They would have qualified if there is -- Councilwoman, they would have qualified if they would have came in and went through the process of filling out the right paperwork, they would all have qualified.
So was your program for small businesses who wanted to go 599 RESOLUTION NO. 040095 - 3/29/04 to prime? Had these people been in business before, were they experienced businesspeople?
Any business. We have contractors that were -- they had electrical business, carpentry business, stucco business, masonry business. And those that wanted to go through their program to diversify their companies and do something else, as well, because of the lack of work that, you know, that they was doing with the city, this was an opportune time for them to understand the city process and also to begin to do demolition work. We have an electrical company, NCNE Electric, that is one of our prime contractors. So to answer your question, right now we have about 15 contractors right now bidding as prime contractors. We have one of our contractors that bid in the normal process and did a joint venture. His company named is RPM. And he won an 80-house package. Which, to answer Councilman Rizzo's question is, because the issue was, there was 600 RESOLUTION NO. 040095 - 3/29/04 a time that NTI was trying to get more prime contractors to the table. But once we graduate these contractors for them, we was able to have, I think, about seven contractors bidded on this particular contract. And automatically it drove the unit cost down. And the city saved $500,000. This is documentation. This isn't something we are making up. Go look at the bidding process. This is all public information.
Because of more people bidded on that project. Before you just had only, like, two or three contractors bidding. So the whole sense of it is, if you get more contractors in the process, but they have to make the -- but they have to go through whatever is there for you to get process into the system. Even if they don't want to come 601 RESOLUTION NO. 040095 - 3/29/04 through us, they still have to go to the city, they still have to fill out a questionnaire form, qualification form. So even if you, you know, for whatever reason, and if you don't think that you have to go through that training, then either the city has small packages, you can bid as a prime any time that you want.
The Chair recognizes Councilman Rizzo for a point of information.
Sir, so I understand it correctly, could you please restate what you said, how competition -- I want to make sure I understand exactly what you said. So can you just say it one more time. I would appreciate it.
What I said, Councilman, is that we had an example that there was -- that the NTI had a problem of getting more primes to bid on their packages. Okay? 602 RESOLUTION NO. 040095 - 3/29/04 Once we was able to graduate our prime contractors, and then when they had the opportunity to get into the process of bidding, there was a package that was out to bid, it was an 80-house package, and I think it was about two months ago, maybe. And one of our graduates joint ventured with one of the majority firms. But not only that, there was approximately, I think, four other of our graduates also bidded on this package. So now you have, instead of two or three people bidding, you have seven people submitting bids on the same package, which makes it more competitive.
Let me just interrupt you for a second. So you were suggesting when there were just a few, there was control over the price.
Once it got expanded, how much money did the city save?
Plus, they saved, once NTI was able to get more people bidding on this. And they are working to do just that, to get more people to bid.
And would you agree with me that the process itself could be done differently? If you had more work, you would be able to buy the scissor lifts, or rent the scissor lifts, you would be able to do maybe some things to make it faster for you, where you could make a few extra bucks by expressing the process?
You can't do stucco on a scissor lift. Number one, you would be going outside the specifications that have been lined out. But you want to have your whole wall already laid so that you can do the whole wall. You don't want to do a section of the wall, come down, and then move. It is too many steps. So you want to try to knock out that wall in one step. So you put your scaffold up, so that 604 RESOLUTION NO. 040095 - 3/29/04 way you can do the whole wall. But I don't want to get into the mechanics of that because each contractor has his way of how he makes his money in a proficient way. But then you can't go outside a specification that has been laid out. We are working within the specs. Now, if you could come in and we could change the specifications --
I want to ask you the same question I asked someone else. Do you think --
I forgot I was on a point of information. I apologize. Get me on the next round.
In term of a bonding, are your contractors able to get the bonding that's required for these positions?
That is, that 605 RESOLUTION NO. 040095 - 3/29/04 we discussed earlier?
