Tax collection is done by the Revenue Department. When accounts become delinquent, after a certain period of time they go to the Law Department. The Law Department contracts some of it out to contractors, who then help with the delinquent collections. As part of our balancing actions, we have some stepped-up enforcement proposals that we think will generate about $8 million a year.
That doesn't include water. That's really mostly business taxes we're looking at with that.
But the real estate taxes, that's not included 83 11/19/08 - WHOLE - BILL 080853, etc. here?
In that, no. Real estate taxes, in February we really started an enhanced collection process there, and those revenues were really already in our base, so we didn't put in more in this Plan.
All right. I'm sorry. You said you expect to collect, what, about 8 million did you say?
Okay. That's it. I just wanted to know a little bit more about how much you anticipated raising with more aggressive tax collection. Thank you. Thank you, Madam President.
Yes. 84 11/19/08 - WHOLE - BILL 080853, etc. The Chair recognizes Councilman Kenney.
Thank you, Madam President. Mr. Dubow, I know early on you said this, but I want to make sure that it's clear for the record. In your opinion, if we hold these bills for any period of time, does that endanger deeper cuts?
So anything that we do to hold this up today, because we're not really dealing with cuts, we're really dealing with tax reduction freezes and revenue enhancements, could in fact have the opposite effect of deepening the cuts?
Thank you. Any other questions or comments by members of the Committee? (No response.) 85 11/19/08 - WHOLE - BILL 080853, etc.
Oh, I'm sorry. Gentlemen. The Chair recognizes Councilman Green.
Thank you. Will the Administration commit today to provide us by the end of the week all of the information that we have requested, including the back-up spreadsheets?
All right. Our next witness? MR. McPHERSON: The next 86 11/19/08 - WHOLE - BILL 080853, etc. witness is Marc Stier. (Witness approached witness table.
Good afternoon. Welcome. Nice seeing you. Please identify yourself for the record and proceed.
My name is Marc Stier and I'm speaking here today on behalf of One Philadelphia, which is a coalition of community groups, labor unions, non-profit organizations that work on behalf of the common good in the City. The City of Philadelphia faces a serious budget crisis. Balancing our budget this fiscal year and in future years will require us to take steps that are difficult and sometimes painful. And I would like to just set a little context before I get to these bills. While our situation is troublesome, One Philadelphia does not believe we should approach it in a state 87 11/19/08 - WHOLE - BILL 080853, etc. of panic. We should remember that our problems are broadly shared with other cities and states and that, in large part, the product of economic force is beyond our control. This creates a great deal of uncertainty. We don't know, for example, how far the national economy will fall next year and how fast it will recover. We don't know how aggressive the new leadership of our federal government will be in stimulating recovery or in coming to the aid of state and municipal governments. It's often said that crises create opportunities. But those are opportunities for errors as well as advances. So we believe that given the uncertainty that surrounds us, a rational response to our problems should avoid precipitant and permanent actions that we will later regret. And we believe we should approach our budget crisis now in a spirit of openness, inclusiveness and transparency so that decisions we make 88 11/19/08 - WHOLE - BILL 080853, etc. take into account the broader set of ideas about how to deal with the crisis and how to use it to make our city better for all of our citizens. Concretely, that means first we believe the Administration should provide as much information as possible about its plans to Council and the citizens of Philadelphia. It's been slow to do so. We need to see the projections for the economy for tax revenues and federal aid over the next five years. We need to see the various alternative proposals for budget reductions that the Administration has considered, and we need to see the standards and metrics which the Administration has used to choose certain budget restrictions and not others -- better reductions and not others. Secondly, we oppose service reductions that harm the well-being of our citizens, and especially the quarter of our population that lives in poverty, until they are thoroughly examined by 89 11/19/08 - WHOLE - BILL 080853, etc. Council and the citizens of Philadelphia. And I understand that the Administration has the authority to make many of those reductions, but we're getting close to the end of the year, and next year you'll have a chance to consider another budget, at which you can, I hope, engage in these debates a little more thoroughly than you can now. We should avoid any permanent decisions until our future becomes clear. So we're troubled by cutbacks and the Administration's proposals to increase support to the Community College and the parks. We're even more troubled by reductions in pools and social services and in the Fire Department. And because they are both permanent and deeper than reductions elsewhere, we are most troubled by cutbacks in our libraries. We believe that these reductions in services have not been justified by the Administration and that permanent closure of branch libraries is an inappropriate 90 11/19/08 - WHOLE - BILL 080853, etc. response to a crisis that may well prove to be temporary. Though we have more libraries per capita than other cities should be a source of pride, not a target for budgetary knives, especially when those libraries replace in-school libraries, after-school programs and adult employment services that are found in other cities, but not our own. Third, we believe that this is the moment to thoroughly reexamine everything the City does so that we can eliminate inefficiencies and bring best practices to Philadelphia.
Reinventing our government will take longer than simply cutting it back, but it will be a much better city in the future. Fourth, while we build a more effective government, we believe that this is a critical moment to look for new revenues from temporary taxes and other sources that can help sustain us over the next few years as our national economy 91 11/19/08 - WHOLE - BILL 080853, etc. recovers. So I am here to speak in favor of the bills that suspend the business tax reductions and the City's contribution to the wage tax reductions. But I also believe we should be considering other revenue measures, perhaps a small temporary increase in property taxes, and should suspend in some part the reduction in the wage tax that will be paid for by gambling revenues. Other possible sources of revenue are detailed in a separate document, which I'll deliver to members of Council. Raising taxes in a recession is a very common practice. It will be happening all across the country in states and cities, and will have little impact on the growth of our economy, as families and businesses are putting off decisions about where to locate and other cities and states with whom we compete are raising their taxes as well. I'll 92 11/19/08 - WHOLE - BILL 080853, etc. just point out, the City of New York will be raising its property taxes eight percent next year. Fifth, this budget crisis provides us with an opportunity how to rethink how we tax in the City. One Philadelphia has long argued that our debates about taxation are too narrow. Instead of just focusing on how much we tax and arguing almost to the point of obsession about minor changes in the business privilege tax, we should be thinking about how smart we tax. We believe that our tax system should meet two criteria that if we are smart enough need not be mutually exclusive. Taxes should be progressive and they should encourage growth in our economy and population. A list of steps that would meet those two criteria are also in a separate document. Madam Chair, American politics is at an inflection point in our history in which opportunities that were once 93 11/19/08 - WHOLE - BILL 080853, etc. closed are now opened and possibilities that seemed part of a distant future loom before us. We are full of hope, hope that we can overcome old divisions, address longstanding economic inequalities, provide healthcare for all and address our energy environmental problems. We have serious difficulties in our country and our city right now, but this is no time to accept the defeat that comes with lowered expectations. While we have to close a budget deficit today, it still is possible we have to look beyond our immediate problems and embrace the better future we can create by working together to create one Philadelphia. And, finally, if I can mention, just make one personal observation. As you all know, I had hoped that I might be sitting in this Council by this point, and I have to say that my disappointment at losing an election is somewhat 94 11/19/08 - WHOLE - BILL 080853, etc. mitigated by the difficulties I all know you have in facing the budget crisis we have in Philadelphia today. And I haven't gotten to know many of you during the course of my campaign. I'm confident that you will address these issues in a thorough and responsible manner. Thank you very much.
