COUNCIL OF THE CITY OF PHILADELPHIA COMMITTEE ON COMMERCE AND ECONOMIC DEVELOPMENT Remote location using Microsoft® Teams Tuesday, December 12, 2023 1:05 p.m. PRESENT: COUNCILMAN MARK SQUILLA, CHAIR COUNCILMAN CURTIS JONES, JR., VICE-CHAIR COUNCILWOMAN KENDRA BROOKS COUNCILWOMAN JAMIE GAUTHIER COUNCILWOMAN KATHERINE GILMORE RICHARDSON
Good afternoon. Today is the public hearing of the Committee on Commerce and Economic Development, Tuesday, December 12, 2023. The hearing is called to order and members and guests will please take their seats. I recognize the presence of a quorum of Committee members. I am Councilmember Mark Squilla, Chair of the Commerce and Economic Development. And the members of the Committee in attendance are Vice-Chair Councilmember Jones to my right, Councilmember Johnson to my left, Councilmember Gauthier and Councilmember Gilmore Richardson. This is a public hearing on the Committee of Commerce and Economic Development. The purpose of the public hearing is to hear testimony on Resolution No. 230165. Resolution No. 230520 will be held and not be heard today and will be rescheduled for another time. Mr. McMonagle, would you please read the title of Resolution 5 No. 2305 -- 165.
Resolution No. 7 230165, authorizing the Committee on Commerce and Economic Development to hold hearings regarding strategies to ignite business and job growth and to make Philadelphia a more economically competitive city.
Thank you. Before we start for our panel of witnesses today, I'd like to recognize Councilmember Johnson for opening remarks.
Thank you, Mr. Chairman. And it does feel good to be back outside. Good afternoon, Mr. Chairman and colleagues. I understand that we have a full agenda at today's hearing. And so, I will be brief but I want to take this time to discuss what is at stake in our collective efforts to address poverty and create economic opportunity in every community and in every zip code in Philadelphia. Nobody in this room needs to be reminded that Philadelphia has been labeled the poorest big city in America with a poverty rate that remains above percent, and 13 that's despite steady improvements 14 over the last decade. That's 15 because while our city has seen 16 important signs of economic growth, 17 these gains have not been evenly 18 shared across the City, leading to 19 what many call a tale of two 20 cities. 21 Recent data shows that while roughly in 8 households in 23 Philadelphia experience poverty, 24 in 4 African American households 25 are living below the poverty line. 1 Meanwhile 33 percent of Hispanic households, the highest of any ethnic group, have income below the poverty level. Gains in household income have also not been shared evenly across our city. 7 13 percent over the same period. And 14 at the neighborhood level, these 15 statistics are just a start. 16 Any individual 17 Councilmember can illustrate our 18 city's economic divide by looking 19 closely at the different 20 neighborhoods that make up their Districts. In the 2nd, families in Southwest Center City had a median income of $113,000 in 2022, a 51 percent increase over the last decade. While across the Schuylkill in Southwest Philadelphia, the median household income was just $39,000, just a percent increase since 2012. It is incumbent upon us as City leaders to understand why our city's growth has not been shared equitably across every community and neighborhood, and we must take steps to ensure that every family regardless of their zip code or background has access to economic opportunity. Growing our city's economy in creating good-paying family- sustaining jobs is an important piece of that puzzle. But it's also important that our city puts in the hard work to ensure that every community has access to these opportunities and that every family shares in this prosperity. So that means that City Council and our incoming Mayor must look at ways to reform our tax structure and regulatory environment to make our city more economically competitive and grow the number of family-sustaining jobs. It also means making smart investments in education and job training programs and building a robust support system for diverse small businesses in our neighborhood commercial corridors that these businesses call home. I'm looking forward to this hearing. But most importantly, I want to thank all of my panelists for participating in this hearing. As the Councilman of the 2nd Councilmanic District, I always talk about how the 2nd Councilmanic District for me is an economic engine here in the city of Philadelphia. And here's why: As the Councilman, I represent the Flyers, the Sixers, the Phillies, the Eagles. I represent the Airport, the Navy Yard, the Port, the Bellevue District, which is formerly known as the Sunoco Refinery site and also Live! Casino, and we have a new development project called Pennovation, which is a part of the University of Pennsylvania. However, all of those economic development projects mean nothing if we're not impacting those who are most in need and those who are most vulnerable. We have all addressed this issue from a perspective of haves and have-nots. And so, as Councilperson of the 2nd Councilmanic District, it's my responsibility to make sure that we're providing economic opportunity for everyone irregardless of their zip code. And so with that being said, I want to thank my colleagues for taking time out of your schedule and for everyone showing up, and we look forward to this very robust discussion and conversation.
Thank you, Mr. Presi -- thank you, Councilmember. Today we'd like to call the first panel to testify. Mr. McMonagle, would you please read the name of the person who will be testifying.
Can we please have Anne Nadol, Jodie Harris and Sharmain Matlock-Turner ready to go please. (Witnesses approached Witness Table.)
Anne, we can start with you. Just state your name for the record and then proceed with your testimony.
Good morning or good afternoon. Anne Nadol, Commerce Director for the City of Philadelphia. Good afternoon, Chairman Squilla and members of the Commerce and Economic Development Committee. My name is Anne Nadol, Director of Commerce and I am here to testify on Resolution No. 230165 introduced by Councilmember Johnson regarding strategies to ignite business and job growth and to make Philadelphia more economically competitive. Philadelphia offers a very competitive opportunity for growth with strong access to top talent, affordable real estate opportunities, favorable business climate, high quality of life options and unparalleled central location in the Mid-Atlantic seaboard with access to 60 percent of the United States market and population. S. and is consistently rated as one of the most walkable cities with various transportation methods. And Philadelphia's companies find themselves growing amongst a lively network of world-class industries, urban parks, vibrant commercial districts and cultural attractions. , and Philadelphia's International Airport serves more than 30 million commercial passengers on a yearly basis, offering flights to 140 destinations around the world. S. East Coast with 546 million in container upgrades bringing family-sustaining jobs to the City. Notably, Philadelphia is also the birthplace of the first FDA-approved cell and gene therapy with university hubs within health care, life sciences and higher education sectors accounting for a significant percentage of the City's employment. More than 1800 life science companies in Greater Philadelphia have employed more than 70,000 people since 2021 and developed life-saving medicines and therapies. Yet for too many in our city, as Councilmember Johnson cited, opportunities feel scarce. Philadelphia's growth is not connected to every neighborhood and some have been systematically prevented from accessing economic growth. To combat these challenges, the Commerce Department makes a series of strategic investments. Let me just highlight some: First, Commerce invests in people. Commerce continues to build talent pipelines by seeding and developing workforce programs that connect residents to our high-growth industries like life sciences and advanced manufacturing. We created the Quality Jobs program as an incentive for new and existing businesses to add jobs that pay family-sustaining wages and benefits. We also know that we need to grow our minority business community, so we have shifted our focus from mere goal-setting to capacity-building for diverse businesses. And since the pandemic, we have been far more intentional regarding our business support programs and technical assistance, shifting towards more one-on-one assistance instead of classes or workshops and guiding business owners through the loan process. And to date, our innovative lending network and incentive grant has enabled 40 minority-owned microenterprises to obtain loans within a company and grants to support their equity. Second, Commerce invests in places. We have made significant investments to clean, green and revitalize commercial corridors, and the work that we do in neighborhoods is based on relationships. In 2022 we engaged almost 13,000 businesses and our Office of Business Services is finally fully staffed to help us do this well. In addition to our business attraction efforts, we have hired two retention managers to help maintain Philadelphia's current business base. Lastly, Commerce invests in systems. We've created a new team in the office, the Office of Policy and Strategic Initiatives that is focused specifically on policy, business process, communications data and research, and crucial to their mission is improving the ease of doing business. This team along with the Commerce Department leadership serve as the business advocate within City government for our business community.
And we support the creation of smart tools such as the business resource finder and the permit navigator to help entrepreneurs navigate the rules, requirements and services applicable to them. And we are partnering with the Greater Philadelphia Chamber of Commerce to enhance and select Greater Philadelphia website to highlight the City as a great place to live, play, work and do business. And so, you may ask where are we going with all of these investments. They are just part of Commerce's longstanding work to actualize business and job growth and for our communities, and we will continue to evaluate and target our investments in response to evolving business needs. We hope that the next Administration and City Council will continue steady reductions to the wage and business taxes that have long plagued our reputation as a great place to do business. And we also hope that Philadelphia will take lessons learned from the Shapiro Administration to prioritize ease of doing business and invest in programs that work. Simplifying our business processes and making them predictable does not cost us anything. And we encourage all legislators to engage commerce and the business community when exploring new policies and programs so that we can make sure that we are putting our best solutions forward. We will continue to collaborate with everyone at this table and in this room to encourage state and federal investments in accessible capital, market opportunities and better incentive programs. Such investments would serve as a catalyst for inclusive and long-term growth. Thank you for the opportunity to testify today and I and members of the Commerce team are here and happy to answer any questions you may have. Thank you.
Thank you, Anne, for your testimony. We're going to hold all questions until the panel is complete. I guess next we'll have Sharmain. If you want to just state your name for the record and proceed with your testimony.
Thank you, Councilman. Good afternoon Councilman Squilla, Vice-Chairman Jones and members of the Committee, Councilwoman Gauthier and Councilwoman Richardson. And I also would like to extend a special thank you to Councilman Johnson who introduced the resolution calling for this hearing today. The Urban Affairs Coalition is one of the largest Black- and Brown-led nonprofit organizations in our city. From our inception, more than 50 years ago, UAC has always firmly believed that equitable economic growth was key to lifting our residents out of poverty and in creating thriving and vibrant communities across Philadelphia. We know that too many Philadelphia families are still locked out of the opportunity to meaningfully participate in our city's economic growth. And we know that a sustained partnership between government, the private sector and the nonprofit community is essential to changing that narrative. I'd also like to specifically applaud City Council's longstanding commitment to equitable economic development. As many of you know, I co-chaired Council's Special Committee on Poverty Reduction and Prevention, which brought together leaders in the field from across the City to help make concrete recommendations for lifting Philadelphians out of poverty. At UAC, we see our work as amplifying on building on the foundations set by important efforts like the Anti-poverty Committee. And again, want to thank Council for its continued commitment to equitable development. Our work at UAC has served as a national model, one that has helped provide meaningful opportunities for people from disadvantaged backgrounds, particularly Black and Brown Philadelphians to succeed in the workforce and even start businesses of their own. Today I'd like to talk to you a little bit about these programs which aim to serve people at every stage of life. UAC is just one of many important players, many of whom you will hear from today in this area. And we firmly believe that our collaboration from across our city is necessary to tackle this problem. First, let's start with our work with those who have the greatest barriers to employment, those struggling with homelessness, mental illness and addiction. In order to truly attack the root causes of poverty, we must offer opportunity to our most vulnerable Philadelphians. UAC's program partner Center for Hope does just that by providing housing and intensive wraparound support services to re-entering citizens every month. These individuals were unhoused and received the stability that they need to rebuild their lives and ultimately engage in the workforce. Ready, Willing and Able, another UAC partner, provides employment to about 43 individuals a month or at least 105 men each year who are living in long-term transitional housing as well as accessing vocational training, educational opportunities and social services necessary to help their clients succeed for the long- term. And One Day At A Time, another program partner, has provided more than 500 men and women across our city with a chance to earn a honest day's work while still homeless through a partnership with the Pennsylvania Horticulture Society that provides $100 for four hours of cleaning our communities. This program doesn't just provide financial support for these individuals. It also provides a critical access point to connect them with services designed to stabilize their lives and put them on the path to housing and long-term employment. I'd like to note that this program came out of discussions from Council's Anti-poverty Committee. A concrete example of hard work together is making a meaningful difference today in the lives of Philadelphians.
While the City has a plethora of workforce training programs, we think it's important to ensure that we are training individuals for the jobs of the future, jobs where there is a strong need now and that will allow the opportunity for sustained growth in the future. That's where Hire! Philly comes in, a program that UAC sponsors that brings together the public and private sectors to ensure that we're building viable talent pipelines. The Hire! Philly Job and Resource Fair attracted more than 1,700 opportunity-seekers to meet with 38 employers and an equal number of service providers. Over 100 people walked away from that fair with job offers on that day. Hire! Philly also manages a website, PropelPHL, that was launched during the pandemic. This web-based tool provides a comprehensive suite of services, including resource navigation, career coaching, training and placement in jobs paying a family-sustaining wage within high demand industry pathways. The pilot will begin with 12 to 15 individuals who are currently earning between $14 and $16 an hour. And upon successful completion of the program, they will be placed in jobs that will pay at least percent more than 6 they were making when they came 7 into the program. 8 UAC also focuses on 9 preparing Philadelphia youth for 10 the workforce. We know that early 11 workplace experience is key to 12 later success. Our summer youth 13 employment program provides paid 14 summer job opportunities and 15 internships for 850 Philadelphia 16 youth ranging in the age of 14 to 17 18 years old through the City's 18 broader WorkReady program. This 19 program allows participants to 20 explore different career paths and 21 gain connections and mentorships 22 that put them on the path to later 23 professional success. 24 At the same time, we have 25 long worked with the Building Trades in apprenticeship programs that prepare our young people for family-sustaining union jobs. Our program partner YO-ACAP provides opportunities for dozens of youth each year to participate in a six-week summer training program with the finishing trades. And of course, UAC is a national leader through our Economic Development Projects initiatives in developing and implementing successful economic opportunity plans that have opened disadvantaged business enterprises up to opportunities to participate in some of the region's largest projects, from the Comcast Center to the University of Pennsylvania's new Patient Pavilion. These programs ensure that DBEs can scale their businesses up to build wealth long- term for communities that have too often been left behind. EDP has more than 35 years of experience in this area. As City Council works with the private sector, social service agencies and organizations like UAC in the future, it's essential that we continue to invest in innovative programs like these. We need to provide Philadelphians at all stages of life with meaningful opportunities to be prepared to build a career, to participate in the workforce and start their own businesses. These partnerships between private business, government and the nonprofit sector are essential to driving economic growth in every neighborhood and community in our city. Thank you very much.
Thank you, Sharmain, for your testimony. And, Jodie, I apologize. I skipped you. So Jodie Harris from the PIDC. Just state your name for the record and then proceed. After you, we'll go with Jeff real quick and then Kenyatta.
