Committee Hearing, December 9, 2009

COUNCIL OF THE CITY OF PHILADELPHIA COMMITTEE ON FINANCE - - - Room 400, City Hall Philadelphia, Pennsylvania Wednesday, December 9, 2009 1:30 p.m. - - - PRESENT: COUNCILWOMAN MARIAN B. TASCO, CHAIR COUNCILMAN DARRELL L. CLARKE COUNCILMAN FRANK DiCICCO COUNCILMAN W. WILSON GOODE, JR. COUNCILMAN BILL GREEN COUNCILMAN WILLIAM GREENLEE COUNCILMAN CURTIS JONES, JR. COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILWOMAN JANNIE BLACKWELL COUNCILMAN JAMES KENNEY BILL 090686 - An ordinance amending Chapter 15 19-500 of The Philadelphia Code, entitled Taxes and Rents - General"... BILL 090849 - An ordinance amending Section 17 10-1001 of Title 10 ("Regulation of Individual Conduct and Activity")... BILL 090850 - An ordinance amending Section 19 10-1001 of Title 10 ("Regulation of Individual Conduct and Activity")... - - - V A R A L L O Incorporated Litigation Support Services Eleven Penn Center 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 215.561.2220 215.567.2670 2

Hello. Good afternoon. The Committee on Finance will come to order. We will have a quorum by the time we finish with all the testimony, but for the purposes of the hearing, we will open it so that we can begin the testimony. We will ask the Clerk to please read the first bill that we will hear.

Bill No. 090686, an ordinance amending Chapter 19-500 of The Philadelphia Code, entitled "Taxes and Rents - General," by providing for a temporary tax amnesty program under which delinquent taxpayers may satisfy their past due tax obligations with forgiveness of all or a portion of accrued interest and penalties, under certain terms and conditions. Bill No. 090849, an ordinance 22 amending Section 10-1001 of Title 10 ("Regulation of Individual Conduct and Activity") of The Philadelphia Code relating to fees charged by the 3 12/9/09 - FINANCE - BILL 090686, etc. Commissioner of Records by modifying the amount of such fees, under certain terms and conditions. Bill No. 090850, an ordinance 6 amending Section 10-1001 of Title 10 ("Regulation of Individual Conduct and Activity") of The Philadelphia Code relating to fees charged by the Commissioner of Records by modifying the amount of such fees, under certain terms and conditions.

Thank you very much. We will now hear testimony on Bill No. 090686, the tax amnesty bills. The Chair calls Commissioner Keith Richardson. (Witness approached witness table.) COMMISSIONER RICHARDSON: Good afternoon.

