated in our community. Overall this proposal will negative impact. It is our understanding that NTI strategy is to preserve and rebuild Philadelphia. West Park Side is a Philadelphia neighborhood in desperate need of rebuilding. Currently there are at least 50 vacant dilapidated homes in West Park Side. Park Side Association is rehabbing 32 homes. The weed and seed program in West Philadelphia Empowerment Zone are helping address the vacant land issues. We need NTI to direct their 220 Resolution 040095 - 3/22/04 attention to the blight in our community by demolishing the homes that are inhabitable, create safety concern for youth that often harbor criminal activity. We, the residents of the Fourth Councilmanic District are in need of the NTI funds, as other communities. We are in need as other communities to demolish dangerous property and rebuild. We are in need and deserve a stable neighborhood. We cannot do this without the funds that have been set aside for this purpose. We pray you will rescind your decision to cut over a million dollars targeted for the Fourth District. Thank you.
Is Mr. 221 Resolution 040095 - 3/22/04 Grant here? (No response.) MR. McPHERSON: Rachel Cohen.
Who's after Rachel? MR. McPHERSON: Deborah Seay.
Good afternoon, Madam President, Council members. My name is Rachel Cohen. I'm from the People's Emergency Center Community Development Corporation. I'm here today on behalf of Gloria Guard, our President. I'm here today to express our support for the continued funding for the demolition of vacant derelict buildings. We can see firsthand the hazardous conditions created by these abandoned buildings. We do support the reallocation of funding for Fiscal Year 2004. However, we would like to express our desire that some of that demolition funding be set 222 Resolution 040095 - 3/22/04 aside for acquisition. As all these buildings are demolished, our neighborhoods are then left with vacant lots, which can become an even bigger problem. Vacant lots become attractive places for trash dumping, as well as central locations for drug activities. The blight in the neighborhood continues. It doesn't go away just because the building is taken down. We firmly believe there's also a need for additional funding for acquisition, as I said. If we're going to rebuild our neighborhoods, we need funding to acquire the properties and for redevelopment. As a community development corporation which has been working in West Powelton for 12 years, we firmly understand the importance of redevelopment. With the support of past acquisition funding, we've been able to convert 78 vacant and blighted properties into a 223 Resolution 040095 - 3/22/04 hundred units of affordable, transitional, and permanent housing, four social service facilities, a community playground, and green space. But we really could not have done that without acquisition funding. Currently we are in partnership with Penrose Properties to do -- to redevelop nearly a hundred properties in the Mantua area and create 60 units of affordable housing. This project, called Cloisters Three, won't be possible without the City having acquired the properties. This development will just begin to stabilize the neighborhood, but there's still so much more to be done. Future developments are dependent on this continued acquisition funding. So I thank you today. Nice and brief for you.
Are there 224 Resolution 040095 - 3/22/04 any questions or comments of this witness from members of the committee? (No response.)
Thank you again for your patience. MR. McPHERSON: Patricia Branch. Richard O'Malley.
Miss Branch, would you approach the witness table, please. I think she was called first.
Good afternoon. My name is Patricia Branch. I'm the block captain of the 3200 block of Etting Street. I've been the block captain 12 years. 225 Resolution 040095 - 3/22/04 Anyway, I have submitted a petition and letters, several of them, for to get our pavements and curbs done. Our street's been resurfaced three times. Nobody has ever done our pavements and curbs. I've been in my home since 1978, and they have not did it. But all around in all the other areas and Districts, they do the block -- the pavements and the curbs. And I'm just asking, can you put the funds there so our block can get new pavements and curbs? Thank you very much. (Applause.)
Thank you for your patience. All right. Mr. O'Malley.
Before Mr. O'Malley starts and before Miss Branch leaves, Miss Branch, I want to thank you for coming in. Miss Branch, as I say, she has been chasing after me for more than a couple 226 Resolution 040095 - 3/22/04 years about the issue of curbs and sidewalks. And when we get back to the Administration testimony, I'd like to get a response, based on action by this Council, on that particular issue. There was a study that was supposed to be done. And also just what our general policy is. This is, you know, a citizen and a taxpayer who's been making this request for a long period of time. And I think it's an issue that needs to be addressed in a comprehensive way, recognizing, again, our financial constraints. But there are certainly some citizens who have these issues, and we do figure out a way over time to do a wide variety of things. This is a part of neighborhood revitalization. Different things take place in different neighborhoods. So, thank you, Madam President. I'll ask the question when the Administration returns. 227 Resolution 040095 - 3/22/04
Thank you. Mr. O'Malley, please identify yourself for the record and proceed.
Good afternoon. My name is Richard O'Malley, 5101 Overbrook Avenue. I'm a Vice President of the Wynnefield Residents Association, which is located in the Fourth Councilmanic District. 1 million in NTI funds for the demolition of rundown structures in our District. Their current proposal was contained within resolution 40095. I realize that Wynnefield may not be typical of the desperate housing needs of other neighborhoods in the Fourth District, but I'm also aware that many people have an unrealistic view of Wynnefield as an affluent community of large, beautiful, detached houses with manicured lawns and 228 Resolution 040095 - 3/22/04 gardens. Actually, based on statistics supplied last year by the City Planning Commission, Wynnefield is an economically diverse community with many of the same problems of so-called less affluent neighborhoods. In terms of housing stock, 49 percent of our homes are rowhouses with only percent detached houses. Many of 12 these rowhouses were built in the 1920s, 13 immediately after World War I, and they are 14 now in the early stages of decay. 15 Disturbing demographic trends in 16 Wynnefield in the 1990s include the fact 17 that its population declined at a more 18 rapid rate than the City's. Wynnefield's 19 population declined by seven percent, the 20 City by four percent. 21 Wynnefield's poverty rate increased 22 significantly, from 14 to 20 percent in 23 that decade. Owner occupied housing decreased by five percent, while renter occupied housing 229 Resolution 040095 - 3/22/04 increased by seven percent, which was the reverse of the trend City wide. In the Census of 2000, Wynnefield's unemployment rate was percent, compared 6 to the City's 11 percent. 7 And in one of the four census tracts 8 in Wynnefield, there was a median income 9 under the City's average. 10 And today in Wynnefield seven 11 percent of our structures are vacant. 12 So while Wynnefield is still a 13 beautiful neighborhood, clearly it has problems which could be addressed by the Mayor's Neighborhood Transformation Initiative. Assistance to homeowners now would save money. Waiting for problems to fester in the long run will cost the City a great deal more. Finally, I would like to look at the reason or reasons why NTI demolition funds were reduced only in the Fourth District. Is it a coincidence that our District Councilperson happens to be 230 Resolution 040095 - 3/22/04 Michael Nutter? An editorial in the Philadelphia Inquirer on February the 29th concluded that the reduction was an attempt by the City Administration to punish Michael Nutter for opposing the Mayor on a number of issues. Perhaps you can understand why we, the tax-paying residents of Wynnefield feel that we are in a battle zone; and that we, the residents, are the collateral damage resulting from the struggle. In effect, we, as well as the Councilman are being punished. Personally I happen to believe that Councilman Nutter has served us well. The explanation provided by the City for the reduction is not convincing. The City NTI administrator blames the Councilman for not participating in NTI tours of the Fourth District. Actually, as the Inquirer observed, NTI has consultants who are paid to designate properties for destruction throughout the City. 231 Resolution 040095 - 3/22/04 And a City land survey has identified 2,242 structures in the Fourth District as unsafe or dangerous. We, the tax-paying residents of Wynnefield, expect equal treatment with the residents in the other Councilmanic Districts. 8 million, be provided the Fourth District. If they are reduced, we can rightly conclude that we are the victims of unjust discrimination and of a political vendetta We, the residents, will be the collateral damage. May I provide one final statistic? The residents in Wynnefield traditionally turn out to vote at a higher rate than many other sections of Philadelphia.
The Wynnefield Residents Association will keep our residents informed of these proceedings in the Focus which is our neighborhood newspaper. 232 Resolution 040095 - 3/22/04 Thank you again for giving me this opportunity to speak.
Thank you, Mr. O'Malley. You've been very patient. (Applause.)
Our next witness. MR. McPHERSON: Alfonso Owens and Jennifer Lewis.
Good afternoon. Please identify yourself for the record.
Hello. Madam President, Council members. My name is Jennifer Lewis. And on behalf of Home ownership Developers and Union Hill Community Developers, I would like to thank Council for the commitment that you've made to the Neighborhood Transformation Initiative. The demolition of vacant, abandoned, and dangerous structures has had a positive impact on communities, through the elimination of blight and despair. 233 Resolution 040095 - 3/22/04 However, we request and hope that Council will also take into consideration making appropriations for more land acquisition dollars. While some land has been acquired to date, in many cases in order to effectively assemble land for development, the acquisition of additional scattered sites is needed to create contiguous lots and allow real projects to come to fruition. Our project, Union Hill Homes, is a home ownership initiative, designed to provide a minimum of 50 units of high quality homes for ownership to low and moderate income residents. As you all know, Mantua, like some other neighborhoods in Philadelphia, has been experiencing a deteriorating housing stock, as more properties become vacant and abandoned. This increase in vacancy threatens the safety and condition of the area. Thus, to restore the area to vitality and stabilize the existing 234 Resolution 040095 - 3/22/04 occupied properties, our proposed Union Hill Homes project will convert these vacant, abandoned properties into new home ownership units, but we need your continued support of land acquisition.
Hello. My name Alfonso Owens. I'm the Vice President of 39th and Adams Creek Community Organization. And together with the HUD coalition, we are forming a new non-profit organization called the Union Hill Community Developers, to bring together our local enterprise for the Union Hill Home projects. Throughout our belief that home ownership housing is vital to the health of our community, we are partners with the Homeownership Developers and working very closely with Councilwoman Blackwell and her staff, to make sure that this project is a success. We're going to need your support and your continued commitment to revitalize our community through the abandoned properties 235 Resolution 040095 - 3/22/04 and demolition properties. Our development team is committed to promote and comply with all fellow fair housing law and regulation. Union Hill Homes will benefit the Mantua and the great Philadelphia community through employment, opportunity that the project will develop and will bring. For the construction of the project, the development team will seek local minority, women, disabled business and enterprise to participate. Thank you very much for giving me the opportunity to testify.
Thank you. Thank you both. Our next witness. MR. McPHERSON: Deborah Toney-Moore.