Thank you very much. MR. McPHERSON: Our next witness is Brett Mandel. (Witnesses approached witness table.)
Good afternoon. Would you please identify yourself for the record.
Madam President, members of City Council, thank you for the opportunity to testify. My name is Scott Ziskin. I'm a member of the Board of Directors of Philadelphia Forward. I'm also the President of a company called ZipCo Wine Cellar Services, which 95 11/19/08 - WHOLE - BILL 080853, etc. is a company that designs and builds wine cellars in private residences throughout the United States. Because of Philadelphia's erroneous business tax burden, I moved my company, after years of being in the 8 City, to New Jersey, because after seeing 9 very little or no progress on the 10 business tax in Philadelphia. After the 11 City's Revenue Department employee 12 pointed out how much I could save by 13 moving my firm to New Jersey, we moved to 14 New Jersey, where we already had an 15 existing business. When my firm left, I 16 took ten well-paying jobs with me. 17 Because my workers do not live in 18 Philadelphia, the City now loses not only 19 all of my business privilege tax revenue, 20 but all of the wage tax revenue from my 21 employees. As we grow into the future, 22 Philadelphia will get no benefit from our 23 success. 24
My name is Robert 25 Padulo and I live and work in Center 96 11/19/08 - WHOLE - BILL 080853, etc. City. I'm a business owner of a company that I started nine years ago. I'm also a member of the Board of Directors of Philadelphia Forward, as well as the President of a group of over 40 business owners like myself called the Entrepreneurs Roundtable of the Union League of Philadelphia. As I said, I'm President of my own company, which is called iWorkwell, Incorporated. It's a Philadelphia firm which provides a total human resource solution online designed to make HR easy. We currently employ 11 well-paid workers just down the block, on Walnut Street here in Philadelphia. I very much enjoy operating a business in Philadelphia and look forward to growing in Philadelphia. However, the City's high tax burden makes me rethink every year about the reduced operating costs my company and its shareholders would enjoy if we reduced our tax burden, like he did, by relocating just outside the City limit. 97 11/19/08 - WHOLE - BILL 080853, etc. Firms like mine are the future of the City, but as I and other entrepreneurs like myself look to expand, we need to know that the City is working to become more competitive in terms of tax costs or, quite simply, we will take our business elsewhere.
Philadelphia Forward understands the peculiar nature of the international economic crisis -- Scott Ziskin -- and its effects on the City's budget and Five-Year Fiscal Plan. We understand the policy rationale behind making the suspension of the City's successful tax reduction program part of an overall package of spending cuts and revenue enhancements, but in considering the legislation before you, Bill 080854, which would end reduction to the job-killing business privilege tax, and Bill 080855, which would end City-funded reductions to the City wage tax, we hope that you will make an important amendment. While the rhetoric supporting 98 11/19/08 - WHOLE - BILL 080853, etc. this legislation has called for suspension of tax reductions into mid 2015, the language in both bills simply ends the City tax reductions. We hope that legislation can be altered to show that after the suspension, tax reductions will resume, and, of course, we would hope if economic conditions improve, this legislation would be altered to resume those successful reductions even sooner.
Since the City began its tax reduction program more than a decade ago and until the recent international financial woes, we have reduced tax rates, but we have enjoyed increased tax revenues. More important, the gap between national employment growth and Philadelphia's own employment growth has been cut in half since we began the tax reductions. Wharton's Robert Inman concluded about five years ago that the City's tax reduction program has been responsible for saving tens of thousands 99 11/19/08 - WHOLE - BILL 080853, etc. of jobs that we would have otherwise lost had we not made the slow and steady progress toward becoming more competitive. Tax reform is helping when the long-term, all-encompassing battle to make Philadelphia better able to attract and retain residents and employers. By altering this legislation to indicate that our successful tax reduction program will not end but instead will continue after a brief suspension, you will at least be showing current, future and former employers and residents that Philadelphia continues to be serious about tax reform and attracting and retaining businesses and jobs and is serious about becoming a city of growth and opportunity. Thank you for the opportunity to speak to you today.
Thank you very much for your testimony. Thank you. Any questions? The Chair recognizes Councilman 100 11/19/08 - WHOLE - BILL 080853, etc. Greenlee.
Thank you, Madam Chair. Good afternoon. Just a couple of questions. First, I want to be clear. I think the Finance Director said, sir, that he's proposing an amendment to do exactly what you just said, which is to start the cuts.
All right. Just so I'm clear, I mean, I'm not sure if I heard a direct response to this. What is your position on these two bills as of now?
Well, provided that they're putting in a date for when we will resume them, we support that, and we hope that it could also be added that if the financial conditions improve before then, that the tax reductions would be resumed sooner.
Well, I 101 11/19/08 - WHOLE - BILL 080853, etc. don't know if you put that in as part of the amendment. I mean, we are always open to be able to do that if we have to. I don't think that's something you would actually put in the bill. I mean, it's not something I ever saw of that.