Good afternoon. Would you state your name for the record, please, and proceed with your testimony. 4 12/9/09 - FINANCE - BILL 090686, etc. COMMISSIONER RICHARDSON: Keith J. Richardson, Revenue Commissioner. Good afternoon, Chairman Tasco and members of the City Council Committee on Finance. Again, I am Keith J. Richardson, the Revenue Commissioner. I am here to testify on Bill No. 090686, which proposes a temporary tax amnesty program during Fiscal Year 2010. I am here to testify in support of the proposed tax amnesty. The vast majority of Philadelphians are meeting their obligations to the City by paying their taxes in full and on time. In this time of economic distress, City revenue collections have suffered and some citizens and businesses find themselves overwhelmed by the penalties associated with their tax debts. Through an amnesty, City government can offer those citizens and businesses a chance to get back on track with their tax bills before their debts grow and become even more overwhelming. 5 12/9/09 - FINANCE - BILL 090686, etc. Amnesty and other efforts to increase revenue collections seek to lessen the impact of the City's financial distress on residents, reducing the need for either spending cuts or fees and tax rate increases. The Administration has evaluated the City's receivables, experience with previous tax amnesties, and the outcome of recent amnesties in other cities and states. Based on that information, we project that a successfully implemented amnesty would result in a net increase of to 30 million in Fiscal Year 2010 16 collections. The amnesty will be 17 available for all tax types, except sales 18 tax, which is collected by the state and 19 the recently enacted Acute Care Hospital 20 Assessment. Everything else - the real 21 estate, wage tax, business privilege tax 22 and others - will be included. 23 To achieve this revenue 24 projection, the Department of Revenue 25 will be issuing a request for proposals 6 12/9/09 - FINANCE - BILL 090686, etc. from collection consultants and investing in outreach and advertising. 6 million for staffing, contingency fees for the collection agency, advertising, supplies and technology. I testified before the Council Committee on Appropriations regarding the transfer ordinance last week, and the Committee forwarded the ordinance with a favorable recommendation. The Department of Revenue has carefully considered the potential pitfalls of offering an amnesty and is taking steps to ensure that it is fair to all taxpayers and does not encourage future delinquency. In that regard, we are proposing a series of amendments that address these issues, as well as some technical changes recommended by the Law Department. For example, the ordinance 25 should provide that all delinquencies 7 12/9/09 - FINANCE - BILL 090686, etc. accrued since the last amnesty and incurred before July 1 of 2009 will be eligible. I want to emphasize the last requirement. Taxpayers should not put off paying taxes that are due now to wait for amnesty. We will not be offering amnesty on recent debts. The amnesty will be open to those who underreported, underpaid or never filed. Program participants will need to apply. We anticipate online, phone and in-person applications. For those that are eligible, the entire penalty and half of the interest due will be waived. We are eager to get people on the tax rolls and up to date on their accounts, but it is important for everyone to realize that this is a unique, isolated opportunity. Those eligible for the Fiscal Year 2010 amnesty that fail to come forward will be ineligible for any future amnesty should they occur. We do not intend to offer 8 12/9/09 - FINANCE - BILL 090686, etc. another amnesty in the future. Over the past year, the Department of Revenue has stepped up enforcement activity. We have been publishing the names of delinquents, hiring more auditors and engaging in more information-sharing with the IRS.

After the amnesty, these efforts will continue and expand. For those that could come forward during this amnesty and fail to take advantage of the opportunity, we need the capacity to act efficiently, economically to collect revenue due to the City. To this end, the Administration is seeking Council approval for an additional enforcement tool that will ensure that after the amnesty, Philadelphia's tax collection activities can continue successfully. Bill No. 090833 would enable the City to place the burden for paying collection firms' fees directly on delinquents rather than the burden being shared by all taxpayers. Without this companion 9 12/9/09 - FINANCE - BILL 090686, etc. bill, the seriousness of Philadelphia's tax collection efforts post amnesty will be undermined. The unique opportunity of an amnesty must be paired with consequences for continued non-compliance. By shifting collection fees onto the debtor rather than the General Fund, Philadelphia will be increasing the incentive for people to pay on time, while reducing the expense of tax enforcement activities currently borne by the taxpayers that do pay on time and in full. We urge the passage of the temporary tax amnesty legislation, in conjunction with Bill 090833, as well as the transfer ordinance to provide the needed funding for amnesty administration. Thank you. I would like to hand up the following draft amendments to the bill. I'm happy to answer any questions.

Thank you 10 12/9/09 - FINANCE - BILL 090686, etc. very much for your testimony. Let me just go back to -- there was a bill given to Council some time ago requesting that we pass legislation to allow for collection agencies to collect real estate taxes. That bill has not been passed yet. So are you saying that the bill that you have now, that if we pass -- and that was because the fees that they charged cannot be passed directly to the owner. Is that the companion bill that you're asking us to pass? Is that going to be the same bill that you asked us to pass before? COMMISSIONER RICHARDSON: I would ask Dan Cantu-Hertzler, if he can come up, from the Law Department to express his comments on this, please. (Witness approached witness table.)