Yes. Yes, they are. But Councilwoman, there is a process. The bonding company has a criteria. And we have a bonding expert right here, this is all he does, this is why we brought him to the team, and also does all the training. Is that no matter how much that we want a company to be bonded, there are still steps that any bonding company has for you to go through and certain things that they want to see. And that's what the center does, is to work with each contractor to ensure that they have met those steps. So once they submit their bonding application, we want to make sure that they do not get turned down. Okay? So if you don't go and do what you have to do, whatever it is, whatever you have to find out, whether the issue is finance, whether the issue is tax returns, whether the issue is you have to show that you have a certain amount of money in the bank, whatever that criteria is, we have to follow that and 606 RESOLUTION NO. 040095 - 3/29/04 then find a way of how we get that done for that contractor. It is not that easy, where you come in and sit down, "I want a bond." They have a criteria. There are steps that you have to take. And this is what we do every single day to ensure that we work with those contractors to ensure that we take every step. And then, also, that they understand those steps and they understand how you obtain a bond. It isn't just that they come in there and we say, okay, give me some information, then we go into some kind of back room and we perform --
Mr. Fullard, I think your responses are going to have to be a little more concise. Because we have had people waiting for quite some time. Some people have been here since 10 o'clock. So I would ask you to please be a little more concise with your responses. Thank you. Councilwoman, are you finished with your questions? 607 RESOLUTION NO. 040095 - 3/29/04
Thank you, Madam Chair. Mr. Fullard, this is the first time I have heard of the need for more prime contractors. I thought the problem that we were working on was to increase the number of minority subcontractors. You have outlined a very carefully, step-by-step approach to helping a contractor. My problem with you is, why isn't that attention given to the creation of minority subcontracts? Because it would seem to me that that's usually the first step for a new business. Before they can become a prime contractor, they would have to be a subcontractor. Doesn't being a prime contractor involve the business being strong enough to have a substantial sum of money available?
That's right. And 608 RESOLUTION NO. 040095 - 3/29/04 that's why we --
And a new group of people, two or three people, getting together in the neighborhood and saying, we are tired of working for somebody else, we ought to, between the three of us, have enough ability to, you know, get together as a contractor? How would that work? Is there anybody doing your kind of work but on behalf of subcontractors? How would it work? Suppose three men in the community or three women came to you or two of one and one of the other came to you and said, "We have been talking about it. We have had a lot of experience. We have done some work. We don't have much money because we never got paid a decent pay. But we would like to accept the responsibility, it sounds like a good program. What do we do?" Now, is there anybody that could advise them step by step, as you indicated, the care and attention you give to the development of a prime contractor? 609 RESOLUTION NO. 040095 - 3/29/04 You are the first person I have heard testify in a way that gave me the slightest bit of confidence that the City of Philadelphia knew what it was doing. Because it seems to me whether it is prime or a sub, he doesn't know anything about the field or she doesn't know anything about the field. Somebody has got to help them understand all of the problems. And you seem to have an approach to deal with the problems and make sure that people understand it fully.
Now, why do you limit yourself to the development of primes, instead of subcontractors? Because wouldn't you do better if you started out with the modest goal of helping people in the community uplift themselves by getting them involved as entrepreneurs, as being a subcontractor, rather than being merely a worker?
Do you want me to respond to that? 610 RESOLUTION NO. 040095 - 3/29/04
As I said before, it is that a lot of our contractors come to us in a sub state. But the goal of the program is to move them into a prime status. Because you don't want to marginalize contractors to just a sub status. Okay? Now, we have been successful because, as I said, we have a training and we go through specifics, estimating, management, all the things that you would need to know of how to get to a prime status. Now it is up to the --
Excuse me for interrupting, but wouldn't a subcontractor have to know how to estimate?
Does he know how to estimate in the right manner? Prime example, we have an example, we have a carpentry company that was in 611 RESOLUTION NO. 040095 - 3/29/04 business for years. And he came to us and said that, you know, if I could get some help with estimating my projects, I think that I can do better. Okay? He went through this program. And this gentleman now is doing more work than he ever has done since he has been in business for years. He is one of our 10 best contractors out there. He is one of our 11 best carpentry companies out there bidding at 12 some -- and some work he still bids as a sub 13 because he has a specialty which is carpentry. 14 And sometimes that doesn't fall under a prime 15 status. 16 But, also, he can now bid as a prime 17 contractor as it relates to when he wants to 18 bid on demolition work as well, because he 19 knows how to bid and he knows how to estimate 20 that work now.
Well, is there any such program as the one you described that you are in charge of that relates to subcontractors?
It relates to all 612 RESOLUTION NO. 040095 - 3/29/04 contractors. It doesn't only relate to only subcontractors. Subcontracting is just that it is just another level of contracting where you don't have a direct bid to the owner. Okay? And then you don't -- and then you are not in charge of the whole project. Okay? So once you get the opportunity -- because minority contractors really never had the opportunity to bid as a prime contractor, but now they have the opportunity. They have the support that can lend them technical support for them to bid as a prime contractor. And we have some really excellent prime contractors now that is doing great work. And we have the information to back it up. Because at the end of the day, you want to know are you making money, have you been successful.
Yes, go ahead, Councilman. 613 RESOLUTION NO. 040095 - 3/29/04
Thank you, Madam President. Very briefly. To answer Councilman Cohen's question partially, Greater Philadelphia Urban Affairs Coalition also runs a minority contractors program. That's not the only minority contractors program in town.
