Had you known in 2003 that this company had the possibility of going out of business or at least were maybe not going out of the business at that time but at least had some -- had been cited by the Federal Government for their lending practices, what would you have done?
We closed on this transaction in May of 2003. And so, you're saying after we had closed we had realized that there were these irregularities what could we have done?
Is that... Yeah. Basically, the way the documents are written, as long as they were meeting their obligations under the agreement -- and that related to, obviously, paying their rent and meeting their job requirements -- I'm not sure there would be too much that we could 3117 Budget - 4/12/05 have met, as long as they were within the law.
Well, at that time I sent a letter to the Mayor questioning their business practices, as related to the citizens of the City of Philadelphia and the predatory lending practices they were engaged in. I got no response.
Yeah. I -- I didn't see that letter, but I'm not sure we could have satisfied your concerns because it was, in fact, after the closing of the transaction, I assume.
Currently, Ms. Naidoff -- Mrs. Naidoff -- the City Council, as you know, was just engaged in a discussion regarding contract reform. Do you believe that should P.I.D.C.'s economic stimulus contracts be part of the contract reform proposal?
Well, in the bill that's on the calendar now, relative to 3118 Budget - 4/12/05 contract reform, P.I.D.C., P.C.D.C., and some of these other agencies that give contracts to companies like American Business Financial, they're not included in the legislation. Do you believe that since this is -- these are contracts that are given out by the City, don't you think should they be part of the contract reform proposals?
Because they are not directly contracts given out by the City, I think we'd have to get a legal opinion as to whether that would fall within the confines of what you're talking about.
Yes. And that would be the issue, whether the dollars would control that.
All right. Does your contracts that are left from P.I.D.C.'s economic stimulus fund go through the City's Contract Review Committee? What is the Contract Review Committee? 3119 Budget - 4/12/05
What is the Contract Review Committee? And do the P.I.D.C' s economic development stimulus funds go through that Contract Review Committee?
Well, the Contract Review Committee is an administratively created committee to review professional services contracts.
The Finance Director and some designees of the Finance Director, Procurement Commissioner, Budget Director's Office.
Professional services. 3120 Budget - 4/12/05 Contracts for professional services.
What constitutes a contract for professional service? What could you use to stimulus money?
Engineering services, architectural services, legal services, consultants.
Well, we submitted -- And I looked at your testimony...
The Chair recognizes Councilman Goode for a point of information.
Thank you, Madam President. I believe Councilwoman Tasco was asking whether the economic stimulus money had to go through the Contract Review Committee.
It does not go through the review committee. 3121 Budget - 4/12/05 So I could put in a request for some stimulus dollars for a consultant to work in my district in the commercial corridors. Would that be something that would be considered?
The economic stimulus dollars are generally large dollar contracts that we use to support business attraction, retention and creation -- job creation efforts.
So, the Commerce Director... Are you part of that committee?
I am a member of the committee, but Mr. Gordon serves as my designee.
But then the P.I.D.C. economic stimulus dollars do not go through that committee.
So, solely the 3122 Budget - 4/12/05 dollars are granted by the... by whom?
They're City contracts for professional services. So, if a department is engaging an engineering firm to do surveys, for example, that would go through that committee.
Okay. But who determines how the economic stimulus dollars are spent?
That's generally done on recommendation of our department, in consultation with the Mayor's Office.
Okay. We'll probably come back to that. Let me ask you a question about the Cultural Fund.
Is the Office of Arts and Culture still in existence?
Last year we appropriated $100,000 for that department. What happened to it?
That money was used to 3123 Budget - 4/12/05 continue the payments for the Art Commission staff which formerly was done under the Office of Arts and Culture, and also to support some staffing needs that we had, in order to continue the transition, as those programs were accepted or were picked up by other City departments.
Well, you know, we -- I now serve on the Arts and Cultural Fund. And we have budgeted $2 million appropriations for that fund, but we do not have dollars for administrative support which the Arts and Cultural Fund Office did provide support. Do you ever see that office being opened again? And what support can you or your office give to the Arts and Cultural Fund?