It's good to know we have another parent in the this afternoon. I thank you for this opportunity to speak on behalf of the Neighborhood Transformation Act. 236 Resolution 040095 - 3/22/04 I am from the Fourth Councilmanic District. In June we had an opportunity as a community to come together --
Okay. Again, my name is Deborah Toney-Moore. I'm a parent. I'm a member of the -- resident of the Fourth Councilmanic District. I also work with the Philadelphia Home and School Council in the West Region. 2 million from our budget in the Fourth Councilmanic District. I'm here on behalf of parents and families who live in the area who realize there's a direct correlation for good schools in every community. And in Philadelphia, that is the one common 237 Resolution 040095 - 3/22/04 denominator that we all share. I would like to bring to the attention of the City Council the need to make sure that funding remains at a level that is in the interests of other -- excuse me -- of other neighborhoods. And I'd also like to make sure that we realize that the investment also has to take place within our schools. We have in our schools thousands of children being let out this June. We have a fiscal year coming to an end with the NTI. And we need to make sure that dollars are appropriated for schools to be redeveloped, to be improved upon, to make sure our children have a good, positive environment in which to learn. We also would like to make sure that you draw attention to, and our children are going to corridors such as Overbrook High School, where there's a bridge that we call going to over the bridge to go to school. It's very rundown. And that leads directly to our neighborhood recreation 238 Resolution 040095 - 3/22/04 center that serves both Wynnefield and Overbrook. And that also needs to be looked at, because children are coming out of school and they need safe places to go. Our District is looking at the economic impact, as it looks at its Capital Improvement Plan on schools, building good schools in every neighborhood. That's an important piece because many of our children are not meeting the academic requirements. We can directly correlate that to the environment in which they're being educated. In addition, many of these schools -- many of these children are being mandated to attend summer school. We need to make sure that whatever we can do with this Neighborhood Transformation incorporates the school. We need to make sure that we're looking at the -- as we're looking at the redesign of our neighborhood schools, that includes models that will help sustain the community. 239 Resolution 040095 - 3/22/04 One of the major impacts of our community in unemployment is a high youth unemployment in the Fourth Councilmanic District. We need to look at models in which the schools are being used to get a new way of thinking about education, where we draw more young people into retail, where we draw them more into entrepreneurship. This all can be done with the Neighborhood Transformation and working with other private investors, working with the parents and the students. We only had to look at the Philadelphia Student Union in West Philadelphia High School, where they developed a model for what they would like to see in their schools. We know schools can be the driving catalyst to sustain a community that doesn't have many visible institutions. Fortunately in Wynnefield we have St. Joe's. We need to partner with St. Joe's, partner with the community and 240 Resolution 040095 - 3/22/04 making sure that our school models resemble what they're modeling. They're building infrastructures in our community, and they're including retail. They're including economic development in their structures. When we look at the money that Neighborhood Transformation can go into, we also really need to look into partnerships with our School District of Philadelphia, to make sure that youth have opportunities at that -- in the educational level where, when they're preparing for college, they're also preparing for the real world. And in our democracy, a lot of that is entrepreneurism.
One of the things that I realize from fighting so diligently from the school takeover, if we don't find ways to bring dollars, to bring real partnerships, we're going to find that five years from now, ten years from now, we're running into the same problems and asking for more funding. I think it's very important as we 241 Resolution 040095 - 3/22/04 use these funds, that we find other ways to model how we can sustain the life of a community. It's very important to me that we make sure that the partnership from the community remains intact, so we don't have to get letters a year -- almost a year later saying that we lost funding. But the community is the driving force in the Neighborhood Transformation Initiative. I thank you so much for allowing me to speak today. I ask that you make sure that that money for NTI in the Fourth Councilmanic District remains there, and that we come up with a community plan would be in the best interests of all our constituents and will not forget the many of thousands of children we have to educate. Thank you.
Thank you very much. MR. McPHERSON: The next witness is 242 Resolution 040095 - 3/22/04 Jim Wilson.
Please continue. MR. McPHERSON: Miss Leta Johnson.
Good afternoon. Good afternoon, City Council and members, and people who have come to listen. I'm coming here... I don't have a really prepared speech for you.
I don't have a prepared speech. I don't have a lot of words. Our block got together in 1994. We decided for a group of us people, concerned 243 Resolution 040095 - 3/22/04 citizens, get together and pull together as one, as a council, took -- create a union as one, to take care of a lot of issues that were problems in the community that we knew we could solve. And luckily, we did. We did this within ourselves, and with the help of the Police Chief, as far as Town Watch. That's about as far as we knew that our strength and our power could go. We didn't know that we had any kind of help as far as City Hall or any big brother could help us. Then our roof fell apart, so that I got sick. And interest kind of lost for several years. And we decided a year ago that we needed that group again. Things were getting to fall apart. The neighborhood was not doing well. So we tried to pull together. We checked the neighborhood to see who wanted to be interested. Everybody was, of course. 244 Resolution 040095 - 3/22/04 But very few other -- There were other things involved that nobody wanted to mention or nobody wanted to get involved with us, you know? So, we did what we could. We did some cleanups, and we did -- we fought a lot of times with L & I. I myself, even with problems with my leg. Hey, I came down to L & I in person to discuss the fact that, you know, one of the porches was hanging loose and about to fall on my house -- and maybe you heard -- one of the little kids that plays around there. Presently we got to abandoned 17 properties on our block. And most of them 18 are in imminent danger of collapse. The 19 little children can't play outside safely. 20 Bricks, stones, all kind of things 21 hanging and flying in the air, tear up 22 people's cars. People have to have a lot 23 of contract work done because of the walls are draining from the abandoned properties, the roofs are caving in. The walls 245 Resolution 040095 - 3/22/04 themselves. The floors, the joists of the floors are caving in. And it's sad. It's kind of embarrassing to bring your neighbor -- you know, people that come up to visit you even, to see how far it's been -- had -- 30 years ago, and the properties are still standing there, still looking the bleak look of old empty buildings, you know. And they're dangerous.
To the best of your knowledge, are these buildings that you're referring to scheduled to be demolished?
Thank you, Madam Chair. Miss Johnson, thank you for coming 246 Resolution 040095 - 3/22/04 in. And we did have an opportunity for a sidebar discussion. The area that Miss Johnson is talking about is generally the one -- the unit and 100 blocks of North 54th Street, Udall, Conestoga, and 55th, which are directly adjacent to my colleague, Councilwoman Blackwell's District. We share 54th Street. I have the west side. She has the east side. And so, it's all kind of over there together. Both from my own observation, but also certainly confirmed by the NTI office and other surveys that have been done, the area where Miss Johnson lives is an area that has one of the highest concentrations of vacant or deteriorated buildings in that part of the District. The area from 54th to 60th, Market to Vine, probably has the most intense concentration of dangerous and vacant buildings anywhere in the Fourth District. And again, one of the issues -- And the reason the proposed funding cut from 247 Resolution 040095 - 3/22/04 the amendment in front of us is so critical is because the area that Miss Johnson is concerned about is one of the first areas that would see demolition activity from the NTI program. But also, as she and I had an opportunity to talk, there is an increasing concern -- And I shared this with Mr. McCalla and others who came to see me not too long ago -- that the first part of the program is the demolition. And we had a lot of that conversation with Miss Smith and others at the table. The growing concern is, what happens after demolition? There will be a significant amount of demolition activity on those blocks, the unit blocks and the one hundred blocks, of almost every one of those streets that I mentioned. There might be some encapsulation candidates on those blocks as well. But what the neighbors are also concerned about, after the noise, the dust, 248 Resolution 040095 - 3/22/04 and all the other stuff that happens, is what's next? And so, I've asked the NTI and other agencies who are part of this to come back to me with a proposal on both encapsulation for those properties that can be saved. In a couple instances we have properties that might be three in a row. We don't have a lot of those. But there are opportunities with three parcels -- three vacant buildings going down, that you might be able to rebuild two houses in the three parcel area. So to the best of my knowledge, you know, there are no plans for those next steps. And so, there is the increasing concern of what's next after the demolition. But the properties, the area that Miss Johnson is talking about, is the first area slated. There will be neighborhood meetings about that shortly. But many of those properties that you're concerned about are going to be torn down. 249 Resolution 040095 - 3/22/04
Okay. Well, we want the package, the whole package. It's no 4 good without -- with just the demolition. We need to know what's going to happen after that. We're a quiet block. And we've tried to do as much as we can ourselves, as you see. You can see for yourself. However, we're asking you now... We're asking you now for a total package and information on that. So, please, you know, don't let us down. Okay?
Good evening, Madam President and Council people. I'm Steve Jones. I'm 52nd Ward 250 Resolution 040095 - 3/22/04 Chairperson. I'm here today on behalf of the 55 committee people in the 52nd Ward. Our concerns is about the Fourth District, the abandoned properties, our friends and our relatives that lives in the District that was cut by $1.2 million. Do we tear down some houses in the District and not the others? How do we justify that? In order for the District to be equal, we need our $2.8 million. Our District has been blessed by having two Councilpeople at large in the District, the 52nd Ward. They have been very supportive in the past. I'm asking them to be very supportive in the future in helping us. Thank you. MR. McPHERSON: Any questions? (No response.) MR. McPHERSON: Thank you. Our next witness is Steve Culbertson. VOICE IN THE AUDIENCE: He left. 251 Resolution 040095 - 3/22/04 MR. McPHERSON: Blaine Stoddard.
See, Blaine, I'm sitting in just because it's you. Thank you all again for your patience. Thank you for the speakers from all over PEC, as well as the last speaker, from 54th Street and the surrounding community. And thank you for the other folks who came who represented Mantua as well. Thank you. Please identify yourself and begin your testimony. And again, thank you for your patience, Blaine.