Certainly you have to be able to adjust to the circumstances.
Yeah. And that's sort of, I guess, a given, just like we adjusted here. We originally said we were going to continue the cuts, and unfortunately because of the situation, we couldn't. So not to put words in your mouth, so just so I understand this, your position would be with this amendment that the Finance Director has proposed, you support these bills. Am I right to say that?
But can I add just 102 11/19/08 - WHOLE - BILL 080853, etc. one brief point?
As a resident of this city and business owner of this city for ten years now, my belief is that we're actually not doing enough to reduce our tax rates, because as Forbes Magazine just came out last month, this is the number one worst tax city in America. So the idea of raising taxes, do that if you want businesses to flee.
I don't think anybody is talking about raising taxes. None of us are talking about raising taxes that I know of.
-- that trying to 103 11/19/08 - WHOLE - BILL 080853, etc. find ways to cut costs any way you can to get more businesses here will continue the trend of actually increasing taxes by lowering tax rates.
I understand. Not to get into a debate back and forth, but just one last thing. You said about also being a citizen. As the proposals are right now, the citizens of the City are also paying a price. They're going to have less libraries. They're going to have less --
I understand. So as a citizen -- so I guess what I'm getting at is, there's a shared burden here, is what we're trying to --
What the Administration is trying to do and what we're trying to find. We may not be totally agreeing on that, but that's what 104 11/19/08 - WHOLE - BILL 080853, etc. we're trying to do, I think.
Councilman, the lack of tax cuts forced my business out of the City.
And the trickle down of what we spend in material, office supplies, things like that, run into tens of thousands of dollars.
I understand, sir, but, again, we also have to pay for stuff, too. I mean --
I don't have a problem paying on my net. I have a big problem paying on my gross.
I understand, but that's money we right now have in the budget. I understand. Look, I think we'd all love to get rid of that gross receipts tax. It is terribly burdensome, but --
I know for a fact of three companies that are getting ready 105 11/19/08 - WHOLE - BILL 080853, etc. to move out of the City specifically because of that.
And they're all companies that make in excess of a million dollars.
I heard that and we've heard that for a long time, and I'm sure it's true, but we also have to pay for stuff, sir.
And I'm a citizen. My kids went to City schools. I own property in the City. I've been born and raised in the City, public schools myself. I'm invested in the City.
Thank you very much. 106 11/19/08 - WHOLE - BILL 080853, etc. Any other questions? (No response.)
The Chair calls the next witness. MR. McPHERSON: Bill Madeira.
Good afternoon. Kindly identify yourself for the record.
Good afternoon. I am Bill Madeira with Public Citizens for Children and Youth.
Thank you. Thank you for taking the time to hold this hearing. No one is claiming that this is not a grim time in the City, in the State, in the nation, in fact all over the globe. And no one is saying that the City's budget does not need to be cut drastically, but this is a time for compromise and innovative leadership. On the periphery of this 107 11/19/08 - WHOLE - BILL 080853, etc. financial dilemma, there are dozens of possible compromises and creative methods of addressing our deficits. What if the local universities were to open their pools in the community? What if information science graduate students could fulfill some basic library functions? What if library landlords -- some libraries are not located in City buildings -- waived part of the rent? What if friends groups and philanthropic organizations could raise some of the funds to cover the cost of keeping library doors open? What if some of the corporate giants realized that a literate population is in their best interest? Business and individual tax delinquents currently owe at least $27 million in delinquent taxes to the City. This number far exceeds the 8 million which closing our libraries would save. What if organizations that currently owe the City money were able to provide the funds needed to save our 108 11/19/08 - WHOLE - BILL 080853, etc. libraries? What if the unions were to broker meetings between their members and community groups around the City? Why is our first step to cut institutions which provide invaluable services to our children and families? It is well known that the Philadelphia libraries keep kids safe and off the streets, assist job seekers in finding employment, educate our children, and provide us all with an opportunity for a better future. The majority of the 11 libraries which are being cut are located in the City's high crime police districts. Cutting these libraries will mean one less safe space for our children and one less activity to keep them occupied, off the streets and out of harm's way. So why is this the first option? "What if's" always take time to explore. Someone needs to ask groups and individuals to step up. Compromises and cooperative actions need to be drafted. 109 11/19/08 - WHOLE - BILL 080853, etc. Before we make this rash decision, let's evaluate some other cost-saving options. There are numerous possibilities, and together we as a community can address this challenge to maintain a healthier environment for our city's children and families. I am here today on behalf of PCCY and the young people of Philadelphia to ask the members of this Council to be the diplomates who will rise to the task of preserving the institutions that keep our children safe, healthy and literate. Thank you for taking the time.
Thank you very much, sir. Thank you. MR. McPHERSON: Our next witness is Amy Dougherty. (Witness approached witness table.)
Good afternoon. 110 11/19/08 - WHOLE - BILL 080853, etc.