Okay. Jodie Harris, PIDC. Good afternoon, Chairman Squilla and the members of the Commerce and Economic Development Committee. As I stated, my name is Jodie Harris and I am the President of the Philadelphia Industrial Development Corporation, also known as PIDC. I'm here today to share the mission and vision of PIDC and the Philadelphia Authority for Industrial Development, also known as PAID, as it relates to Resolution 230165. I want to thank and recognize Councilmember Jones and Councilmember Johnson for their dedicated service on PIDC's Board of Directors. As background, PIDC is the City's public-private economic development agency and is a nonprofit jointly created by the City and the Greater Philadelphia Chamber of Commerce in 1958. Our mission is to spur investment, support business growth and foster inclusive growth that creates jobs, revitalizes neighborhoods and drives growth and opportunity to every corner of Philadelphia. PIDC and its affiliates currently represent a best practice and community-based economic development, by offering a broad array of financing and real estate solutions together with supported business services targeted to Philadelphia's diverse population, including business owners of color, women-owned businesses and low-income communities. Few, if any, organizations in the nation have our three-prong structure that includes a private nonprofit and a governmental authority all under a unified and professional staffing structure. First, PIDC Community Capital is a 501(c)(3) nonprofit and certified community development financial institution created expressly to obtain public and private resources as a catalyst to investing in underserved communities with a particular focus on community lending and technical assistance in underserved, low-income neighborhoods. Second, PAID is a public authority governed by an independent board, delivering real estate services in tax-exempt financing. And finally, PIDC's financing corporation is the Certified Economic Development Organization, CEDO, for the City of Philadelphia under Pennsylvania's economic development rules and operates as a public-private partnership to facilitate investment of federal, state and local funds and to Philadelphia's business community. Philadelphia was visionary in the creation of this structure and remains a leader in Pennsylvania and in the nation in community and economic development to this day. To provide a perspective on scale and volume of activity, in 2022 PIDC continued its mission of driving growth across the City closing 175 financial transactions in all 10 City Council Districts and signing 269,000 square feet of leases at the Navy Yard. At the end of 2022, we managed 513 loans worth more than 413 million. PIDC's portfolio includes a wide array of small business loans, many in low-income census tracts. And while PIDC acted as a conduit for the vast majority of investment, in 2022 we directly delivered nearly 668 million through PIDC lending products in the new market's tax credit. 62 percent of our core lending went to diverse business enterprises. As a member of the PA CDFI network, we successfully facilitated the investment of more than 77 million into Philadelphia's diverse businesses in response to the devastating impacts of the pandemic, we closed out our last COVID-released transaction this year. As the uncertain economic environment continues to present challenges, PIDC continues to deploy critical funding. Our long portfolio remains strong. And thus far in 2023, we've closed over 160 financial transactions, investing more than 308 million across the City. Our clients include construction and contractor firms, fresh food providers and supermarkets, health care and medical clinics and education, demonstrating our role as a mission-driven economic corporation.
And like each of you, we understand that the level of ease of doing business in Philadelphia no matter the size of the business has a direct relationship to our ability as a city to attract, manage and invest public and private resources into the clients, communities and markets that allow Philadelphia to thrive, to innovate and to offer a better quality of life. One specific area in which PIDC is helping businesses to invest in themselves is through our commercial mortgage product. This product developed out of a need for small businesses and nonprofits to purchase their existing locations and benefit from investing in their growing neighborhoods. By allowing businesses to gain ownership of their physical asset, the commercial mortgage loan helps to build wealth for entrepreneurs and promote neighborhood stability. One example is Hair Du Jour Salon, a salon on North 63rd Street in Overbrook that we proudly supported with a $440,000 commercial mortgage loan. The owner Anne Turner purchased a three-story mixed-use property adjacent to the salon's existing location and plans to relocate her business there on the ground floor and then rent out the other units in the building. Since we designed and launched this program, we have supported nearly two dozen businesses in purchasing their property. Another way PIDC supports businesses is through our contract line of credit product which offers working capital for qualified small businesses seeking a line of credit to find contract-related working capital. Recently we supported the Milligan Group, a Black woman-owned firm that provides a range of electrical construction and telecommunications infrastructure. With the help of a Rebuild-specific Contract Line of Credit, the Milligan Group was able to complete an electrical upgrade and lighting package for the Frank Glavin Playground, a Rebuild project in Port Richmond. At the same time as we have focused on access to capital for diverse businesses, we've also adopted new strategies to ensure that larger scale projects in Philadelphia are more impactful in creating opportunity for Philadelphians. For example, at the Navy Yard, PIDC's development partners Ensemble/Mosaic were selected in part because of their strong commitment to diversity, equity and inclusion at all levels, including the development ownership. Since that time, Ensemble/Mosaic has launched a bold commitment to DEI securing nearly 47 percent of their total contract dollars to minority, women, veteran and other business enterprises. 9 million square feet of space and 6 billion in diverse and inclusive new investment over years. 18 Also, we launched a new 19 program and workforce development 20 to connect Philadelphians with quality job opportunities at the Navy Yard with employers Four Seasons, Total Landscaping, Philly Shipyard and Tasty Baking. Since 2020, the Navy Yard Skills Initiative has placed more than 100 people in full-time living-wage positions with these employers, and we continue to expand the program with new cohorts every year. PIDC also offers business support services, including educational workshops, one-on-one counseling, credit repair and networking events designed to support business growth. In 2023, we have hosted over 40 workshops, including 11 in Spanish that will support hundreds of local business owners and entrepreneurs with topics like technical assistance, marketing, accounting and more. Yet despite these efforts and those of our partner organizations, including the Department of Commerce and the Chamber of Commerce, we recognize and agree that major and unacceptable gaps and disparities continue to exist, particularly for BIPOC-owned businesses and development firms and for communities of color. It is one reason why our new strategic framework focuses on our deployment of resources across all that we do, from lending to real estate to our own purchasing power in ways to address racial inequity and poverty in Philadelphia.
PIDC's staff are dedicated to our mission and we are excited to continue our longstanding partnership with both City Council and the Administration to continuously identify ways we can work together to ignite business and job growth and to make Philadelphia a more economically competitive city. Thank you all for the opportunity to testify today.
Thank you so much for your testimony and I know we have others to testify. But there's a quick question, Councilmember Jones.
I don't know how quick it is, but it is a question. First, let me thank you, Mr. Chairman, for this opportunity and thank the author of the resolution, Member Johnson, for focusing on this issue. The reason why I asked to stop right here is because I think it's a really good representation of workforce, finance and planning with the Commerce Department, almost like a three-pronged stool to build economic development on. I want to push back gently on the fact that there are other places in the city of Philadelphia other than the Navy Yard, other than the airport, other than a site that needs development, one of which is the old Budd Plant in Hunting Park. And I want to use this as an example of asking. I know Budd Biotech has invested in that area and I wanted to know how PIDC, how the Commerce Department and how UAC have moved in a direction to help bring vitality back to the home of where the Tastykake used to be. So is there any collaboration within that?
Thank you, Councilmember Jones, for that question. The Budd site -- oh, I'm sorry. Anne Nadol, Commerce Director. Thank you, Councilmember Jones. The Budd site is a really interesting opportunity that I think we are continually marketing. We have brought a number of companies through there as potential sites for either a location in Philadelphia expansion, especially for the smaller companies that are coming out of incubator space that are looking for a broader or larger location. It is one of the top sites that we continually push with companies coming in from out of town. Haven't landed anybody in there quite yet but it --
We have brought a lot of life sciences through there. Life sciences companies tend to like to locate with other life sciences companies and we need to land that first big anchor that will then attract other companies, and that is -- with our life sciences, and this might have been raised at the other hearing that was going to be this afternoon that was postponed, that is a site that we have focused on as a future next hub for life sciences companies.
So to that point, these are life sciences companies that are like your start-ups of the Silicon Valley. They are companies that want to hire people that don't necessarily have a degree. They want to specifically train workers to work within their individual plants to package, to test, to provide kits for different testing of diseases. So this is a perfect opportunity to create a school-to-paycheck pipeline and we want to kind of encourage that. The other aspect of this is one that Member Gilmore Richardson deals with. I think we have somewhere in the neighborhood of 7,000 vacancies within the city of Philadelphia. And I would love to figure out how we can do a paycheck pipeline from school to paycheck for those types of opportunities, Streets Department, Gas Works and others where you don't need a degree in rocket science. You need to be able to be a willing worker to learn your craft within a department that you find. So how are we tapping that in and it impacts every zip code, everybody, everyone can benefit from those type of opportunities?
If I may, Councilman, one thing that I think is a best practice of the Navy Yard, which I think we can adopt for locations in Hunting Park and others across the City, is the development of a master plan. And the master plan brings together partners from every spectrum of trying to create concentrated comprehensive economic development in the area. So Commerce working with PIDC, working with other nonprofits providing these wraparound services. I think it's important for us to identify across the City, not just in certain Districts but across the City where those places are where we need this type of comprehensive plan. So it's one of my hopes as the new President for PIDC to be able to partner with City Council and the Administration to develop other sites in the same way that we have developed the Navy Yard. It may not be specifically life sciences. It may be a different type of sector that we can use to attract to Philadelphia, but we need everyone around the table contributing their pieces and we need to plan it. We need to plan it over months, over years to make sure that when we welcome people to Philadelphia, we don't just take them to one location. We're taking them to multiple, but they see that each location has the benefits of being in Philadelphia.
I truly appreciate that response because that is where I was going. We have the Paper Mill up in my District, which has about -- 1,000 -- no, 6 25,000 acres up there that's 7 unutilized. But if we planned and 8 worked -- that's why I asked Member 9 Johnson about SEPTA and being able 10 to move people in and out of that 11 area because I can't have that kind 12 of development without a plan for 13 mass transit. 14 Member Gilmore Richardson 15 understands exactly what I mean 16 when I say that development has to 17 be planned like you said to 18 incorporate the intended and 19 unintended consequences. 20 So thank you, Mr. Chairman. 21 Thank you, Member Johnson, for this 22 resolution. 23
Thank 24 you, Councilmember. 25 Councilmember Gilmore Richardson.
Yes. Thank you so much, Mr. Chairman. Thank you, Councilmember Johnson, for this resolution to (inaudible). I want to go back to the testimony given by our Commerce Director Anne Nadol regarding the workforce development piece. I wanted to just ask a few questions relative to the life sciences sector. And I know Councilmember Gauthier will be working on this issue more fully in the new term. But you talked about Philadelphia being the birthplace as the first FDA-approved cell and gene therapy within the University hub in health care here in our city. And we've met with a number of those entities and they've talked to us specifically about the very specific nature of that work, that it's a lot of research. You don't know exactly when you'll come up with the next big thing in cell and gene therapy. So for that reason, it becomes very difficult to plan relative to workforce development. So I wanted to zero in on that and ask you about how you think based on what we know to be true as of today we adequately plan from a workforce development perspective for this industry and for this field? And in addition to that, if you could talk about the work of Commerce and the Workforce Professionals Alliance, and if you all are still meeting post-COVID and how you all work together to ensure that we have workforce development coverage across the City of Philadelphia for the variety of industries we know are here and are coming to Philadelphia?
So let me start with the life sciences question. And thank you, Councilwoman Gilmore Richardson, for that. And we know this is a passion of both yours and Councilwoman Gauthier, so we're happy to talk to you about it. For the life sciences, as we know one of the sort of misnomers about life sciences is that it is only for Ph.D.s, right. And the beauty of the life sciences sector is that it really can be, as you said, from a degree to a paycheck because we have a terrific network in the City of job training partners, be it the West Philadelphia Skills Initiative, be it Community College, be it programs down at the Navy Yard, where we are working with the businesses based on their needs. They tell us what they need and they are training and we are helping them train specifically for immediate needs that they have to their technology, to their processes, to their protocols, and that has been a real gamechanger for both our ability to retain and attract life sciences companies because we are pretty innovative in that field, and also obviously the folks who get employed benefit greatly from that. To your question about what Commerce is doing in the Workforce Professionals Alliance, with Council's foresight of creating the division of workforce in the Commerce Department with the Charter change that just passed, we are gearing up to really grow that part of the Commerce Department, and very much looking forward to that. It marries very well with all of the other initiatives and direction and priorities of the Department. And I can certainly bring up -- oh, there you go. Pop up like Jack in the box, bring up Gianna Grossman and Dawn Summerville to talk a little bit about the detailed growth plans and areas of emphasis for that. So let me give you the chair. (Witnesses approached Witness Table.)
Thank you, Councilmember Gilmore Richardson, always advocating for workforce. The Workforce Professionals Alliance is an organization of over 28 of our largest workforce training organizations in the City. And in our new workforce report that you will be getting in the next few weeks, we actually show the impact of the Workforce Professionals Alliance on the entire workforce ecosystem. So annually we collect the data of how large their budgets are, how many people they can support and train to show that this is really the powerhouse of the workforce ecosystem. And I will say we just opened our Workforce Solution Grant annual call for ideas this year, and we have 37 intent to applies. Last year we had 9 applications that totaled 10 approximately $10 million in ask. 11 And we have $1 million this year. 12 It seems like we're on track to 13 have even more applicants, so it 14 shows a need for the funding. 15
My apologies. May you 17 repeat that? We had a total of? 18
37 intent 19 to applies for the Workforce 20 Solutions Grant, which again is $1 21 million. Last year the 26 22 applications we got totaled 23 approximately $10 million in ask, 24 so it shows the need for flexible 25 funding in the workforce solutions space.
And can I ask you a question based on the organizations that responded. What fields did you notice the most?
Yeah. So we put a focus on life sciences for the growth in the sector this year as well as focusing on some of our public sector jobs as we've seen obviously such a high vacancy rate and need to train people in as well as skilled trades. We won't know the exact industries until we get the full proposal, but we can send you a breakdown as soon as we have it.
Councilmember Richardson, thanks again. As Gianna said, our focus on life sciences in particular as you stated and Director Nadol stated, there are opportunities that don't need a Ph.D. and we can get through with skilled training, certification, septic training, for those that can go into labs and really maintain a lab and prepare it for manufacturing and cell and gene therapy processes, those are opportunities that can start off at $50,000 and $60,000 and that's without a college degree. So that is the focus as Gianna has pointed out. As long as we continue to have viruses and colds and everything else in food, airborne disease, there is a need in this space for that sector.
Yeah. Just a real good point of information for the Commerce Department. Are we tracking the data that actually shows the actual numbers of the companies that come to our city that provided opportunity for non-degreed individuals in the life sciences? Can you give us some of the numbers please?
Yes. We're working with several companies. I can say the number is growing every day. It's actually a huge part of our traction plan to the City of Philadelphia. But I would say that we have probably about six very engaged large companies that have already started hiring without degrees. There's many more that are interested. But it is a -- we have -- I think's over 500 jobs in the next few years. One company alone has 200 to 300 jobs without degrees.
Can you just give us an idea how those six large life sciences companies, the actual numbers of individuals hired, 100, 200, 300?
So far it's probably been approximately 100, but the problem for scale is that we have so many open positions. If we had more programs, we could fill more jobs.
Councilman Johnson -- and again, we'll continue to track that as well. The Commerce Department, we keep a database that we use and to be in touch and as we can pull those numbers, we can have those for you.
And I only ask that question -- and I'm a partner. But I asked that question, we want our city to be more competitive when it comes to our business environment. We know that when we recruit more businesses to come to the City of Philadelphia, that's more revenue to increase our tax base to allow us to do all those great things that we like to do. But also what keeps me up in the evening is household income has risen amongst every ethnic group except African Americans.
Poverty has decreased in the city of Philadelphia consistently since the year 2 -- has consistently decreased. However, amongst Black and Brown people it has increased. That was recently based upon the Census Bureau and it was reported in the Inquirer. And so, when I looked at this last data that talked about how we increase our voter participation this last election, biggest turnout since 2019, that was in all gentrified neighborhoods. And amongst Black and Brown people, we weren't actually coming out. And so, we are trying to figure out how do we take the policy we're working on and connecting to actually those most in need. And so, that's really where the question was going at in terms of tracking and seeing are we doing everything possible because obviously we aren't, but to actually get the information and you said it's going to be 500 jobs available in the next couple of years, I'm pretty sure we're going to work with you around that strategy to get the word out to the population of people who are non-degreed that can have an opportunity to go into those life sciences. That's all.
If I can make one additional statement, Councilman Johnson.
We all have work to do, public and private. We have work to do in those places and spaces so that we are getting to those BIPOC communities. I believe again in what they say, if you can't see it, believe it that you can be it. We're not doing enough. I think all of us collectively are not doing enough to really promote these opportunities. And quite frankly, life sciences in my opinion I would like to see more of this placed in school, middle school --
I would like to see it late elementary into middle school. That's where you start.
Whether or not my grandson likes it or not, he'll be in the life sciences campus summit. And this is where the opportunity is. This is where the growth -- you have to start having folks interested in the opportunity and not think that they need a Ph.D. or sitting in a lab. It's a broader, broader discussion.
