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Minutes

Committee Hearing, December 16, 1998

Philadelphia City Council Committee HearingsDec 16, 1998

People mentioned

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Organizations mentioned

Councilman Cohen

That would not otherwise have resulted?

Mr. Hankowsky

Correct. And then for the School District, the School District gets those taxes. They don't put it in the project, and those are from their portion of the existing real estate tax; and most significant in a project like this, from the use and occupancy tax, and then liquor by the drink from, you know, sales at restaurants. And then in addition, the other 76 is 46 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 from those two sources -- real estate and sales. And only those two taxes are used to pay the loan. So if you add all three of those together, 180 million or whatever that would roughly come out to be, that's all the taxes that get paid by the project over years. 9

Councilman Cohen

But actually, the 10 only tax revenue we're going to get is going to be 11 120 million, that from the -- 12

Mr. Hankowsky

That we get to use and 13 spend. 14

Councilman Cohen

That's what we'll 15 see. 16

Mr. Hankowsky

Right. 17

Councilman Cohen

The rest of the 18 taxes -- 19

Mr. Hankowsky

That's right. 20

Councilman Cohen

-- go to pay off the loan.

Mr. Hankowsky

That's right.

Councilman Cohen

So that would mean 120 million to the City and School District over 20 years comes to about $5.5 million a year. 47 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845

Mr. Hankowsky

Right.

Councilman Cohen

Between the City and the School District, that's what we would receive in tax benefits, approximately.

Mr. Hankowsky

Right. And I simply want to point out in the 21st year, the loan's paid off, no more does any of the real estate or the sales go to pay the loan. And so the City and the School District, in the 21st year, would be getting about 12 million a year.

Councilman Cohen

Yeah. Unless by that time, of course the -- a lot of renewal work had to be done, things were out, problems developed that nobody thinks of. So we just don't know what will be available in the 21st year; it will depend on a lot of circumstances.

Mr. Hankowsky

Right, but there's no 20 way that the developer or the project can use any of those dollars, whatever they are. If they wanted to use tax dollars in the 21st year, they'd have to come back here the. TIF ends, it's over, all money comes to us.

Councilman Cohen

If anybody had ever 48 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 told me that Disneyland -- wasn't there a Disneyland in Paris that failed to succeed?

Mr. Hankowsky

I think it's still there and operating and making money, so I don't think it failed to succeed.

Councilman Cohen

Well, that's not the last I heard, but I would like to get that information, if we could. That would help. But we just don't know. Everybody thought that Graduate Hospital was the greatest hospital -- many people argued it was the greatest hospital we had in Philadelphia. And yet, this morning's business section tells about Philadelphia Hospital Authorities bonds being worth only percent. So we can't tell. Twenty 17 years is a long time. 18 All right. That's -- I'm just trying 19 to get all of the facts on this. 20 Thank you, Mr. President.

President Street

Thank you very much. The Chair recognizes Councilmember Rizzo.

Councilman Rizzo

Thank you, Mr. President. 49 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 Mr. Hankowsky, I would like to follow up on something that Councilman Cohen just asked about. I'm talking about commitment. I apologize if you've already covered or it's been supplied in the materials. Could you describe the lease arrangement that Disney has with the developer, how long, and what the commitment is.

Mr. Hankowsky

Actually, I think I'd probably have to ask the developer to do that. We are not directly privy to the business terms and the --

Councilman Rizzo

The reason I ask that question, I read in the paper where the executives of Disney, it appeared -- I was surprised to read that they haven't really analyzed this to the point where they were positive exactly how well this operation would do in Philadelphia. And it sounded to me like it's a little bit of a crap shoot here. And I'd like to know what the commitment is, the lease. And the second part of that question is, if DisneyQuest had not been considered as a tenant, would you have TIFed this project? 50 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845