I think I'm going to jump right in with the questions, because I agree with Bill 5 Green, I don't understand how we got from check marks to library closures. And I would like to just say that while data and metrics are interesting, they're more interesting for what they did not include. These are the things that it didn't include: Evening hours, how many of the 11 branches slated for closure have evening hours. Only eight of them do. Computer use. There was no 17 metric that I saw that designated computer use at all. Location. How many of the 11 slated for closure are in residential corridors and how many are in commercial corridors, and how does this affect usage. What effect will empty, shuddered buildings have on crime and other factors in the community? 111 11/19/08 - WHOLE - BILL 080853, etc. Crime statistics related to the branches slated for closures. I 4 didn't see that at all in the metrics, 5 nor did I see income level in the 11 6 branches slated for closure. 7 percent people 11 live below the poverty level. 7 percent live below the poverty level. 1 percent live below the poverty level, and it goes on and on. The number of high school dropouts, unemployed, single parent households in the 11 branches slated for closure, that was not included. Public schools, how many are there that surround and use the 11 branches slated for closure, how many have their own libraries with accredited librarians and up-to-date materials, including books, periodicals and computer 112 11/19/08 - WHOLE - BILL 080853, etc. terminals. And of those that do have libraries, what kind of assets are there. Are they housed in multi-purpose rooms, in closets or how many have their own rooms? How many have adequate school libraries and how many use the public library as their school library. And then there's charter and parochial schools. How many are there that surround these 11 branches slated for closure, and how many have their own libraries with accredited librarians. Day and home care centers. How many are there that surround and use the 11 branches slated for closures. So there is a lot left out of the metrics. And there's something that's included that I don't understand, and, that is, the building size. Why is building size germane to this discussion at all? Because if we're talking about expanding libraries -- on one hand, the Library administration seems to be 113 11/19/08 - WHOLE - BILL 080853, etc. suggesting that if a library isn't big enough to at some point in the future make it expanded, then we should close it now. I don't really get the connection. It doesn't make sense to me. And there's one other longstanding concern and question that I have, and, that is, it seems as if communities that don't -- are not believed to be utilizing their library enough are being punished. It seems as if it really is not the failure of the community but the failure of the Library administration to not be reaching out to those residents to bring them into the library. For instance, if a police or fire station has statistics that state that crime has reduced or fires have reduced, then everybody is happy. Everybody is -- we figured that it's a success. Library is completely the opposite. To the extent that people are not utilizing the library branch, it is 114 11/19/08 - WHOLE - BILL 080853, etc. to the extent that the Library administration is not doing its job bringing people in. I have a whole lot more to include in my testimony, but just to save time, I thought I would just pass that out. I would like to -- I think what I'm really -- what we're really asking for is to slow down, give us time to really come up with a credible plan, give us time to build some public-private partnerships, give us time to figure out what the real metrics are. I don't see why we cannot utilize the same concept with libraries that is being used for pools and rec centers. Let's talk about temporary service reductions and not permanent closures. Thank you very much.
Thank you. Any questions from -- (Applause.) 115 11/19/08 - WHOLE - BILL 080853, etc.
-- members of the Committee? Just a moment, please. Councilwoman Blackwell.
Thank you. I certainly want to thank you for being at half of the meetings I've been at. I've been at at least eight meetings in this regard, and thank you for being at them as well. In fact, tomorrow night we have a meeting not on your schedule at the Charles L. Durham Library, 34th and Haverford. We have that tomorrow at 7:00, in addition to two on Saturday, one at Kingsessing at 2:00 and then Friends of the Free Library, the other one, at the Charles L. Durham at 2:00. So it's really become a nightmare, and although this isn't on the agenda for the bills we're voting on today, it's a part of the issue that concern so many of us, because these bills today that deal, two tax bills and the other six other an increase in fees, 116 11/19/08 - WHOLE - BILL 080853, etc. may give the public the impression that we support these other closings, which we don't. Councilpeople support the people who send them here, and we know what's happening in our areas. And, again, we find it unfortunate that we would be put in this position in the first place. But obviously we support you in your stance. I went to a meeting just last night on the library issue, and we have communities who don't have libraries who are supporting the citywide effort to keep them open. So I thank you for your efforts and your support, and we're with you.
You're welcome. The Chair recognizes Councilman Green.
Thank you, 117 11/19/08 - WHOLE - BILL 080853, etc. Madam Chair. Thank you for your testimony. I'm sorry that we were running around trying to figure out how to deal with this while you were doing so. I turned around and heard your first line, but for the benefit of people who didn't hear it, I was wondering if you could repeat the way you began your testimony, which was something about check marks.
Right. Well, basically I don't understand how we got from check marks on papers to closing 11 branches and why these branches or any branches were chosen.
Thank you. During the PhillyStat session yesterday, Ms. Reardon stated that the City measured the distance between library branches by using Google Earth. Do you think that is sufficient work in order to determine which libraries should be closed and open? 118 11/19/08 - WHOLE - BILL 080853, etc.
Well, no, of course, I don't. People walk to their neighborhood libraries. Very often there are children walk to their neighborhood libraries from school, seniors walk or take their cars. And the other interesting thing is that while we've heard a lot about, oh, it's 1.9 miles, 2 miles, 2.5 miles, that's only one way. It's not round trip. But it's not just about mileage. It's about crossing large streets, going into completely different neighborhoods. It may be crossing dangerous neighborhoods. It is basically taking the neighborhood connectiveness and capability and ability of a community to utilize its own library. The other thing that wasn't included in these metrics, just for example, did you know that at the Haddington Library there is a growing Latino, Asian, Pakistani, Haitian and 119 11/19/08 - WHOLE - BILL 080853, etc. Jamaican population? You're not going to see that in any of the metrics, who are these libraries serving and what are they doing. Logan Library and Ogontz Library service Temple students. I got a call from an administrator at Temple who works specifically with students. He says, All our kids have laptops, but they all visit their library. That's not being captured in the metrics. I could really go on for days about what is not being captured.
Let me follow up with another couple quick questions. Have you requested the underlying data that made up the check mark chart from the Administration or from the Library?
Well, I actually just got the check marks yesterday. So we have not been -- I just wanted, while we're on that subject --
Well, that's 120 11/19/08 - WHOLE - BILL 080853, etc. my next question, if you let me -- during the PhillyStat session yesterday, Ms. Reardon said that the Free Library had talked to the Friends of the Free Library before going public with the cuts. Is that an accurate statement?
Not about this. Basically, the Friends of the Free Library is the major stakeholder to libraries. We've been around since 1973. We've got thousands of members, 47 friends groups. You all know that.
But we have not been part of this discussion at all. We had one conversation in October, and that was because we begged for it. We finally got it, but at that point, we were discussing service reductions, and what 121 11/19/08 - WHOLE - BILL 080853, etc. our position was, we understood that there needed to be service reductions given the financial crisis, but let us please make them equal across the system. We found out the same time the rest of the City found out that we were talking about permanent closures the same day that the Mayor made his budget announcement in November. We were not aware that we were ever discussing, considering that -- they were, not me -- closures, permanent closures.
Thank you. Just one final question. Do you know how many of the 11 libraries slated for closure are in the nine high crime police districts targeted by Commissioner Ramsey's plan?
Seven of the 11 libraries are in the high crime police districts targeted by Commissioner Ramsey's plan. 122 11/19/08 - WHOLE - BILL 080853, etc.