And I'm going to wrap up because I don't want to dominate my colleagues' time. But that was a mic drop moment, and I think Councilwoman Katherine Gilmore Richardson is going to follow up on it. And then maybe we have to have a conversation with Dr. Watlington to kind of look at how we reimagine public education, charter school education, right, to kind of allow us to look at the other alternatives. And although we're talking about non-degreed, you know I'm an advocate for also encouraging our young people to do a pipeline to become degreed to be that scientist inside the actual company doing the actual work as a part of conversation. But I will digress my time back to Councilwoman Katherine Gilmore Richardson.
Thank you, colleague. And that's exactly where I was going relative to middle years exposure for young people. I wanted to start with the Workforce Professionals Alliance and then go to another thing that was mentioned by Director Nadol relative to some of the changes made at the state level for the ease of doing business and then trickle that down to the City of Philadelphia and how we're working with the School District of Philadelphia to provide not only middle years exposure which we know is so important, but also figure out how we create a pathway and a pipeline to the families supporting and sustaining career opportunities that we know that are available in the City. And so, I will reserve the balance of my questions so we can get that through this panel. But I did want to put on the record that I think it's important that we work with the School District of Philadelphia from a City perspective to create an additional CTE program, Career and Technical Education program, that specifically focuses in on specific life sciences. And I know that we have four programs that we can say sort of marry into that area already. But I know that one of those programs is related to the school, as an example, that my daughter goes to, which is Engineering and Science. So they can count that school towards life sciences, but it's not specifically life sciences. And so, I want to further delve into how we can work from a City perspective with the School District of Philadelphia to create that program in that we can possibly work with some of the organizations that you've already identified to be the career, the middle-year career exposure organizations so that it eases the process and the application process with the PDE. This is something that I know Governor Shapiro is definitely interested in and is committed to, and I think we should work towards as a City entity working directly with the District so that we eliminate any potential issues and/or challenges with the District working directly with the organizations that we are trying to get, bring and retain in the City of Philadelphia. Okay.
Can we please have Della Clark, Jeff Hornstein and Kenyatta James please. (Witnesses approached Witness Table.)
Della, just state your name for the record and proceed with your testimony --
-- and then we'll ask the rest of the questions once your panel's done.
Della Clark, President of the Enterprise Center. I want to thank you, Councilman Squilla, for the opportunity to make comments regarding Resolution 2 230165, the Committee on Community and Economic Development. And I also have to recognize my Councilwoman from West Philadelphia, Councilwoman Gauthier. And congratulations, Councilwoman, I was at the Urban League for your award on Friday, and Councilman Johnson. My perspective on starting and growing and scaling minority businesses is unique. I have about 30-plus years of working with minority enterprises. My firm belief is that we need to invest more in capital products versus programs, which would positively impact neighborhood violence and poverty. We need to invest patient capital to grow successful minority entrepreneurs and generational wealth in the communities they serve. There are two types of business founders: Founders from low-wealth families and communities and founders from prosperous families and prosperous communities. Founders from low-wealth communities grow slower than founders from prosperous communities who typically have cash reserve. Low-wealth founders receive technical assistance and founders from prosperous communities receive management, consulting and expertise. Low-wealth founders receive CDFI loans while founders from prosperous communities receive patient capital like equity investment. We need to recognize that these two different journeys often result in different trajectories even though both types of entrepreneurs are being held to the same standard while measuring success. We need to recalibrate the lenses through which we view the entrepreneurial journey. Focusing in on capital: In the Mayor's progress report on economic equity, the City notes that it distributed 33 million for COVID-19 business relief through multiple programs focused on supporting small- and minority- businesses and million to small 11 businesses in immediate response to 12 the pandemic restriction. 13 Most of these funds were grants. And while they offered relief, they did not move the business toward profitability. It only fulfilled short-term working capital needs and not growth strategies. While recalibrating our lenses regarding the entrepreneurial journey, we also need to change our lenses about the importance of capital versus programs. The prevailing assumption is that if an entrepreneur is poor or lack resources, they need training. We need to refocus this strategy away from keeping business owners in training. We cannot train away the lack of access to wealthy friends and family networks. The City instead need to support seed investment, convertible notes, patient capital while simultaneously positioning businesses for future growth by attaching them to financing advisory services, for structure of Board, preparing regular financial statements, increasing enterprise value by building assets and using economic indicators for improved financial decisions. We are preparing businesses for the thinktank world and not the capital markets. We also need to use City assets to drive investments in our minority business contractors using a multi-level strategy where the community benefits. And my point in this section here is that when we have a population where the majority of minority is in the lead, the commensurate with City contracts is not. 5 percent of City contracts went to minority vendors, and that number needs to increase if we want to bring capital along with that. We need the City of Philadelphia to take full ownership over its contracting so that we can obtain the data transparency necessary to remove the roadblocks that keep qualified minority business owners from accessing public contracts. We do not want carve-outs. We want intentional investments to grow Black and Brown businesses. In a minority-majority city, it is no longer appropriate to use the excuse there aren't enough qualified minority contractors in any industry.
Many minority companies are not qualified because we have not invested in their business infrastructure. They are operating with little cash reserve so they do not have the resources to grow their business. We have them chasing contracts versus building a business. The City's Department of Commerce PHL: Most Diverse Tech Hub initiative launched last year allowed us to highlight successful businesses in one sector and provide four businesses with cash prizes totaling 200,000. We should be working to highlight successful MBE companies in every industry sector and provide them with the capital they need to grow and scale. S data, several neighborhoods such as East Germantown, Overbrook and Logan are on the downward household income trajectory and median Black household income is growing at one-half the rate that is growing for Philadelphia's other races and ethnicities. We will continue to be the poorest largest city if we continue to concentrate our economic investments in the City's core, a strategic neighborhood-based approach to locating, developing and starting City assets that oversee and monitor by the City of Philadelphia can help equalize the access to jobs and contract opportunities. We have a once-in-a-lifetime generational opportunity to connect MBEs to the private sector, including real estate development projects currently in progress all over the City, but minority contractors are regulated to providing fulfilling staffing roles and not participating in receiving mark-ups on supplies and general conditions. To private developers working in Philadelphia, we need to show how you are investing in the next generation of minority contractors. In summary, minority businesses are Philadelphia's future employers, but they need capital to invest in business infrastructure to be sustainable. So I want to thank you for this opportunity to present my comments. And I want to leave with you with we need to invest in capital and less in programs.
Thank you, Della, so much for your testimony. And we'll go quickly to Jeff Hornstein and Kenyatta. Just state your name, Jeff, for the record and then proceed.
Yep. Jeff Hornstein, Executive Director of the Economy League of Greater Philadelphia. My neck always hurts after Della because I just find myself nodding to everything she says. So the question at hand this afternoon from our point of view is what are the key drivers of equitable and inclusive growth. Philadelphia has been growing in terms of population. I live in Northern Liberties. We've quintupled in the last years, 17 right. We've had private sector 18 investment. We've had jobs. We're 19 probably at the tail-end of what's 20 been a massive real estate boom. And of course, our poverty rate has ticked down a little bit over the past 10 years, 20 years. But we must ask ourselves whether that is because we have gentrified the poor out of the City, which is what every other city has done. No other city really has a lower poverty rate than we do, as Paul Levy likes to point out. We have the same absolute number of poor people. The denominator has just gotten smaller so the rate stays about the same. Thus far, we don't have much evidence of displacement but we can't really be sure. But what we do know is that we have a massive equity gap between our middle class residents and our working-class residents, many, but not all, of whom are people of color. So we really started thinking about a three-legged inequity stool at the Economy League, and we're really trying to tackle two of those with partners like Enterprise Center and the Diverse Chambers and others. First, inequitable access to quality good-paying jobs. That's not where we're focusing our energy. We've written a lot about this, but we're much more into doing stuff these days. We have great initiatives like the West Philly Skills Initiative, Temple Lenfest North Philly Workforce Initiative and others, they all need to scale. We need to pick some winners and scale them. Second, and one that we're just about to release a report on, we have deep pervasive inequity in Philadelphia's real estate market, and this points directly to something that Della just said. " We analyzed 70 years of property value data, and found a $57 billion, $57 billion gap between home values in majority White versus majority Black and Brown neighborhoods. Without -- and I misprinted that in the official testimony that I handed in, but it's 57 billion. Without access to home equity that comes from real estate appreciation where working-class Philadelphians, particularly people of color, are going to get the capital they need to start businesses. Most of my ancestors leveraged their household -- their home wealth to start businesses and become entrepreneurs. But people of color in this City and across the country have been denied that key pathway towards upper mobility. We'll be sending you all a copy of that report shortly and we'll be proposing what we are calling the Fair City Challenge for 2024 to identify, support and invest in community-driven solutions to revalue in disinvested neighborhoods. And again, plenty of people are doing a great job. I mean, 52nd Street wouldn't exist but for the Enterprise Center and some others, but there's a lot more work to be done in this realm. So the third leg of this stool and most germane to this hearing is the dramatic underrepresentation of Black and Brown Philadelphians as owners of businesses with employees, those on a growth trajectory. More than 80 percent of Philadelphia-based businesses are owned by people who look like me, while 65 percent of this City do not look like me. And that's our future, right. We are a BIPOC majority city. I hate this term, minority- majority, minority -- that's just dumb. We are a majority Black and Brown city, right. How do we turn that tide around? Part of it is what Della just said, we need access to capital, investment capital in a big way. Some of our colleagues, which you'll hear from I'm sure, in the Diverse Chambers, have called for tax policy changes. We support those efforts.
But our approach is really to leverage the purchasing power, the big institutions in three districts sitting right in front of me; Councilman Squilla's, Councilman Johnson's and Councilwoman Gauthier's. Between the three of you, tens of billions of dollars of purchasing power that -- stuff and supply chains. We have large corporations, hospitals, universities and, yes, the City of Philadelphia spends billions each year between capital and other stuff. And we at the Economy League believe that helping and encouraging those supply chains to open themselves up, to create opportunities for local diverse firms, which is why we launched the PAGE initiative, Philadelphia Anchors for Growth and Equity, five years ago in partnership with the Commerce Department, Penn, Jefferson, Drexel, CHOP, Temple, Blue Cross. And we're thrilled to be core partners in the new Supply PHL initiative that Anne Nadol and Commerce have put together to make sure that there's equitable access to the contracts that are going from the Infrastructure Bipartisan law and other federal and state funds that flow towards the City. But until we are able to invest in the companies that are going to do business with these supply chains, we're really just going to be in the same place. And we have gone backwards. We have fewer Black-owned contractors today that can build a dorm at Penn on their own than we did 10 years ago. That's a fact. So by the time I'm 70, 15 years from now, I want there to be at least 10. That's a goal, a measurable goal, and hold us to it. So I'm going to cede the rest of my time to Kenyatta James who's going to talk a little bit more about it.
Thank you, Kenyatta. Before you start, I just want to recognize Councilmember Brooks is present for the hearing. Thank you. Just state your name for the record and proceed.
I'm Kenyatta James. Thank you, Chairman Squilla, Councilmembers Johnson and Gauthier and the rest of the Committee. We know that Philadelphia cannot build a thriving economy without creating a robust Black and Brown business community. Leadership from the Mayor, City Council has helped to grow the number of successful minority businesses in the region. However, these entrepreneurs still face persistent barriers to full market inclusion. Philadelphia Anchors for Growth & Equity or PAGE was developed to target a few of these structural barriers, including relationships, access to capital and information asymmetries. Our program offers a comprehensive approach to identifying sourcing and capitalizing opportunities from large institutions for select minority businesses. Our innovative catalytic capital grant program known as the Hurdle Fund allows minority businesses to rapidly increase their capabilities when they have qualified for an opportunity with an institutional partner. In the first year of operation, we gave away about $125,000 which helped unlocked over $2 million in contract revenue for local minority businesses. Our introductions and contract negotiations support helped to unlock another $35 million in contract revenue for minority businesses. P. Morgan and other supporters, we're going to be launching the , a cohort of local diverse firms that are ready to do business with large institutions. We'll be measuring their growth as an index of health in the local economy. So I'm going to go right kind of into some recommendations because I think that we end up in this really interesting place where we're doing amazing work and it's all siloed, right. We work with all of these institutions, but that doesn't necessarily mean that our goals are aligned. So I think that there are a couple of practical things that we can do to really improve our effectiveness as an economic development community. The first thing is that City government should help us create a clear vision, a clear set of priorities for economic development in the region that's supported by data and uses the resources of private corporations of the development nonprofits of workforce development partners, educational partners in the philanthropic community as well as CDFIs to all move in one direction and encourage one type of investment or at least one vision of investment and growth. If business investment is divorced from workforce development, you end up training people for jobs that don't exist. And it's the same thing with anchor needs in businesses. If there's not clear information being passed, then you end up with businesses that aren't well-positioned to grow in the region. We also need to really create a separate support system for B2B and B2C entrepreneurs that allows both of them to grow. The resources should respect the differences in industry, the differences in size and allow the development of organizations to build, focus capacity in supporting the type of businesses that they're good at supporting. We support B2B and B2 institutional businesses. We're not here for the B2C businesses as much. We do the research. We'll provide the numbers, but there's others that are better at that than us and we need that to be part of a comprehensive strategy. We need to invest in the operational capacity of minority businesses through grants, through low-interest loans and through advertising support. The City needs to make capital easier to access for minority businesses that have long suffered from discrimination in accessing capital or wealth. This means supporting grant programs like our Hurdle Fund, catalytic capital for B2B businesses as well as expanding the grants that go to B2C businesses, whether it's to improve facades, improve point of sales infrastructure, improve equipment or whatever else is needed. This also means expanding already successful programs, help CDFIs. PIDC has great programming for people that are doing public work.
We need similar low-cost capital for similarly low-risk projects, right. So this includes contracts that come out of our anchor institutions. They're low risk. We can capitalize them at low cost, but we don't. We don't treat them like City contracts, and that can become a barrier for growth of these institutions, these businesses. We need to collect better data. That means increasing the information the City collects about minority businesses to the collection of taxes and consolidating that information in a way that nonprofit partners can use. Right now we have the ability to have such a stronger vision of what's happening in the market and we don't. And what ends up happening is that we all have our little bits of information about the specific groups that we work with and that's not comprehensive. And we need to empower partners through long-term partnerships and funding opportunities that allow for learning. Nonprofits are an integral part of the economic development capacity in the region. But a lack of resources and punishing grant cycles can make it difficult to be creative. Tackling this is an old problem that will require new innovative solutions. There is very little funding for new ideas in today's market. True equity will require innovation and innovation requires the ability to take risk. To that end, City government should partner with private and philanthropic sectors to fund new and innovative programs that address economic challenges. So in conclusion, we need a clear vision. We need investment capital. We need better data. We need coordination of both resources and programs to enable the creation of a truly equitable and effective ecosystem for local and diverse firms. We have attached our most recent impact report that has a bunch of additional data points and we're looking forward to working with Council in 2024. Thank you.
Thank you so much for your testimony. I know Councilmember Gauthier had a question.