Mr. Hankowsky

Well, let me address your first question about what are the terms with Disney. And I'll allow somebody to sort of figuratively kick me if I get this wrong. Disney has signed a 15-year lease with an option to renew. In addition, you have to remember, Disney is going to be investing out of their own money 80 or $90 million on top of what we're talking about today, 167 million that Goldenberg will borrow r invest. That's a pretty significant commitment. Disney did not have to pick us. They had other -- I can tell you for sure of this. They other municipalities that were also interested in them picking their sites. I think what Disney was doing, from a business perspective, they're a publicly traded company, and they have to be forthright. As with any new venture, you know, things can happen, but they're making a very significant commitment here. To your question of would we have TIFed it if Disney was not part of the project? I think the simplest way to put that is we were only prepared to come to this Council if we knew Disney 51 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 was on board. And the developer was only prepared to proceed if he knew he had Disney. And so, as I think you know, when there was a briefing with Council, we began this process in terms of putting the ordinance in and waiting the 30 days on the basis that we knew that Disney was going to make a decision in early December. If Disney had said no versus yes last week, I don't think we'd be here this morning. I think we and the developer and everybody would be back to ground zero and thinking about what we're doing. I don't want to tell you that under no 14 circumstances would we have ever come back here, but we would not be here this morning, I can tell you that.

Councilman Rizzo

Back to the lease. If, unfortunately, DisneyQuest doesn't work in Philadelphia, and they pack up and leave, and they have 10 years left on the lease, if someone occupied it, another operation, would they receive the benefit of the TIF?

Mr. Hankowsky

Well, again, the TIF is not going to Disney; I need to really emphasize that. 52 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845

Councilman Rizzo

But you said that --

Mr. Hankowsky

But the answer is --

Councilman Rizzo

-- the TIF is because of Disney.

Mr. Hankowsky

No. What I said was, the project is because of Disney. Disney being in the project gives the project and the developer the capability to attract other tenants and make it work, rent it out. But the answer to your question is, in fact, that a TIF will go in place, the developer will borrow all this money, build this, open the doors, and operate it. And yes, he would have borrowed the million and would owe the debt 16 service on it, and we would still provide the TIF 17 funds to continue to honor that commitment, yes. 18

Councilman Rizzo

Do you think it's 19 appropriate that, whether your organization or the 20 Administration reviewed the lease, don't you think 21 it would be terribly embarrassing to Philadelphia 22 five, six years from now if it didn't work, if 23 they packed up and left and paid off the lease? 24

Mr. Hankowsky

Well, I think, 25 Councilman, I don't disagree that that's a 53 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 problem, but I do want to be clear we. We, meaning the Administration and City Council ourselves, have made numerous decisions about projects and have invested in them. And things can happen. I mean, companies can go out of business. As Councilman Cohen just mentioned, Allegheny. I mean, five years, I'm not sure we all would have predicted where that was going. So we need to make business judgments, but they, in fact, are judgments. And the judgment here is that this is a project where the pieces are in place, it's able to start and, you know, there could be a national recession. So many things can happen that affect projects. So I don't think that there's a peculiar issue that highlights this any more than other transactions that we look at.

Councilman Rizzo

But you have to agree that if the American Street corridor packs up or one of the TIFs that's obviously not as visible as DisneyQuest having a moving truck backed up to the door in four years leaving Philadelphia. 54 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 My question is, again, the developer would continue, you don't know what the lease agreement is. You know that they have 15-year lease, but what the commitment is, we really don't know 'cause no one has really seen the lease agreement.

Mr. Hankowsky

I want to be completely clear because maybe I slightly misstated that. What I'm telling you is that the actual document is between the two parties. We do have the lease terms and know that Disney has signed a 15-year lease, is making an investment, is occupying 80 to 90,000 square feet, etc.

Councilman Rizzo

But could we -- and I don't think we know -- have a landlord being paid by Disney but a vacant property on Market Street?

Mr. Hankowsky

I probably need to check that, but I -- that could be a situation at the PNC operation center. PNC Bank go out of business, continue to pay the rent 'cause they have a long-term lease there. It could be the case in the SmithKline TIF. So is it a legal possibility? I think 55 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 the answer is yeah. I mean, Disney could go out of business, so you don't get companies to affirmatively covenant that they'll be in business.

Councilman Rizzo

But I was a little bit surprised to read and hear and see on television that Disney said that they weren't really sure. I would hope that that may be an inaccurate statement as to how well they're going to do here. You would think that an organization like Disney, before making a decision like this, would have done a lot of homework or analyzed --

Mr. Hankowsky

Well, I can tell you that sure --

Councilman Rizzo

I'm sure they did but I'm also concerned by that statement.