Yes. I'm Dan Cantu-Hertzler, Chair of the Corporate and Tax Group in the City Law 11 12/9/09 - FINANCE - BILL 090686, etc. Department. The bill is rather similar to the bill from last year, but it would go beyond it. It would affect not only real estate but potentially all taxes, if we have the authorization from the General Assembly to impose collection agency fees. Right now we do have that authority as to real estate taxes, water/sewer bills, other real estate related, things like L&I liens, if City Council grants authorization. We don't -- City Council has not granted that authorization. This proposed bill 16 would also allow it on business taxes and other taxes, if the state passes enabling legislation.

So we would, in addition to water -- I guess my concern is, you all know the issues that we raised around that first bill that you sent to us relative to collection agencies collecting real estate taxes.

Yeah. I 12 12/9/09 - FINANCE - BILL 090686, etc. think there were some misunderstandings, and we'd be happy to talk more about that.

But if we pass this amendment that you're asking us to pass, we are, in essence, passing that bill, the tenets of that bill.

Yes, I believe that's correct.

So right now only the law firms can collect real estate taxes?

Collection agencies can collect real estate taxes, but if we have the collection agencies do it, then we have to pay them rather than the taxpayers paying them.

The cost for the collection is borne by the City?

It's borne by the City and all taxpayers rather than just the delinquent taxpayers.

I really do still have a problem with that. 13 12/9/09 - FINANCE - BILL 090686, etc.

I understand. Maybe we should talk offline. I know that's not scheduled for a hearing right now anyway, but sure.

Well, are you going to offer that bill today, the companion bill?

It's already been introduced, but it wasn't scheduled for hearing today. I believe it was introduced by 11 Councilmembers a couple weeks ago.

They probably didn't know what they were signing. Who introduced it?

Councilwoman Krajewski, along with this bill. After this bill, but as part of this.

Okay. We'll have a discussion about that.

Sure.

The other 14 12/9/09 - FINANCE - BILL 090686, etc. thing, Mr. Richardson, what is your relationship with the IRS and collecting information from the IRS about individuals who file income with the IRS, but you not necessarily know about that income that they have reported to the IRS? COMMISSIONER RICHARDSON: Again, our working relationship with the IRS, even with the Commonwealth of Pennsylvania, is that we share data on taxpayers or a bulk of information may be on 2007's tax information or a specific year. As with regards to your question -- can you repeat your question again? I'll make sure I answer it properly.

Well, I'm asking you, do you get the information directly? Does your office receive information directly from the IRS relative to individuals who may have reported income to the federal government 15 12/9/09 - FINANCE - BILL 090686, etc. but not necessarily reported to the City for collection of, say, wage tax or any other tax? COMMISSIONER RICHARDSON: Well, yes, we do get data from the IRS. It comes in bulk. We have to go through it and decipher potential taxpayers in the City, whether it be individuals or businesses that may owe the City of Philadelphia for not filing with us.

What is your level of success and do you have enough staffing to capture that information? COMMISSIONER RICHARDSON: Our level of success in our discovery area has been very successful over the years using data from the IRS. Again, as I testify every year, it's always good to have more folks, because there's a lot of information out there that we may not be able to capture every time we go after taxpayers. Again, we try to use parameters on certain dollar amounts that 16 12/9/09 - FINANCE - BILL 090686, etc. we will go after. For those individuals, for example, who may owe school income tax, we look at people who may have dividends of a thousand dollars and above. So we try to go after that universe. Anything at $500, is it beneficial for us to go after that individual per se compared to that bigger universe? So we try to set parameters on things.

Well, do you ever notify the people who are under a thousand dollars who may -- do you directly notify them that they have income and should pay wage tax on it? COMMISSIONER RICHARDSON: If that's a project we're working on, yes, we will work with them and send letters out to taxpayers. And, again, also we work with the collection agencies to assist us with that.

Well, if you go to a collection agency, doesn't the collection agency charge a fee? 17 12/9/09 - FINANCE - BILL 090686, etc. COMMISSIONER RICHARDSON: Yes, they do.