We don't envision the creation again of the Office of Arts and Culture. We have taken some rather comprehensive steps to make sure that all of the programs that were carried out by that 3124 Budget - 4/12/05 office have been picked up by other City departments and other staff members who are expert in the areas and able to carry out those functions. We believe that the day-to-day activities with the percent for art, the Sculpture Conservation Program, Art in City Hall, and the collection management functions are all functioning well now within the Public Property Department. And the Art Commission, as I mentioned a moment ago, is functioning well. That's now in the Planning Department. And I am carrying out the role of the Mayor's liaison to the arts and culture community and working with him particularly on the effort to find sustainable funding for arts and cultural organizations.
Well, what administrative support can your office give to the Arts and Cultural Fund?
I don't know that we can give any. I'd be happy to help in my own personal capacity as the Mayor's liaison to 3125 Budget - 4/12/05 the arts and culture community.
So they're left to fend for themselves, with no 5 administrative -- no increase in their appropriations for administrative work.
Well, I think it's no 8 different than any other appropriation, in that any organization that gets an appropriation has to account for a certain amount of administrative overhead as part of the receipt of those funds. And that's the way it's done generally.
I'll come back. Am I finished, Madam President? If not, let me just go ahead?
There are other members that have been waiting. So, if you don't mind, we'll do a second go-around.
I want to go to the question the President asked about the $125 million, which you may or may not be 3126 Budget - 4/12/05 able to answer for this fund. Who pays the debt service on the this fund?
Oh. Okay. Do you have an overall City plan for the water -- for the waterfront, that where you're going to use the fund for whatever you're going to use them for, infrastructure and all of those? Is there a design plan for the riverfront?
As I mentioned before to the President, that's what we are putting together now, is a proposed list of projects along the waterfront, in order to capitalize and galvanize the development that is going along -- on now along the 38 miles of waterfront. And we will back to you with that list.
Thank you. The Chair recognizes Councilwoman Brown.
I'm sorry. Councilman Goode, you're next. You had asked for a point of information. Your light went off.
My questions are really around budgeting personnel for the next fiscal year and in the future, in light of the new economic development blueprint. How will staff capacity be adjusted to implement the blueprint?
The capacity issue has not been addressed yet. But what we have been talking about is how we will allocate the various functions and activities that we have outlined in the blueprint, among not 3128 Budget - 4/12/05 only the people in our department but the related agencies who work with us on a regular basis, like P.I.D.C., P.C.D.C., Innovation Philadelphia. And we are actually talking to all of them at this point about how to carry out those initiatives.
How many staff persons or consultants do you consider to be directly assigned toward the implementation of the blueprint?
Because I don't think the decisions are made yet about how we're going to carry out all of the initiatives.
I'm just asking at this point in time how many staff people you have directly assigned toward implementation of the blueprint.
Well, in -- sometimes I guess you would have to say all of the members of our department are engaged in the blueprint. 3129 Budget - 4/12/05
Okay. What will be accomplished during the next fiscal year, in terms of the implementation of the blueprint?
We've laid out the blueprint, in terms of the next three years. So, we don't have specific goals for the next year.
Okay. Last question is, what's the total dollar amount in new resources to be allocated for the implementation of the blueprint?
The only specific allocation of new dollars is the one million dollar commitment to the Knowledge Industry Partnership.
No, because we have been talking about that as part of this budget proposal.
You're welcome. The Chair recognizes Councilwoman Brown.
I'd like to follow up first on the questions raised by Councilwoman Tasco regarding the arts and -- the Office of Arts and Culture. Am I hearing you say that all of the former functions and roles of that department 3131 Budget - 4/12/05 had been fully integrated into other departments within government? None remain in transition?
I think it's probably not fair to say all of the functions have been assigned out to other departments. Certainly the programs that I mentioned have been assigned to a variety of departments, such as Public Property and the Planning Department. But as I mentioned, we maintain within our department a strong presence in the role that I carry out for the Mayor as the liaison to the arts and business community -- arts and culture community, and have been spending a fair amount of time and energy, particularly on the project of trying to find sustainable funding for arts and cultural organizations.
And so citizens outside of government who want to contact any of the programs that have now been integrated into other departments, the way for them to get to those programs is now how? 3132 Budget - 4/12/05
Many people know directly to call the Public Property Department or the Planning Department, but otherwise calls come through us. We've had one yesterday about the Caulder Sculpture Garden. Obviously, when we get those calls, we get the right people involved.