Yes. I have some comments and a question. Thank you, Mr. Chair. First, I want to thank everybody for just the amazing work that you all are doing in this area of economic development and workforce development. I wanted to offer particular kudos to Della Clark. I couldn't agree more with your comments around what is needed in terms of truly opening up opportunities for Black and Brown business owners. And I wanted to thank you for living what it is that you're testifying about. I don't know if everybody knows that Della, herself, is creating a $50 million fund for the renovation of commercial corridors in West Philadelphia using entirely Black- and Brown-owned contractors, so thank you for modeling that. And I agree with you that we at the City and all of our partner agencies have to be willing to live that as well. So thank you so much. I wanted to touch briefly on this issue of workforce development again. I understand why we're doing everything that we're doing as a city to create a more favorable environment for business, whether we're talking about reducing the wage and business income tax or streamlining processes and services within City government, and I believe that that will work, but I don't think that there's a straight line between creating a more favorable environment and employing the folks in our city who really, really need jobs. And my fear is that if we don't place a commensurate investment in workforce, that we end up with what Jeff stated, right. I do not think it's a success for Philadelphia to turn into San Francisco or Boston or any other city that has replaced working class and poor people with different people. I think the success for Philadelphia is to invest in workforce development, try to get some commitments from the companies that we're attracting here so that our people can grow with industry. In West Philadelphia and Southwest Philadelphia, the industry that we see really growing is life sciences and gene and cell therapy in particular, and it's really changing the landscape of Market Street and Chestnut Street as well as the lower Schuylkill. And in some instances, the growth of that real estate development is pushing out affordable housing, because at least for a time that commercial development was seen as more lucrative. And so, I just want to stress the importance of making sure that when we're working to invest in workforce development for life sciences, that we're thinking about that at scale. I love the Skills Initiative. I helped start the Skills Initiative or helped fund the start of the Skills Initiative when I was at LISC. But I think there has to be a balance between this very sort of targeted or training for the exact jobs that exist and we're planning the jobs that are going to come, because if we don't have that balance, it will move away from us. And then we are Boston, right, and we are these places where there is no 8 opportunity for Black and Brown people to get the family-sustaining jobs that can exist. So I hope that we grow that activity and grow it at scale. I wanted to ask a question for the folks at the Economy League. I love PAGE. My Chief of Staff helped to start PAGE. I think it's a wonderful initiative. But I'm often in this position where I talk to my institutional partners and I'm hearing how great they're doing at procurement with, you know -- I won't say minority -- Black- and Brown-owned and women- owned contractors, but then I talk to those contractors and those businesses and they tell me a completely different story. And sometimes I'm at a loss of how to bridge that gap, right, to get us to the place that we really need to be. So you have a great familiarity with the institutions in my District as well as the other Districts. How do you suggest that we really bridge that gap and get to the place we need to be where those billions of dollars are being spent with the businesses and companies who need it and who deserve that?
I'll take first crack at that, and Kenyatta can add some words for color. So we believe in measuring what matters, right. Most of the impact reports that come out measure volume of dollars spent. If there's no growth among businesses, what does it all mean and how many businesses have grown in the past years. I know lots of them, right. I used to run union campaigns against a lot of the same contractors that are on my Board now, Scotland Yard Security, Team Clean, EMSCO Scientific which I didn't run a union campaign against, but a bunch of them, right, and they're all stuck at the same revenue level, right. Pride Enterprises is broken out in part because Craig Williams has done some very, very, very smart strategic partnerships with larger contractors that have allowed him to take on risk to grow, has given him access to capital, has given him the ability to bond at higher levels. So that's the question. That's why we're building the 100. We're talking to the Commonwealth about doing the 1000, which would be a basket of 2 1,000 businesses. That's going to 3 be the index for us, right. If we 4 take 5 verticals, 20 businesses in 5 each vertical, just kind of making 6 that up right now, but something 7 like that, and we say, all right, 8 give us your certified financials 9 every year, give us certified 10 documentation every year in 11 exchange for being branded part of 12 the and we will give you a 13 report every year as an index of 14 how this sector is doing, right. 15 Della's got tons of 16 businesses in her pipeline. We 17 need to measure how they're doing, 18 because at the end of the day -- 19 like Penn, Drexel, CHOP, Jefferson, 20 they're doing good stuff, but their focus is how much they're spending, not on how much the businesses are actually growing. And that's the key. If all that stuff were true, we would have a 5 percent poverty rate and 1,000 Black millionaires in Philadelphia and we have neither. So someone's got to like --
It's not that the university, eds and meds don't have the contracts. Our businesses don't have the financial capacity. Just as an example, let's say one of the institutions awarded a business a $3 million contract. That business probably needs $500,000 to $750,000 of mobilization money before they can make the first invoice to that institution. Who's going to provide that 500,000, 700,000? They don't have the cash reserve. So we talk a lot about what everybody is doing. We talk a lot about contract. What we need to talk about is capital, because that business does not have that 500,000 to 700,000 in their bank account. They have to go borrow that money, the cost of that capital, the cost for insurance, the cost for the bond performance. We talk about all the peripheral, but what we don't talk about is what do they need to build that balance sheet to get more and more contracts from all these institutions.
One more follow-up. I perceive what you're saying, Della, to be that this is largely an issue of capital. And I guess my question is would putting that capital on the table fix this issue of having our major institutions contract much more with Black and Brown businesses or are there other things that we need to be doing from the City level to force this issue?
If you were in charge of a commodity that your institution needed, you're going to make a decision to provide that contract to someone who is going to give you assurance that they can deliver the product and service on time. It boils down to the ability to fulfill contract obligation and most minorities don't have capital, which is why they don't bid often enough, why they are hesitant to be aggressive on contracts because they know they don't have the cash reserve. So I think the City needs to begin to change its focus on capital, and if we do that, contracts will come.
I will add to that. An institution like a college or a hospital is really like eight separate entities. So I think that some of what you're facing is that you will speak with someone from the institution and overall the institution might be doing well. But maybe three departments are doing really, really well and then there's another five departments that are actually behind. And we're going to see this a lot as these institutions grow because they have a lot of staff, they have a lot of separate programming. Many times the supplier diversity staff sit in procurement and only procurement, so there's not like supply diversity across every different type of thing that happens, and then you end up with supply diversity staff trying to insert themselves into HR, other spaces around that purchasing where they don't have the same level of relationship. So I don't think that it's just an issue of capital, though I think that that's a major issue. There is an issue of training, of commitment and of clarity within each institution about where are they successful versus where are they behind and to be able to take that number and break it down piece-by-piece. The other thing is that there is no agreement in the market around how we measure success. So someone coming in and saying, we did really well on this versus someone else being like, oh, this was average, they can be looking at the exact same numbers. There's no 24 agreement on exactly how these things are measured and people are allowed to kind of make their own choices, which means that the information that gets reported back to you can be a little unclear as you look at multiple institutions. So I think that that's an area where the City can be helpful to say, you know, this is what we're going to look at. It would help us as nonprofits have a clearer picture and I think that it will help the overall region kind of have a clearer set of dynamics that they're going to pay attention to.
Thank you, Mr. Chair. I just had a question for Jodie Harris from PIDC. Regarding the capital, right, and I know I had some conversations with some folks down at PIDC about this early on. When Live! Casino wanted to open up, I'm in the 2nd Councilmanic District years ago, they had a model program that provided capital for vendors that wanted to do business with the Cordish family and Live! Casino in Baltimore, right. And so, while they were lobbying us for the legislation for the casino, they actually brought to the City of Philadelphia individuals who actually participated in their capital program and talked about how that program expanded their business and also gave them the opportunity to do business with the Cordish family/Live! Casino and we wanted to look at reduplicating -- no, I'm sorry, duplicating that model here in the city of Philadelphia. So, Jodie -- because we have our own bank. I don't know if people know or not know, but PIDC and PAID have all the capital that can support, right, small businesses, Black and Brown businesses, women-owned businesses, so do you want to elaborate on any initiatives that you're working on or exploring the possibilities of a capital program to help businesses?
Thank you for that, Councilman. And Della's giggling over here because we just had this conversation. So just to clarify, PIDC has a CDFI that manages its own balance sheet, but then we also are a conduit finances for a lot of the City projects. So the size of our assets under management are much greater than the actual loans that we put out, so we don't have all the money. We might help manage some of it, but --
But we do have ideas about how to increase our funding. And I don't disagree with what my colleagues have said about the need for capital, about the need to move from technical assistance to consulting and more services that help grow and support a business at the scale that they need to grow. I do think though to Councilwoman Gauthier's point about forcing the issue, there has to be standards. The City has to set standards. There have to be floors. You cannot go below this when doing a contract with the City if you are going to bring in Black and Brown contractors. There has to be levels. There has to be standards and standards are measurable. So to Kenyatta James' point, the data needs to be there in order for us to measure how we're doing and to see if those floors and standards and caps on certain types of requirements need to be adjusted. I also think though to Della's point about capital, there needs to be that equity piece that helps Black and Brown companies be able to, one, secure contracts, to open their businesses, to weather the storm. I don't have the data on this, but if you were to look at businesses that were able to weather COVID, most of them had cash reserves or operating reserves. They did not need to rely on federal, state or local assistance because they had that equity built into their business. And so, providing that equity level capital which sometimes comes in the form of grants is challenging. So PIDC has been thinking about in a suite of products and services -- I mean, you have to look at the whole continuum of a small business and you have to look at different points, there's different types of capital that might be appropriate. One thing we've been talking about is that equity piece that we don't do now unless we're the conduit for a City grant or small grant program, but we have loan products that are favorably priced. We look at the terms and conditions and work with the borrower, but that equity piece is missing, so we have been looking at that. The issue with equity, and I think this is where the City can partner with organizations like ours, is finding the capital to fund that initiative. So you need patient capital from the philanthropic community. You need patient capital from the banking community. You have to pull together a level of capital as Della's doing with your fund, bringing in different types of capital to be able to even provide patient capital to small businesses. So I think this is an opportunity for us to figure out how we bring in all the groups in Philadelphia. All of the major employers, all of the philanthropic community to figure out how we fund capital initiatives that provide that equity piece because it's not in the market right now.
My last comment, because Kenyatta brought this up -- great name too, Kenyatta, right. Kenyatta talked about how we're working in silos, right. I got the Chamber of Commerce that represents thousands of businesses, not only in the city of Philadelphia but regionally, right. We got the Enterprise Center, PIDC, Philadelphia Economy League/PAGE and the Commerce Department. Is there a monthly roundtable? Is there a task force amongst all of you where you're exchanging ideas, you're talking to one another regarding -- and everybody doesn't have to be on the same page in terms of individual tasks that they're working on, but the mission is all the same I would think. For most of the people that I know and deal with inside this room, the issue is the same, is to lift people out of poverty. The issue is the same, to make sure we have a great city of economic growth and development. And most importantly, making sure it's equitable across the board. But I think that happens when we're talking to one another. And Kenyatta asked that question, and I wanted to give it back to all of you to figure out if that's something that does take place? And I see Chellie over there like, let me get up there and say what I need to say. It's just a question I wanted to ask. No 5 different than how we deal with gun violence, like a lot of us try to get in the room to figure that out. But I think this is the very symptom of addressing the issue of poverty that contributes to a lot of things we're dealing with.
If I may start, Anne Nadol, Commerce Director. We do have -- we had it this morning, 8 o'clock this morning, bright and early. We have standing working meetings both with PIDC, with Planning and Development, with the Chambers. Our teams are working together I will say much more closely than they have in the past on business retention and recruitment, sort of (inaudible) let's say that we have insisted that they work together, and obviously there is always room to do more. We sit on one another's Boards, so we have a constant stream of communication. Can always be improved and worked on of course.
I would also add though, for those of you that don't know I'm from Philly, but I've been out of the City for about 30 years working other places. And so, coming back --
And so, I've been spending my time here trying to get to know all the groups in Philadelphia. I will say that what I've found, and this is not to disparage any organization or any initiative, but we do organize around programs, we organize around initiatives, and that kind of cross-comprehensive planning, discussion, collaborative group, I don't know if it exists. So I have a collaborative relationship with the Chambers and with the City and with other groups that we work with. But if City Council and the Administration wanted to go to one group to ask what's going on in Philadelphia, I don't know which group you would go to.
Yeah, we do have weak coordinating institutions here. It's a big problem.
Yeah. I think I would -- I'll go a step further if I might and say that our civic -- I'm sorry. Chellie Cameron, President and CEO of the Chamber of Commerce for Greater Philadelphia. I would say that we have a fractured civic environment in Philadelphia. We don't always coordinate and collaborate as well as we could. There are bright spots though where we work together incredibly well around specific programs. And, Councilmember Johnson, as you mentioned we represent -- we're a member-driven organization, so very different than some of the other organizations that you've heard from today. We represent more than 600,000 employees in the region and almost 1600 businesses right now. And we try to collaborate around the issues that are most important where we feel that we can make the most impact. But it is, it's very difficult. We do sit on each other's Boards. We talk all the time. And sometimes when we have those glimmers of hope, those programs that are successful, we need the help of the City to scale them. I can't remember who said it, but it's all about scaling those programs that we know can work.
Point of information. Two things: One, I wanted to shout out Rebecca Grant who started a working group around the life sciences. So recently we've been coming together as companies, City partners. I think one of our biggest takeaways is that the School District needs to be there, but that's something we're working on. The second thing I wanted to say is that we love piloting things as a city and we love starting and stopping things. So when I was back at SBN, the Sustainable Business Network, we were doing something called the City as a Model Employer. That was the biggest example I saw of bringing together City agencies, private employers, workforce development programs to try to come up with this grand vision for getting people into jobs whether they be in the City or outside of the City, but I don't even know what happened to that to be honest with you. And so, we need something of that nature but we also need it to be consistent.
And normally, philanthropy plays that role, right. And it doesn't really play that role in the city, right. We don't have this coordinating foundation like you see in Seattle or Baltimore or Detroit or any number of places. That's an artifact to the fact that we never had one huge industry that went belly up and left us a bazillion dollar foundation except William Penn. We don't have that coordination, so we rely on City government too much in my opinion. I love you all. But we rely too much on City government instead of getting our own proverbial houses in order on the nonprofit side. We need one person or one organization to be the convener and it just doesn't happen. But there's a lot of great work going on. I agree with Chellie that we can and should collaborate more. I'm on the Board of the African American Chambers so we get tied in there on ours. We do that pretty intentionally. Our capital, the catalytic capital committee that Kenyatta was talking of, the Hurdle Fund has a partnership with the Enterprise Center and ImpactPHL, so we took a little bit of money, $125,000, all of it raised from private high-net worth individuals by the way, and leveraged $2 million in contracts. Now, if we had $5 million and you guys wanted to do a midyear transfer ordinance and give us half a million dollars or something like that, we can leverage that into $40 million, $50 million for the contracts --
And I'm not being flip. But you got to look at what works and scale it.
But, no, thank you for that. And I think the charge too is not only a charge on the organizations but a charge on the City, right, work with the organizations and to have a plan in place so that we could then collaborate together and don't depend totally on the City, right, don't depend totally on you. But make those collaborations and work together to fulfill that plan. And I think that's a charge for us and the new Administration moving forward.
Yeah. And we're happy to sit down with you collectively and help you figure that out because we have a lot of information if we can all share it and kind of get past this competition for scarce resources, kind of nonprofit hunger games. We could really make a huge impact.
So to Councilmember Squilla's point, when I think about all the different organizations and you said, yeah, we all meet and we coordinate, how does that translate into the information that we share when folks are calling our office, who should I talk to about this or who do -- so, you know, our teams are trying to decipher is it a PIDC thing, is it a Chamber's thing. So when we're talking about those deliverables, like it's one thing for you guys to meet and collaborate, but what do those collaborations look like in realtime to get the information in the hands of the folks that are trying to grow, develop, expand businesses here in the City? And I think to Councilmember Squilla's point, that's what the City's business collaboration should be more about. If we're talking about -- someone talked about building more Black millionaires. The only way we can do it is giving thousandaires the opportunity to know how to get there. And if we don't have the resources and tools readily available for the people we meet every day, we're going to be having this conversation again later on, so that collaboration needs to be translated into realtime for communities.
Thank you for the opportunity to be here. I appreciate it.
Thank you all and thank you for your testimony. Mr. McMonagle, can you please call the next panel. And as your name is called, please come up to the table.
Yes. Can we please have Regina Hairston, Jennifer Rodriguez and Nick Shenoy. (Witnesses approached Witness Table.)
Can we also have Chellie Cameron standing by and Zach Wilcha. I apologize if I mispronounced that.