Except for -- let me see. Durham is not. Except for one. Except for one.
You think ten are? I have seven, but you're saying it's ten are in the high crime?
Yes. What I have is, I'm looking at my -- no. I just have that Durham is the only one that is not, from my assessment.
So do you think it's reasonable to ask elementary and high school children to walk four miles through high crime areas in the winter to get their homework done?
I think it's unrealistic. I don't think they will. I don't think they will do it. I think it will virtually close libraries off to those children.
Thank you for your testimony. 123 11/19/08 - WHOLE - BILL 080853, etc. Excuse me. Councilman Goode.
Thank you, Madam President. Councilman Green mentioned that I think seven of the library closings 7 are in high crime districts targeted by 8 the Police Commissioner. Does anyone 9 know whether that crime took place during 10 library hours? Because that's the only 11 thing that would make it relevant. (No response.)
Well, can I respond? My understanding is -- what I have heard is that the high crime hours are from about, particularly in these, are from 3:00 to 6:00, starting from 3:00 in the afternoon onward.
Correct. Not the highest crime, not the only time there's crime, but that's what my understanding is. 124 11/19/08 - WHOLE - BILL 080853, etc.
The highest time of crime is not between 3:00 and 6:00. That's a statistic that is used related to young people being involved in incidents, but --
-- when we're talking about the high crime areas in the City, we're talking more hard core crime that happens, not during library hours.
Thank you, Madam President. I know that sometimes when we're in this room, we kind of lose sight of the things that are going on outside in a macro economy. We are in a worldwide financial meltdown, a crisis of 125 11/19/08 - WHOLE - BILL 080853, etc. proportions we haven't seen since the '30s. Every country in the world is dealing with this massive loss of finances and money. New York City I believe is taking a billion dollars out of their operating budget for '09 for one year. These cuts are painful and they're horrible, but what we're discussing here today are not the cuts. They are the revenue enhancements that will soften the cuts and keep us from having to make further cuts. So I understand Councilwoman Blackwell's position, that sometimes if we pass this, it makes it look like we're endorsing the cuts. We're not doing anything of the such in this room today. We are trying to get more money and save more money so that we cannot cut further than we are. So any discussion that perhaps we should hold these to punish the Mayor because he hasn't talked to us 126 11/19/08 - WHOLE - BILL 080853, etc. appropriately is kind of crazy, because we'll be back in this room again talking about more cuts. So I think you have to look at this whole situation as it relates to the entire world, because the entire world is suffering as a result of the financial collapse. There are banks laying off 50,000 people overnight. There are car companies laying off 25,000 and 30,000 employees. We're not laying off anybody. Maybe a couple hundred people, but that's it, and we feel bad about it, but I think this Administration has been doing a great job in trying to hold on and keep their fingers in the dike so the thing doesn't collapse. I think we got to pass these bills, and if we don't pass these bills, we'll be back here next week talking about more fire stations and libraries and everything else. Thank you.
Thank 127 11/19/08 - WHOLE - BILL 080853, etc. you. The Chair recognizes Councilman Jones.
Thank you, Madam President. And I appreciate my colleague's acknowledgment that this is a worldwide issue and a national issue, and he's absolutely right. But as I look to Washington as we did a $700 billion bailout, that we didn't ask the right questions, because once the check was cleared, they didn't do what they said they were going to do, and they paid who they wanted to pay, and transparency was gone, because we didn't ask the right questions on the front end. So I would urge that we don't act in haste, but just get it right. I would also say that although there is not a direct correlation between maybe the hours that we can document, but there is something that my colleague, Wilson Goode, brought up that I 128 11/19/08 - WHOLE - BILL 080853, etc. remembered as a freshman, that there is a direct correlation between the number of inner city children who cannot read by the time they are four and the number of jail cells that planners build by the time they're 18. And so, yeah, I understand that all -- the global issue is upon us, but all politics is local, and I want to save my library.
Thank you. And I respect Councilman Jones' position, and I understand that a District Councilperson often has a different dynamic than an at-large Councilperson, and I do respect that. But the point that I'm trying to make is that what 129 11/19/08 - WHOLE - BILL 080853, etc. we're discussing today has nothing to do with the cuts and, in actuality, we could restore every single thing that the Mayor is talking about taking away and he still doesn't have to spend it, because the cuts are on his administrative responsibilities and these are our responsibilities, to keep the cuts as soft as possible. And that's my point. It's not that the library is not important. It's not that Councilman Jones' concern and representation of his constituents is not important. It is. And I hope that the worldwide financial calamity reverses over the next few years and maybe we can put some of these things back, but in the meantime, this is a tsunami. It's coming, and unless we do something to prepare for it, we're going to get blown over by it. So I do respect Councilman Jones' position. I know he works hard for his constituents, but we got to get this done. 130 11/19/08 - WHOLE - BILL 080853, etc.
Thank you. The Chair recognizes Councilman Green.
Thank you, Madam Chair. I'm sure we all agree with Councilman Kenney and do understand the point that he's made three times today, but what we're questioning here is not whether or not we need to do revenue enhancements, but the specific priorities that the Administration has made versus those priorities that Council would make. And we cannot be part of that debate, provide the Administration information without the necessary data. I do -- we all completely understand. The Mayor can do, the Administration, can do whatever he wants to do with cuts, but it is our job to provide the oversight that holds the Administration accountable for those decisions. You break it, you bought it. 131 11/19/08 - WHOLE - BILL 080853, etc. But we need the information in order to be able to provide that oversight and to be able to judge whether or not these were the right cuts when we come back in very short order and are looking at a brand new budget and a brand new Five-Year Plan in February. It is not unreasonable for us to ask to have this information, and the only time that we have the leverage to get it is prior to passing something that the Administration wants. Otherwise, we're completely out of the debate. This body has not been given the respect that we deserve and been provided with simple information that exists in spreadsheets at the library and elsewhere. All we want is data. It is not unreasonable for us to ask for it and get it. And, of course, I do agree that we need the revenue enhancements, but that's not the point and that's really not what we're talking about here today. We're talking about respect for this body 132 11/19/08 - WHOLE - BILL 080853, etc. and information, openness, accountability, new day, new way of operating. That's what we expect. Thank you. (Applause.)