My name is Blaine Stoddard. I run the Partnership CDC. We are at 40th and Market Streets in West Philadelphia. Madam President -- who just walked out, Madam Chair -- Councilwoman Blackwell, and to the Council people that are here today, some of you I know; some of you I don't know. The Partnership CDC... I have some 252 Resolution 040095 - 3/22/04 prepared statements, but I'm going to divert a little bit and just talk about what's on my heart because, as you know, Councilwoman, my heart is burdened today. The Partnership CDC and its subsidiaries have 103 employees, 103 employees. years ago we started out 9 with one employee, me. And no staff. Just 10 me. 11 And we have employees in almost -- 12 probably almost every District. We have employees in the Third District, the Fourth District. We have employees in Germantown. We have employees that live in Frankford, and even Northeast Philadelphia, South Philadelphia and Southwest Philadelphia. We have employees everywhere. And the Partnership CDC is dying. We're dying. My payroll -- Our payroll is $160,000 a month. That's how much we pay on payroll. 38... I'm not sure what the Wage Tax -- and then some on that every month. We're not dying, Councilwoman, 253 Resolution 040095 - 3/22/04 because of some wrongdoing. We're not dying because there's no leadership. We're not dying because the private sector and the foundation sector has abandoned us. We're dying because we have built a development engine with professionals that make anywhere from $8 an hour, taking people off welfare and putting them to work, to people that make $80,000 a year. And we're dying because we've built a development engine with no gas. And the gas is vacant houses so that we can do affordable and market rate housing. That's the easiest way I can break it down for you. For four years, going on five years, Councilwoman, we have not gotten the units that we need to do our development. And you know about that. When NTI started, CDCs were not included in the process. They're only private developers. And with Councilwoman Blackwell's help, we were brought to the table. And now I sit here today to tell you 254 Resolution 040095 - 3/22/04 the truth, that we're dying. I don't know what's going to happen. There's a $25 million bill in front of you. If you add that all up to the other bills that are in front of you today, and you get maybe $295 million. We need to be a part of this. We have two specific projects that we are working on that need to be included today, not tomorrow. And we want to thank you again, Councilwoman, for your support on this. The first one is the Urban Renewal Area at 45th near Sansom. We have 46 units to be developed there for market rate housing. And we have the financing lined up. The Reinvestment Fund is going to finance the project. We have a private developer that we're working with to make this project come to the table. And all we need from the City is the acquisition. So, as you look at demolition, you also have to understand that there are 255 Resolution 040095 - 3/22/04 economic development engines already in the neighborhoods that can be used to develop these neighborhoods. And I think that needs to be a part of the agenda on the table. The second project is, we've applied for 29 vacant buildings in and around University City for affordable housing under the HRP. For those of you who don't know, the Homeownership Rehab Program is the largest year-around rehab program in the City, run by the Redevelopment Authority. And we are one -- We have been one of the largest users of the Homeownership Rehab Program where the City gives a developer, a non-profit, a fixed $35,000 subsidy to fix up the units and turn them over for affordable housing. And we're one of the top users of that. But again, everything has dried up under NTI. And we need to unclog the pipeline.
We need to unclog the drain, and get developers and CDCs the properties they 256 Resolution 040095 - 3/22/04 need for projects that are at the front of the line. And as far as I'm concerned, we are at the front of the line. We have financing, we have our development partners in place. And just to give you an example, for the Councilpeople that are still here, PECO energy, other than what you hear -- I know there's been a lot of talk about Vince Fumo. 7 million over the last ten years. And we're not for PECO'S generosity under the State Tax Credit Program, we would not be here. And I hope there's a reporter in here to publish that tomorrow. And the William Penn Foundation has given us a half a million dollars to hire staff to do these projects. And the window is from 2002 to 2004 that we were supposed to start these projects. And it's now 2004. We have $10 million in loans from the Reinvestment Fund 257 Resolution 040095 - 3/22/04 and LISK for some of these projects. 5 million from Melon Bank to do rental conversions. University City is gentrifying so fast, and rentals are going up so fast that we've gone out to the bank. 5 million, and we have converted 10 market rate units to affordable housing, 11 with no hope, no assistance, not even the 12 permits from the City. 13 And we've done 22 units in nine 14 months, just to show how quickly this can 15 be done, if the bureaucracy would just sort 16 of help us along to get this done. 17 I'm going to stop here today. I 18 mean, Councilman Goode asked a question 19 about what is the production level, housing 20 production level, under NTI for the past 21 four years. 22 We believe in the CDC world, that housing production is down 75 to 90 percent. Okay? If you take out PHA, and if you take 258 Resolution 040095 - 3/22/04 out the market rate stuff that has been done downtown, we believe the housing production is down 75 to 90 percent. So that's a direct answer to the question. Somebody else asked today -- And I'm sorry Councilwoman Blondell Reynolds-Brown is not here -- somebody asked, why is it that we can't get appraisals done? Because you need appraisals to basically turn over the units. Well, you need appraisals so that you can do a declaration of taking, and also you can turn over the units to private developers of CDC. How many people are doing appraisals at the RDA? Again, we believe one. And his name, if I can get his name... His name is Mr. Valentino Pascarela (phonetic). And then, how many people are doing Act 94s? You have 5500 units that we're trying to acquire. And again, we believe one. And her name is Maryann Procuri (phonetic). 259 Resolution 040095 - 3/22/04 So the system is totally backed up. I work with the RDA every day. I work with the City every day. I work with you, Councilwoman. I work with OHCD. We're all good people. And I would even consider us all friends but the system is broken. It is broken and we need to fix it. )
Thank you, Mr. Stoddard. Certainly we do share so many of your same concerns. In fact, we introduced legislation to be heard before our housing committee dealing with Sansom Street. It's very disparaging that we're -- that we have a plan for half of Sansom Street and not the other half, because obviously you can't do half a block. And we are very concerned about the issues you raise. Obviously, we thank you for your commitment. And we want to... In our commitment, we want NTI to work so that neighborhoods who have made their self 260 Resolution 040095 - 3/22/04 determinations know can get the housing done. You wanted to comment?
Yes, ma'am. I just want to say, I can not stand in front of my staff of 103 people and tell them that it's over, not in this type of job market, where there are no jobs out here. We're trying to create jobs. And we just need a little help from the City, a little push from the City, to get this done. Long before NTI. We can do this. Now NTI is here. We still want to do it. We feel that we just need the will and the push to do development so that we can keep our engine going.
Well, let me say to the Administration, who has heard your testimony as well, we're going to ask them to come back -- not now when the public is testifying. But certainly before these hearings conclude, we would like to hear them to 261 Resolution 040095 - 3/22/04 respond to the issue. Madam President, Mr. Stoddard, from the Partnership CDC says that production is 90 percent down.
And we are very concerned about the issues he raised, and certainly request that the Administration respond to those. Thank you. Thank you, Mr. Stoddard MR. McPHERSON: The next witness is Carolyn Sutton.
The Chair recognizes Councilman Clarke, Mr. Stoddard.
Thank you. First, Mr. Stoddard, I just want to make sure I didn't hear you right. Did you say you didn't get a permit from the City? You didn't mean that, did you?
No, no, no. What we did was, we did our rental conversions. We did operating apartments. We went out to the market. We borrowed $1.5 million. We went out and bought operating buildings 262 Resolution 040095 - 3/22/04 that only needed paint. I said I did not need a permit.
I just wanted to clear that up for you. With respects to housing reduction -- And I agree with you that production is down, not that you need me to agree with you. But one of the things that I find in investigating this issue, in fact, has to do with a large degree with the Philadelphia Housing Authority.
As you know, a substantial amount of units in the City and state are done as a result of PHFA's tax credit program. And what has happened in the last two, maybe three years, because of the decision to not fund projects in the -- first in the initial year of the NTI program, that there were not projects being put in the pipeline to go to PHFA for tax credits, particularly nine percent credits. 263 Resolution 040095 - 3/22/04 And as a result of that -- I don't know who made the decision -- but the Housing Authority essentially got very aggressive in getting tax credits to fund this project. Particularly, I know in my District, they did part of Richard Allen, and Cambridge, and I believe Mill Creek is a nine percent credit. And one of the things that I've talked to, to both the Administration and the Housing Authority, is to look into the possibility of them not going in for nine percent credits, and going in for volume cap which is four percent credits, which I understand there were an overabundance of at PHFA, and let some of the traditional non-profit and for-profit entities to do tax credit housing with community groups in the neighborhoods. And I believe or hope that that will be the strategy as we move ahead. Right now I believe that we're... Based on the formula, that the City of 264 Resolution 040095 - 3/22/04 Philadelphia is in line for approximately 3.1 in tax credits in the last cycle and probably in the next cycle. But the Housing Authorities have gone in and altered -- Their requests are upwards of 1.6 million. So, right from the get-go, they take up half of the nine percent credit. So I would like to see us take an approach where we don't have the Housing Authority going for the four percent because they can afford it. It's a little more expensive than nine percent. So let the traditional CDCs and other organizations go after the nine percent. Do you agree with that assessment?
Yes, sir. And can I respond to that? I think that's a great idea for PHA to go for the volume cap which is a different pool of money, other than the regular private developer or CDC driven, that we need the nine percent credit. So I think that's an excellent idea. 265 Resolution 040095 - 3/22/04 Let me also say this: PHA did most of the housing volume in the City because they were already in the pipeline. Not only that; they owned most of their land already.
Acquisition came to a halt for at least two years under NTI.
And -- And -- And -- And it's coming out of the -- coming out of being in a -- in a -- in a standstill now. However, the critical issues that you have raised and the City Council people have raised today about the capacity of the Redevelopment Authority, about the reorganization of the housing agencies that you have asked Pat those questions, I'm not raising these issues. The City Council, you, the City Council people have raised these issues all day. There needs to be a reorganization of the housing system, to meet the volume and the goals that you have set under NTI. And 266 Resolution 040095 - 3/22/04 there has been no reorganization. So -- So people like us, with 103 employees, that work and that live in your Districts could lose their jobs because for four years we have no production. For example, the people that -- The people -- One of the things -- One of the things we do when we do volume real estate rehab is, one of our subsidiary companies does all the cleaning, all the painting and all the pressure washing. And they make anywhere from $15 to $25 an hour doing that. For four years I can't hire that crew. I don't know where -- I've lost my crew because we don't have any work for them. And so, the issues you raised are pertinent, but you have to understand that PHA could do volume -- housing volume because they already own the land. They demoed their own buildings and they rebuilt townhomes on them.
Right. And they have an additional subsidy because they 267 Resolution 040095 - 3/22/04 have ACC'S --
And they don't need Penn Homes money. And Penn Homes is traditionally a part of the nine percent funding process.