Would you do better if you did the direct notification? COMMISSIONER RICHARDSON: It would be good if we could do the direct notification, but we may have to send out 5,000 letters to taxpayers and we don't have the staff to take potentially 5,000 calls coming back. So that may be a situation that we want to take advantage of the collection agency that can assist us with the collections on that.

I'll let some others ask questions, and I have some more questions. Councilman Greenlee.

Thank you, Madam Chair. Good afternoon, Commissioner. Just one question, and I know there's going to be testimony about this, but since you're here, I might as well ask 18 12/9/09 - FINANCE - BILL 090686, etc. you. There's going to be some testimony requesting that water bills be included in this. Do you have an opinion on that one way or the other? COMMISSIONER RICHARDSON: My opinion is that right now we should deal with tax amnesty only, not water. I think if you're going to offer water, we haven't done an analysis on that. Also, you have to realize, for an example, I may have a person that owes us $2,200 for water. After you take off the penalty and perhaps a lien or two, they owe us like $1,800. So a $400 difference. Is that going to make much of a difference for a person who already owes us? They may not pay it. Also, if we look at offering a potential water amnesty and we're in a moratorium right now, we're looking at potentially six months that people will not pay us at all, so our receivables will go up. 19 12/9/09 - FINANCE - BILL 090686, etc.

And, again, you're saying the City doesn't really gain that much from that; is that basically what you're -- COMMISSIONER RICHARDSON: The City doesn't. The Water Department potentially could gain from that. Again, I think Commissioner Brunwasser should be here as well, because I can't speak on the behalf of their department and the bond covenants as well. But I think if we're doing the tax amnesty, that benefits the City and the General Fund.

Okay. I got you. Thank you. COMMISSIONER RICHARDSON: You're welcome, sir.

The Chair recognizes Councilman Green.

Thank you, Madam Chair. Good afternoon. COMMISSIONER RICHARDSON: Good afternoon. 20 12/9/09 - FINANCE - BILL 090686, etc.

I'm just curious about a couple of aspects of the bill. Why July 1st, 2009 versus September 1st, 2009 or whatever as the date that taxes have to be -- I mean, they're all dates in the past. COMMISSIONER RICHARDSON: Well, you want to have a cut-off timeframe, and I think working with Krajewski's office, we settled on the June 30, 2009 at the end of the fiscal year as a cut-off.

Because it's the end of the fiscal year? COMMISSIONER RICHARDSON: Yes.

That makes sense. And have you been involved in tax amnesties in other jurisdictions where you worked? COMMISSIONER RICHARDSON: No. 22

This is your first one? COMMISSIONER RICHARDSON: Yeah.

Most tax 21 12/9/09 - FINANCE - BILL 090686, etc. amnesties eliminate all interest and penalties, don't they? COMMISSIONER RICHARDSON: No, sir. Most of them eliminate all penalty and potentially 50 percent or percent 7 of the interest. 8

Twenty-five 9 percent of the interest. 10 Do you know what New Jersey's 11 very successful recent one was? 12 COMMISSIONER RICHARDSON: Why 13 were they very successful? 14

No; what the 15 reduction in the tax rate -- I mean, in 16 the interest was. Was it 50 percent of 17 the interest or 25 percent of the 18 interest? 19 COMMISSIONER RICHARDSON: New 20 Jersey waived all penalties and half the 21 interest. 22

New Jersey 23 waived all the penalties and half the 24 interest? 25 COMMISSIONER RICHARDSON: Yes. 22 12/9/09 - FINANCE - BILL 090686, etc.

Do you have a list of jurisdictions there like that? COMMISSIONER RICHARDSON: I have some of them.

What do you show there? COMMISSIONER RICHARDSON: Pretty much the states that have done amnesties in the last fiscal year or so.