Thank you. The Chair recognizes Councilman Goode.
Thank you, Madam President. First to the point of whether there's a correlation between achievement in terms of reading and/or math and whether that is connected to crime, I, of course, agree with that. But the only point I would make related to that is, one of these bills is in fact a revenue enhancer for the School District, and so people should take that into consideration. So the question I will pose out there is simply, if there's a need on certain members' parts to hold a bill or 133 11/19/08 - WHOLE - BILL 080853, etc. some bills as a statement they want to make to negotiate something, still why are we holding all bills? That still doesn't make any sense to me whatsoever. Thank you.
Thank you. The Chair recognizes Councilman Rizzo.
Thank you, Madam President. I think we're approaching this thing a little bit backwards. The Administration indicated that over $2 billion is untouchable money, and I wonder what exactly that means. Does that mean that we can't look at some of these departments that are classified as untouchable to see if they can't run more efficiently? So I can't be supportive of increasing these fees until I'm confident that the things are running smoothly. So I plan to vote no on a lot of these 134 11/19/08 - WHOLE - BILL 080853, etc. particular issues. Not all of them, but most of them. So that's what -- I appreciate that, Madam President.
Any other questions or comments from members of the Committee? (No response.)
Seeing none, I would ask Mr. McPherson to -- thank you very much.
Our next witness? MR. McPHERSON: Mike McCrea and Donna Sims. (Witnesses approached witness table.) MR. McCREA: Good afternoon. Thank you. I'm here -- and, again, I agree with some of the Councilmembers here that I think we ought to not vote these out until they get the information that they need to do their job correctly. I agree 135 11/19/08 - WHOLE - BILL 080853, etc. with them 100 percent. And part of the reason why I am, this is clear and transparent. That's all we're asking for. Now, while it may appear to some as griping, grumbling and grandstanding, I think I have a right and a duty to question the validity of the proposed service cuts outlined by Mayor Nutter. It is clearly a matter of perspective concerning the extent of any so-called fiscal crisis. During the previous Administration, we listened to "Chicken Little" tell us that the City was below revenue estimates every October, the lowest revenue month of the year, and the budget would have to be adjusted. Every year he continued with the dog and pony show, and then miraculously after the budget was passed, revenues exceeded estimates and there was a surplus, which he spent on his priorities, ignoring the service cuts imposed during the process. 136 11/19/08 - WHOLE - BILL 080853, etc. While the financial picture is certainly less than promising and some may say even bleak, even a $1 billion shortfall over five years in a city with a $4 billion annual budget is a budget gap of only five percent. That certainly does not qualify, in our mind, as drastic or insurmountable. I think there are many excesses in the budget that can be and should be looked at before we reduce any services or close anything. Specifically concerning the Recreation Department, the volunteer advisory councils and friends groups, during the good times as well as the crisis, continue to provide over 90 percent of the on-site program dollars. As partners, we feel the City is continually taking the delivery of these services for granted. When the Administration talks about after-school programs, summer camps and swimming pools, the fact that each of these quality services are delivered citywide 137 11/19/08 - WHOLE - BILL 080853, etc. at a cost to the City of about $1.65 a day per child is lost in the conversation, rarely if ever brought up. Where in this city's budget do we get a better value for our tax dollar than that? Just imagine 80 children in any of our 130 day camps, 95 degrees and no 10 place to cool off. When they speak about closing pools, it is not just about losing services. There are summer jobs attached to every facility and swimming pool, so when the Administration closes 68 pools, that translates into 700 jobs. And if you include the rest of the seasonal positions being cut, the number is over 1,000 jobs, mostly for teens and young adults. Add these together and we really think Mayor Nutter and the Administration need to work much harder to protect these services and not take the easy way out. We believe that if they spent as much time working on saving these basic services as they did 138 11/19/08 - WHOLE - BILL 080853, etc. defending their position that we have too many rec centers, pools, libraries and fire stations, that we would all be much better off. We understand Mayor Nutter's dislike of being compared to the previous Administration, but it's hard not to when Doug Oliver used the famous Street term "rightsizing" on two occasions in the last several days, and rightsizing by any other name or vehicle is just as offensive. Our message should be clear. We all need to sacrifice. No exceptions. Take care of your business in our own house before you come after our basic services. When you come after our kids, you're coming after us, and that's just simply not acceptable. Thank you.
Thank you very much. Good afternoon. Please identify yourself for the record. 139 11/19/08 - WHOLE - BILL 080853, etc.
Donna Sims. First I'd like to thank this Council for allowing us to come and speak on this issue, the Honorable Anna Verna and, of course, my Councilwoman, who is Jannie Blackwell. To every other Council in this room, in this Council Chamber today, we have tremendous respect for all of you and we know your job is very, very difficult. We know this is not something that you're supporting. But I want to get right to the point, because I was told I have a few minutes. Concerning the Laura Sims Skate House in the Park, I want to know who made the backroom deal to try to sacrifice our facility. How in the world can you justify closing all of the rinks that are in the minority-based communities and the only two that are left open are in predominantly white communities? How can you justify that? I feel like I've stepped into a time capsule when we came before Council in 140 11/19/08 - WHOLE - BILL 080853, etc. the 1970s and we were told that black children didn't ice skate and we were offered more money for basketball courts. It feels like the same thought is that black children aren't ice skating. These are the children that are ice skating at Cobbs Creek. These are the hockey teams that we have. The majority of them are coming out of our community. The police district at the 18th District stated to us -- this was under Officer Riles -- that when our facility opened, crime went down in that age group. You don't have a whole lot of things for the girls to do out there, but yet you have girls and families and everyone coming, and they skate. I don't know what people hear, if they think that it's just people from outside of the community. It is not. These are pictures of children who are coming and skating, learning for the 141 11/19/08 - WHOLE - BILL 080853, etc. first time, but they have something to do. They come after school. They have after-school programs. These are pictures of the after-school homework programs. You're going to turn these children out. It is not just about dollars and cents. It's about people's lives, and something has to be done just to find the dollars in terms of what Mike said, but even beyond that, who would have the audacity to say that you're going to close the rinks in all of the minority communities and the only ones you leave open is the Rizzo Rink in South Philadelphia and the Tarken in Northeast? Who has the audacity to put that before the people of Philadelphia and think we're going to accept it? We are not. It is a disgrace that you would even present something like that. It is a disgrace. We have ranked consistently number one or two, or in there, of all the rinks in the City in terms of 142 11/19/08 - WHOLE - BILL 080853, etc. attendance, in terms of revenue. The other thing that I want to put on the table concerning this backroom deal, we know that three or four years ago Ed Snider and his people came to our rink. They came there with film crews. They came there taking film of our mechanics, of our engineering and all of this, and they were escorted by the Department of Recreation. Who made this backroom deal to try to take our rink? You're not going to do it. Somebody is making a backroom deal, and I'll bet you if something like this were to go through, you all would then -- he would jump up, these people would jump up like saviors coming to save our rink, and they'd buy it and privatize it, and then our children would be relegated to one or two days a week. It's not going to happen. So whoever it is that's making this deal, you're on notice. It is not going to happen. 143 11/19/08 - WHOLE - BILL 080853, etc. Now, I thank you very much.