And I'm simply suggesting that, you know, PHA should be what PHA traditionally is, affordable housing. And we have a lot of individuals who are concerned about the lack of affordable housing, because the nine percent credits let you have a higher income. And if we go back to what PHA used to be, you know, truly affordable housing, I think we could probably solve two issues: One, the funding issue; and the other, providing truly affordable housing. 268 Resolution 040095 - 3/22/04
Thank you. Thank you, Mr. Chairman. Given the mission of NTI, and the traditional mission of CDCs, and given acknowledgment of the fact that capacity has been an issue or an impediment with regards to meeting goals that NTI established, and hearing your first recommendation which would be reorganization of the housing agencies may prove to be beneficial, what other suggestions, recommendations would you offer up at a time like now, given what's ahead for NTI in the next year?
At a critical time like this, the RDA needs to hire ten people to do Act 94, which is the -- which is the either Urban Renewal or Act 94 spot condemnation taking, which is the act that allows the City to basically clear a title on a vacant property and issue a new title, 269 Resolution 040095 - 3/22/04 and sell that property or give that property for a dollar to a developer for what you call a nominal consideration. They need ten people working on that full-time. The second thing. They need, like, ten appraisers because every building has to be appraised. And it's taking... I don't know -- I don't know how long it's taking, so I don't want to make -- That's something that maybe Pat and the staff could answer. But I know it's taking very, very long to get an appraisal. In addition to that, while we're waiting on appraisal, in a lot in a gentrifying area or in a changing market area, a lot that may cost $2,000 now that I could buy and build something on, if it takes two or four years from now, that same lot could cost $25,000 and the project could not get done. And so that's the issue we're facing, in terms of the backlog. I call it project constipation. That's what we have, 270 Resolution 040095 - 3/22/04 project constipation.
Appropriate description. So is that to suggest, then, more appraisers and Act 94 practitioners would move this logjam in a substantial way?
That -- That is -- That is like the first thing that needs to be done, either move -- move people from PHDC or OHCD or RDA or NTI. They need to be moved into this process so that things can get done right away.
According to my records, right now there's only one person doing each, as well as I know for the appraisers they're being subcontracted out. But that process needs to be streamlined. It also needs to be speeded up.
My final question. Pre NTI, about how many homes did you do per year?
We could do 10 to 20 -- 271 Resolution 040095 - 3/22/04 20 a year, 10 to 25 a year. But we also were able -- Because of acquisition, we were able to do some huge projects with private developers. We did some stuff with Scott Mazo. We did a 44 unit, beautiful historic building, with Brad Ingerman. So the Partnership CDC has done 330 units of housing and invested $54 million in the community, mostly before NTI.
Thank you for your testimony. MR. McPHERSON: Councilwoman Blackwell.
Thank you very much. We thank Mr. Stoddard again for his... Oh, gosh. How should I describe his presentation? Shocking, perhaps, is the best way to describe it. 272 Resolution 040095 - 3/22/04 But these are -- As many of you know, the Partnership CDC is in the Third District. And these are the reasons why we raise questions, why we came up with an amendment today, because of people like the Partnership CDC, who work so hard, who are heart -- in the heartland of the community, and who are stymied and can't move. I also felt compelled to say, wearing a PHA hat, that I'm sure they're glad to discuss their funding, and what works and what doesn't work for them. And certainly... And certainly, in terms of PHA's mission, I know that PHA serves many hats today. Their mission is -- They still deal with affordable housing. They are beginning to serve as developer in some ways. They are doing home ownership, as they are doing with the Lucien Blackwell Homes, half home ownership and half rental, as homes in Mill creek. But by the same token, I believe that -- I don't want PHA to become the 273 Resolution 040095 - 3/22/04 object of criticism, because as we know, they are the main focus in town. PHA has been moving because they work on this all the time. They work on housing all the time. They're always working on the next project. And they've learned to do it very, very well. So, here we are with our community groups, and we're fighting, and we're floundering. And we're trying to get the City and the NTI program to work with us. But PHA is very clear on its mission. They're always working. They're always pushing. And they have contacts all over the country. And so, we are grateful for what they have done, because they have still managed to keep -- During this period when other things aren't moving, PHA has been moving. Thank God for that. So, I wanted to say that in defense of PHA. And again, I wanted to thank Blaine Stoddard from Partnership CDC, for his commitment in this field, and all the 274 Resolution 040095 - 3/22/04 information he possesses, and for continuing to fight for housing, and to fight for improving the community. Thank you very much, Blaine. MR. McPHERSON: Councilman Clarke.
Thank you. Councilwoman, I don't think you should feel the need to defend PHA because my statements weren't meant that way. It was just a simple fact that they are going in for a funding source that is directly competitive with other organizations. I spoke to Carl Green about this issue, and Carl clearly understands the issue. He has indicated that he is more than willing to adjust the strategy, to go for four percent credits because they, more so than any other organization, have the ability. Four percents are a little more expensive to do development deals, but if anybody has money to do it, it is PHA. I think they feel a void because we were having -- We had a situation where tax 275 Resolution 040095 - 3/22/04 credits that have been allocated for Philadelphia were not being utilized because we were not funding projects, we were not acquiring projects for a period of two years, to set that vacuum up, that PHA then saw the need. And it could have been at the direction and with the support of the Administration to go after those nine percents. But now that we're in a situation that those nine percents have become extremely valuable, we now have an acquisition strategy in place, to a degree. We have things in the pipeline. And we now need to adjust that strategy and have PHA go after the volume cap, and let the CDCs and the other for-profits go after the lucrative nine percents. And I think that we'll achieve a goal of providing both affordable housing because there is -- You know, PHA couldn't have a level of affordability in those units and still achieve the level of 276 Resolution 040095 - 3/22/04 support that we need for our CDCs. So I don't want you to think that, you know, it was said in criticism. It was just the numbers. The numbers are what they are. And Mr. Green has agreed that they probably should look at adjusting their strategy.
Thank you. Thank you for clarifying that issue. Thank you, Madam President.
Our next witness. MR. McPHERSON: Carolyn Sutton. (No response.) MR. McPHERSON: Julie Camborn. (No response.) MR. McPHERSON: Liz Ford.
Please identify yourself for the record. 277 Resolution 040095 - 3/22/04
Yes. Good evening, everyone. My name is Liz Ford, and I am from the Fourth Councilmanic District, under Councilman Nutter. And I am here because I received information in the mail about reduction of money coming through the Fourth District. And I was very appalled because I haven't seen money coming through the Fourth District. And what I would like to do is just to give you a statement. Back in the year 18, ICAN was awarded $170,000 to do a very small project. We have never got that money. All right? And I don't know where the money went. Because we're looking at 29 and 30. And every time I would go forward for this money, it never was there or no one told me how to get to it. I was always going from this person to this person and then out the door. I don't understand that. I never received money awarded by the City Council of the 278 Resolution 040095 - 3/22/04 CDBG dollars. And I'm still looking forward to getting that. But in the meantime, my buildings, because it set so long, the buildings that was awarded to me by the City? That had been vacant for years before I got them, they starting to fall because I was not able to get through getting the small project put together. I needed the $170,000, according to the banks that I went to -- and I went to a couple of them, and also a credit union. But the credit unions did not go for this type of arrangement. So I found that out earlier. But the two banks, they still sitting there holding onto my proposal because the City is not releasing that $170,000. The banks are Citizen and First Union. And I'm appalled to that. And I don't understand why. And as far as NTI is concerned, I'd like NTI to realize that Haddington goes all the way to 63rd Street. It doesn't 279 Resolution 040095 - 3/22/04 stop at 60th Street. It seems like when we find out things, we always find out late; and we are not included into any of the things that we -- I tried to get from NTI. I called them. They ignored all of my attempts to contact them. All right. So I just stopped. Because the more you try to get information from people, the angrier they get, and then they push back more. I don't want that, because my community is very, very important to me. I live and I also work in that area. All right? And I like to see it upgraded. Excuse me. The other thing, too, I guess I'm one of those community CDCs that Councilwoman Brown was talking about, that seem to fall through the cracks. And I don't understand why. We've been working very hard trying to do things, and keep that office open, and community service. 280 Resolution 040095 - 3/22/04 Now, we have serviced a lot of people without money, and that's very difficult, very, very difficult. Couple of things, that -- at the time that could have been resolved. And I don't know why I have not gotten a Resolution on it. We was given a building on 6002 Girard Avenue, to take it, to rehab it. And we asked them for that building because we were going to put drama and other things in that building for the community. Always trying to do things for the children, because we saw there was a need for that. This building was taken away. After we had put $10,000 into this building, it was taken away, without due cause. I'm still trying to get the written... why it was taken away. I don't understand that either. But on a good note, ICAN has been servicing this community because we been in this neighborhood since 1985, '86. The early 1990s, what we tried to do was create 281 Resolution 040095 - 3/22/04 a building -- mid 1990s, rather. I'm sorry -- A building that would house a fun or entertainment. So everything has started to where I can not get resources. Councilman Nutter has allowed us to do certain things, and I appreciate that. But the building will be called The Way Kids Rule. It will be on 60th and Vine. And the other thing, too, is that I'm really surprised that... And I have documentations here that I'm going to give you, if you don't mind.
I just don't want to go through the whole reading thing. so I just want to make you aware that certain things are not happening. All right. And I'm right there in the middle of the Haddington area. And I've been there, been the CDC for the longest. I'm probably the longest running CDC in that area, that has not been recognized. And I really don't appreciate that, after the long work that we've tried to do. We all are volunteers. And there's 282 Resolution 040095 - 3/22/04 nothing wrong with volunteers because we still get work done. I guess what I'm sort of frustrated to a point where, when you go out and you try to reach the people that you want to reach, and you get ignored, and you don't get any reply, and then sitting there wondering what's going on and what's happening. And I would like to get my 6002 Girard Avenue back, so I can put the drama productions and whatnot that we wanted to put in the first place. I understand the 6002 Girard Avenue was given to somebody else, but I understand he gave the building back. I don't know what went on. But I know that ICAN does not have that building. And the buildings that we do have are crumbling because I never got my $170,000, even to get that small, very small project started. I thank you for listening. And I'm hoping that I get some response or reply so 283 Resolution 040095 - 3/22/04 that I can move on with what we're trying to do in our building.
Thank you. I think Pat Smith is still here. And perhaps she could... She could certainly be of assistance to you in telling you where that money is.