Mr. Hankowsky

Councilman, I want to -- I just want to be very -- Disney did a lot of work. Disney is a publicly traded company. I can tell you because I've dealt with publicly-traded companies before. They are loath, and in some cases, literally prohibited, without certain disclosure requirements, for example, speculating about revenue, because that deals with earnings, 56 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 which deals with stock. So that I think the best way to think about that is, they don't want to put a number on or characterize how well they'll do here. They're going to say the same thing in Chicago, they're going to say the same thing wherever it is they're doing things.

Councilman Rizzo

I checked. I didn't see that same comment in Chicago. I would like to hear from the developer, if it's appropriate, and not confidential information. Whether you want to get back to me or to the Chair, I --

Mr. Hankowsky

The developer is here right now.

Councilman Rizzo

Well, I'd like to hear the possibility if this would fail, what would happen to the property? I would like to hear from the developer and talk about the lease. (Kevin Goldenberg comes forward.)

Mr. Goldenberg

Hello. My name's Ken Goldenberg. I represent the developer, the Goldenberg Group. And I want to thank you for giving us the consideration of hearing this 57 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 application today. In listening to the question that you posed, I think, you know, one thing that we don't want to lose sight of is that we're talking about an absolutely enormous investment by a private company. I was thinking back there, and I'm not sure I can think of another situation where a company has come into Philadelphia in the last 5, 10, or years and invested in the neighborhood 12 of 50 to $100 million of their own monies in any 13 project. So -- and a company like Disney, who is 14 as subject as it is to the vagaries of the 15 marketplace just can't afford to take an investment like that very lightly. So, suffice it to say, they've done an enormous amount of homework about Philadelphia and an enormous amount of homework about Eighth and market. And they're taking this investment with utter seriousness. They are entering into a significant lease with the development company, Goldenberg Group, that will go on for 15 years and then has options extended beyond that. The amount of the 58 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 rent is not insignificant by any stretch of the imagination. So coupled with the size of the investment, I'd say, you know, outside of the fact that we can never predict with absolute certainty that any company won't have a problem, this is a pretty good investment from, I think, every standpoint .

Councilman Rizzo

If it turned out not to be, and they'd keep their 15-year commitment to the developer, do they have any -- is there any commitment? Could you release the property if they decided to move out, or would we have a vacant building with possibly boards on it at Eighth and Market?

Mr. Goldenberg

Well, given the size of the investment and given the lease obligation, they will go through everything they possibly can to make this project work. Keep in mind that Disney only represents about 10 percent of the entire project, about 15 percent of the entertainment an retail of the project. So you're going to have about 10 other very strong companies that are also, 59 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 hopefully, going to be a part of this project. And even if -- I should bite my tongue, but even if something happened to the DisneyQuest situation somewhere down the line, notwithstanding that investment, there will be so much going on there that someone else would probably fill that void.

Councilman Rizzo

The investment that you described, and also reading a lot of expense is back-room operations that can be packed up and moved someplace else, so a lot of that financial commitment other than the actual cosmetics and the aesthetics of the building could be relocated someplace else? Is that a given?

Mr. Goldenberg

No. I think, actually, most of that is fixtures. I mean, most of that 50 to 100 -- and I don't know the precise number, but most of that is actually going into the organism which is the building. I don't think that it's the type of stuff that can be easily removed.

Councilman Rizzo

Let's hope that this was just a waste of time, that it's extremely successful. And that's not a concern, but you can 60 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 understand that there is a need to ask that question.

Mr. Goldenberg

Absolutely.

Councilman Rizzo

Thank you. Thank you, Mr. President.

President Street

Thank you very much. Do we have any other questions for Mr. Hankowsky? (No further questions for Mr. Hankowsky at this time.)

President Street

Mr. Hankowsky, thank you very much.

Mr. Hankowsky

Thank you again for this morning and for very everything.

President Street

Thank you very much. Mr. Mondesire, Jerry Mondesire from the NAACP. (Messrs. Mondesire and Connors come forward.)

President Street

Please identify yourselves for the record.

Mr. Connors

Good morning, President Street. Good morning, members of City Council. My name is Clinton Connors, and I'm Chairman of 61 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 the Economic Development Committee of the Philadelphia Chapter of the NAACP. Can you hear me?

President Street

Yes.