It wasn't a question; it was a point of information, sir.
I was letting you know there is another minority contractors program in town that does train subcontractors, as well.
Because I have been looking for some program when I raised the question with Ms. Smith and Mr. -- I can never pronounce his name -- Solvibile. I got 614 RESOLUTION NO. 040095 - 3/29/04 the impression that minority contractors have to come to Delaware Valley African-American Chamber of Commerce. Is that your program?
And I got no 9 feeling that anybody in that program was concerned about the specific needs of a small-venture subcontractor.
We are interested in both, and every aspect of their growth, of their companies, but also to sustain them financially. We also gives out line of credit. We also do start-up moneys for these companies, too. You can also get insurance right there on the spot, you know. You can -- you know, if you have the paperwork, if you have provided enough information about your sub status, then we can 615 RESOLUTION NO. 040095 - 3/29/04 really look at your company and see where you can grow and how you can get to a prime status. Now, we also have some contractors that specialize in subcontract work, as far as it relates to stucco, as far as it relates to asbestos removal, as well. And they come into that program to do just that.
Suppose you have this situation, it seems to me this would be the most common one: A new group has started as a subcontractor. They would deal with the prime, a sub would be under a prime at some point, he would enter a new contractual relationship, and the city might have something to do with it, too. But say the sub has a problem, he has had no experience in having problems. He has got this prime contractor who might be a big outfit and the City of Philadelphia, which is pretty big, and they tell him you have got a problem here; who does he go to to get help from the problem?
He comes to see us, 616 RESOLUTION NO. 040095 - 3/29/04 and we can help him out.
All right. And that includes -- because sometimes both the Council and the Mayor's Office both claim to have representatives interested in the development, and they are both moderate goals, in the development of subcontractors. They would welcome the natural order of things, to have a progression up to prime contractors.
That's the business. That's the business owners' discretion, if he wants to do subcontract work or if he wants to move up to a prime level. But we want avenues to be open for him to make that decision.
In the beginning I think it starts simply on a subcontract. You mean somebody jumps in cold and becomes a prime contractor?
Let's take an easier case, where they are ready to become a subcontractor. 617 RESOLUTION NO. 040095 - 3/29/04 They can go to your group and get advice? They can go to your group and say, look, I didn't know what I was getting into, maybe, or maybe I did, but I now have this big contractor on my neck and the City of Philadelphia; what do I do?
We are not going to give them advice. We are going to do more than just give them advice. We want to do whatever his impediment, whatever his issue is, we want to take care of that specifically at his request. If he needs money, if he needs bonding, if he got a city contract, we can get him money. We can get him insurance. We can get him bonding. If he needs help with the estimate, if he doesn't understand the specification, if he has submitted a bid to this prime contractor and he feel as though he has made a mistake, we will look at that and we will go through his bid for him to understand and for us to understand what those issues are. We do more than just advice, because 618 RESOLUTION NO. 040095 - 3/29/04 we have been giving advice for over 30 years.
He would contact the Emerging Contractors Center at 1415 North Broad, at Broad and Mascher. He would come in there, he would fill out his information, and there is someone right there on the spot that will assist him that day.
All right. Very good. Very good. We are going to get a report card for you.
You already have one. You already got one, Councilman. You already got a whole full-blown report of the whole program from its conception. You already got a full-blown report. You already got it.
You are the only person that's ever, when I got down to the nitty-gritty, as I did, who said, yes, we will deal with this problem.
The Chair 619 RESOLUTION NO. 040095 - 3/29/04 recognizes Councilman Goode.
Thank you, Madam President. Mr. Fullard, you testified that the city has saved approximately half a million dollars due to the number of bids going up on demolition contracts. Did the bid packages also change?
No. That was a specific bid that went out. It was an 80-house package. And I am just -- it could have been, like, 78, 79 houses, or whatever the case may be. But just to round it off, it was an 80-house package.
So have the bid packages changed as a result of people graduating from the emerging contractors program?
The bid -- the city was admirable in working something out for smaller bid packages because of the capacity of the prime contractors that we were turning out and because in our program we lay out different levels of these companies. We would be working with prime 620 RESOLUTION NO. 040095 - 3/29/04 contractors that can do house packages from --
Mr. Fullard, my point is that the city chose to invest in Emerging Contractors Program roughly a year and a half ago, whenever it was. They have chosen within this budget year, even a tough budget year, to invest in the program again. How has that changed the bidding process or bidding packages? Have they adjusted what they are doing in terms of bidding as a result of people graduating from Emerging Contractors.
I mean, every other week, so that there is a consistent flow of small packages for the small contractors to bid on.