Well, the other thing is that the buildings that they're getting ready to tear down on Vine Street, when I looked at it, it looked like it wasn't ready to be torn down. But the buildings we requested to be torn down for the project, for The Way Kids Rule building, it's still sitting there. It's been sitting there over 30 years. We trying to get those buildings torn down. 6050 Vine Street and 6052 Vine Street we purchased, because for this project, for the children and the neighborhood? We purchased 6058 Vine Street in order to make this project come alive. We need those two buildings 284 Resolution 040095 - 3/22/04 demolished. And I've been trying to get them demolished for the past three, four years. We need them demolished so we can move on with this project. I thank you for listening, and have a good day.
Thank you very much. Thank you. Our next witness. MR. McPHERSON: Our next witness is Johnny Tobin. (No response.) MR. McPHERSON: Robert... I'm sorry. Robert Brasswell. Is Johnny Tobin here? I'm sorry.
No. 18 MR. McPHERSON: No? Okay. Stephen Coughman. (No response.) MR. McPHERSON: Jihad Ali.
Good evening, Council Chair. I have some -- a prepared testimony 285 Resolution 040095 - 3/22/04 for some of the Council people that...
That would be wonderful. I think you can proceed while they're being circulated.
Thank you, Councilwoman. My name is Jihad Ali. And I'm a founding member of the African American Contractors Roundtable Council, a non-profit organization of African American and Hispanic contractors who have advocated for the inclusion of disadvantaged African American and Hispanic contractors in the City of Philadelphia construction industry. I want to thank this Honorable Council for this opportunity to comment on this important issue, and I commend you for providing ordinary citizens the opportunity to describe to you the difficulty for minorities to get into the construction work or construction contracts in the Neighborhood Transformation Initiative. I will not belabor these hearings with a lot of details because many others have concerns about these matters have 286 Resolution 040095 - 3/22/04 already provided details in previous testimony. However, I do want to emphasize that there has been and continues to be a systematic and successful program of denying access to records and contracts under the Neighborhood Transformation Initiative. What is most disheartening is that the City and other agencies designated to assure that there is minority participation in the awarding of contracts, subcontracts, and man hours employed on projects funded by tax dollars, have failed to carry out their responsibility, and in some cases have been complicit in seeing that only a select few minorities get work, and place unauthorized organizations as brokers of contracts. Agencies like NTI have the responsibility to establish policies and procedures which govern the inclusion of minority business in NTI projects, policies and procedures of the NTI which govern 287 Resolution 040095 - 3/22/04 prime contractors and their selection of minority businesses as subcontractors, policies and procedures of the NTI which governs the implementation of the use of all legally permissible means of fostering the award of prime contracts to minority businesses such as joint ventures, policies and procedures of the NTI governing the inclusion of minority businesses on solicitation lists, policies and procedures on having transparency on subconsultants and contracts awarded by the NTI. According to the 2000 Census, the City population is 43 percent African American, 8 percent Hispanic, 2 percent Asian, and 45 percent white. Despite these numbers, the practice of discrimination continues. No single organization, other than this Council, represents all of the City of Philadelphia citizens. I am aware that the NTI awarded a contract to the African American Chamber of Commerce to help newly formed emerging 288 Resolution 040095 - 3/22/04 contractors enter the construction industry. We have repeatedly requested copies of all proposals and documentation forms which must be completed by an organization such as ours, in order to receive funding in an amount as authorized for the African American Chamber of Commerce. In conclusion, this Honorable Council is the only organization that has the responsibility of all of its citizens. If we want to seriously find a solution to the patterns of discrimination against African American and Latino contractors and workers, there must be more direct oversight by this Council. Council must have adequate reporting and monitoring system in place that will allow it to oversee how City construction dollars are being spent. This is the only way to reduce the opportunity for corruption, nepotistic employment practices, inefficiencies, and systematic discrimination. 289 Resolution 040095 - 3/22/04 While the courts have held that quotas in and of themselves to be unconstitutional, there would be nothing illegal about this Council assuring that City agencies or programs like NTI improve the use of minority contractors by at least one hundred percent each year over the next four years. I'd like to make a few comments about some of the testimony that I heard earlier on the Emerging Contractors Program.
Now, as an individual that's been involved in construction -- commercial unionized construction for years in this 17 City, has been a strong advocate on most of 18 the demonstrations in this City concerning 19 the inclusion of African Americans, one 20 thing is, I have a feeling, from being on the street, that most of the community people really believe that Council wants to do the right thing. The problem happens between this Council and the programs that are in place, 290 Resolution 040095 - 3/22/04 and the oversight that doesn't occur once programs are funded. If we look at -- If we look at -- If we -- If the question is, is the emerging contractors successful, let's look at it from this perspective. I think Miss Smith said -- she testified that there was candidates that 10 went through training. 11 What she didn't say was each one of 12 those candidates go for a total of 23 hours 13 a week in training. They go Monday through 14 Friday, I believe, from the hours of 6:00 15 to 11:00, three nights a week, and they go 16 one day from 8:00 to 4:00. 17 For a total of eight weeks, that's a 18 total of 184 man hours or woman hours. If 19 we do that -- If we add another 40 hours, 20 because I believe her testimony was that they are given some on-site demolition to occur. And if we assume that they do 40 hours, that would be a total of 224 hours maximum that each one of these candidates would do in order to enter this industry, 291 Resolution 040095 - 3/22/04 for a total times would be 4,080 hours. Now, if we're saying that this program is going to empower somebody for only 224 man hours of instruction, it's going to put them in a competitive position with some of these established businesses, it's not going to happen. I know people that have been in business for years. They have all 11 experience necessary. They know all the 12 intricacies of construction. They know all 13 about safety. They know all about the 14 unions, which is not even discussed at this 15 table at this time. So we know that that's 16 an uphill battle. 17 What I think is happening is, we 18 have a few people that are really taking 19 advantage of the desire of this Council to 20 do something for disadvantaged men and women, and to try to do something during your watch to make a difference for the youth out there that's looking for direction. But what we really need, what 292 Resolution 040095 - 3/22/04 Council -- It should be so. When they come in front of this committee, you should drive them really very hard, to find out how are they performing, because in construction, like any business, it's the bottom line. What Miss Smith didn't testify to was, what is the cost -- how much have they funded, this Emerging Contractors Program? And if we do basic math, we said it was $400,000. Divide that by the 4,080 hours. We would say that's $89 an hour and some change for instruction. That money could be spent in a better way. One of the main problems that Emerging Contractors Program had was the bonding. Those of you in Council that are not even contractors, you're aware of what bonding is. Now, when this program was -- When the inception of this program happened, the Contractors Roundtable which were -- at least at the time, was invited to give some comment on that program, we had a question 293 Resolution 040095 - 3/22/04 about the fact that how would startup businesses going to go from nothing to something overnight, with no experience and get bonding? Let alone not even have the union agreements. When that was -- We said, well, wouldn't it be a better suggestion, like Councilman Clarke had had... What about the exiting businesses that are out there, the disadvantaged businesses, like Councilman Cohen said? What about those businesses been struggling for years to make it? Let's 15 partner them with some of these emergent 16 people. It seemed like a win situation. 17 It was shot down. Now here we are a 18 year later.
We can always say that they've 19 had three contractors that actually 20 graduated from the program that are participating in contracts. And I think maybe one contractor is at least bidding. So, in terms of if we -- If the question is is the Emerging Contractors Program a success, it depends on how we 294 Resolution 040095 - 3/22/04 define success. If success is to sell false hopes, it's a success. If success is to fill up classrooms and get people in there, it's a success. If we look at what is the bottom line, if they have produced any contractors that are even going to compete with firms that have been in business for years, 11 the answer is no, it's not a success. 12 Now, we can't -- We don't have -- I 13 don't have time to waist, and I'm sure this 14 Council doesn't. We need to put all our 15 minds together because no one of us is as 16 smart as all of us. 17 If we put our minds together, we can 18 beat this thing. This thing about 19 exclusion for minority contractors is 20 really -- it's really a plain argument. And all we have to do is put our minds together and find a solution. But I ask this Council to be more -- more vigilant on how these monies are spent. Make people more accountable. 295 Resolution 040095 - 3/22/04 Don't go by the fact when people come up to talk programs. You have to look at the basics. And if we go back in time and look at how this program was structured, we would see that it was structured from a bad foundation. But in Pat Smith and them's defense, they have one component of this program that was really a success. And that was the DAP program. Because the DAP program is only -- is the only key that is going to allow these disadvantaged young men and women to enter into these construction trades, because we haven't even begun to talk about the 16 trades, when it really -- in effect, are really over 60 union locals that have 80,000 men and women employed in those trades. Receipts of last year was $153 million. Currently all those unions currently have in the bank $50 million ready to defend any challenge on their turf. 296 Resolution 040095 - 3/22/04 We just saw that this week where they kicked MTV out of town. So, not even looking at that, we need to go back to the drawing board, make Miss Smith and them more accountable on this Emerging Contractors' program. One thing I would like to close in saying is, we asked to be a part of the NTI. Now, sometimes when Council is putting money out, different agencies, they will do outreach. And NTI did do outreach. Miss Smith and them had a meeting -- I think it was Councilwoman Miller said there was a meeting down in the Mayor's office which I attended. We talked to the Director and some other people from Hill International. And we asked for -- We asked for another dialogue with them so we could get more established guys involved. We were told someone at Hill that the only way that we could get more established contractors involved was they had to be in the Emerging Contractors Program. 297 Resolution 040095 - 3/22/04 Now, let's think about that. We're talking about businesses that are established telling them to go to class? And I've been in meetings with guys that have been very angry because somebody's telling them to go back to class. And the question that they -- The answer was always, I need contracts. So we need you, the members of Council, that are concerned like we are, to help us. We need you to make Pat Smith and her -- Because, you know, the buck really should stop with Miss Smith. She says she can do something, but she should be made to do it. Because we can not have people who we're paying millions of dollars to, and spending a lot of money on salaries. They have to be made accountable. They should be -- They should be forced to walk in West Philly, North Philly, South Philly and talk to some of those young people on those streets that don't have any hope in the world. 298 Resolution 040095 - 3/22/04 So, I just really need you to help us.
Because when it's all said and done, when I look at my children, I want to say I tried. So I'm down here today to try to get you to make them reconsider their funding of the Emerging Contractors Program, and make them look at helping more established contractors. Thank you for your time. ).
Thank you. Councilwoman Blackwell, your light is on.