And can you just tell us what they waived? COMMISSIONER RICHARDSON: Sure. Alabama waived all penalties. Arizona did all penalties and half interest. Connecticut waived penalties and 17 percent of interest. Delaware waived all 18 penalties and interest. 19

Delaware 20 waived all penalties and all interest? 21 COMMISSIONER RICHARDSON: In 22 Delaware, yes. 23 Louisiana did waiving all 24 penalties and half interest. Maine did 25 waiving 90 percent of penalties but no 23 12/9/09 - FINANCE - BILL 090686, etc. interest. Maryland did waiving of all penalties and half the interest, just to name some of the few.

So we're pretty consistent with what's been going on around the country? COMMISSIONER RICHARDSON: Yes, sir.

Thank you. COMMISSIONER RICHARDSON: You're welcome.

Any other questions? Councilwoman Blackwell.

Thank you. Good afternoon. COMMISSIONER RICHARDSON: Good afternoon, Madam.

I am concerned that we -- I'm never for publishing the names of delinquents in the newspaper. I'm never for doing that, or showing their pictures on the front of 24 12/9/09 - FINANCE - BILL 090686, etc. the newspapers. I remember years back where they did it for traffic tickets when the late Lucien Blackwell was around, and he complained, so that they stopped it. I'm not for that. But I'm also for -- I have one member of my staff who was under agreement and another member who owed no 10 bill. So that's just two people on my staff who were contacted and threatened with this tax stuff when they didn't owe. So I'm concerned about people -- if it can happen to my staff, it can happen any place, and that's two people alone. So I am concerned that we are careful in that review and we make sure that people we contact, we don't threaten people unnecessarily and make people afraid that they're in all this trouble and they owe when they don't. If two can happen in my office, then it can happen anywhere.

I share Councilwoman Blackwell's concern. My 25 12/9/09 - FINANCE - BILL 090686, etc. concern with this collection agency business, unless the City has officially notified a person that they owe the money and give them an opportunity, without having that discussion, you put it in a collection agency's hand, then that becomes part of their credit report, when they could have satisfied the obligation. And I'm talking about certain instances where an individual may not be aware that that extra income or whatever they get is subject to payment to the City or notification to the City. I think they ought to be given the first notification from the City before it goes to the collection agency. When you get to the collection agency -- and I'm not talking about these large bills that you've been trying to collect for months. I'm talking about the initial contact. COMMISSIONER RICHARDSON: To address your concerns, Madam Chair, again, anyone who was a delinquency with the City of Philadelphia -- and we're 12/9/09 - FINANCE - BILL 090686, etc. talking delinquencies -- gets letters from the Department of Revenue numerous times. You could be delinquent on real estate, you're getting bills monthly from us that you owe. It could be for business taxes as well. Now, with regard to what you're commenting on, a lot of times taxpayers may not know they owe the City for a certain tax that may be owed. Again, we cannot go out after every potential taxpayer who may owe something. We may not be aware that they may have received some certain kind of income. Again, they may file their returns with the IRS. They may file with the state and neglect to file with the City. Most practitioners know that an individual may owe the City. So when we get data from another state agency or the federal government and we see that, again, we have to make a determination, do we want to go after a bigger pool that's going to bring larger revenue to 27 12/9/09 - FINANCE - BILL 090686, etc. the City or potentially a smaller pool that would bring revenue to the City but we don't have the man force to work on it.