So there are more bidders because of people graduating from that program. And the city continues to invest in that program. But was it always anticipated that there was a need to do capacity building of minority contractors? What is your first 621 RESOLUTION NO. 040095 - 3/29/04 recollection that the city decided to increase the pool of contractors by training contractors?
That was the first problem that we had identified. Because there was only one prime contractor, minority contractor, that could get by me in the whole City of Philadelphia.
I guess my question is, if NTI was proposed in the general election of 1999, and if NTI was introduced in 2000, at what point was your program developed?
Our program was developed in 2003. That -- you know, when the contract was executed. We worked and we lobbied for about a year.
If NTI was proposed in the general election of 1999, if it was introduced as legislation in 2000, if the number of bidders of demolition contracts has increased due to graduates from your 622 RESOLUTION NO. 040095 - 3/29/04 program, and that has driven down the costs for the city, shouldn't the city have developed a program in Year 2000?
Yes, sure. They should have. But you were there in 1999, when we first came along.
The second question is, who are the eight banks? Who engaged the eight banks.
Who engaged the banks, the eight banks you referred to?
Who engaged the banks, in terms of becoming part of the Emerging Contractors Program?
Who brought them to the table? We brought them to the table.
The African -- American 623 RESOLUTION NO. 040095 - 3/29/04 Chamber of Commerce.
Oh, I am sorry. For the bank. I couldn't hear what you were saying. The African-American Chamber of Commerce worked with the banks for this specific program to work with small contractor demolition --
I am asking the question of who engaged who, who called who.
He called every president of the bank, and we had a sit-down and we sat down with them. We met with the Mayor on a number of occasions, as well, for this specific program, Councilman. I know that you have a program, 624 RESOLUTION NO. 040095 - 3/29/04 as well, that you --
Well, I am not here to talk about the banks. I am just here to talk about what the banks are doing.
Right. And I am just telling you what the banks are doing. I am not saying who engaged the bank. I am just saying that we had a specific program working with the banks and people are getting lines of credit. That's it. And, then, if you helped to facilitate that, great. But I think that it is a group effort.
Excuse me. I think the Councilman is speaking. If he asks 625 RESOLUTION NO. 040095 - 3/29/04 a question, simply answer the question.
It is a group effort, except for when we actually asked the Administration to engage the banks in 2000.
And they waited to engage the banks at some later point and for some later purpose. It is not a group effort when PNC Bank already said that it was willing to do bonding, in a letter from its then executive Vice-President, now President, in December of 2000. So, in other words, it was not a team effort we were trying to do this in 2000 and it didn't get done, and didn't get done until 2003. And, as a result of that, there were less bids because people have not graduated from a program that did not exist yet because some people drug their feet. And it was not a group effort of people dragging their feet.
I'm not in that. All I am telling you was -- 626 RESOLUTION NO. 040095 - 3/29/04
I don't think that was a question. I don't think you asked a question, did you, Councilman?
I am a supporter of the contractors program, I am a supporter of the contractors program at Temple. I am a supporter of the contractors program at the Greater Philadelphia Urban Affairs Coalition.
I think your posturing in coming in here was that you don't believe that you should have to defend the record of that program. What we are here to do is question the process. And the reason we are 627 RESOLUTION NO. 040095 - 3/29/04 questioning the process is partially due to how demolition contracting process takes place, the fact that costs have increased dramatically. And even your testimony suggested the cost has decreased based on the fact that the number of bidders have increased that were treated in 2003 that should have been treated along with the legislation in 2000. I am just questioning, in terms of the record, the process. Because obviously the process is not perfect. This is not a matter of just sitting here and coming in here and testifying are we going to give the $25 million, are we not going to give the $25 million because we are doing some good that wasn't done before. The program can always be better, your program, whether it is the city's process, or whatever it is. But even to the extent that your process, your contracting program is not the only contracting program in town. I think you should acknowledge that 628 RESOLUTION NO. 040095 - 3/29/04 there are larger issues with regard to this, some of them which actually deal with the finance industry and issues that were raised by this Council repeatedly over the last three or four years that just are beginning to be addressed recently. How do you respond to that now?
I can respond. Thank you, Madam President. You said a number of things that does not involve me. Okay? As part of the process, anything dealing with the banks and, you know, PNC. I have yet to see PNC write a bond for anybody in the City of Philadelphia as it relates to the NTI program, that I know of. But I know --
That's because they were not engaged in the Year 2000, when it was offered to them.