I only wanted to say thank you to Mr. Ali. I've heard him say parts of these remarks before. I know he's committed. And it's an example. My goodness, we're talking today about how NTI is stalled, but Mr. Ali's testimony just indicates how far-reaching it is. And it's certainly unfair. I get a lot of pressure. I've had this discussion 299 Resolution 040095 - 3/22/04 with many people with regard to people in neighborhoods and minorities in neighborhoods saying they're not included, and what's going on, and what are we as City officials doing? I mean, it's just concerns. And the questions are absolutely legitimate. And certainly we all need to work closer with him, and certainly have him not feel that he's alone in this struggle, because it's not. It's all of us. We are -- We are -- We are our City. We're representatives of certainly neighborhoods. But Mr. Ali has aptly, justly, succinctly stated the issue. And certainly we all need to work more closely with him. And thank you very much.
Thank you. The Chair recognizes Councilwoman Tasco.
Thank you, Mr. Ali for coming in. We've had several 300 Resolution 040095 - 3/22/04 conversations about this stuff. It's the more things change, the more things stay the same. And it's been year after year after year for at least the last 30 years of trying to get minority participation in any of the work on the City. I won't be critical of the emerging program because I don't know too much about it. But whenever we come to the table and ask for the participation of a disadvantaged group, then they get into a program. And they never get out of the program to participate in the actual work. So by the time they finish the program, NTI will be over and nobody will have participated. It's just like trying -- When we had the hearings on the minority participation program, in terms of employment. They set up a program where the kids go into an apprenticeship program. They never get out of the program, so they never 301 Resolution 040095 - 3/22/04 get in the work. You never know how many African Americans or other minorities are in these unions. And so it's just always a program. A program may be nice, but I do not think that they should -- if a qualified contractor wants to participate in that NTI program, they should not be sent to a training program, because I do know there are many guys who are around here who have the ability and the capability. The one thing that we ought to look at -- and I don't know how we do that -- that is an obstacle that is always going to be an obstacle -- has been forever is the bonding issue. But there are ways that they can do that, and they will listen to them. All kinds of barriers are put up so that there will not be any participation. It is an economic force, economic enslavement. And it's not right. And I don't -- And I hope that what he said about steering someone who wants to do work in the NTI program, 302 Resolution 040095 - 3/22/04 who has the capability of doing it, certainly has to be the financial capability of doing it. That does not happen. And they have to go on some program. Because they'll never get out of the program.
Mr. Ali, thank you very much. I'm sorry. You did say you have what, years of experience? 12
I have 20 years in the 13 construction industry. And as the 14 Councilwoman said, I am not alone. But I 15 am a member of an association, and we have 16 35 members. And some of our members have 17 bonds. So the fact that we're not included 18 in this program, it's just a bad mistake. 19
Well, when 20 you say you're not included in the program, don't they put out RFPs? Do you apply?
Well, actually, in the Emerging Contractors Program, no, that no 24 RFPs were put out. And I think that's an interesting 303 Resolution 040095 - 3/22/04 point, because the Council, when we -- in terms of the Emerging Contractors Program and participating in that, no RFPs were put out. But I think Council really needs to look at how that was structured and the structure of that whole program. You have a responsibility to look at the details. My mother always said the devil is in the details. And we have to look at the details.
So Pat can answer also, she mentioned earlier that they were going to put smaller bid packages together. Because the only way you're going to develop a small business is to put it in a venue, whether it's minority or any other small business, is to put it in a venue where they can compete. They'll never be able to compete with the big guys. So, the packages have to be in -- And I think what Councilman Goode was trying to state this morning, well, we 304 Resolution 040095 - 3/22/04 control the money. And it's a special program we have. We write the rules. And the people have to follow the rules or they don't participate. There's no law saying that it has to be $21,000. We'll say we'll give you $10,000 for this building. Here's the specification. I bet they would do the work. Same thing with putting these small packages together. We have put smaller packages together, gotten more -- smaller businesses to help participate. Then we would be looking at this sheet (Indicating). It wouldn't look like this (Indicating). See, because people could be working throughout the City. You know, my demolition in my District is just going to start in July, two years later, but it could have started with the other demolition. Here, it's completed. But I'm way back here (Indicating). Why couldn't we all have been on the same track? If you 305 Resolution 040095 - 3/22/04 look at the program in a way that we could have involved more smaller businesses to do the demolition, and then we wouldn't -- it wouldn't look like this (Indicating).
I just wanted to just hopefully clarify a couple of points. I didn't want Mr. Ali to go away to think that the only way he could -- businesses can participate is through the Emerging Contractors Program. We have in the past put out smaller bid packages which are publicly bidded.
And we've been trying to, you know, do community outreach to let people know about that. All of our bid packages are posted. We're putting out even more. For example, we experimented in the Tioga bid package with both small and large bid packages. But what happened was, I believe, most contractors bidded them together, as opposed to separately. We crossed Greenwich was an example 306 Resolution 040095 - 3/22/04 of an property bid package, and we've had some other, East Germantown, some smaller bid packages. One of the -- the feedback that we're getting, I think it goes back to the performance bond issue. And what we're looking at now is, how can we in the City -- because look -- use a different type of surety bond instead of our traditional one. When we looked -- And we've started looking at other jurisdictions. And different cities do different things. But the Law Department is looking at that. And what we've committed to is to begin, was to resolve the surety bond issue, because I don't want small packages to go out in pairs --
-- because of the surety bond issues. We wanted to start rolling out at least twice a month small bid packages, not more than six. And I believe we've been talking about that. 307 Resolution 040095 - 3/22/04
Yeah, but, see, the thing is, it's not just that we have to talk about it. We really have to look at it from a business perspective. And the City can't really allow theirselves -- I don't know if you were here when we had the Crosen (phonetic) decision. But one of the things that occurred during the Crosen decision was, we had the General Building Contractors Association which originally was known as Amassive (phonetic) Builders Association Of Philadelphia, which incidentally was formed in 1841. 1944 they changed the name to the General Building Contractors Association. They are the dominant contractors organization in the City. One thing that we learned from the Crosen decision was that they allowed the City to make some steps to try to help disadvantaged businesses. And when the market went down, they sued, and they successfully won their suit, along with 308 Resolution 040095 - 3/22/04 attorney privileges. So what I'm saying that to say is, whatever you come up with, it's going to have to be a fair business model, because it's going to have to be fair across the board, because there will be an adversary to spring right on you. And it's not going to -- Even if you had a business opportunity for one firm to participate, you can not get around that surety bonding. But what would be better for us to work on is joint ventures. It's accessible across the board. But we need people in power, positions of authority, to at least put that on the table because we're really shooting ourselves in the foot. With a joint venture, we're assuring a new firm with an established firm that it's a win for everybody, and there's guidance for the new firm, because nobody can get in construction and walk down that path. 309 Resolution 040095 - 3/22/04 Imagine it from your perspective. How could somebody have 224 hours worth of political training and come out and be the Council President or a Council person? It just couldn't be done. So it's the same thing in business. All we needed -- But it was said to us that we could only be participating. And I don't want to name the fellow's name now, but I'll tell you at the end of the meeting, that he told me the only way we could participate, because they told him that it had to come from the Chamber. And that was a slap in the face to everybody that's been struggling. Look: We're all in this thing together. But as I said earlier, no one of us is as smart as all of us. And if we put all our minds, then all this stuff is easy. The unions... The only reason why the unions are dominant is because they're organized. That's it. There's no rocket science in none of those unions, none of them. And you know them only like I know 310 Resolution 040095 - 3/22/04 them. But the problem is, they're organized. And as long as you're organized, you can win every time. So that's really all we need to be a part of.
Thank you, Mr. Ali. The Chair recognizes Councilman Rizzo for a point of order.
You know, it's interesting you're bringing up these performance bond issues. I recently talked to a vendor that told me that he sells a significant amount of vehicles to the City of Philadelphia each year. And he indicated that because of the significant requirements for these bonds, that it's adding approximately three to four hundred dollars to the cost of every vehicle. See, it's so unrealistic, and it's so unnecessary, that I believe the Procurement Department -- And, Pat, you're 311 Resolution 040095 - 3/22/04 shaking your head, so you must know what I'm talking about here, because I believe we're talking about the same performance bond --
-- no matter whether it's for what you're doing or other commodities that the City purchases. So if we are requiring these vendors to come up with these security bonds, and it costs the City more than necessary, something -- that whole thing has to be revamped. The vendor eventually called me back and said that the Procurement Commissioner said that it was an issue that was a City Charter issue that needed to be dealt with on the ballot.
I mean, I don't pretend to know all the law on that. But obviously it's costing the City a lot of extra money. And maybe it really needs to 312 Resolution 040095 - 3/22/04 be reviewed and looked at very, very... very hard.
I know there have been some changes with what they call the small purchases. It probably wouldn't apply to that. That, I think, just passed a Charter. So they're putting regulations into that. But that deals with the purchase of goods versus demolition construction. And some people argue the purchase of goods are less risky and different. But we are looking at other... what the private industry does, like everyone talks about. The AIA surety form. We're looking at some of the other jurisdictions, and look at what their bonding requirements are, to see if we can come up with something that's just much more reasonable, particularly for smaller bid packages, where I think one could argue there is a lesser financial risk because of the size of the package. We wouldn't do it for the mega ones, but then that's how we 313 Resolution 040095 - 3/22/04 can begin to lower some of the barriers that we've --
It's almost like riding a car, because just like in the City, bonding is almost -- is insurance. So it's insurance that the project is going to be done in a safe manner and nobody's going to get hurt. It is insurance. It's just like in the City of Philadelphia in construction, it's -- it's -- it's ingrained in the industry. It's not going to change in this lifetime because it's been like that for three lifetimes. But the thing is, we just need to be able to get maybe lower levels of insurance. But the fact for Emerging Contractors are, if you're not qualified, you're not going to get that insurance. And you can't get qualified unless you have 314 Resolution 040095 - 3/22/04 experience. So they're running around in a treadmill. They're never going to get to the next point unless they do a joint venture. And that's just really a concept thing, because it's really, do I want my name to be on the contract by myself or do I want to share it with Miss Smith? What's the difference? At the end of the day, we're still going to make money and we're going to move on. We don't always have to be married together. But as long as we move to a point where I can step off, then later on I'll be fine. And that's what we have to keep in mind. I'd like to thank you for my time.
Thank you. I believe Councilman Nutter would like to be recognized.