Thank you. Thank you for being here to testify. We'll start with Regina Hairston from the African American Chamber. You want to just state your name for the record and then proceed with your testimony.
Certainly. Regina A. Hairston, President and CEO of the African American Chamber of Commerce for Pennsylvania, New Jersey and Delaware. Good afternoon, Chairman Squilla, the other esteemed Councilmembers that are before me and a special thank you to Councilmember Johnson for this resolution. Again, my name is Regina A. Hairston and I'm the President and CEO of the African American Chamber of Commerce of Pennsylvania, New Jersey and Delaware serving as the voice of more than 180,000 Black businesses in the Delaware Valley and Southeastern Pennsylvania. AACC drives equity and economic growth through advocacy, access to capital, curated networking opportunities, business development and advisory services. I appreciate the opportunity to speak today about the crucial topic of job growth and economic opportunity and its significance in our ongoing efforts to alleviate poverty in Philadelphia. As representatives of the Chamber of Commerce dedicated to the advancement of Black-owned businesses in our City, we are deeply committed to fostering an environment that supports business growth and empowers those most in need to participate in and benefit from the opportunities created. First and foremost, we acknowledge that job creation is a multi-faceted challenge. It requires a conducive tax and regulatory environment that fosters business growth. As we analyze the economic landscape of Philadelphia, we must recognize that our city faces significant competition in attracting and retaining businesses. Therefore, it is essential that we create a tax and regulatory environment that not only supports established businesses but also encourages new enterprises to start and thrive. I want to highlight some pertinent data that sheds light on the current state of economic disparities and the challenges faced by Black entrepreneurs in our city. According to a May 2023 report by Brookings, Who is Driving Black Business Growth, insights from the latest data on Black-owned businesses, the 10 metro areas with the highest proportional reputation of Black-owned businesses are all in the Southeast. Most metro areas with high Black-owned business growth also have high total business growth. Similarly, areas with the largest decline in Black-owned businesses also have declines across all businesses. However, Black-owned businesses tend to be disproportionately impacted in these places with much larger decreases in the number of Black businesses compared to the region's average. 8 Black-owned businesses per 1,000 residents. S. economy. This could prove to be transformative in closing the 228-year wealth family gap and increase economic mobility for Philadelphia. Additionally, Arizona State University concluded an analysis and found that the City of Philadelphia ranked 71 out of 80 when it comes to the case of doing business, meaning 70 cities did better than Philadelphia. To this end, we recommend that the City Council consider implementing policies aimed at simplifying the regulatory landscape for small- and medium-sized diverse enterprises, streamlining the permitting process and continuing targeted tax incentives to encourage job creation. By doing so, we can make Philadelphia an attractive destination for businesses to invest, grow and create jobs. As we look to the future, it's imperative that we will prioritize equitable job growth and economic development. We must create a Philadelphia where everyone regardless of their background has the opportunity to thrive. By working collaboratively to improve our tax and regulatory environment and implementing targeted and data-driven initiatives and investments, we can build a more inclusive and prosperous city for all. Thank you for your time and consideration. We look forward to partnering with the City Council and all of our partners here today to make the important changes a reality in driving inclusive economic growth in Philadelphia. Thank you.
Thank you. Thank you for your testimony. We'll hold questions if we can until the panel is complete. Jennifer, if you want to -- oh, I'm sorry. Please proceed. State your name for the record and start.
Hi. I'm Eric Diaz. I'm going to be a poor substitute for Jennifer Rodriguez, but I'll give my best shot. Thank you very much, Councilmembers Squilla, Brooks, Johnson and Richardson. Good afternoon. As I said, I'm Eric Diaz. I'm Managing Partner of LairDiaz, which is a law firm on a mission to empower small business owners and entrepreneurs in the Latino community to accomplish their business goals. I'm also a Board member of the Greater Philadelphia Spanish Chamber of Commerce, which is why I was directed to come down here from New York today and help out for the Chamber. For the past 30 years, as I think most people know, the Chamber has been the leading voice developing, promoting and advocating for the 12,000 Hispanic businesses in Philadelphia, while encouraging the advancement and economic growth of the Hispanic community as a whole. At the Hispanic Chamber, we firmly believe that entrepreneurship and small business ownership are key to solving the inequity that stunts the growth and perpetuates the plight of the poor and underrepresented communities in Philadelphia. We, therefore, also firmly believe that promoting entrepreneurship and small business ownership should be a priority of City government as it considers the new City budget. So I thank you guys for providing that opportunity here today. Why should it be a priority? Because families of entrepreneurs who own a business have a higher median net worth than families who do not. It's as simple as that. And Hispanic families of entrepreneurs who own a business have four times the net worth of Hispanic families that do not. Increased net worth obviously leads to increased economic activity, a more robust tax base and a better economy for the City. Entrepreneurs and small business owners are the backbone of the economy. Indeed across the country the majority of new jobs -- and I was surprised by this -- are created by small businesses, not by the giant conglomerates that you hear so much about. It's the small businesses that create the majority of new jobs. Yet as Councilmember Johnson mentioned, really lamented in his opening remarks -- and thank you for that, sir -- here in Philadelphia entrepreneurship, as Jennifer doesn't like to say but has to say, is on life support, it's not doing too well. We rank at the bottom for comparable cities for many key indicators of the local business climate. C. And we all seem to agree, right. That's why we're here. We should know better and we should do better in Philly. I and the Hispanic Chamber applaud the efforts of the members of City Council and of the witnesses and participants here today to be making this ongoing effort. I'm from New York, but Philadelphia is a proud heritage (inaudible), entrepreneurship industry indeed. Philadelphia earned the moniker The Workshop of the World, because of their critical role it played during the industrial revolution. Today unfortunately the City is no longer perceived as a hub of economic innovation industry and it's lagging behind peer cities in terms of new business starts and diverse business density. Surprisingly though, according to Pews Economic Recovery Dashboard, small businesses in Philadelphia are actually creating more new jobs than their large or midsize counterparts. Imagine the job creation we could catalyze by committing to support our small business owners and following through on that commitment by providing them with the resources that they need to succeed. Sadly, entrepreneurs are increasingly deciding against Philadelphia due to the highly regulated, costly and bureaucratic environment, which we are targeting here today. Indeed a recent survey conducted by the Diverse Chambers Coalition of Philadelphia yielded the disturbing but not surprising news that small business owners in Philadelphia would not recommend the City as a place to do business.
These small business owners, the economic foundation of the City, gave Philadelphia the dismal score of -50 on a scale of -100 to +100. In assigning the score, respondents frequently lamented that high cost, red tape and crime layered onto the already difficult -- layered onto the difficulties already inherent in running a small business as the primary detractors. Being an entrepreneur is tough enough. These additional local challenges are chasing businesses away. While lowering business taxes is critical, and we've had some success there obviously, critical to improving the competitive environment of the City and much more needs to be done to spur long-term economic growth. For businesses to make long-term significant investments that will bring about the sustained job growth, we need significant reductions in the cost of doing business and increase in the ease of doing business, less friction as they say. We need to transform criminal behavior with opportunities to learn and earn through legal methods and means. These folks are industrious and they can be channeled in the right direction with the right resources, who wants to provide pride in the places where folks live and play so they're self-motivated to keep these places clean and trash-free. These are the priorities of diverse business owners and the path that Philadelphia must find and travel if it's to regain its status as a place that supports and welcomes entrepreneurs and small business owners. At the Hispanic Chamber and at LairDiaz, we are committed to supporting Latino- owned businesses. As business leaders, as community leaders and as residents of the City, we must intentionally plan and strategically execute to achieve safe, equitable and robust economic recovery. Thank you very much again for holding today's hearing. The leaders, staff and members of the Hispanic Chamber and LairDiaz and I personally are ready, willing and able to work with you all to build a stronger and safer Philadelphia for all. Thank you very much.
Thank you, Larry, for that great testimony. Much appreciated. Nick, if you're ready, state your name for the record and then proceed with your testimony.
Thank you, Councilman. My name is Narasimha Shenoy, also known as Nick Shenoy. I am the founder of the Asian American Chamber of Commerce. And currently I'm the interim CEO. I'm the President until we fill that position. Good afternoon, gentlemen. Councilman Squilla, Councilman Johnson, Councilwoman Richardson and Councilwoman Brooks. Thank you for providing me the opportunity to testify on behalf of the Asian American Chamber of Commerce of Greater Philadelphia regarding Resolution 230165. The Asian Chamber of Commerce is a membership organization for Asian businesses, individual entrepreneurs and nonprofit organizations for the growth of the economy and employment in the Greater Philadelphia area. Majority of Asian business owners in Philadelphia are immigrants and most of them are refugees that came to seek a better life and to pursue the American dream. Those who are not well-educated, culturally different and face language barriers are in business for their survival. Our mission is to help such individuals and businesses to survive and to create jobs for their family members and others. Every job we help to create for the City will not only generate revenue for the City, but also one less person off the welfare and out of poverty. We appreciate the City Council for addressing the poverty issue and finding ways to reduce the poverty rate in Philadelphia, which is the highest in the nation. The first and foremost step to reduce poverty is to make it easier for entrepreneurs to start a business and create employment in their neighborhoods. Starting and running a small business is hard enough and should not be made harder by unnecessary burdensome legislations and taxes. The City of Philadelphia is perceived to be unfriendly to businesses because of legislation adversely affecting businesses, business growth and regulations of how to run their own businesses. After the pandemic, businesses learned how to do business outside the City to avoid legislations which limits their ability to manage and grow businesses. Surrounding counties are much more business-friendly, and small businesses who can do business from surrounding counties are doing so. Safety is a primary concern to our businesses and communities, especially after the COVID-19 pandemic and civil unrest. Asian hate is on the rise for our businesses and community. COVID-19 has a drastic effect on minority businesses. Some of them have already closed and more are likely to do so. After that, damage due to the protest has further devastated these microbusiness communities. Business owners are not confident that this is not going to happen again and are concerned about the ability of the City to protect their businesses. This will considerably slow down the restart of existing businesses and slow down new startups. The City must work to overcome this fear and build confidence in the business community through a business- friendly environment. Due to language issues, there is no adequate means to inform our businesses to comply with ongoing legislation and are fined frequently for noncompliance. This factor severely impacts business startups and growth. Some of them may end up closing their businesses. There are 13,000 Asian-owned businesses in Philadelphia. Most of them are family-owned with the first generation immigrants. These businesses make substantial contribution to the local economy. Primary objective of these immigrants is to educate their children for professional careers rather than having them own the business. As these immigrants age, there will be ongoing attrition for the next few years. We need to encourage our younger generation to be entrepreneurs to maintain or increase business ownership. The City needs to provide adequate resources to help start and grow business. There needs to be serious effort to provide a business-friendly and safe environment to maintain existing jobs in our community to reduce poverty.
This Chamber was founded to help our businesses who need help to maintain their business to support their families. We do our part to reduce poverty level, but we can hardly do justice to this 13,000 businesses with limited resources. We seek additional resources to provide adequate service to serve these businesses to meet this resolution to reduce poverty. 7 percent. All three community poverty rates are at unacceptable levels. These resolutions only address Hispanic and African American communities and seems to ignore the need to reduce Asian poverty level to acceptable levels. Asians are frequently stereotyped as not needing assistance. As we have seen in study after study shown at federal, state and local levels, Asians do need assistance to achieve equal opportunity and assistance to lower the poverty rate. Therefore, I request City Council to include the Asian American community in your effort to reduce poverty for Philadelphia residents with a high poverty level. Thank you for allowing me to testify. This Chamber will be eager to work with City Council to help create jobs and reduce the poverty level for our residents. Thank you.
Narasimha, thank you for your testimony. We appreciate it. Now, we have Chellie. If you want to state your name for the record and proceed with your testimony and then followed by Zach.
Good afternoon, Mr. Chairman and members of the Committee. I'm Chellie Cameron, President and CEO of the Chamber of Commerce for Greater Philadelphia. And I'm grateful for the opportunity today to testify on Resolution No. 230165. And I am eager to discuss how we can work together to ignite inclusive economic growth in our city. I also want to note for the record that I am a proud resident of the 2nd Councilmanic District in the City of Philadelphia, so the things that we're talking about today are personal for me. The things that we're talking about affect my neighbors, they affect my friends, they affect my colleagues. And so, we have to succeed when we talk about economic growth and providing good family-sustaining jobs. I submitted a rather lengthy piece of testimony for the record. I am going to summarize if that pleases the Committee.
All right. So the Chamber represents more than 600,000 employees in the region and is committed to economic development by promoting policies that grow businesses and good-paying jobs. Our core mission is to create a thriving business environment that champions economic inclusion, enhances regional improvements and empowers talent initiatives all with the goal of positioning Greater Philadelphia as the top global destination for business and a leader in inclusive growth. As you've heard in the testimony provided by my respected colleagues from the region's Chambers, we are not alone in this mission. We have come together as the Inclusive Growth Coalition and we try to speak with a unified voice and advocate for an improved business and job climate, and I know we speak with a unified voice and we talk about making sure that this area has the best environment for business. Philadelphia's truly a world-class city with incredible potential for growth. 3 percent poverty rate and concerns around public safety, cleanliness still abound, and we have one of the highest tax structures in the nation. If we can effectively address these challenges, I believe we can and will realize our great potential. We also along with our colleagues understand that the approach and solution has to be multi-faceted, and we recognize that government can't go it alone. Public-private partnership is one of the keys to our success. To this end, I want to cite a couple of examples with the Chambers involved today, and again I'm happy to go into more detail if anybody would like. But we are a key member of the civic coalition to save lives along with the Philadelphia Foundation, the William Penn Foundation, the Urban Affairs Coalition, the Philadelphia Equity Alliance and several businesses. This broad civic effort led by Executive Director Estelle Richardson focuses on evidence-based and sustainable intervention strategies to reduce gun violence in Philadelphia. We must also invest in workforce development and improve the training-to-job pipeline. Activating key partnerships in the public and private sector is critical to achieving this goal. The Chamber in collaboration with Philadelphia Works, the City of Philadelphia Commerce Department and Campus Philly will launch the Greater Philadelphia Talent Network early next year. Again, it's going to be called the Greater Philadelphia Talent Network. We identified a critical gap in our civic community in the workforce area, and this network will be a referral system that will connect employers with vetted training or placement partners within the region. It's a way for us to truly bridge businesses and those organizations that are providing workforce and talent development. For nearly five years, the Chamber has convened member companies in the growing life sciences industry to address their talent needs. We've been pleased to see several programs come to life, such as the Biomedical Technician Training program developed by the Wistar Institute, the West Philadelphia Skills Initiative and Iovance. This was truly a successful program and it needs to scale. It's really just one of many aimed at helping everyday Philadelphians get the training they need to launch family-sustaining careers in this new sector and without requiring a college degree to do so. Finally, Philadelphia's tax structure remains one of the largest barriers to our economic growth. Eliminating the net income portion of the Business Income and Receipts Tax, which is a double tax on businesses and the second highest in the nation, and reducing the resident and nonresident wage tax are critical steps to accelerating our city's economy. These taxes have been a significant deterrent for companies considering Philadelphia as a potential business hub. The resulting scarcity of private employers within the City limits, limits the availability of quality jobs and hinders the development and growth of small and diverse businesses.
These are clear examples and just a few examples of why we must continue activating innovative and powerful partnerships and leveraging our City strengths. It is imperative that we speak with one collective voice in Harrisburg and Washington for resources to address our city's challenges. And I can't emphasize that enough, we have to speak with one voice so that we can get the resources we need. But by uniting our strengths and resources, I do believe that we will continue to transform the Philadelphia of today to a better tomorrow. The Chamber stands ready to be a proud partner to you, to build a clean, green, safe and prosperous Philadelphia for all of us. Thank you again for the opportunity to testify.