It is the question, Councilman. I am trying to respond to that, 629 RESOLUTION NO. 040095 - 3/29/04 that's all. But PNC has been due diligent in providing lines of credit, okay, for those contractors. I know that much. As well as Wachovia, Citizens, Fleet, and all of the other banks. And, also, PIDC has done a tremendous job of loans and also lines of credit that are in place now. Now, I can't respond to something that is going for or is still in the mix of to happen. I am talking about cause and effect. I am talking about things that are happening. That's what I am speaking to. That's all I am saying. Of the things that we have done, and that's all that I am responding to. I am saying that we was contracted out to produce 15 prime contracts. That's what our mission was.
Let me end with this. You started your own testimony by saying you shouldn't have to come up here and 630 RESOLUTION NO. 040095 - 3/29/04 defend your program. Of course you should have to come up here and defend your program, but I am not sure who criticized your program. The larger issue here is, you are trying to say the system is not broke. There is debate in terms of whether the system is broke or not as relates to minority contractors. But whether it is broke or not -- let's suggest that you are right, it is not broke -- it just recently got fixed.
It ain't fixed. I am telling you it ain't fixed. African-Americans still only get 4.5 percent of the receipts here in Philadelphia. We still have a long way to go. It ain't fixed --
Excuse me. We are not going to have cross-conferences like this. Would you please address the Chair, please. And, as I said, I am going to ask that you be brief because people have been waiting here since 10 o'clock this morning, 631 RESOLUTION NO. 040095 - 3/29/04 and we would like an opportunity to hear everyone. We also have people waiting for another hearing. So, again, I am going to ask you to please be concise with your responses.
Thank you. Our last witness is Mr. Steve Kauffman. Is he here? Thank you, gentlemen. Mr. Kauffman. Good afternoon, Mr. Kauffman. Thank you so much for your patience.
I am Steve Kauffman from Community Ventures. We are a nonprofit developer of affordable housing here in Philadelphia. I wanted to follow up on some testimony that feels like it occurred about five years ago from Sue Sierra and also from the Affordable Housing group. And I will try to keep this down to two minutes. Both of them suggested that NTI dollars be transferred at some point to 632 RESOLUTION NO. 040095 - 3/29/04 increase the acquisition budget by $15 million, and also there was a suggestion that the housing trust fund get an initial shot of money from NTI. And I spoke to Sue Sierra, I support her testimony, and I said, where do these NTI dollars come from, because it is finite. She did suggest that those dollars could come from demolition dollars that have not yet been allocated coming out of future years. And I just wanted to suggest that as a possibility. The other point which has not been stressed today in terms of finding additional funding is the matter of the recycling agreement. As I think everybody here knows, when the city, when the RDA, does take properties, the initial budget, NTI budget, does not take into account eventually unpaid city taxes, water and sewer liens, demolition liens, will come back. And given that only, apparently, $2 million of acquisition funding has actually been spent, in contrast to the 60 million 633 RESOLUTION NO. 040095 - 3/29/04 that's been allocated, what occurred to me was that at this point in the game perhaps NTI can estimate in a rough sense what that repayment of taxes and back liens is going to constitute, and basically borrow some of that $60 million that hasn't been allocated, take some of that money, spend it now on acquisition, and then repay that later, replenish the pot with those tax receipts. Because I think now enough properties have gone through the process that it should be possible to start figuring out in a conservative way what those tax receipts might be. The other point I wanted to stress was that with the Mayor's River City initiative, there are NTI neighborhoods that relate directly to the river, the two rivers, and perhaps that initiative could be a source of some of these acquisitions and even development dollars for affordable housing. As a developer, I am concerned because there are a couple of projects that we're involved in right now that are stopped, 634 RESOLUTION NO. 040095 - 3/29/04 basically, for lack of acquisition dollars. And, obviously, we can't respond to housing needs unless that first step, which is acquisition, takes place. And thank you for the opportunity to speak.
Thank you very much. The Chair recognizes Councilwoman Blackwell. One moment, Mr. Kauffman.
Madam President, I only wanted to make a statement, but I don't have a question for Mr. Kauffman. I would like to thank him for his investment and involvement in Southwest Philadelphia.
Thank you, sir. Do we have anyone else to testify on this resolution?
Can you tell me what the effect of the resolution is and why we have to vote on it? I am very befuddled at this moment. There have been some very important questions 635 RESOLUTION NO. 040095 - 3/29/04 raised about the operation of NTI. There may be good answers, there may not be. I think we are just beginning to touch the beginning of the program. Because it took about three years --
Why do we have to deal with the amendments now? It is very early in the budget process. I would like to have much more time to think about it. MR. McPHERSON: Councilman Cohen, these adjustments are for the current Fiscal Year. These are not adjustments to the '05. These are adjustments to the Fiscal '04 NTI program. And the Administration had indicated that they had pretty much exhausted their demolition dollars. And what they have requested to do is to increase the amount allocated for demolition by approximately $25 million for Fiscal '04, which will end on June 30 of '04. They will be coming to City Council with the '05 budget. And I think there is a 636 RESOLUTION NO. 040095 - 3/29/04 requirement of 90 days before the end of the Fiscal Year to have that submitted.