Okay. And you say not all of them have been fully integrated. Which programs remain?
I was just referring to the fact that I have retained within... we have retained within our department my specific role as the liaison to the arts and culture community.
Okay. Now to follow up on Council President's questions regarding the $125 million, is there any -- and knowing that what you've already stated which is the full breakout has not been -- is not public yet -- is there any consideration in that pending document on commercial corridor development?
The $125 million, if 3133 Budget - 4/12/05 it is made up of the reserve funds from the water and sewer bonds, will have to be used for related projects, for water and sewer projects. And the Mayor has committed this to his new River City Initiative. So, what we're looking at is those kinds of infrastructure projects that will help advance the new River City Initiative.
Okay. All right. Neighborhoods that have a significant number of residential properties, is there any -- do you know if there are any trends that speak to the number of openings or closing of those businesses along those commercial corridors?
You were asking 3134 Budget - 4/12/05 whether I knew of any reports about that?
So, currently, then, the Commerce Department is not keeping a handle on, if you will, businesses in the commercial corridors that are opening or closing and the whys to that.
Well, we have -- we have a number of people whose primary focus is the commercial corridors and the neighborhood -- and neighborhood economic development. And they do keep a fairly close -- They keep fairly close tabs on what's happening, but nobody keeps a list or report of the openings and closings.
Okay. Can you or a member of your team tell me what percentage of our City's commerce activities attributed to neighborhood commercial corridors versus downtown businesses. Councilman Goode has a point of 3135 Budget - 4/12/05 information, Madam President.
I'm going back to the question before that. Isn't it a requirement of P.C.D.C.'s contract to track --
Isn't it a requirement of P.C.D.C.'s contract to track openings and closings of businesses?
I was struck by the discussion during Councilman Goode's hearing on the blueprint, where Councilwoman Tasco raised a number of what I believe to be legitimate concerns about neighborhood commercial development and the City's priorities and where we want to invest dollars which is now what drives these questions. So, can -- if not now, sometime soon 3136 Budget - 4/12/05 hereafter -- this information be provided to Madam President on what percentage of dollars we yield from commercial neighborhood corridors versus downtown?
That would be useful. Can you or a member of your team speak to the amount of capital development that has happened over the past four years? And for me, my interest is looking to see has there been an increase, a decrease, a fluctuation or whatever.
Councilwoman, we'll have to try to get that information for you.
Okay. Let me just make sure I've covered all my questions here. There was one other item in your testimony. 3137 Budget - 4/12/05
The $1 million in capital dollars per year have been spent now over the last... How many? Over the last three years, $1 million.
Okay. My final question comes from your testimony on where you say, and I quote, business attraction and expansion efforts will include small and neighborhood businesses, with a focus on commercial corridors. What strategies, tactics or plans are in place or under way to speak to that reality, where you want to deal with business attraction and expansion efforts? Can you elaborate on that for us?
Several things. We have indicated in the testimony that we have 3138 Budget - 4/12/05 a very, you know, successful team effort that's been going on for a number of years now, in terms of primarily business retention. And now that that cycle of leases expiring is coming to a close, except for occasional ones... The bulk of them, though, have now been processed. So, we're now going to turn our attention to the business attraction effort. And that's a team effort of the Commerce Department, P.I.D.C., the Chamber of Commerce, Center City District and the Governor's Action Team.
The business retention focused on commercial corridors?
The commercial corridors effort is addressed in the blueprint when we talk about the fact that there are a number of agencies and departments and programs that focus on it. 3139 Budget - 4/12/05 And so, our first step now is to look at -- and we have begun this process of looking at -- the variety of ways in which we fund and support commercial corridors. And we're trying to see if there are some better ways of leveraging all of those efforts, so that we get more successful effort, more bang for our buck, frankly, in order to make sure that all of those efforts come together in a more consolidated fashion.
Okay. I guess my final comment would be, when we think of the Mayor's N.T.I. program and the targeted communities that are being impacted by that, the hope is that there's a link or a bridge to business corridors within those N.T.I. areas so that we, indeed, have neighborhood transformation in its purest form.