Thank you, Chellie. And we'll hold questions until after Zach testifies. Zach, just state your name for the record and proceed.
All right. Hi, folks. My name is Zach Wilcha. I'm CEO of the Independence Business Alliance and we are the LGBTQ+ Chamber of Commerce for the Greater of Philadelphia area. Good morning and happy holidays to you, Councilmember Squilla and all of the members of the Committee on Commerce and Economic Development. I want to thank you for having me here to testify on behalf of the IBA. We serve the LGBTQ+ and ally professionals across 350 member businesses and our community members, who we believe represent a relatively high population compared to similarly situated cities. I'm here today speaking on behalf of Philadelphia's LGBTQ+ business community, which is comprised of all races and ethnic backgrounds, sexual orientations, gender expressions and widely varied in industry. Our aim is to do good things for businesses and the best thing for our people in communities, goals which we believe are not mutually exclusive. We fear that somewhere along the way it became a popular notion that helping our businesses was the opposite of helping our communities, but in Philadelphia that cannot be further from the truth. According to surveys done annually by our Diverse Chambers Coalition, keeping our finger on the pulse of small businesses, our businesses' main concerns can be distilled down to five Cs, namely the cost of doing business in Philadelphia, the clarity or ease of doing business in the City, the lack of cleanliness as a barrier to businesses and being personally and professionally affected by crime, and finally access to capital. As for the cost of doing business in our city, the main thrust of complaints is around the business BIRT tax, which our businesses overwhelmingly identify as their most onerous expense. The double taxes, which do not occur in similarly-situated cities, are grinding away businesses at a historical moment when resources are thinner than ever. More dangerous for our city's future is the fact that this tax structure simply does not exist in neighboring cities and makes the prospect of moving one's business or locating a new business outside of the City quite alluring. This is but one primary action that the City can take to help grow businesses and create jobs. But we must stress that we have work to do as a city to create a tax-regulatory environment that will enable and support the kind of businesses and equitable and quality job growth. We should not aim to create extra barriers to drive enterprise away when our city is already at an economic crisis point. And as we have testified before, quality jobs do not appear without strong enterprises. But it's not just taxes. Regarding clarity of doing business with the city of Philadelphia, our businesses relayed to us how difficult it is to navigate the ever-changing and labyrinth codes and regulations that exist to keep a business running. This is not to mention the siloed City departments outdated technology and the complicated rules that require purse and power that our small businesses simply do not possess to navigate successfully. As Regina said, a recent study by Arizona State University ranked Philadelphia 71st out of 80 cities in terms of ease of doing business. Our disconnected systems can often turn into a nightmare of bureaucracy for businesses, especially those that operate in corridors outside of Center City. Our City departments do routinely amazing work for our businesses and our hope is that City Council will support them in encouraging and empowering more central and internal communication to ensure that their excellent work can be experienced efficiently. Crime and lack of cleanliness go hand-in-hand as barriers to the smooth operation of businesses and are currently our members number one hurdle to the quality of personal and professional life.
More than half of our respondents to the survey that I referenced reported being personally affected by crime and they have had to reduce hours of operation and hire expensive security to keep themselves and their families safe. Crime is the main concern of our businesses, with more than half of them reporting that they were physically impacted by the crime and now must reduce hours. Many also find that the labor market is simply not there to hire balanced with the risk of crime, and we need to do more to attract and retain talent to our city which we all know is the best. Lack of cleanliness across neighborhoods also represent a hurdle to quality of life. We have to remember that the whole city must be prioritized when we think of clean, green and safe, as everyone's workday begins at their stoop, not just when they arrive in Center City, if they arrive there. Our businesses love the City and want to operate their businesses here but are finding it harder to reasonably do so. As Eric said before, the net promoter score for entrepreneurs who would recommend the City of Philadelphia to open a business here has fallen from -33 to -50 according to our surveys. For all of these reasons, we are at an important moment in the City's economic history when we can choose to invest in our businesses and better our communities at the same time. In order to grow our economy, reduce poverty, maintain quality services and make our city safer, particularly during this extended period of economic recovery, it is imperative that we increase the number of gainfully employed people in Philadelphia, whether they are working for themselves or for others. And we need to create an environment conducive for businesses to thrive, survive, scale and hire, and then will take investment in our business communities. It's not an either-or moment to prioritize other City services or create inclusive growth through businesses and therefore jobs in the tax base, it's all of the above. We believe in the City of Philadelphia. Everyone on this panel does. Our LGBTQ+ community and the businesses know it's a world-class city and we want to stay here and be successful. Our Chamber is the home of trans work, the first ever trans economic empowerment program run out of a Chamber of Commerce in the country which trains employers and connects job-seekers to them. We've placed several people in jobs across the region already. And in fact, in alignment with Mayor Kenney's recent executive orders to protect LGBTQ+ rights, particularly in transgender communities, the City will be using this program to help with hiring. In a state where we still do not have comprehensive protections and employment housing or public accommodations for our community, queer people have a high incidence in turning to entrepreneurship to keep them out of poverty. A fact that is fortified by estimates that more than 40 percent of Philadelphia's houseless population identifies as LGBTQ+. Our businesses deserve investment as part of the values that our City Council prioritizes and will represent. Our city can substantially improve its economic standing with initiatives and policies that will grow all businesses and jobs citywide. The key to this is real investment and private sector job growth, including continued meaningful reform and tax structures, focus on quality of life, workforce development and a green, clean and safe city for all to enjoy. This will help grow and attract employers of all sizes and will encourage folks from all the communities we represent here today to become business owners themselves. Thank you so much for your time and consideration today. We look forward to working with you and everyone else who spoke today to forge solutions for the success of the City we all love to call home.
Thank you, Zach. Thank you for your testimony. Councilmember Gauthier.
Thank you, Mr. Chair. Thank you for your testimony and for your work. I have two questions. One, I have an ongoing debate with Will Carter that I hope he's okay with me bringing up here. So every couple of months he talks to me about sort of cities that are doing better than Philadelphia in terms of business in reducing their poverty rate. And every time I ask him how many of those cities -- does that decrease in the poverty rate reflect bringing the current people in that city out of poverty or does it reflect replacing those people. And so, I wanted to pose that question to the panel. How do we make stronger and more direct ties between some of the incentives that are being sort of advocated for whether it be wage or BIRT tax reductions or whether it be programs like KOZ, and the more surety that the people in this City, Black and Brown people who are in poverty are going to benefit from those incentives at the end of the day, what does that look like? And I heard, Chellie, I heard you talk a little bit about this talent initiative which I was very excited about, but I wanted to know if you all could expound upon how we make more direct ties between those type of incentives in creating a better business environment and pulling people who exist right now in our city out of poverty into opportunity?
Regina Hairston. I'm just going to use myself as an example. Twenty-one years ago I came to Philadelphia from Virginia. I had not completed my college degree. I had a job making about $50,000 in middle management. At the time Mayor Nutter was in office. They came up with an initiative, an incentive, to get people in Philadelphia to graduate. If you went to Community College of Philadelphia, you had 15 credits, you could graduate without any debt. That was a gamechanger for me. I went back to school. I worked 60 hours because at the time, my ex-husband's mother was in the hospital, I was the breadwinner, I had a 2-year-old, but that incentive incentivized me to take that opportunity. From that, I went on with a scholarship to St. Joe's University where I graduated with a 3.8 GPA at the same time interning for Councilmember Jones because I asked my job if I can change my hours so I can come here for four hours a week, but it didn't stop there. So from there -- and Kenyatta -- Councilmember Johnson will remember, I'm sorry. He was at Fels, had graduated. There was something pushing me for more and more and more as I continued and as my salary continued because of incentives by this body. So I approached him. He didn't know me. I didn't know him. I asked for a recommendation to the University of Fels. He granted me that opportunity. I went on to the University of Fels where I graduated with my Master's in Public Administration. I went on to work for West Catholic Preparatory High School still making -- I took a salary decrease because I knew I wanted to be on a different path, maybe $42,000. Went to PA Society and met a Black business owner, veteran-owned. Black-owned shop, Mustafa Rashed, Bellevue Strategies. He hired me and I quickly rose through the ranks. And he would increase my salary over and over and over so I would stay there. So we're talking about someone who comes to Philadelphia making maybe $40,000-something and I sit here before you today as the President and CEO of the African American Chamber of Commerce. My salary is threefold, but I didn't get here by myself. I got here because of the decisions that were made that helped me increase my family income and also the business owner Mustafa Rashed, when I went to his business, he had three employees. Now, he has 30-something employees. But he didn't get there because we didn't make intentional investments so he could grow his business. And I am the example of when you make intentional investment in Black business, in workforce, in education. This is what you see when you make those investments.
I love that. Thank you so much for that telling that story. As a Black woman, I've had similar experiences about people who've helped to catapult me into opportunity. I'm not so much asking about sort of programs that are particularly for people, right. I'm talking more about if we buy that creating this more advantageous business environment will attract more businesses, how can we systematically try to ensure that those incentives will result in jobs for Black and Brown people specifically, right. And this comes across my desk a lot. Like, I'm often asked to grant KOZ applications, extend KOZ applications. And my question is always the same, like what is this going to mean for people in my District, right, in terms of real commitment and real opportunity, how do we get there?
I guess I would just jump in and say that if you were to reduce the corporate net income tax for all businesses in Philadelphia, it's going to benefit those that are owned by Black people, Brown people and women. To target it specifically, I can't speak to the legality of that and whether or not you could do something like that, but it will incentivize all businesses and really for them to grow in Philadelphia. We hear time and time again from businesses that say if we just -- the taxes, we're thinking about going out to Conshohocken because we can't afford to add and hire people that we need to do our work in Philadelphia, so yep.
I just want to add because I support incentives and I've with Penn, Pennovation. However, it was contingent upon them doing a CBA with the community, right, as a way for them to give back and still working on issues around diversity and inclusion to make sure that people who are going to be constructing the project as a part of Pennovation look like Black and Brown and women and diverse businesses have an opportunity at the table. But the other part of that, and I'm waiting for Paul to come up here because we had this conversation to try to figure out if we are giving incentives, right, making sure that we're doing the enforcement on the giveback, right. And the other part is that the more you make the environment conducive that want to come here, especially the larger corporations, they're doing procurement and supplier opportunities for the Black and Brown businesses that want to thrive in that environment. That's the conversation that Paul and I kind of went back -- because there's different sides of how people are approaching this and we want to make sure that if we are providing incentives, right, there's a giveback. So I feel exactly where you're coming from. I try to make sure -- and it's never going to be perfect, because for me power concedes nothing without a demand. Some of it sounds cute. Folks say, oh, I want DEI, but if there's no 3 intention, right, because if there's no intention, then that means that we're not pushing hard enough. Because if that wasn't the case, people would be making sure that opportunities are coming forward without even us being involved. It would just be it's the right thing to do, which that's not the case in America. But I do recognize that when you make it easier, and this is coming from having entrepreneurs in my family, right, and watching them go through the process and me get questioned, right. Well, let's look at your city's policies and how for some of the smaller businesses, right, because of how our tax structure is -- I think one of the taxes you basically have to pay the whole year before you actually do the business. How does that work? What if you don't get the business but you done paid upfront. To me that doesn't -- it never made sense, right. And so, I think we have to think outside the box and look at how we're doing it and also making sure when we do provide the incentives, I understand exactly what Councilwoman Jamie Gauthier is talking about, making sure there is a return on that investment in terms of who we're providing. But at least in the 2nd Councilmanic District, anybody that comes through, I'm pushing for 50 percent participation. It's the responsibility of the Office of Equal Opportunity to monitor it. Every time we do a zoning bill, they meet monthly to kind of review where we're at with the numbers. And I think we have to look at how we do it systematically though across the city of Philadelphia to make sure everybody has a seat at the table, but that enforcement is real.
You make some very good points. And I would just point to I was trying to address the tax reductions. I think when you're talking incentives, you can absolutely target them where you want them to go. The Commerce Department does that all the time, so does PIDC. So there are many organizations that can help with that. Steve Mullin from Econsult is also coming up and he can speak to the tax cuts and the economics.
May I add something to that? Regina Hairston. When we look at, and I mentioned this in my testimony, when it comes to Black businesses in Philadelphia, they tend to be solopreneurs. Meaning, they don't have anybody that is an employee. When you add an employee to that business, it can grow and it can scale. And so, when you have tax decreases in the net profits portion of it, it allows them to put that money back into the business. Then they can actually hire someone and then it allows them to actually plan a little better. And I want to say something about the ease of doing business. We had a very small bar in West Philadelphia, Caribbean owner who had been paying his taxes the entire time. He hired a consultant who did not file his taxes correctly with the City of Philadelphia. Five years ago I met this man and I introduced him to the Commerce Department and said there are business managers that will come out and do this work for you. They set up a payment plan. For whatever reason, his payment plan was off track. Six months ago he gets a letter from the City of Philadelphia that they're going to close his business in days and 7 he already owes over $100,000 8 because of penalties. So no one 9 answered the phone because it said, 10 due to COVID I'm working from home. So they call me frantically. I send an email and voila, I get an immediately because I'm the President of the African America Chamber of Commerce. We cannot allow that to continue to happen. And so, then we took it a step further. My Board Chair is a certified CPA. We got him on the phone. He was allowed to talk to the folks at the tax department. They settled on the $10,000 that they owed the City and then he was able to keep his business, but you don't see that happen often. So this has to be -- this can't be the exception. This has to be the norm that folks can get the help that they need and that there's somebody to at least answer the phone if they're going to send you a notice that says that they're going to close your business.
Absolutely. And I want to be clear that I am with you all 100 percent as it relates to the ease of doing business in the City and having a more customer service-oriented approach, especially for small businesses. My challenge was more for the tax cuts and the incentives and just making sure that while we create that advantageous environment, there is more of a direct -- we can see more of a direct tie to jobs, particularly for the people that we most want to help and create opportunity for. Yeah.
I think the education is really a key point. I came to this country in '72 with a high school education. I have a Master's in Engineering and an MBA that's given me a good opportunity. If we look at the Asian population in Philadelphia, those who are educated they're really not in the poverty. They're doing very well. And those, the refugees that came without the education, they're really having problems. Some of them are able to succeed doing the business. Others are just on the welfare. So the question is what do we do with them, right. How do we really have -- I think if we can have these mom-and-pop businesses grow a little bit, they can absolve some of that population. I think that's the only way the refugee community can really grow. And if you go to suburbs, all Asians are pretty much well to do. That's why the median income of Asians are a little higher because of the certain population that are educated, but again in Philadelphia there are a lot of other population who are not educated which (inaudible).
Thank you. Thank you again for your testimony and for your answering the questions. Appreciate it all. Mr. McMonagle, can you please read the next people to testify.
Can we please have Jason Hachadorian, I apologize if I mispronounced that, Paul Levy, Stephen Mullin and Jennifer McDonald. (Witnesses approached Witness Table.)
Jason from Pew, I guess you can start first. Just state your name for the record and then you can proceed with your testimony.