Councilman Rizzo, we are going to be ready to vote soon. Please don't leave.
It seems to me to be a long time to be making a transfer of funds. If they are that close to going broke, they should have raised this a long time ago. But you have had very important questions raised by the Committee on affordable housing. You have had other interesting proposals about formulating a special fund to make that affordable housing or other housing available. I think this is a time --
Madam President, if I may be heard for why I am raising this now. I feel totally unable to vote on this question because right now I don't know 637 RESOLUTION NO. 040095 - 3/29/04 whether we spent already far too much on demolition. There have been questions that no 4 one was able to answer. When Councilman Goode raised the question of the housing results, I didn't get any answers. I don't know whether he felt he got answers, but I doubt it. I am just not ready to vote and I don't understand why we should be put in a position of the Administration waiting until the last minute. I don't believe they need that money that desperately. And if they did, they created that situation. But I think we have got to meet the question what's the need of Philadelphia. And the need of Philadelphia, I think, is to meet the kind of questions of today people are getting inadequate housing service, and that's the people on the affordable coalition and a means of people who live in the small row houses who suddenly find their houses taken away, even though they lived there many years, without any opportunity to know what's going 638 RESOLUTION NO. 040095 - 3/29/04 on. I think they are the kind of housing problems we have got to address at the same time we deal with the NTI program. I don't understand why this can't wait at a regular order of business for housing in Philadelphia. We are beginning with the budget probably within a week or two.
Ms. Smith, am I led to believe and is it accurate to say that bids were put out on the package that we are discussing?
Yes. We are ready to move forward with a number of bid packages. We initially transmitted the resolution at the beginning of February, right after Council came back from recess. We recalibrated and looked at our numbers at the close of the quarters which is December, realized a projected a shortfall, transmitted the resolution. We had enough resources through February, and we are doing as much as we can to carry us through March. But we are at the point where the large bid packages that we 639 RESOLUTION NO. 040095 - 3/29/04 have awarded to date cannot go forward.
So this money is for packages, bid packages, that have already been awarded?
Yes, already been awarded or ready to be awarded. All bid approval forms have been approved.
What happens, Ms. Smith, what happens if we don't go forward with the bids that have been awarded?
If we don't go forward, then what will happen, if we selected a low bidder, that bid they have given us only stays in place for that -- whatever the time. So then we have to re-bid the whole process. And some of the most recent bids have been some of our better bids or numbers. So there is greater risk of the numbers coming back higher. Those are some of the consequences.
May I suggest that, as a result of these hearings, I think bids are going to come in much lower. Because I think that up until now nobody was watching 640 RESOLUTION NO. 040095 - 3/29/04 what was going on, and people were feeling when bids came in, they had no choice, and the bidders were having a great day. There was a big pocketbook that was wide open. The city had borrowed, what was it, 275 or 295 million dollars. The till was overflowing and the pressure was to spend the money. And they spent it so fast and they got much less in return than they ever promised to get for that expenditure of money. I am afraid this program -- to achieve the original goals of the first program, I think we are entitled also to know, and all the people of Philadelphia want to know, what's it going to cost. Because it is certainly going to cost far more than $300 million, if the cost of demolition is doubling. And I am sure we are way behind in the stated number of demolitions that this kind of expenditure of money would occur. Could you get for us, is there any way to calculate, or do we all have to work in 641 RESOLUTION NO. 040095 - 3/29/04 the dark, as to how many projects have been completed, what was the expenditure for those projects, and what was the anticipated cost of completing that number? And I think you are going to find a huge difference between the amount of money we have spent and the number of projects that that amount of money was supposed to deliver. I think there has got to be a review of the whole thing. Because, otherwise, I think this city is going, at a time when we all know there is supposed to be serious financial problems, we are facing maybe double the cost of the NTI. I don't know what it is, because nobody gives us any figures. And I am worried to death. And I think the people of Philadelphia have the right to find out what it is going to cost. And I think with all these other existing housing difficulties we have heard today, we ought to deal with the whole housing problem. Because this is not producing 642 RESOLUTION NO. 040095 - 3/29/04 housing, actually; it is producing clean lots. And as far as I know, even the homeless should not be compelled to sleep on a clean lot. I would like to find out what is actually happening in housing and what money has been spent and how many actual housing units.