Well, we believe there's certainly a link. And as I said in the testimony, we 3140 Budget - 4/12/05 believe that the commercial corridors provide the backbone of the neighborhood economic development. What I'm saying is that we think that at this point there are so many different avenues in which the City administration is looking at commercial corridors, that perhaps there's a better way of consolidating or at least coordinating those efforts, so that we leverage those dollars better.
Thank you for your testimony. Thank you, Madam Chair.
You're welcome. Councilman Rizzo, did you still want to be recognized?
Thank you, Madam Chair. If I have any time left over, Councilman Nutter would like to have it. Good afternoon.
One of the areas that you've been very responsive to me has been businesses that are being... There's an attempt, as you know... Businesses are trying to be picked off by other states. And I know that Virginia is one of those states that is making a very, very aggressive pitch here in the City of Philadelphia offering, obviously, lots of opportunities. And I know that you indicated that we do as much as we can do here, but there's also some need -- some help we need from the State of Pennsylvania. So, could you tell me... Do you know presently how many states are actually aggressive at this point trying to locate businesses into their states like Virginia? Are there others that are really focused on Philadelphia right now? And why do you think that? Do they feel as though things aren't good here or it's just that this is the way their strategy is? Why are they looking at Philadelphia? And why am I 3142 Budget - 4/12/05 getting so many calls from businesses that are receiving these letters from other states?
I think that's a very astute observation. I woke up this morning to an ad on radio about the State of Florida looking for some leads in Philadelphia. I just think that this is a trend that is going on all across the country. And I would venture to say there's probably not a state that doesn't have this kind of business attraction effort. So, what we are seeing here is probably the same thing you would hear from colleagues and friends in other parts of the country. And hopefully, they will hear about Philadelphia and Pennsylvania attracting business in their jurisdictions as well.
I don't mean to interrupt you, but I don't hear any of my colleagues in other places getting mail from Philadelphia or Pennsylvania. I haven't really... You know what 3143 Budget - 4/12/05 would be interesting? If you could have your staff show us what we do and Pennsylvania does to go after businesses. Because it's kind of depressing to have these folks call --
...and say that Virginia is coming here to sit down to show me opportunities that I have in another state. Maybe we are just a little too close to the scene here. But I think it would be good to educate -- It would be educational for us to see and be able to say, well, look, we do the same thing. But I've never seen, honestly, other than a few ads a few years back about what we're doing as a city and in concert with the state to attract business here.
I'd be happy to show you. The state has actually been active in this for quite some time. And as you know, the City is just beginning its efforts with the Select Greater 3144 Budget - 4/12/05 Philadelphia effort which is being put together by the Greater Philadelphia Chamber of Commerce and which we are supporting. We do think that kind of collaboration is the way to proceed on this. And working together with the business community, I hope that it won't be very long before you start hearing from friends and colleagues who say they hear Select Greater Philadelphia ads in their part of the country.
Well, I'm glad that the new leadership is doing that, but you would have hoped that that would have been in place long before now. And I'm not trying to be critical. It's just that it seems as though other places, especially, like you said, the south, the sun belt, is very aggressive; and as a matter of fact, from what I hear, successful. Because I know one particular business that is trying to survive in the inner city that just, I think, is today or tomorrow making a decision to leave 3145 Budget - 4/12/05 Philadelphia. And I've tried to twist their arm, but it's not working.
Well, I'm sorry to hear that. But I do hope that in a very short order you'll feel that there is a great deal of successful effort going on in Philadelphia to attract businesses.
Well, that's good. I'd like to see some of that so I can be aware of it.
Thank you. And also, I want to thank the folks at the airport for all of the good work that they do constantly getting involved in requests and different issues there. And they're very responsive and try to be as cooperative with a place that is just bursting at the seams. And I just hope that all the plans that we all want to see happen there happen and happen quickly. But again, thanks for the good work 3146 Budget - 4/12/05 at the airport.
Thank you for saying that. Mr. Isdell and his staff are here to hear those nice words. Thank you.
Thank you. Madam President, Councilman Nutter can have my last 34 seconds.
Thank you. The Chair recognizes Councilman Nutter.
It's just incredibly generous. Good afternoon, Ms. Naidoff.