But the person who has the larger bill does not go to a collection agency and is not subjected to the reporting that the collection agencies do to the credit bureau, so they get an opportunity to pay their bill, where somebody who may not know it is put in the hands of a collection agency and gets that -- and may not know that they owe the City this money, that the City is subjected to a tax on that money. They're put in the hands of a collection agency, and, therefore, they get a report on their credit report. So that is an unfair advantage for the person who owes a little bit of money. COMMISSIONER RICHARDSON: Well, to clear the record for you, if the collection agency is calling somebody, 28 12/9/09 - FINANCE - BILL 090686, etc. they're not reporting to the credit bureau. The only time you're going to get reported to the credit bureau for a tax issue is when the City has secured a judge or lien against the individual. So if I call Ms. Jones, who may on a pickle company in North Philadelphia, about her delinquencies, I'm making a phone call. They're not getting reported until she continues to say, I'm going to thumb my nose at the City for 90 days. The City says, Well, we're going to put a lien against you. That becomes a public record. That is what gets reported to the credit bureaus, not a phone call from the collection agency does not get reported to the credit bureau. Because, one, there's no judgement or lien against the taxpayer, so they cannot report it. A collection agency is only working on the behalf of us to make that phone call to say, Hey, listen, Mr. Jones, Ms. Jones, you have a delinquency with the City, we would like for you to take care 29 12/9/09 - FINANCE - BILL 090686, etc. of this to resolve it today. They could say, The City is going to look at taking a lien against you. That's when it can go to the collection agency. Thousands of people get calls every day. It doesn't go to the credit bureau for every call. There wouldn't be anybody who would have good credit if that was the situation.

So the City at some point makes the determination to file the lien? COMMISSIONER RICHARDSON: Yes. We will file a lien. It becomes a public record, which then would be on the person's credit bureau, not just from a phone call from a collection bureau.

For the record, can you describe what events led to the previous temporary tax amnesty program of 1986, and are those events similar with regards to this bill? COMMISSIONER RICHARDSON: No, I can't because I wasn't here and privy to 30 12/9/09 - FINANCE - BILL 090686, etc. that back in 1985-'86, unfortunately, so I can't really say why that happened, and the folks that were here -- people are not here who worked that program back then.

All right. According to your testimony, it is projected that the City will receive a net increase of tax collections between $25 to $30 million for Fiscal Year '10. If we reached this target, would the program be considered a success and would it be continued for another year? COMMISSIONER RICHARDSON: I think it would be a success because we hit our target. No, we would not want to make amnesty an ongoing thing.

So it's just for the one-year period? COMMISSIONER RICHARDSON: Yes.

When is the deadline on this one? COMMISSIONER RICHARDSON: We're anticipating from May to June would be 31 12/9/09 - FINANCE - BILL 090686, etc. the amnesty timeframe.

On of your testimony, you state that 12.6 million will be needed for various administrative costs, including contingency fees for collection agencies for this program. What collection agencies will be used? COMMISSIONER RICHARDSON: Right now we don't know what collection agency or agencies will be used. We'll do an RFP out if and when the ordinance is approved by Council, and then we will have -- whatever agencies would like to bid on the contract, they are more than welcome to bid on that. Again, with regard to the 12.6 million, some of that money goes to advertising this. An amnesty campaign is something that you have to advertise on a national basis. We have to reach out to all 50 states, their chambers of commerce. We need to reach out to the 32 12/9/09 - FINANCE - BILL 090686, etc. Wall Street Journal and the national and potentially international publishing of the Wall Street Journal, the USA Today, the papers here, the Internet, billboards, the bus barns that folks are waiting to catch the buses at. We have to advertise and we have to be out to talk with the various PICPA, PSPA, all the various agencies that deal with accountants, the Bar Association as well. Again, some of the money will potentially be used for the collection agency. Again, we're saying, I think it was, $10 million. I'm hoping it potentially is all used up. If $10 million is used, we'll probably collect lots of money, but, again, it's just -- it's going to be based off a contingency fee what an agency would be collecting from the City.

Does this include any increase to your staff? COMMISSIONER RICHARDSON: It will potentially include an increase to 33 12/9/09 - FINANCE - BILL 090686, etc. the staff for the processing side of things. So we had seeked $250,000 and also potentially $200,000 for IT, because we're going to have to code all the accounts on the system to make sure that they've been coded for amnesty, so if the City ever decides to do an amnesty -- hopefully we all will be gone from here then -- that people will know that these cases now are not eligible because they did not take advantage of it in Fiscal Year 2010.

Okay. Is there any other questions? Councilman Jones. Councilman Jones, I'm sorry.