Mr. Connors

Okay. We come today in opposition to the $25 million TIF for the Disney project, and we oppose this for a variety of reasons. First of all, has a minority participation position in terms of contracts been brought to the table? As we have heard so far, it's pending, there is nothing that is concrete. We hear talk about 1100 jobs being created, but what types of jobs are we talking about? Has the Disney Corporation committed to the living-wage concept, or are these just entry-level level and dead-end jobs? What has the City sought from Disney for the use of public funds? We feel that for the use of these public funds, the Disney Corporation should also develop a major neighborhood project. This project would be the building of five combination recreation-education centers to be located North Philadelphia, South Philadelphia, 62 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 West Philadelphia, Germantown, and Kensington, fully staffed be residents of these respective communities. And if training is needed in these jobs, Disney would also incur those costs. These centers would have computers, a library, and current recreation equipment. These are some of the things that we would expect you, as our elected representatives, to request on our behalf, and not to take the I'm-so-glad-they're-coming position. Now in closing, we urge that Bill 13 980845 not be passed today but that these questions come under further scrutiny and review. I submit to you that they will be posed to the developer and to the Disney Corporation by the NAACP. We cannot and we will not, as a community or as a people and community, continue to be excluded. Now, let me be me clear on this. We have watched the hotels receive TIFs, and I just got reports on hotels today that are under construction. In terms of personal services, professional services contracts, out of $8 million, 27,000 has been given to minority 63 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 firms. This is not good, needless to say. We've watched the Kvaerner deal get signed and the minority piece remain up in the air. But let me tell you something. As far as this is concerned, we at the NAACP, if these questions or things of this nature are not addressed, we are prepared to take public action against this project, and we are prepared to lay down in front of the bulldozers, if necessary, to prevent this from happening. We cannot to see projects that use public funds and not be included in it. This will not, I assure you happen. So, to the Goldenberg Group, to the Disney Corporation, we will be at the table. Thank you.

President Street

Thank you very much.

Mr. Mondesire

My name is Jerome Mondesire. I'm President of the Philadelphia branch of the NAACP. Just to echo what my economic development chairperson has said, we're really here today just to stress the need for inclusion. 64 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 We have watched too many times that this Council and this current administration use, or allow to be used, public money to do all kinds of things, whether it is to build Rite Aid stores all throughout every neighborhood of this city or to sign a half-a-billion-dollar deal Kvaerner. And now we have a deal involving the Disney folks and the Goldenberg Group. And what we have found time and time again is that African-Americans are not included at the ground level, at the planning level, at the construction level. There's an article in the paper today which talks about the DisneyQuest project in another part of the country. And it shows an African-American in the picture, riding one of the electronic, computerized rides. So there will be, we expect, and as this Council, I'm sure knows, there will be lots of participation by African-Americans in the DisneyQuest once it opens up, but we're saying that it's not fair, it is unacceptable to just look upon you as consumers, people who can just continue to pay the bill. And what we're talking about now is having inclusion. 65 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 So we urge this Council to go slow on this TIF. Do not approve it so rapidly, as it appears it appears it is about to happen on this day and probably three weeks hence. We urge you to go slow on this TIF, to force the Goldenberg Group, to require them to come forth with the economic opportunity plan, to inspect it, to ask them questions, and to join us at the NAACP, to ask both the Goldenberg Group and the Disney Corporation what it is they plan to do to include African-Americans and all Philadelphians in the building construction and management of this project? That's why we're here. Thank you very much for listening.

President Street

Thank you very much. Are there any questions? (No questions.)

President Street

Thank you, gentlemen.

Mr. Mondesire

Thank you.

President Street

Is there anybody else to testify on Bill No. 980845? (Steve Leshinksi comes forward.) 66 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845

Councilman Nutter

Mr. President, I have a question I'd like to ask Mr. Hankowsky.

President Street

Mr. Hankowsky. Well, let's have this witness, and then we'll get him. Please identify yourself for the records.