Jason Hachadorian with Pew Charitable Trusts. Thank you all for the invitation to testify today. I'm super excited to talk about this very important topic facing the City of Philadelphia. So again, my name is Jason Hachadorian of the Pew Charitable Trusts, Philadelphia Research and Policy Initiative where we conduct nonpartisan independent research and engage with public officials and other stakeholders on key issues facing Philadelphia. The state of Philadelphia's economy has implications for residents across the City from the availability and accessibility of well-paying jobs to the ability of the City to collect revenues sufficient to deliver quality services. Over the last several years, we have been benchmarking and assessing the City's economic and fiscal performance as the City emerges from the pandemic. And I'll share some of those key findings today as well as how we are approaching this issue: One thing we know is that before the pandemic Philadelphia already underperformed our peer cities on many different business and economic indicators. 3, which is the lowest of 10 peer cities. So this means there were fewer businesses and fewer jobs available to residents. We know that a city's economy gains business establishments when companies are born, split off from existing ones, move in from elsewhere or open up new locations, and it loses them when companies go out of business, scale back or move out of the City. We found that companies created or opened establishments in Philadelphia at a slightly higher rate than they shuttered them in the lead-up to the pandemic. But that gap in Philadelphia was much smaller than in peer cities. So Philadelphia's relatively weak performance in this regard was due more to a lack of establishment births or creations than to excessive deaths, so meaning a lag in business creation was more of an issue than business closures or relocations. When looking at the rates and ethnicity of owners, which we heard some of the statistics earlier, Black-owned businesses are substantially unrepresented in Philadelphia. In 2017, which is unfortunately the most recent year of data available, 75 percent of employer businesses were those companies with paid employees with White owners. Only 6 percent had Black owners. And as a reminder, African Americans account for roughly 40 percent of the adult population in Philadelphia. Of course we know that the number of businesses is only part of the story. Who businesses employ, the quality of those jobs and the career ladders they offer also matter. So while job growth in Philadelphia was actually starting to outpace the nation just prior to the pandemic, our research showed that Philadelphia created no 24 new net middle-wage jobs from 2009 to 2019. So rather we created jobs at the low and high end of the pay spectrum. So essentially grew in a U-shaped pattern with high-paying jobs at one end and poverty jobs at the other end. And even of those middle- wage jobs, which historically have afforded opportunities to noncollege-educated individuals, more and more of them have been going to individuals with college degrees. In many cases the pandemic only exacerbated existing disparities. Early on in the pandemic, we looked at job losses by demographic groups and found that Black workers, female workers and individuals without Bachelor degrees suffered disproportionately high share of job losses from 2019 to 2021. But as the City has started to emerge from the economic conditions present at the height of the pandemic, we're actually starting to see a few bright spots that are worth highlighting. To start, the number of jobs in Philadelphia is officially higher now than before the pandemic. Preliminary reports from the Bureau of Labor Statistics puts it at an increase of roughly 20,000 jobs.
And we see that applications in Philadelphia for new business registrations have reached new highs, with more than 40,000 applications in 2021 alone, and that represents a 35 percent increase from 2019 to 2022. There has been some research that suggest that businesses launched during a recession are particularly vulnerable to failure, but this still represents a high for the number of startup applications in Philadelphia. Finally, massive federal investments through the Infrastructure Investment and Jobs Act and the Inflation Reduction Act have the potential to significantly influence job growth in Philadelphia and across the region over the coming years. While the unprecedented nature of these investments makes it challenging to accurately predict specifics, there's no 9 question that these investments have the potential to favorably impact our local and regional economy. Despite all of this, we know that these promising trends and opportunities can obscure some hard truths. For example, just because new jobs are created doesn't mean residents are prepared to fill them. Nor is every new job a quality job, specifically one that provides the conditions for economic stability, including family-sustaining pay, sufficient accessible benefits, safe working conditions and fair reliable scheduling. Recent research from experts has argued that cities need to coordinate their economic and workforce development efforts to best grow and support an equitable economy. In other words, as cities work to expand the number of quality jobs in growing industries, there needs to be a simultaneous focus on building education and training pathways to equip residents with the skills and supports needed to fill those jobs. And when it comes to workforce development, both the skills needed for entry-level work and the ongoing education and training needed for incumbent workers are key. So again, thank you for allowing me to join today and I'm happy to try to answer any questions you may have about our research.
Jason, thank you for your testimony. We'll hold questions until the end. Paul, I think Steve and then Jennifer.
Thank you very much. Members of Council, my name is Paul Levy, President of the Center City District. I have a set of handouts in front of you if you have it. I think you've heard today from a lot of really very experienced and excellent practitioners who are giving you lots of good examples of things that are working in the City. I want to pull the camera back and look statistically at where we are and the challenge in front of us. So I'm just going to speak from the set of pictures and slides in front of you. If you look at the bottom of , you see the profound challenge that we all inherited which is between 1970 and 2005. We lost 255,000 jobs and 430,000 residents. There was a period of massive deindustrialization in the City. The period just before the pandemic was good for the City, bottom of , Slide 4. 6 million people. That was the good news. But that lifted us within striking distance of 1990 levels but nowhere near 1970 levels in terms of replacement of jobs. Slide 6 at the bottom is the comparative slide that should give us all concern. New York and Boston also lost between 85 to 90 percent of the jobs they had in 1997. But Boston now has 33 percent more jobs than it did in 1970. New York has 16 percent more jobs. We have 21 percent fewer jobs. We have a major job crisis. If you turn to the next slide, Slide 7, prior to the pandemic we grew. But see where we are on that list in terms of the rate of job growth overall. Bottom of , that takes us through 2022. Our rate of job growth was slower. The line was going up but very, very slow. I think we all recognize on the top of Slide No. 9, the picture of Philadelphia today, 42 percent of all of our jobs are right here in Center City. Another 11 percent are in University City and I've used the City's Planning analysis of districts to show there are jobs all across the rest of the City, but frankly how few jobs there are, and I'll show that in a moment. Obviously we benefit from a transit system that is hub-and-spoke that brings people into the downtown. Let me be clear. Here in Center City prior to the pandemic, we had 63 percent of all jobs required less than a college degree and 34 percent required only a high school diploma, so we had a range of opportunity within the City. And for that reason, percent of 4 the working residents of every 5 neighborhood in this City outside 6 the downtown came into Center City 7 to work. That was a place of 8 opportunity. 9 But at the bottom of the 10 next page, Slide 14, is a slide 11 that ought to truly alarm all of 12 us. This is a map of business 13 density per 1,000 residents. And 14 what you see is, and I've blown it 15 up on the right, the density of 16 Center City and University City. 17 You see the Airport. You see some 18 things in the Northwest and the 19 Northeast, but the absence of jobs 20 across the rest of the City. 21 If you then start 22 translating that into a lot of the 23 testimony you heard today, at the 24 top Slide 15 this is the business 25 density per 1,000 residents in New York, Boston, Atlanta, Philadelphia and Washington. You will see at the top that we have not only the lowest density within the region of those cities, but within the city we have the lowest density of jobs per 1,000 residents. At the bottom of the is the issue many other people have addressed. There is a disparity between majority or all businesses and Black and Brown businesses in every city. The disparity is worse in Philadelphia. We have the lowest density of Black-owned businesses of any of our comparative cities. I will now address the tax issue because these go directly -- debt map, a little bit from 2020 shows a tax rate of a wage tax in the City and you see the wage tax that exist in every surrounding county. It is three times the wage tax within Philadelphia. Our BIRT tax does not exist in any of those locations. Let's talk about the recovery.
Today when suburban workers who live in the suburbs choose to work remotely, they have the incentive of being exempt from our wage tax. We refunded about $90 million a year last year. This is not high wage for a slow wage. These jobs go together. When office workers don't come back, we have vacant office buildings. We have percent 15 fewer janitors employed in the City 16 of Philadelphia in 2023 than we did 17 in 2019. That is a loss of 775 18 jobs. We have lost 2500 restaurant 19 jobs. Lunchtime, business lunches 20 have disappeared. It's not either 21 or. It's not White jobs versus Black jobs. It's not high wage versus low. It's a growing economy, we all grow together, and that is where we really have failed. I have a picture just of a Barron Field at the top here. When the sun doesn't shine, the crops don't grow. All right. That is what our tax structure does to us. At the bottom on Slide 20, I have listed the top employers in the 9 City of Philadelphia. Only one of 10 them is private sector for-profit. Among the top 20 -- I'm sorry, the type is so small. I'll blow it up and send it to you. I can't even read it either. I'll read it for you because I memorized this. Among the top we have 5, 17 Comcast, American Airlines and then 18 a private security company and then 19 Independence Blue Cross and then a 20 home health care. No criticism of all our exempted institutions and nonprofits, they're great. We have an absence of private sector firms in the City directly related to our tax structure. The absence of those firms means the absence of their supply chains, the absence of their purchases, the absence -- now, we can see great things in the exempt institutions. But when you have so few private sector employers, you don't get that supply chain advantage. So on the top, and I'm almost finished, top of Slide 23, right now 34 percent of the residents of every one of your Districts is reverse commuting to the suburbs for work because there's not enough within the City. On the issue of poverty, Slide 24, the poverty in this City is an absolute central issue we need to address. But let's be clear, that over the last 45 years the number of people in poverty in this City rose by 98,000. That's an awful number. But the number of the middle class people who left is 488,000. The number of poverty, the people in poverty, has barely grown. We have not grown the economy. And therefore, we've trapped people in poverty and the middle class keeps leaving. And when they leave, we lose the tax base, et cetera. So to simply conclude here, if we had more of the region's business in the City, we would have more of the region's supply chain, more of the region's purchases. Councilwoman Gauthier, you asked a question before that I want to try to answer. And I put it here at the bottom. I saw a great presentation over the weekend with the Heights Philadelphia program, which encourages people to go from high school on through graduation. Can there be a tax competitiveness and job growth bargain in which more for-profit private sector companies agree to underwrite and support programs like Heights and paid internships and make a five-year commitment. At the same time as you may make a five-year commitment to lower wage and BIRT taxes, they go together. It's not either or, a commitment to job training, a commitment to placement, commitment to internships, but a commitment to job growth through tax policy. On the last page I simply have the wish-for scenario, that awfully low level of Black-owned businesses and all businesses go up dramatically and that very low rate of job growth compared to where we were in 1970 goes up dramatically. That should be our aspiration for 2024. We should get out of these either-or choices as you said in the opening of this hearing. It's not a tale of two cities. We need both of those cities to work together for job growth. Thank you very much.
Thank you, Paul, for your testimony. Steve -- well, you know what -- all right. Go ahead, Steve, yeah. And then we'll do Jennifer at the end -- Jen, you want to start and then we'll... MS. McDONALD: Good afternoon. My name is Jennifer McDonald. I'm an Assistant Director of Activism at the Institute for Justice, which is a national nonprofit that advocates for entrepreneurs across the country. I also direct our Cities Work initiative, which partners with cities to make it cheaper, faster and simpler to do business in cities. So we organize small business owners to help them advocate for themselves. We also collaborate with City officials on the research and policy tools that will enact meaningful reform. So our goal here is simple: We want to make it so that you don't need a law degree and a trust fund in order to open a business in the City of Philadelphia. We've been working with the Department of Commerce for over a year now to try and identify some of the policies that we think can help get us to that point from a regulatory perspective. So we launched a study in 2022 called Barriers to Business, and it's the heavy one that you guys all have a copy of. And so, in that study we looked at 20 major cities, including the City of Philadelphia, and we quantified every single step, form, fee, you name it, it takes to start five common business types across these 20 studies. What we found is that each city has its strengths and weaknesses, but across the board it is too expensive and it is too time-consuming and it is too complicated to open a business. Specifically in Philadelphia, the fees for permits and licensing are very, very high. It will cost you over $3,000 just in licensing fees alone in order to open a restaurant. The process is incredibly confusing because there's multiple layers of requirements. For example, it'll take sifting through 43 different business license classifications to open a business in Philadelphia, and that process is also very lengthy. So, for example, it would require 46 different regulatory steps just to open a barbershop, a very common business type. And so, what we see is that these regulatory hurdles significantly hinder people's ability to do business and their decision to do business in the City of Philadelphia. On a national scale, there's a Small Business Administration Survey that shows that 41 percent of Americans would start their dream business within the next month if they could, but only 2 percent of those people actually do. In an additional survey that was done last year found that 53 percent of people who considered starting a business but didn't said that one of the reasons they didn't start a business is because government fees were too high. Another 49 percent said because government forms and requirements were too confusing. And so, our research both with what's on the books in Philadelphia and with entrepreneurs that we've talked to confirms those findings. Lots of people choose to open businesses that are not in their hometown or are not in the City of Philadelphia or they decide not to open those businesses at all and there's a lot of wasted opportunity there that we've been talking about today. But business ownership really has an impactful ability to bring people out of poverty. Families that own businesses I think it was said earlier have a median net worth of more than four times families that do not own businesses. The wage gap between Black individuals and White individuals, if we're talking about non-entrepreneurs is about 13 times, so White individuals earn 13 times on average median wages of Black individuals. But when we're looking at White and Black business owners, that wage gap decreases to just three times. So still too large, but considerably smaller. So the ability to own a business really brings folks out of poverty and it can really bring that economic opportunity to folks who maybe are our most vulnerable communities.
63 percent of microbusinesses which are those that have fewer than 10 employees were started with less than $5,000 in capital. Most people who start these solo firms or very small firms get their money from friends and family, from their own savings. We're not talking about giant business loans and things like that. So business ownership can be a really accessible way for folks to explore that economic opportunity, particularly if maybe they have a criminal history and have a hard time working for somebody else and that sort of thing. So all that to say, we are experts in local regulatory reform when it comes to opening up business opportunities for individuals. We don't have our final list of recommendations for the City of Philadelphia finished yet, but I can tell you that our recommendations will fall along the lines of talking about here's how we streamline permitting and licensing, and that will include cutting licenses that are no longer necessary or relevant, consolidating paperwork and licenses that are duplicative, trying to streamline processes, reduce the number of categories as well as reducing fees. So it can cost you thousands of dollars just to get a permit to be a street vendor in Center City, thousands and thousands of dollars --
Food trucks too. MS. McDONALD: Food trucks, exactly. Street vending, food trucks, that kind of thing. There's a cap on the number of licenses for things like that. And so, we have kind of the national expertise and we all spent a year doing specific research in Philadelphia to really get into the nitty-gritty of what needs to happen. And so, we'll be publishing that list of recommendations early in the new year, and our hope is that this Committee and Council as well as the new Mayor's Administration will look at some of those recommendations so that we can just start at least trying to bite away at some of this overregulation that we've talked about that stifles people's ability to own businesses. So just to conclude, some of these things when we talk about cutting permit fees and things like that we have a lot of resistance because it will get a fiscal note, write it, it has a budget impact and things like that. But the city of Chicago in 2012 implemented these kinds of reforms. And so, they reduced the number of their license categories, paying special attention to the permitting burdens that were placed on entrepreneurs, and they saved businesses in the City more than $2 million in licensing fees alone. But if you look at their financial statements from the years 2011 before the policy change through 2022, you find that even after reducing those fees and the complexity, both business and tax revenue were actually higher post-reform. So it's like Costco, right, you're going to lower the price and you're going to make it up in volume. So we would encourage the Committee to consider that and really consider some sweeping reforms when it comes to how to make it easier to start a business in Philadelphia. Let's make big changes that are going to affect everybody as much as possible. So we're happy to have follow-up conversations about that and happy to answer any questions you might have.
Yes. Thank you so much, Mr. Chair. I just have a very quick question for you regarding your testimony. You talked about streamlining permits, consolidation of paperwork, reducing categories and fees and then you also mentioned Chicago's reform. You have not developed a full set of recommendations for the City of Philadelphia yet, but in your work have you reviewed the changes that have been made at the Commonwealth level since Governor Shapiro has come into office and how has that impacted the research you all are doing relative to Philadelphia? And are there any specific recommendations from what has happened at the Commonwealth level that you think we should undertake in Philly? MS. McDONALD: So my team focuses just on the city level. I'm less well-prepared to talk about the state level things. But we do also work on the state level with things look occupational licensing for cosmetologists and (inaudible) and things like that. But I would have to get back to you on those state level policies.
I was just wondering if you all are taking some of that into consideration as you develop the list of recommendations for Philadelphia. MS. McDONALD: We haven't yet, but that's really good to know. So thank you.