Our next witness? MR. McPHERSON: There are none.
Do we have anyone else to testify on these bills?
Thank you. I'm taken back to the days of Lucien Blackwell when Laura Sims, who is her mother, came here and Lou would talk about how she called him on the waterfront at 5:00 in the morning and he would pick up the phone and she would 144 11/19/08 - WHOLE - BILL 080853, etc. say, Mr. Blackwell, this is Mrs. Sims. Well, now you know where Donna comes from, and it was her mother who fought so hard and in whose name the rink was renamed. It's called the Laura Sims Ice Rink in Cobbs Creek Park. And it just fills me up to think of how far we've come or maybe we haven't come. But we do thank her for her commitment, because her mother and her father loved West Philadelphia, loved that rink, and we're just proud that she would come to maintain that legacy. Thank you.
Thank you very much. MR. McPHERSON: Our next bill 22 is Bill No. 080856, an ordinance amending Section 9-305 of The Philadelphia Code, entitled "Burglary, Theft and Robbery Alarm Systems," by revising the amounts 145 11/19/08 - WHOLE - BILL 080853, etc. of certain fees and penalties and the number of permissible false alarms, providing for collection of fees by alarm companies, providing for administrative adjudication, and making related changes, all under certain terms and conditions. And our first witness is Paula Weiss. (Witness approached witness table.)
Good afternoon, Council President Verna, members of Council. I am Paula Weiss, Executive Director of the Office of Administrative Review, which is a unit in the Office of the Director of Finance. I'm here to testify in support of Bill No. " The Office of Administrative 146 11/19/08 - WHOLE - BILL 080853, etc. Review is responsible for maintaining alarm user registration and activation data, as well as for billing, enforcement and collection of annual registration fees and excess false alarm fines. The alarm ordinance in Section 8 9-305 of The Philadelphia Code with its enforcement and fine provisions was enacted in 1992. The current bill seeks to update the fines and fees and to amend enforcement requirements to improve the City's effectiveness. It is based on approximately years of experience with 15 the Alarm Code provisions as currently 16 written. There are three key components that this bill addresses. The first is alarm registration. The ordinance 20 requires that each alarm user in the City register their alarm and provide certain information on an annual basis. This bill raises the annual $35 alarm registration fee that has been in place since 1992 to $50. This annual fee 147 11/19/08 - WHOLE - BILL 080853, etc. covers the cost to the City for the annual billing, the data entry and the management of this information. There are currently over 75,000 registrations in the database that receive a minimum of one billing per year for the registration fee and many of which receive more than one mailing before the fee is received. In addition, in Fiscal Year '08, 8,600 new registrations were processed and added to our database. A recurring problem for the City is attempting to identify unregistered alarm users after a false alarm activation has been reported. There is a large cost to the City in staff time spent trying to appropriately maintain information and bill for excess false alarms at locations where the alarm has not been registered by the user because ownership information is not readily available to us when an alarm activation has occurred. Many false 148 11/19/08 - WHOLE - BILL 080853, etc. alarms that users should be billed for go unbilled because we do not have the responsible party information. This bill provides two mechanisms to address that problem. It will allow the City to require alarm companies who are in possession of the alarm user information to collect and remit the registration fees with the responsible party information to the City, and it will increase the penalty for failing to register an alarm system from $100 to $150. The second component is false alarms. This bill provides for a decrease in the number of annual fine-free false alarms from the current three to two and increases the fine for each excess false alarm from $25 to $75. False alarm activations use valuable police resources and are costly to the City in many ways. An alarm activation that is called into the 9-1-1 system results in a police response to 149 11/19/08 - WHOLE - BILL 080853, etc. the premises. Our experience is that over 97 percent of alarm activations turn out to be false alarms. Obviously these false alarms cause police resources to be pulled from what may be actual crime-related activities. It has been estimated, again, that the direct cost for this police response is as high as $4 million annually. In addition, there are indirect administrative costs that are associated with monitoring and billing accounts with excess false alarms. The purpose of the false alarm fine is twofold. First, it allows the City to recover the direct costs for providing police response, as well as the associated costs for maintaining the information. The current $25 fine was first established in 1992 and hasn't been raised or looked at since. Second, the fine encourages alarm users to modify their behaviors so as to avoid multiple false alarms. It is 150 11/19/08 - WHOLE - BILL 080853, etc.