Mr. Leshinski

Hi. My name is Steve Leshinski. I'm an organizer with the Jobs and Living Wage Campaign in Philadelphia. And we're here today here with the Jobs and Minimum Wage Campaign here in Philadelphia. We're a coalition of 60-plus organizations representing unions, churches, and community-based organizations throughout the City. And we're here today just to plant a seed in this process, to let City Council know. We want to echo the concerns of the speakers from the NAACP about the community implications of this project, about some of the questions that really still need to be answers about commitments to wages, workers' rights, and union neutrality. At the same time, we think it's only fair to say that we've approached both Disney and 67 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 Goldenberg about meeting with the Coalition, and they've both agreed to do that. We'll follow up in those meetings in January, we'll present our concerns. We'll make our requests that these workers be paid a living wage so that when their shift is over, they can afford to go in and use these services. And we will be back to City Council and report on this progress. Let us just say that the issue of waiting to make this decision, we think, is important. It's unfortunate that this big a project, that this great an opportunity is not having more time to be fleshed out in this arena. Be that as it may and the urgency of City Council and the timeline that's been proposed here, we will be back and we will report on these meetings. So thanks for listening.

President Street

Thank you very much. Mr. Hankowsky, please identify yourself again for the record.

Mr. Hankowsky

Bill Hankowsky, President of PIDC.

President Street

The Chair recognizes Councilman Nutter. 68 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845

Councilman Nutter

Thank you, Mr. President. Mr. Hankowsky, two things. There was testimony and there were some questions last week during the public hearing on the West Philadelphia TIF about the use of this particular tool and an expressed greater interest in possibly having some of these projects take place in whatever generally people refer to as "the neighborhoods." And in the TIF hearing last week, that is one example of that kind of project; there may be others. I had mentioned to you earlier that I had gotten some information from Chicago about what they did with that particular project, but also sent some materials about their TIF program in Chicago. And I can just kind of show you this, but the interesting part of their brochure is entitled "TIFs Make Neighborhoods Come Alive." And I'd like to share this with you subsequent to this hearing. There's also -- and we'll have some discussion about this. There's a report produced by the city of Chicago, a review of tax increment financing, which talks about all of the TIF 69 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 districts out in Chicago and then some reporting requirements that go with what came out of their TIF program. In light of the testimony from the gentlemen from the NAACP, just one quick question. It's my understanding that this project is slated for -- is it opening July of 2,000?

Mr. Hankowsky

Correct.

Councilman Nutter

And would that be considered a fairly aggressive timetable for something like that? I don't know what goes into building 15-story building.

Mr. Hankowsky

It is extremely aggressive.

Councilman Nutter

Okay. And what kind of schedule are you on in order to meet that opening date? When you back it all out, what does any level of, I guess, delay of this particular bill, which, without it you can't start the TIF district and get the revenues going, what does that do to the project?

Mr. Hankowsky

Well, let me answer that in part by amplifying the schedule, because it will be relevant to the answer. 70 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 As you know, we introduce this ordinance with the indulgence of Council in order to meet the 30-day notice requirement and with an understanding that we were hopeful that we would have an answer from Disney at the beginning of December, and on the basis of that, would proceed with this hearing date that the President's office was kind enough to give us. And we wouldn't if we didn't have such announcement. We now are in a situation where the pieces are beginning to come together such that the real schedule is, we would look for favorable consideration today, understanding that you're ending your activities tomorrow. Because what we immediately now need to do is take the Disney announcement, the developer needs to finalize their financing now that they're beginning -- they need to finalize leases with other tenants. It's a series of dominos that are now lined up, that have to get put together. Such a developer could start construction in a kind of February time frame, which means that they're going to have to, for example, do things like order steal, award 71 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 contracts, finalize their loan documents, finalize the TIF note. So we would be hopeful that we would, therefore, be, when Council would reconvene in January, either have the first and second reading; or if Council would be pleased to do this today, if you suspend the rules and give us first reading tomorrow, then we would have second and final passage in January, because we're going to have to close the TIF note part of this financing probably also in February. And I think in terms of doing all of that, and I would never be presumptuous to ever anticipate Council's final consideration, but understanding today that we're in the Committee of the Whole, and if there were favorable consideration, I would hope that that would be an indication that we could proceed to get all of those pieces together, looking for that final second reading and passage. That's the schedule we're on. We're on a --

Councilman Nutter

The statute requirement is three weeks from the time a bill 72 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 comes out of committee?

Mr. Hankowsky

Correct.

Councilman Nutter

So that takes you into the first week in January. More than likely, there's no Council session the first week in January. So at the earliest, we might be talking about the second or third week in January --.

Mr. Hankowsky

Yeah. We, obviously, were somewhat --

Councilman Nutter

-- with a suspension.

Mr. Hankowsky

-- speculating since Council has not yet put out a schedule of hearings or dates for '99.