Mr. Longstreth.. I didn't catch the other gentleman's name at the table. Let me go to -- Let's go to of the testimony which at least has a listing for both P.I.D.C. and P.C.D.C. in a number of performance indicators. What I've wanted to ask was how 3147 Budget - 4/12/05 many... Whether it's just those two agencies or there may be others, what was the total reconciliation on jobs either created, slash affected, and the total number lost? And what was the net last year? Did we have a plus? Did we have a growth in jobs in the City or did we have a loss in jobs in the City?
The loss figures, as we understand it, were in the neighborhood of 3,000. So, if you look at the total here, it looks like we gained some, if you add the 3,000 in P.I.D.C. and the 100 in P.C.D.C.
Okay. Now, there was a report not too long ago from the Department of Labor that seemed to have a slightly different view of the job situation. So, can you explain the difference?
I can try. I actually don't have my materials here about that, but there are several measures, apparently, within the Department of Labor for job loss. And the figure of 10,000 which is the one I 3148 Budget - 4/12/05 think that had been...
Yes. ...had been publicized recently, was from a particular status called the Bureau of Labor Statistics Q.C.E.W, Quarterly Census of Employment, which is based mostly on unemployment figures. And there is another statistic that is called the C.E.S., is it? The C.E.S. which is the one that we rely on and many other jurisdictions do, too, because we believe it's more credible. It is not limited to unemployment figures and it is also, as I understand it, not limited -- it's not calculated on a county basis. And in looking at counties only, Philadelphia has typically come out with larger numbers than we believe are realistic for Philadelphia because they are only looking at a concentrated --
Because they're only looking at an area that has a very intense population; whereas, in other areas, where you have a county that covers much more -- covers rural and suburban figures -- landscapes, you get a different calculation for job creation and job loss. I can provide you with additional information, Councilman.
Well, I mean, are you saying that the Bureau of Labor report was wrong?
No, I'm not saying it's wrong. I'm saying that they have different measures. And in the judgment of our policy analysts who follow this -- and apparently this view is shared by many others in other jurisdictions -- the better calculation is the C.E.S. calculation, as opposed to the Q.C.E.W.
Okay. Well, I mean, has a document... Has a document been 3150 Budget - 4/12/05 put together to explain this or has there been a follow-up or have you challenged the assumptions of the Department of Labor? I mean, it's not like the report was, you know, issued in secret or silence. I mean, I believe it was on either the front page of the Inquirer in the A section or it was on the front page of the business section.
There's been no 19 information put on any record anywhere that either disputes it or says, you know, they're right; we're wrong; this is why this report versus that report. So... I mean, that's the information that's out in the marketplace. And I guess, as you could imagine, it doesn't 3151 Budget - 4/12/05 necessarily present the rosiest picture for... What was that earlier today we learned of peachy... peachy situation? We learned from the District Attorney earlier. There's a certain law enforcement concept.
I would just say to you that when we were first contacted by a number of reporters about the 10,600 figure, I worked with the Budget Director and the policy analysts who track these numbers and was given a very comprehensive explanation of it myself which is what I would propose to share with you. And we did try to explain that to the reporters who were covering this story. Unfortunately, they didn't choose to include that in their reports.
Well, has there been a report put out by the City, I mean, the next day or couple days later? I mean...
I'm told that we sent a letter to the City Council President with 3152 Budget - 4/12/05 that information. We'll get another copy and distribute that.
Well, I understand that. I can appreciate that. The City Council President doesn't have a newspaper.
Right. Well, we did what we could, in terms of talking to the press about it. It was not successful.
I remember the number as something around 3,000. I'd have to get you the specifics on that.
So, you're saying there was a net gain in jobs in Philadelphia of 3,000?
If you believe the -- If you look at the C.E.S. figures and the numbers in this chart of 3,100, yes, there would be a net gain of -- very slight gain. I would say it's really a tradeoff.
Okay. Well, I mean, there is a little bit of a difference 3153 Budget - 4/12/05 from a 10,600 deficit to a 3,000 positive.
It's a little bit of a swing. There's a slight gap between those two numbers. So...
We do believe that the rate of loss is declining, the losses are declining. And we believe that it won't be too long now before we'll begin to show some more positive figures.
Okay. Can you... Thank you. Can you provide us with an update on... There's been some discussion publicly about efforts to create regional -- a regional funding mechanism for art and culture, involving not only Philadelphia but the four counties around us. What is going on with that effort?