I would, Madam President, but it's solely for the purpose of asking Miss Smith possibly three questions. She doesn't necessarily have to 315 Resolution 040095 - 3/22/04 give answers to at least two of them. One I do need an answer on, but I don't know whether...
It is not regarding his testimony, so I don't want to tread on another member's time. Lost track of where we are.
How many more witnesses do we have? MR. McPHERSON: We have one more witness, that I'm aware of. Rosemary Cubis.
Good evening. My name is Rosemary Cubis, and I live in the Twelfth... in the Seventh -- in the Seventh District, 19th Ward, 12th Division. And the reason I'm here today -- and 316 Resolution 040095 - 3/22/04 I thank you very much for staying this late -- we're tired; you're more tired than we are -- is because after hearing all this testimony, we have experienced the City's anti-blight program as government sponsored terrorism in my area. And I want to make that real clear. All the people who spoke about the need to tear down dangerous buildings makes it real clear that the monies that have been allocated by this City Council in other areas are very necessary for those buildings. But before you we have signs. We have placards here that you can all not see, but we can make available to Council that shows... You can take it around... that shows --
All right. That's great. We have two. This one that you're going to see is the street of Bodine Street 317 Resolution 040095 - 3/22/04 that has been memorialized in the City Paper with a six-page investigation, that included reports from HUD siting the City on misconduct. Bodine people are all Spanish speaking. They were forced out by the City. The City has made our neighborhood blighted. Those of us who live there have lifted up our neighborhood from blight. We had abandoned buildings. We had garbage strewn lots. We had drug traffic. We had total disregard for our neighborhoods. We brought it back. Over the 31 years that I live in my house, I've seen many efforts. We have brought it back from blight. Technically, unofficially, we are now the boundary of Northern Liberties. The houses in our area on that Bodine Street, they were offered $20,000. Last May of 2003 the Redevelopment Authority said that it would -- projected that it would take $29.8 million to use eminent 318 Resolution 040095 - 3/22/04 domain, including relocation for 218 families. If you do the math that's, $136,000 per family. The families on Bodine were offered $20,000. The subsequent families in the takings that the City is using for eminent domain are 12,000, 15,000. Now, you tell me where people can move with these prices. What's not taken into account is the years of making those neighborhood safe. A house is not a neighborhood. A house is not a home. We made those neighborhoods safe. I am not moving from my house which you're seeing. My house is the one with the mural. The other houses in that chart are Bodine Street which the City has blighted. And I say that very clearly. Those homes were in good shape. The gardens were beautiful. The City forced those people to move in the way that I'll explain. You get a letter from the City. And the City says we 319 Resolution 040095 - 3/22/04 are -- a very confusing letter to Spanish speaking people. We are interested possibly in your house. Do not pay rent. If you pay rent, keep paying it. Do not move, and have 90 days to move. These are the letters that we have received in our neighborhood. People were totally intimidated on Bodine. So that's the term that I use: They were forced. And that's one of the points of government sponsored terrorism. That's how it feels. Now, what we're here today is that the budget for demolition has been doubled. From million projected, it is now 17 projected for 53 million. 18 We think that those abandoned 19 properties that people sat here time after 20 time speaking about, that are in such bad 21 condition, need to be demolished. 22 The minority contractors fairly 23 should have those demolitions, but they 24 shouldn't be in areas of our community that 25 are rehabbable. 320 Resolution 040095 - 3/22/04 Specifically, these signs went up last week. The building that you're looking at now in that orange chart -- we made it almost the same color -- is a church that had this tagged on it. The imminently dangerous has been crossed out. And what's put on there is unsafe. We have other signs where imminently dangerous was crossed out and nothing was put. These are buildings that... The one there is rehabbed. It's a church inside where we'll be having our community meeting to talk about this, and what the City's doing to us. We're trying to fix our neighborhood. We have fixed it. Bodine has no remedy now. But this is what's happening to us. The takings through NTI on my block were attempted. 2163 North 2nd Street, and 2153, and all the property in between, the City tried to take it through NTI last June. 321 Resolution 040095 - 3/22/04 We came. We testified that those properties were owned, thriving, lived in. One was a business. And the City had no 5 business taking it. And then they said -- The City told us that it was a mistake. Well, they couldn't get our land that way, so then they're going this route. This is on an adjacent building.
The Councilman, I believe, tried to make an inquiry as to why this was happening. And on the ones on 2nd Street he could find no answer. These are rehabbed.
You're talking about the sign that's on the church.
I'm talking about the sign that's on the church and the sign that's on the PHA house which has minor fire and smoke damage that we've been waiting to be repaired. And the problem is 322 Resolution 040095 - 3/22/04 we have no control over PHA. And the typical time line is 90 days. Now, any of you who know PHA, how do you expect that we'll be able to put pressure on PHA to do something in 90 days that they haven't done in a year? We are experiencing this blight removal as terrorism. Our neighborhoods are being torn apart. And we don't appreciate it. You need the money in West Philly for demolition of housing that is dangerous. You need to get it. And you need to get it out of our neighborhood. We don't need the green grass, if that's what NTI represents for us. We need housing. And we need you to leave us alone. We are rehabbing our homes. And these are poor people we're talking about, people on fixed incomes, minority people, Spanish speaking people, senior people, women. And what we're asking is that money 323 Resolution 040095 - 3/22/04 not be augmented for demolition. Use the money that was allocated and parcel it out to the areas that are imminently dangerous, not like this where imminently dangerous is crossed out. So, we'd like the money not increased, and we'd like NTI or whatever the blight program is called now or later, to leave our neighborhood alone.
We'd like a response from NTI because this is from L & I, and this is through another channel. Since they couldn't get it through NTI, in terms of buildings that were right on my block, now this is the new -- there were ten teams in our area slapping these on indiscriminately. When we saw it slapped on the church, we said this is --
Three. But I did want to talk about the process. When we go out and inspect, and we find any kind of condition that constitutes a notice violation, we put up a sign. That sign does not mean the building will be demolished. The next step -- And many of you who have been part of this process -- is getting together and going through all the violations. We do it in the field. We have photographs. And then the ones that are imminently dangerous are then listed as part of the proposed bid package. Then that in turn is submitted to City Council for review and approval. But any time inspectors from the City are out in the field, and they find a condition that's a violation, they do put the notices on. And even if a building is intact; you know, it's a vacant property, it still presents, you know, a nuisance in the sense of, if somebody were to go into 325 Resolution 040095 - 3/22/04 the property they can hurt themselves. So that's been the basic process. I can't speak to the church or the two properties there, but we can -- you know, I can get the addresses and give you the violations to let you know why they were cited, and whether or not -- I don't know -- they're being proposed for any bid package. But there's several steps after we do the notices.
Councilman... President Verna, the reason that we're so worried is, we have had the experience where our neighbors had bought a house on Sheriff sale to rehab on the 2200 block of Palethorp. And they were rehabbing it and fixing it. And they got -- A neighbor came and said, the wrecking ball is knocking down the house that you've put on a roof. And you have the windows. And we have proof and we have documentation. And so, therefore, we don't take these signs lightly, because we have 326 Resolution 040095 - 3/22/04 the experience, as I said -- and I used it very carefully, government sponsored terrorism. That is how we're experiencing this blight program. We're here before you time after time just defending what we have, and what we've been able to build over the years. That is outrageous, that when all this blight exists, we have to sit here before you just defending what we ourselves have improved. That's outrageous. And that's why we're saying that this government is doing the citizens on my block and neighboring blocks very, very great harm. And we want to know where the -- where the money is going. $136,000 it averages out per family for those 218 families for $29.8 million. Check May of last year Daily News. Where is that money going? It's not going to the residents. So in whose pockets and in which processes and for whose salaries are those going? 327 Resolution 040095 - 3/22/04 We're just defending ourselves from being wiped out. And instead, we hear all these people that are desperately in need of having housing torn down, while we're basically trying to keep ours together. We ask this Council to really look at this very carefully because this is -- this needs more -- this needs very clear scrutiny from as many levels of the government and of the people as possible. Because there's something very wrong here. And I think another sign that we'll have to create is lies. In other words, we have to say it that way, because it's impossible that everything you've been told is in place is in place, and yet these things are happening.
Hi. My name is Elizabeth Sagarra. I'm from the Citywide Coalition to saving my home. I was here last week hearing John Street speak. And there were a lot of people here for the same problem, people that want to keep their home. People are 328 Resolution 040095 - 3/22/04 homeless. And a lot of them were homeless. All this money is given for demolition, but I don't hear nothing about giving homes to homeless people or helping minority people. This increase of demolition, we don't need it. What we need is more homes rehash and more homes given to people that needs it. There's too many people here homeless. And NTI is making me a homeless person because they're trying to destroy a property next door to my home. And they -- And if they knock down that home, it's going to damage my property. And that's going to leave me to move. NTI is making people more homeless. They are not doing their homework. They're not going -- They're looking at the building and placing papers on top of them. I seen it with my own eyes. March 11, '04, when they put this on my neighbor's house, I seen them just look 329 Resolution 040095 - 3/22/04 at the building. They parked their car and looked at it, and they put this right on it. That's all I seen. They didn't go in the building. They didn't see nothing. That building is not falling. I don't know what's going on, but what I'm realizing is, there's more homes needs to be fixed than taken down. And we have to stop this, because a lot of people in another five or six years at NTI can taking homes off of people, there's going to be more homeless people living in Philadelphia. We all going to be poor. And I'm poor already. NTI is going make me poorer. I'm a homeowner. They're taking homeowners and making them into renters. That's making those people more poor. This man Don Ramone (phonetic) on Bodine Street owned his own home for 40 years. And NTI just came and took it off of him. Now he has to rent a home to live? That -- That... And you have to really, really, really to not increase -- I'm 330 Resolution 040095 - 3/22/04 begging you, please, help us. Don't make us homeless. Don't make these poor people more poor. We want -- We want to keep our home. We want to raise our children there. We want to keep our community together. It's the fiber. It's not the home. It's the fiber and the -- and the unity that we have in our community.
We have one more person. We gave you a bird's eye view of our area but it's happening all over the City. We didn't know that this hearing was happening. And therefore, we didn't have a prepared speech or we would have been.
You're doing quite well without one, believe me. Good evening. Please identify yourself.