Councilman Nutter

Right, all right.

Mr. Hankowsky

But I just want to be fair Councilman. It was both the schedule, but also, I think, the indication that a majority of the members of Council, presuming this committee would act favorably or, in fact, support it such that we would -- we and the developer would spend the necessary time, effort, legal fees, etc. to do this. We would have a situation, I think, 73 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 where we would conceivably, with a passage, we would be trying to, you know, close the loans the next week.

Councilman Nutter

Well, I understand you're going to be very busy.

Mr. Hankowsky

Some of these we've done early, and we've had long times, but this is not that case.

Councilman Nutter

I understand you're going to be very busy between now and then. You may need to be a little busier. What commitment, in light of the earlier testimony, what commitment is PIDC prepared to make and then the developer prepared to make regarding any of the outstanding issues that were raised in the course of this public hearing? And specifically the tightening up or the nailing down on MBE/WBE/DBE issues that may be unresolved prior to passage of the bill?

Mr. Hankowsky

Right. Well, I would never, again, speak for other participants.

Councilman Nutter

I understand that.

Mr. Hankowsky

For other participants in this process. But my understanding this 74 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 morning is that after some five or six hours yesterday, which wasn't the first meeting, but a meeting. That between Minority Businesses Enterprise Council, Council's technical staff, the Urban Affairs Coalition, and the developer agreement is in place vis-a-vis MBE/WBE. It is, in fact, in the typewriter. I put on the record the percentages because I wanted to be able to do that, out of respect for this committee. And I think the developer would be willing to come here and, you know, on their behalf, say what I said, speaking for myself.

President Street

Mr. Hankowsky, do I correctly understand that the Golden Group, in conjunction with the City Council technical staff, the Minority Business Enterprise Council, and the Greater Philadelphia Urban Coalition have agreed to economic opportunity plan for the project? I'm reading some answer. As I understand it, the plan provides for the following goals for minority, women's, and disabled participation. Does everybody have this?

Councilwoman Clark

I don't have 75 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 this.

Councilman Nutter

No. 4

Councilman Dicicco

I think Mr. Goldenberg suggested that he would be willing to come forward and talk about that document that you have and put some of those matters in the record. And at some point later today, I think Mr. Fina said that we would all have a written document from the developer.

Councilman Nutter

That would be helpful.

President Street

Mr. Hankowsky, can you do this?

Mr. Hankowsky

Yes, I can do this.

President Street

Let's have Mr. Hankowsky do it. He's much more experienced at this, and he probably can do it in a shorter period of time.

Mr. Hankowsky

Yes. I'm going to go over the percentage numbers that will be in the plan. The plan will be the physical document that will be, you know --

President Street

I understand that. Just give us the -- 76 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845

Mr. Hankowsky

But they are: On the construction workforce -- 30 percent minority, percent female; 5 On the construction contracting -- 22 percent minority disadvantaged business enterprises; 12 percent women disadvantaged business enterprises; 2 percent disabled disadvantaged business enterprises. Once the project is operational, open, that the goals for permanent employees on an hourly base would be: 40 percent for minorities, 30 percent for female, and 2 percent for disabled; Permanent employees vis-a-vis management -- 25 percent minority, 35 percent female, and 2 percent disabled; And service contract related to the permanent operation of the facility -- percent 20 minority disadvantaged business, 12 percent women 21 disadvantaged businesses, and 2 percent disabled 22 disadvantaged businesses.

Councilman Nutter

So this is the document that, based on the earlier discussion, we will probably have later on today. 77 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845

Councilman Nutter

Okay. And, certainly, any other information, or if there are additional meetings and the like, they will certainly happen between now and the time of final passage?

Mr. Hankowsky

Absolutely.

Councilman Nutter

And if you could, I think on all of our behalfs, make sure that -- certainly Councilman DiCicco is always up to speed and naturally included in that and can report back to his colleagues. If there are any other issues or in fact that everything has been resolved prior to the second reading and final passage, I mean that should pretty much square things away.

Mr. Hankowsky

We will do that.

Councilman Nutter

Okay, all right.

President Street

The Chair recognizes Councilwoman Clark.