I would be happy to provide that information, Councilman. And also, as Council President Verna and Mr. McPherson pointed out, when we submit the full program budget for FY '05, we will look at the issues around acquisition.
When do you think we will receive that? I think Wednesday --
The preliminary plan is due Wednesday, preliminary. And final will be transmitted on the first of May, along with the CDBG block grant final plan. So that we are actually looking at all the housing and community development resources. That's how we did it over the last two years. And I will be sitting down with 643 RESOLUTION NO. 040095 - 3/29/04 representatives from Council during the month of April to review that plan, answer questions, as well as gather up all the information that's been requested.
Thank you. Councilman, would you yield to Councilwoman Tasco?
Thank you. The first package of demolition, the first houses that were demolished, what was the cost for those houses? Because I have some houses -- I had an appropriation of $1.4 million. And I have some houses that are going to be demolished, I think, effective July 1. Now, what happened to all the appropriation I had before July 1, and what was the cost of the bid going out? I kind of agree with David in terms of the cost factor. Did we pay $11,000 for all those houses that were demolished in West Philly and Lower Philadelphia?
In Fiscal Year '03 we 644 RESOLUTION NO. 040095 - 3/29/04 didn't do that many bid packages. I believe that we probably did about, maybe, at most, three or four. Most of our work was emergency curb-side type of work.
At that time, as I discussed before, some of the earlier bids were coming in at around 10, that was because of one contractor's low bid, then it kind of jumped to about 13. That was the next big package that went out, that was a combination of both small and large. And at that time the contractor elected just to bid on a small package so that we could, you know, create opportunity. That was the Tioga bid package. Then the next series started to go up. Another small bid package was in one of these areas, that was around 9. West Tioga, Frankford, they started -- numbers started going up on average, started to get into the range of -- this is what was actually awarded around 16 and one was 14. They really do 645 RESOLUTION NO. 040095 - 3/29/04 vary. 16, 12, 1.
In the first Fiscal Year we only got to -- it looks like we awarded through what we call the Kingsessing bid package. That includes -- so that includes -- so the first year we only got seven, we were behind, seven bid packages out. Then we started picking up in the beginning of this Fiscal Year, that's why I said we really doubled. That's why when we came to Council back in May of last year, we lowered our projections based on what our experience have been. But we were able to increase production. So we got more bid packages out on the street. This amendment includes what we anticipate contracting for through the end of the Fiscal Year. That's in the highlighted colors. So, for example, Councilwoman, your 646 RESOLUTION NO. 040095 - 3/29/04 district, as you know, we have been working with you, I believe, for the last five or six months other representatives have been working with you on the Logan bid package. We got the cost estimates, we submitted them to you. And that number is coming in -- our estimate was 3.9. And that's what I believe you signed. Because everything has to be submitted to you before it is advertised.
Maybe I don't know the question to ask. But somehow or another I find myself agreeing with Councilman Cohen on the cost. I just can't see how the cost went up so high between the time you did the West Philly, North Philly stuff, to now you are getting -- and I think my letter says it starts July 1. Does that mean that this dollar figure is for 2004 or 2005? The letter I got that says that demolition will start in my district July 1. The bid package is already out. 647 RESOLUTION NO. 040095 - 3/29/04
My understanding is that you signed off on the bid approval form, but we haven't -- I don't believe we have yet advertised the Logan package.
Madam President, go to someone else, so I can figure out what I am asking.