meant to act as a deterrent to incurring multiple false alarms in a year. The third area this bill 5 tackles is enforcement. Critical to improving enforcement of the provisions of our program is the change in the adjudication process from the current code provision that requires the City to file a code enforcement complaint in Municipal Court. Currently, the primary enforcement action is through the Municipal Court process and places a heavy burden on the City. For every excess false alarm violation, a code enforcement complaint must be filed in Municipal Court, served on the alarm user as a precursor to a hearing before a Municipal Court judge for a final determination of the fine that the City can then act to collect. This is a costly, time-consuming and slow process. There are service requirements, court costs and a limited number of hearing 151 11/19/08 - WHOLE - BILL 080853, etc. slots per week that the Court will allow for these matters. Therefore, the City can only pursue judgments for a small number of the approximately 30,000 annual excess false alarm activations, particularly since the Municipal Court slots have to be divided among false alarm activations and other code violations. This bill provides an administrative review process that is far more streamlined and cost effective for both the City and the person or entity cited for a violation. An administrative hearing of record before a hearing examiner will be available and subject to appeal by the person or entity found liable following the hearing process. The responsibility will rest on the alarm user to request and appear at a hearing to contest any false alarm charges. This means that the City will not bear the burden or expense of moving all cases into the Municipal Court arena. 152 11/19/08 - WHOLE - BILL 080853, etc. At the end of the administrative review process, if a further appeal is not pursued by the alarm user, the decision rendered at the hearing becomes a final order, and any fines, fees and penalties are a debt due and owing to the City. The administrative review process will allow cases to move expeditiously through the hearing process so that both the City and the alleged violator will have a final determination in a more timely manner. For those found liable at the end of the hearing process, the City will be able to move more quickly to the enforcement and collection of outstanding fees and fines. The changes offered in this bill will provide more opportunity for the City to recoup the costs associated with the enforcement of the code provisions for burglary, theft, robbery and alarm systems, and provide needed improvements to the enforcement and 153 11/19/08 - WHOLE - BILL 080853, etc. collection mechanisms. We are requesting a suspension of the rules of Council so that this bill 5 may be considered on the First Reading Calendar at the next session of Council. Thank you. I'll be happy answer any questions.
Thank you. Ms. Weiss, you are proposing that the City increase its annual alarm registration fee --
-- from $35 to $50. When do you propose that this increase will take effect?
I believe it will -- I'm not sure what the bill says. I'm sorry.
There is no 24 timetable? I think that our expectation is it would take effect immediately. 154 11/19/08 - WHOLE - BILL 080853, etc.
Mr. Dubow, could you answer that question? Isn't there a procedure that would have to occur before you said immediately? (Witness approached witness table.)
For all of this legislation, we were looking at getting them implemented by January 1st.
For all of this legislation, we were looking at getting things implemented by January 1st.
In an effort of fairness, are all alarms billed at the same time?
No. Alarm users are billed on a rolling one-year process 155 11/19/08 - WHOLE - BILL 080853, etc. depending on when they first registered their alarm. Each 12-month period -- so we're sending out bills on a monthly basis.
I think in an effort to be fair, some people that renewed now are paying one fee and if you do this immediately, then the rest of the constituents are paying a higher fee. Isn't there a way that we could make sure everybody renews that's eligible at least in this calendar year to be able to renew at the old fee?
Because you're going to have some folks paying 35 and the new fee is 50, correct?
So one month, if you get your bill early, you pay 35. If you're a month late or in January, you're going to pay 50.
That's a good 156 11/19/08 - WHOLE - BILL 080853, etc. point. We will look at that.
Thank you. Thank you, Mr. Dubow. Ms. Weiss, what are the additional revenues that these increases will generate for the current budget and Five-Year Plan?
Well, raising the annual registration fees from $35 to $50 is projected to raise annually 393 --
I'm sorry. Raising the annual registration fees from 35 to 50, we're projecting that that will result in an annual increase in revenue of about $393,000. Reducing the annual fine-free false alarms going from three to two allowable false alarms is projected to add approximately $184,000 in the first year of revenue. And 157 11/19/08 - WHOLE - BILL 080853, etc. increasing the false alarm fines from $25 to $75 is projected to add approximately $305,000 annually.
And for the first year, I would say we'd expect about half of that amount for each one of those.
Ms. Weiss, in your testimony you state that many false alarms that users should be billed for go unbilled because we do not have the responsible party information.
What does your office do to get the necessary party information?
We actually spend a lot of manual research time looking through BRT records, City Revenue records, real estate records in order to attempt, because all of these are obviously property-based, attempting to determine correct property ownership so that we can bill property owners or to determine in some situations business 158 11/19/08 - WHOLE - BILL 080853, etc. owners, because there are certainly times when it's a landlord-tenant situation and it's the tenant who is the responsible alarm user, not the landlord. And so our staff engages in researching available databases that the City has to determine who is at that property, as well as sending out notices.
To the extent that there are alarm systems that are not registered and to which the City nevertheless responds, are costs incurred and who pays?
We all pay them. Costs are incurred every time the police respond to a false alarm, regardless of whether the alarm user is registered or not, and so that cost is incurred by the City, in addition to our incurring costs for the false alarms that we don't charge for. Everyone at this point is provided three false alarms in a given year that we don't charge for but that we 159 11/19/08 - WHOLE - BILL 080853, etc. still incur a cost for, because the police do respond and we do maintain that information in our database.
Thank you, Madam President. The revenue increase or the registration fee increase from 35 to 50, on what basis is that justified?
Well, number one, we haven't -- it's been $35 since 1992, so --
You can't justify something because it's been a long time since we raised it.
That our expenses have certainly gone up since then. And although it may seem at first glance that 160 11/19/08 - WHOLE - BILL 080853, etc. in order to maintain the registration information simply sending out a letter is really all that's involved, in reality we have a lot of research and staff time in locating alarm users that this registration fee can cover. For example, the situation where there's a false alarm activation, we don't know who the alarm user is, before we can even bill that alarm user that $35 or that $50, there's staff time and research in trying to locate who that alarm user is. In addition, though --
Wait a minute. Stop. Stop. There's a lot more important things than this, but this is important. They're all important. I don't follow that you can't -- if I registered -- I've got a burglar alarm. I register with you every year, or I go to prison or something like that. I don't know what it is.
But I 161 11/19/08 - WHOLE - BILL 080853, etc. register. I pay my $35. I have an alarm that goes off. You have trouble looking for me?
No, we don't have trouble looking for you because you've done what you're supposed to do, but there are many, many alarm users in the City who we don't find them until after their alarm has gone off, and so we don't -- we're not able to use their registration information until the alarm has gone off, the police have responded.