Councilwoman Clark

Mr. Hankowsky, this is an issue that you and I go through all the time, isn't it? Today it would have been so much easier for us if each of us had had the materials that you just read. It is a little bit 78 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 distressing that I have to ask you for it each time. These are predictable questions. We have to ask them. How else will we justify our existence if we didn't ask them? And you ought to predict our asking them and come prepared with it. We need to have some smaller group sessions where we talk about the sufficiency of these numbers, and I wanted to participate in that in greater detail. But as you can tell by the testimony we just had, this is an issue that reverberates throughout the minority community, and it's too late to start negotiating for it after the money has already been obligated to other contracts. So we need to have these discussions, we need to have serious sit-down discussions that result in contracts and not explanations of why there are no more opportunities. I am willing now not to burden this record any further, but I do need the record to show that minorities and women and other historically left-out contractors want to be let in at the earliest ground level, including the 79 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 soft money that the lawyers and the accountants and this early start-up. Can we get your commitment to that?

Mr. Hankowsky

You can get my commitment that we will absolutely sit down on this as soon as possible, yes. And I think the developer would agree and be prepared to do that.

Councilwoman Clark

Thank you, Mr. President.

President Street

Thank you very much. Right now, are there any other questions? (No further questions at this time.)

President Street

We temporarily lost our quorum. Thank you very much. Hopefully, the quorum will walk into the room. Mr. Hankowsky I, understand you've offered an amendment.

Mr. Hankowsky

Correct.

President Street

And Councilman DiCicco will offer an amendment?

Councilman Dicicco

Councilman Nutter will be offering the amendment.

President Street

Councilman Nutter 80 12/09/98 COMMITTEE OF THE WHOLE - Bill No. 980845 will be offering the amendment, the Chair stands corrected. Has that amendment been circulated among all members of Council? Mr. Hankowsky, do you oppose the amendment?

Mr. Hankowsky

No, I do not.

President Street

I knew you weren't going to say you support the amendment; you probably aren't authorized to say that. Councilman Nutter?

Councilman Nutter

Mr. President, do you want to take this amendment at this point, or at least a reading of it into the record?

President Street

I'm waiting for my quorum. Once Councilwoman enters the chamber, we will have our quorum, we will end our public hearing and go into our public meeting. (Quorum is reestablished.)

President Street

Is there anyone else to testify? (No response.) - - - 81 12/16/98 COMMITTEE OF THE WHOLE - Public Meeting

President Street

We will now go into our public meeting. The Chair recognizes Councilman Nutter for a motion.

Councilman Nutter

Mr. President, I move the adoption of the amendment, as circulated to the members, on Bill No. 980845.

President Street

Is there a second? (Duly seconded.)

President Street

All those in favor, let it be known by saying aye. Those opposed, say nay. The ayes have it. The bill is amended. The Chair recognizes Councilwoman Verna for an amendment.

Councilwoman Verna

Thank you, Mr. President. I move that the amendments, as presented to us by Bill Hankowsky, be approved. (Duly seconded.)

President Street

All those in favor, let it be known by saying aye. Those opposed, say nay. The ayes have it.

President Street

The Chair recognizes 82 12/16/98 COMMITTEE OF THE WHOLE - Public Meeting Councilwoman Verna for a motion on the amended bill.

Councilwoman Verna

Mr. President, I move that Bill No. 980845, as amended, be reported out of committee with a favorable recommendation. (Duly seconded.)

President Street

All those in favor, let it be known by saying aye. Those opposed, say nay. The ayes have it.

Councilwoman Verna

Mr. Chairman, do we need a suspension of the rules?

President Street

I don't think we need one. We need a suspension for first reading.

Councilwoman Verna

I further move that the rules of Council be suspended so as to permit first reading at our next session of Council. (Duly seconded.)

President Street

All those in favor, let it be known by saying aye. Those opposed, say nay. The ayes have it. This bill will be reported out of committee with a favorable and a 83 12/16/98 COMMITTEE OF THE WHOLE - Public Meeting recommendation that rules of Council be suspended so as to permit first reading at our next session of Council. That brings us to the end of our agenda. We appreciate very much your attendance. Thank you very much. (Adjourned at 12:37 p.m.) - - - 84 C E R T I F I C A T E I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia of Wednesday, December 16, 1998, were reported fully and accurately by me, and that this is a correct transcript of same. RE: COUNCIL COMMITTEE OF THE WHOLE BILL NO. 980845 __________________________________, JOSEPHINE CARDILLO, Registered Professional Reporter