Thank you, Madam President. I have been very concerned about the whole NTI program. And not only demolition, but stabilization and acquisition, because they were all phases of NTI. Last spring the city authorized 5260 properties to be acquired through the Urban Renewal Act, 94, Spot Combination Process. Currently that process is at a standstill due to the lack of funding and processing. Additional funding is needed to help ease this process. Through the introduction of NTI, we engaged the public trust in believing that we 648 RESOLUTION NO. 040095 - 3/29/04 would revitalize neighborhoods, and that's what it is all about. Also, private developers, Madam President, also have to feel confident that we will protect their investments by creating an acquisition pipeline to clear blight in their areas. Due to decreasing subsidies and affordable housing, most developers only end up getting more than to 50 properties at a 12 time because the project is spread out over 13 four years and they are not able to get 14 funding due to the lack of commitment to 15 acquisition dollars. 16 A massive demolition area's scarce, 17 scattered site, occupied structures still 18 remain, many of which are substandard housing 19 and where occupants want to move. 20 We have the case now where we have a senior who is living in one of the last remaining homes in a demolition area, this is Mantua. She eventually had to moved because she was robbed in her home at gun point three times. 649 RESOLUTION NO. 040095 - 3/29/04 On the same block another man wanted to move, and this wasn't until last week, because his home collapsed when demolition occurred next-door. And these are areas where the city pays double and triple due to these kinds of problems. Just last week when we had this hearing, the partnership CDC testified, as did other neighbors, about delighted structures around the 45 and 46 hundred blocks of Sansom Street. Only half of this project has been approved, and we are looking into that -- Pat Smith has committed to doing that as of Friday -- because we still have 11 occupants there, in a development area, living in unsafe housing. And that is where the Mayor signed the NTI legislation. Finally, Madam President, several mom-and-pop entrepreneurs have bought into NTI, too, as being a way that they can acquire vacant properties in neighborhoods. We even have businesses like the Bottom of the Sea in West Philadelphia, local 650 RESOLUTION NO. 040095 - 3/29/04 seafood restaurant that is becoming one of the major ones in Philadelphia, who want to acquire four lots next-door to expand their building, to allow for off-street parking. Another restaurant, the Venus Soul Food Restaurant, in East Parkside, would also like to acquire vacant lots. My point is that we have private developers also willing to pay for land. We have asked the city to find a way to sell property under condemnation to people who want to give. If the issue is money, let us find a way to have a clear deed so people, private investors, private developers, can buy property and we can continue on with the NTI agenda. We love NTI, I have said all the time the Mayor was campaigning, and still continue to say that I am the number one supporter. It is an innovative program that makes a big, big difference in our city, but we need acquisition dollars to make it a reality. 651 RESOLUTION NO. 040095 - 3/29/04 Having said that, we have a commitment, I have in writing, from the chief of staff of our city, that in the NTI program for Fiscal Year '05, statement and budget project to be submitted to us on Wednesday, that the $15 million will be included there that will allow, at least in a small way, for some of us to deal with emergency programs, emergency problems, and some backlog with acquisition projects. And having said that, since we have her commitment that the money will be included in the statement we will receive on Wednesday, I am happy to hold up -- it is only a few days.
I am happy to hold up with my amendment, and I will not submit it at this time. Thank you.
Thank you. Ms. Smith, how many demolitions or bid packages are in the current pipeline?
I believe it is Jefferson Square, so that's 72. I think Belmont, that's 71. I think a lot of people I have lost on the detail. West Philly, I believe some of the West Philly scattered sites, 38. Some of the APM East, which is in the Seventh District, and APM West, those are all that we went ahead and selected and we are just pending notice to proceed.
Yes, they have been awarded the contract. We haven't given the issue to proceed.
How much of this million will go towards those bid packages, 21 just estimate? 22
Well, with APM East and 23 West, what's holding that up from going 24 forward is the resources that we need to do 25 the asbestos monitoring, because we have 653 RESOLUTION NO. 040095 - 3/29/04 exhausted that pot of money, also. So for APM East and West, that's the holdup. Let's see.
Ludlow. Jefferson Square, that's about 1.8. I believe that's ready to go. Belmont is 1.3. We are awaiting Section 106 on some of the Cecil B. Moore, the larger ones. Ludlow is 81, that's 1.7. Then we have the ones that were set aside for the field training program for AAC, and they are scattered throughout. And I would say that's probably about another million dollars.
So I actually wasn't writing down the numbers. So approximately --
That's how much we need just for the ones that we warded the contracts.
Did anybody add that up? I was listening, I wasn't writing. 654 RESOLUTION NO. 040095 - 3/29/04 The Councilwoman is passing me a calculator. Say approximately million? 4
Uh-huh. About 7 or 8. 5 The rest we have approved bid forms. 6 For example, Grays Ferry is an approved bid 7 form. Some of them are small bid packages. We haven't awarded those -- I mean, we just awarded for this past month. So, some of that's included in here.
If what you are looking for is the number, what I would like to do is actually sit down and get the exact number.
I don't need the exact number. I want to get a sense of how much of that $25 million that you asked for authorization essentially will pay for properties that are in the current pipeline that have been signed off on.
It looks like about 12 million, I would say about half, particularly so we could continue the small bid package program. 655 RESOLUTION NO. 040095 - 3/29/04
Are we bound by law to adhere to that process, those particular bids?
So as we move ahead, the remaining million, every one of 9 those bid packages must be signed off by the 10 Councilperson? 11
They have been signed 12 off. They are ready to be advertised, or we 13 may be designing the bid package and we were working towards putting out bids for them before the Fiscal Year. But the Council -- the only bid package listed on this list that's in color, the only one for which we do not have real properties is the one for the Sixth Councilmanic District, which is a small bid package because we were --
The question was, of the remaining $13 million, have they already been signed off by Council Members?
Yes. With the exception 656 RESOLUTION NO. 040095 - 3/29/04 of Council District that has ten properties, that's $210,000.