One, two. Just want to do a quick point of information. Anne Nadol, don't go nowhere please. This was under my notes early on. In your testimony, you said that the City of Philadelphia should follow in the footsteps or do some of the same things that the Shapiro Administration has done. And I had it in my notes to follow up with you, but Councilwoman Gilmore Richardson brought it up again. So my question is give us an idea of what those recommendations were. And if from your perspective as head of Commerce, what do you think that we should be doing recommendation-wise mirroring what Josh Shapiro is doing on the state level?
Yeah. Thank you for that question. As you will recall when the Shapiro came into office, the Governor asked, mandated that every permit and license process be reviewed and then they made guarantees -- to simplify the process. And then they made guarantees that if you were told that it would take 45 days and you got it on Day 46, it was free, and they have done that statewide. I think they're still rolling some of it out, but it is that sort of aggressive, not in a negative way, but aggressive approach to revisiting every single permit, every single license for utility, whether it is expired or whether it is duplicative. I won't speak to the actual fees because Rob Dubow may run me out of town, but I will say that simply simplifying the process is such a saving grace for businesses. I will say that we launched with the Smart Cities Team over the past couple of months the pilot Program of the Permit Navigator that does some of this -- I think you've been involved in that, that does some of this automation if a business or a resident frankly wants to go get a zoning permit or a license, they can go online and it walks you through everything that you will need, the order in which you need things, what it will cost you. It is something that we are currently piloting and it needs to grow, but that has to go hand-in-hand with a review of the utility of those licenses and the permits and how we process this. MS. McDONALD: That permit wizard was fantastic by the way. And by running that permit wizard, that gave us all of the back-end data to be able to see for every permit which requirements do you have to fulfill, how do you do all of the miniature requirements underneath it and that sort of thing. And so, that's kind of our job now to say, we know how to get everybody through the process but can we make the process easier so that it goes faster and things like that.
But it will be a wholesale review for it to have the impact that we all would like it to have.
Thank you so much. Steve, if you would like to -- just state your name for the record and proceed with your testimony.
Sure. Good afternoon. My name is Stephen Mullin. I'm Principal of Econsult Solutions, Inc. here in Philadelphia. I'd like to preface two notes here. One is being at the end of having an opportunity to see almost an entire lifetime of my work involvement here coming here, and I want to see if I can staple the transcripts here together and use that as a textbook in urban economics today, so I appreciate that opportunity. And number two, I have to note that I'm extremely proud of seeing a couple of members, all of the members of the Committee, but I will let you know that the two of you had a life experience that included three hours of my talking for weeks each here. You don't 10 have to worry here because I think 11 it's an opportunity to summarize. 12 So thanks on that front here. 13 And thank you all for 14 allowing me to share my thoughts 15 today. And again, at the end here I've noticed some themes that you guys have noticed too, and they track a little bit of what I was forecasting here. I'll share my testimony. But very clearly, my fellow panelists today are sharing very valuable ideas and suggestions, and I didn't hear a single one that I don't think is worthy of support, continuing, tracking evaluation. I want to offer -- instead of adding to that list, I want to offer sort of what I consider to be the basic fundamental urban economics story here, and I think it relates ultimately to the issues and the purpose for what all of you are doing and what everybody up here has been trying to do in their worlds to here. The first -- I can't read with these. The first is I think it's very important to not think in the static sense here, but think in the dynamic sense. And that's both over time -- I've been at this for over 40 years and have seen parallels and changes and things here, but the dynamic sense is also what's happening in the future and also how does the urban economy work. So when we're saying I want to see X as a result, you might get X somewhere else out here indirectly, but might not get it here in the direct sort of impact or the direct thing you're looking at, but it doesn't mean you don't get that also in this. So that's one thing I would note here. And common theme here too, Councilman Johnson, you mentioned in the beginning the tale of two cities. We've all heard that here. And I am a huge believer, I agree we can't take the tale of two cities and say, okay, we have to go over independently and deal with this part of that city and go over and deal independently with this. It is one city here and the fallacies have to connect there. And I remember way back when learning a concept. This is a necessary but not sufficient condition here. And I'd always look at that. And I've concluded over the years and I think that this is here, is that a necessary but not sufficient condition for advancing towards the goal of making sure that all Philadelphians have more opportunities, have a higher standard of living, have a greater well-being here, that the City has to have a vibrant and growing economy, generating a lot of economic activity, generating a lot of business opportunities and a lot of employment opportunities. Okay. My view is without that you cannot help the tale of that poor city here. You can have individual sort of stories. But you'll recall there was a lot of mention of scale, scale, scale, okay, here. We can have lots of winds that are at very low levels. We have a population of a million, six. A lot of our peer cities aren't anywhere near that size. So we do need to provide the maximum amount of opportunities. We can't be too picky about them because we don't know the future completely. Councilman Johnson, you mentioned at one point when we were talking about forecasting and prediction, you said, well, we just don't know. And the real story is we don't know what's happening next year and the year after. It doesn't mean that we're blind to it, but we don't know.
So the opportunities -- maximizing the opportunities for employment and business generation, having that pot to pool the activity larger increases the opportunities. And to my thinking, it increases the effectiveness of everything you've heard so far in the 15 speakers before me. It increases their potential effectiveness on this. And I think Paul and others have mentioned it's not either or. I consider it in my era for a good part of the time, the either or was a zero-sum game. I used to joke 30 years ago when I sat in these seats responding too, it was, hey, I want a Rita's Water Ice stand, unh-unh, I want it on my corner, unh-unh, I want it on my corner, no, unh-unh, I want it on my corner. And that's what you do when you have a declining city. It's a musical chair game where there's 10 chairs around the table, but there's only 8 people circling the table. The music stops and the only thing you get, no one's missing a chair. But the problem is no one's fixed any of the chairs so 3 of them break over and everything like that. That decline which we witnessed in Philadelphia and many other cities for the second half of the 20th century, it was consistent. We used to talk about -- and you two especially may have heard me mentioning that thing in the 1990s. We're going to manage decline. We're going to manage decline. Ugh, manage decline meaning there's less and less and less resources. Okay. With a declining jurisdiction, people with ability, capability, finances and stuff, they can escape it. You've all mentioned it, talking or preaching to the choir here, that there are people who can't escape that, so they are the losers. Economically vibrant cities as I mentioned here, very, very important to have that. That's one of the reasons why, no surprise, I believe that the regulatory reforms and the tax rate reforms that we're talking about that have been proposed are very, very important here. And there's a big but. And that big but is what people -- including Councilwomen Gauthier and Gilmore Richardson have mentioned here. And that is, the government's role in preparing our citizens and assisting our citizens and our residents at being able to get into that, get up here when a larger pool be able to stand up and be part of that. And that includes information, that includes training, that includes a whole bunch of other things. Frankly, it includes supporting what I think -- I took two-thirds of the conversation here where people were talking about doing that and very, very good. I just think my conclusion is I think that if we are able to increase the business friendliness of the City, absolutely that comment here and the rest of the world, the business friendliness, the pool will be better, the opportunities will be greater, the impacts of the things we heard here are greater. But again, there's no 3 guarantee on anything. But I think the probability will be much, much greater. And we will have a real shot at this after the recovery from the COVID here, which I will note too -- I'll just note one thing. We have more jobs than we did pre-COVID, but they're not the same people. Okay. They're not the same people. The people we're talking about now are the people who are left out. Whenever there's any kind of adjustment, they're left out. So I'll conclude by saying that, but a sufficient condition is a large growing economy and an act of government making sure that the citizens get those opportunities, which include again training, information, connections, all of those things here. Thank you.
Thanks, Steve. Thank you so much for your testimony, and we really appreciate all the information and knowledge that was brought today to us so that we can share that. Is there anyone else here to testify on Bill No. 230165?
State your name for the record and then proceed with your testimony.
Yes. Good evening. My name is Shawmar Pitts. So first of all, I found out about this meeting late. That's why I wasn't signed up, but I thank you so much, Councilman Johnson, for bringing this. And I thank all of you here, Councilmember Gauthier, Councilmember Brooks and Councilman Squilla, thank you. Because when we talk about economic development, right, in my community, a lot of times when you talk about the things and opportunities and chances to get employment and things like that, it's a segment in my community that's always left behind. And it's certainly because of certain things that we are not responsible for. For instance, the lack of education. That plays a big part in it, so much because ignorance is just running rampant in our community. And so, whenever there's talk about economic development, especially in life sciences that's being planned to actually be a big part of the economic engine in our city for the future, me, myself, personally I get nervous about it because I have a younger generation under me that I serve every day and that I'm around every day. And, you know, I see them without having the proper education. It's a group of kids. We just had flag football. And it was a group of kids that came every day, and a group of kids that came to watch every day. And I just saw all their energy and it was just so funny and everything, you know how kids are. And I'm looking at it and I'm saying, how many of them are at grade level in math and in reading. Because five years going to come like that and then it's going to be their time to go into the workforce. And I'm like, it's going to be life sciences in our area. And right now we are in a crisis because of the development of life sciences, that's not the only reason for the crisis, but it's a big factor on our housing in our area, you know what I mean. It's a big, big crisis in our area when it comes to the price is going up in housing, rent's going up and stuff like that. And not only because of life sciences, but just because of the mere prospect of it coming. You have investors that come in and they know it's going to be housing to be had by the people that work in those jobs. So the first thought that comes to my mind is where do we stand, where do the people in my community stand in the development of life sciences because our education is not up to par, so we're not going to be qualified to go into those jobs so we're going to need some help, you know. We need like -- and the first thing that come to my hand, I could be wrong, but the first thing I say is, man, listen, we need legislation passed to help us bridge the gap with this education so that we are able to stay in the neighborhood because people getting ran out the neighborhood, they getting priced out. So now, that's a solution. If we get up to par with our education, then we'll be able to take those jobs and it won't just be like a transplant of people to come to do the job and live in the neighborhood and we got to leave because we don't fit the criteria, you know. So that's the first thing that comes to my mind. But at the same time just from being here and hearing all the testimony before me, I see if we are able to work together, and I guess I need to get in the network and in the know of who you need to know to fix some of these things, because I tried my hand at business and stuff like that and I ran into those things. And I have even tried working in the union and I tried those things. And I've seen so many things that there are like, for instance, when you talk about the minority participation and Councilman Johnson making it mandatory that got to do 50 percent in District 2. But now, citywide I've witnessed people in the Carpenters Union, and we try to think of ways around all kinds of things. My boss was in the Carpenters Union. He was a journeyman carpenter. They would hire Black people when jobs come out.
They would hire them on big jobs, like when they built up all those buildings in University City, right. So he would get hired, but six weeks into the job you get laid off, you know. And you just can't live day-to-day thinking is this the day I'm going to get laid off. It's just too stressful. So we said, all right, this is what you do. You get your own business and don't get hired and get the contracts. Now, you got to -- like they were talking about, it's so many fees and so much money you have to pay that you got to pay upfront. And if you don't get the job, then you're really done, right. It's a capital thing. And then also, let's just say you get the job, those jobs you don't get paid like every week like he was paying me because I was working for him. He don't get paid every week so how is he going to get to pay his workers. He can't pay the workers if he don't get paid. And so, they just squeeze you out. So when you look at things on the surface, you think that you have an opportunity, you have an opportunity, but when you get in, they just run circles around all those rules to keep us out. We see that time and time again, and it leads to crisis in our community. And that's where we're at now. We are at a crisis because every day we're facing different things. One of the members of Philly Thrive, he was tragically killed on December 2nd, you know. And he was one of the ones pulling the weight in the community trying to help. And it's just from gun violence, you know what I mean, and that's one thing we got to contend with. And at the same time you got another member of Philly Thrive that's trying and out of nowhere, y'all got to move, you got to go, and can't afford to pay what it cost to live in the neighborhood no 22 more. He had to move to Folcroft, Pa, you know. It's like these are the things that we're faced with on a daily basis. And a lot of times I'm always frustrated at these things and sometimes I even bring my frustration here because I need a way on how to cope with it, you know, because I see it every day. And when I try to tell people don't make excuses for yourself, work hard, do this, do that, but at the same time when you do that and you still, you still face all of these things that's unfair to you, you know what I mean, because of lack of education, you know what I mean, and we know the Commonwealth Court just made that ruling not too long ago that the way them funds were distributed to the schools was unconstitutional. And we the ones that bear the brunt of that. We suffered because of that. And now, you have it where a lot of our communities are not up to par when it comes to skills and education and things to get jobs that can be sustaining for their families, you know what I mean, which lends to the problem of gun violence and things of that nature, and these are the things that we're up against on a daily basis, you know. And we've come up with some things that we think can help policy-wise and I'm eager to work with the Committee and work with the Council to try to implement some policies that would help us in the immediate term, right, and long-term when it comes to economic development of our community, because all the people who came up and spoke before me I feel good about that. You know, I really feel good about everything that everybody had to say. I just want to have an opportunity to actually learn and see how it works and how can we put it into a policy so that it affects us immediately and in the long- term, because the crisis that we're in now I always felt it could have been avoided. And to hear them say some of the things that I want to say like, for instance, about education and about the capital that we don't have and about how, you know, when you try to get loans and you can't get them, all of those things. I'm encouraged a little but I really want to, you know --
We want to keep your input. We really appreciate your input too. And I think it's important as we heard everybody testify that it's a collaboration and a collaborative effort that we need to work together. And it's not only the businesses, but it's the people who are involved in those businesses. So you testifying today is very important and we're open to listening to your ideas and plans you want to set forth and really appreciate your testimony. So thank you so much.
I just wanted to thank Shawmar for his comment today and I also want to commend Philly Thrive. You all have been persistent at vocalizing that you need to be at the table as this industry grows to ensure that it's good for people. You had four people ready to testify at my hearing today which got moved because of another hearing. But I look forward to reconvening in the new year to talk about the growth of the life sciences. And I agree with you totally that we have to make sure that this works for people in our community, and we have to make sure that we invest in the education and the training in order for people to get jobs that could be truly family-sustaining and transformative for families. And I just want to let you know that I'm committed to moving towards that from my position on Council. So thank you so much.
I just want to go on the record just thanking everyone for coming out and participating in this hearing. Shawmar, continue to keep up the good work. I know we'll continue to talk about some of the things that we have in common, particularly around this issue of not only just life sciences, but how we address development, right, in our communities and most importantly making sure it's equitable across the board in terms of opportunities for individuals. But I do want to thank everyone for sticking and staying. I see our former Professor Steve Mullin back there just sitting down and still taking everything in. But we do recognize that in order for us to move the City of Philadelphia forward, we have to look at policy through an equitable lens for everyone, right. And when I say everyone, I'm talking about businesses, right, rather they're large as well as small businesses, right, rather that's making sure that irregardless of the industry, people have an equal say at the table and we always come up with a level of compromise where everybody gets a chance to walk away from contributing and finding more opportunities. We're working together as opposed to in silos. And most importantly, addressing the zero-sum game where as it was mentioned, well, we'll win on this side and somebody else will feel like they're losing, but how do we make sure that everybody has a seat at the table in terms of how we move the City of Philadelphia forward. So I want to thank you, Mr. Chairman. We do have another hearing we have to go to right after this. And I want to thank my colleagues for sticking and staying for this hearing. Thank you very much.
Thank you. And thank you all for your testimony. And being no other questions and nobody else to testify, that will conclude the public hearing of the Committee on Commerce and Economic Development. Thank you so much for your attention. And Resolution No. 2 230165 will be left to the call of the Chair. Thank you. (Committee on Commerce and Economic Development concluded at 4:20 p.m.) C E R T I F I C A T I O N I, hereby certify that the proceedings and evidence noted are contained fully and accurately in the stenographic notes taken by me in the foregoing matter, and that this is a correct transcript of the same. __________________________________ TANEHA CARROLL