Yes. My name is 331 Resolution 040095 - 3/22/04 Delcina W. Wilson. I am from the Park Side area of the City. And my concerns are some of the same concerns that have been voiced here earlier today. I would like to see more cooperation between the entities that are involved in the demolition of the properties and the community because that's essential. I would like to see some stringent policing of the L & I process because my experience with them has been that they maker erroneous demolitions. I know that personally, you know, firsthand. There should be no way that L & I should go out and knock down a building that is not supposed to be knocked down. They have schematics. They have maps. So if they're not doing their homework on that end, there are other areas that can transpire. I feel the NTI initiative, their purpose is a good one, and there is a lot of blight in the City that needs to be eliminated. 332 Resolution 040095 - 3/22/04 However, we do have sound structures in our area. And some of those structures can more than -- can more than sustain rehabilitation. Some of them are imminently dangerous, and I can, you know, coincide with the fact that they should be eliminated. But the ones that are sound in structure should be given a chance to live again. All areas of the City should be given the same chance. However, Park Side with it's historic background, being the area where the first World's Fair was held, being the area where the blue collar workers from the Pennsylvania Railroad once resided in the interior streets. I think that that should definitely be given some consideration, as well as other areas in the City. So, the buildings that we can save, let's try to save them. I understand the continuous parcel element of development because it's easier to get continuous parcels rather than to 333 Resolution 040095 - 3/22/04 get scattered sites, but let's have some consideration for the integrity of the neighborhood. That's my opinion.
We ask money to go into Basic Systems Repair instead of demolition. And the demolition money that exists, we ask that it be equally shared, especially in areas that desperately need it, like the ones that testified today. But leave us alone. We've done our own. Stop tearing down our buildings. We beg you to help us stop this, because this is terrorism and we don't understand why. Thank you.
You're welcome. Thank you for your patience. Councilman Nutter.
Thank you, Madam Chair. Madam Chair, I will be very brief. If I could just have Miss Smith back, I just need to put a couple questions on the record.
334 Resolution 040095 - 3/22/04 Councilman, we still have one more witness. I'm sorry. Sir, would you please approach the witness table. Identify yourself.
Thank you. Good evening, Council President, Councilman, and people in the audience. My name is Robert Lattimore. This is my wife, Barbara. For over 42 years we've been together. We had a business. We never been on any assistance in our life. We stayed in business for 30 years. I'm sure some of the Council people heard of me because I been here before. My wife and I about a month ago, one after the other, just went into the hospital. We just got out. So if you see me wobbly, then you'll know why. I'm here to protect my family. I was in business, like I said, for 30 years in the -- in the South Philadelphia area. Redevelopment after the Martin Luther King Housing Projects was imploded, 335 Resolution 040095 - 3/22/04 and we were on the other side of the street. They came in and they... through eminent domain they took six of our properties. Mind you, we was in business. They put us out of business. We are now on assistance. We owned six -- We owned eight properties at the time. Now we are struggling to survive. This is not what the RDA or NTI really wanted to happen to any family. I'm here because it's been a long fight for my family. Five years exactly from '99 we came here. Council passed a resolution that if anyone wanted their properties, they could get them. Every time I went to get my properties, I was discarded. I had -- I told Redevelopment that I would build new if I had to. I had no 22 mortgages on my properties. I had --
Did they take your properties through a condemnation or did they demolish them?
No. My properties was not unsafe. I had -- was in the development process myself. I had one of my buildings extended with cinder block, intended to make three apartments out of that one. Altogether, if completed, we would have had apartments, five stores, and a 16 corporation. We never got the opportunity to complete what we was in. Now, and I'm -- Every time I came to City Council I was kind of brushed aside because the Councilperson that I was addressing didn't want to hear that. So I'm here now, me and my wife, to ask whatever Councilperson -- whoever Councilperson for help. Now, so far Redevelopment has taken 337 Resolution 040095 - 3/22/04 and tore down two of my properties and they built on them. I've never signed any agreements with them. They just went on and did what they had to do -- what they wanted to do. I told them that I was going to build. They went on and tore down my business property and other properties along with that. There's two left. And I'm still fighting maybe to get those two back and maybe make an agreement with the developers. But it seemed that every time I tried to --
I think -- Miss Smith is here. I see she's approaching the table.
I've asked Miss Califano to follow up. I'm sorry, sir. I'm going to ask Miss Califano to follow up. I know you mentioned as part of the Martin Luther King Development, so it kind of predates our involvement. But she will -- We can get the 338 Resolution 040095 - 3/22/04 property addresses, and just find out what the status, if money was paid into court, that type of thing.
Money was never paid. I didn't accept it. I had six -- All of my properties was commercial: Apartments, business, and I was developing all of my properties. Redevelopment took my properties and offered me -- And mind you, this is in South Central City. They offered me for six properties $73,500. And one of my properties in that area was worth at least a couple of hundred thousand dollars. But right now we are still suffering as a family unnecessarily. The houses in that area are going like wildfire for $150,000 up. And I'm saying, all I wanted to do was upgrade my community and uplift it. That's what I did for 30 years in that community and longer. But no one would listen to me, no 339 Resolution 040095 - 3/22/04 one. And I'm here now to... well, to ask your assistance, to ask your help.
Thank you. At this time the Chair recognizes Mr. Ramos.
I'm sorry, Madam President. I had pressed that button and pressed it back off earlier. My question was for Pat Smith.
Okay. We'll wait. All right, sir. Miss Califano is here. If you sit with her, give her the addresses in question, she will check into this, and try to be of assistance to you, and see what we can do to help you.
Thank you. Thank you very much. 340 Resolution 040095 - 3/22/04
Just one more. Just one more. The harm that the taking has put on my family is devastating. And I want to put that on record, because any other person would have did something a little different -- and I just wanted to say that -- for his family, the taking from his family. I'm going about this in the way I believe God wanting me to deal with this. And I'm telling you, I will not stand for the taking of something we worked over 30 years to build. Although they were not finished, completed, I bet in '60... it could have been another six months, we would have had things completed. But I say again, I just want the Council people to hear me. And if anyone out there want to reach out, then I'll appreciate that.
Thank you 341 Resolution 040095 - 3/22/04 very much. Miss Califano, why don't you raise your hand so the gentleman will know who you are.
Okay. Miss Smith, do you want to take the table, please. The Chair recognizes Councilman Nutter.
Thank you, Madam President. I'll be very brief. Miss Smith, I have a couple questions that I don't need an answer right now, except for one. First, can you provide to us a side by side breakdown by Councilmanic District, taking the FY'04 budget that we approved, the dollars that were approved, and the anticipated number of demolitions that were in Resolution 030306 compared to year-to-date by Councilmanic District the dollars spent, the number of demolitions that actually took place. One of the things I'm trying to 342 Resolution 040095 - 3/22/04 understand is, it appears that dollars may have been moved around within the total of the $19.6 million that you had. I take it you could have even possibly spent beyond that. And I'm trying to understand how the dollars moved around, and what it means to have a budget by item by District, and how anything can happen to it. Second is, I need you to tell us how much of the NTI money is left.
-- and how much is left in each of the categories. Lastly, we've had some discussion. What I'm taking out of our discussion is, 343 Resolution 040095 - 3/22/04 in terms of -- You're going to come back with a proposed amendment different than the proposed amendment that's in the Resolution for today, possibly different than what's in your testimony. May or may not be. But you shared with me a figure for the Fourth District of $3,362,696.
What I need to understand is, does that then represent a restoration of the 1.1 that was proposed to be decreased in the budget amendment before us, plus an additional $562,696 which is what gets you to the $3.362696. Is that the way it works?
Yes, because it reflects the actual cost of the 100 properties.
Okay. So you're going to restore the proposed cut, plus put on an additional $562,000; is that correct?
Yes. Okay. All right. Thank you. Thank you, Madam President. 344 Resolution 040095 - 3/22/04
And Madam President, if we can have the Sergeant-at-arms circulate and enter -- We have three separate packages, if you will, of letters, petitions, and other documents that members of the community in the Fourth District have sent in or brought today, that maybe had to leave. With your permission, I'd like to have all of them entered into the record.
Make sure that the stenographer gets those, please. At this time the Chair recognizes Councilman Ramos.
Thank you, Madam President. Pat Smith, I was very much concerned about a lot of things that were said here today. And thank you for making yourself 345 Resolution 040095 - 3/22/04 available to us. And I guess you'll be back, probably more than a couple times. But I was really concerned about these signs that went up a few blocks, about six, seven blocks away from my home. And there's a scratching out of the word imminently dangerous. And one of them, the one at 2148 North 2nd Street, and up above it said unsafe. I don't know if -- or if they are synonymous or very close to it, but they seem to want to... seems as though that this sign is saying that this house is not as dangerous as this word imminently dangerous, but the word unsafe fits it better. But then at this other address at 2159 North Phillips Street, it crosses out the word imminently dangerous. And then that's all it says. It just says, keep out. It doesn't say, you know, why to keep out. And because -- It says -- I mean, a message in my neighborhood, that means I'm just -- because I'm telling you to keep 346 Resolution 040095 - 3/22/04 out. And I think the people will find that anywhere in this City very offensive. Again, I don't live too far away from these properties here. And there's many of us in the community in this area that support NTI, like NTI is supported in just about every part of the City. But there are pockets of very good Philadelphians that are concerned about particular things. And they have a voice, and they have a concern that should be heard and addressed. And if you can get back to me tomorrow and let me know what, in fact, happened at these three properties. It's 2148 North 2nd Street, 2149 North 2nd Street and 2159 North Phillips Street. What in fact are the status of these homes, and why were these signs put in the manner that they were? Thank you. That's all, Madam President.
You're welcome. 347 Resolution 040095 - 3/22/04 The Chair recognizes Jack Kelly. His light's on. Do we have anyone else? Any other members have any other questions? Okay. That concludes our hearing for this evening. We will stand in recess until Monday, March the 29th, at 9 o'clock. 10 (Hearing concluded at 6:50 p.m.) 348 CERTIFICATE I HEREBY CERTIFY that the proceedings and evidence are contained fully and accurately in the stenographic notes taken by me upon the public hearing of The Philadelphia City Council, taken on March 22, 2004, and that this is a true and correct transcript of same. _____________________________ DAVID A. DEIK, RPR and Commissioner of Deeds (The foregoing certification of this transcript does not apply to any reproduction of the same by any means, unless under the direct control and/or supervision of the certifying reporter.)