That's all right, Madam Chair. Just for the record, Commissioner, Mrs. Jones does not own a pickle company in the City. COMMISSIONER RICHARDSON: This is Mrs. Jones in Delaware, not your Mrs. Jones, sir, in the 4th District. 34 12/9/09 - FINANCE - BILL 090686, etc.

I just wanted to let you know that. I would like to state for the record that some of these recommendations, and particularly this one, was a part of the Freshmen that 8 we presented to you -- actually, 30 that 9 we submitted to you, and what we've 10 learned as sophomores is that if you 11 relinquish ownership, you can be 12 surprised what can be done. 13 I'm looking at some of the 14 testimony that was submitted as to some 15 of the results from other municipalities where they even underestimated what the results would be and were surprised pleasantly by the amount of participation. What's your ballpark -- I mean, are you lowballing this just to be conservative, or what's your optimistic -- in light of some of the projected budget deficits, how well can we do on this? 35 12/9/09 - FINANCE - BILL 090686, etc. COMMISSIONER RICHARDSON: Again, I'm projecting to you the net of $25 to $30 million we can collect. Again, you will find the majority of all municipalities and states would make sure they are conservative with their numbers. I wouldn't look at the numbers and say, Oh, we have a billion dollars of receivables and we're going to do ten percent. No, because that's not realistic. You have to look at the receivables. You have to break it down to these receivables have businesses that are defunct. There may be situations that you have to take them out of the mix. So you have to look and analyze your numbers. So everyone pretty much does a conservative number. For example, Louisiana said, We can do 150 million. What did they do? 466 million. I mean, everyone thinks of this, they see New Jersey, 200 million. They did 700 million. 36 12/9/09 - FINANCE - BILL 090686, etc. Is it possible to do more than 30 million? I sure hope so, because it helps out the services in the City, but I'm not going to say more than that.

I'm pleased with that. I won't steal the testimony or thunder from the other people testifying, but I'm reading their testimony, and in each of those municipalities, they far exceeded what their initial revenue expectations were. COMMISSIONER RICHARDSON: Right. And let me say this for the record. You have to realize too when you look at municipalities and people are thinking Philadelphia is going to do a hundred million or more, the City of Los Angeles did 17.9 million. Their receivables are about three times ours. In 2004, New York City did 40 million. Their receivables are about ten times as ours. So for us to get a number, again, because New Jersey did a certain 37 12/9/09 - FINANCE - BILL 090686, etc. amount --

Jersey did 200 million estimate, 600 million received. COMMISSIONER RICHARDSON: Actually right now it's about 835 million.

Delaware did an estimate of 10 million and did 22 million received. COMMISSIONER RICHARDSON: Right.

So I'm just optimistic. COMMISSIONER RICHARDSON: Those are states, not municipalities. You have to realize they have more taxes than a municipality has. Again, you have to realize also in the 21st century --

Percentages. COMMISSIONER RICHARDSON: Right. Again, you have to realize all of them used agencies to assist them to get where they are. 38 12/9/09 - FINANCE - BILL 090686, etc.

And your point is that you'd rather use the agency versus ramping up internally to -- COMMISSIONER RICHARDSON: As I said last week, we are not built to do amnesty internally. War stories from people from 1986 to '87, people were around the block until o'clock at 10 night trying to come into the Department. 11 We can't go through tax season and expect 12 to have that done and taken care of and then three weeks later jump into amnesty with 263 people. We are not built for that.

My only comment -- and I'll end it -- is that as I listen to collection agencies sometimes coming from China, India and other places, to the degree that we are talking about stimulus and other things and shovel-ready, I mean, collections seems to be one of those things that if we can get it closer to home, that it will have an economic benefit, not only to the 39 12/9/09 - FINANCE - BILL 090686, etc. municipality and our treasury, but to some people that are looking for jobs at Broad and Cecil B. Moore or 60th and Market, is my point. Thank you, Madam Chair.

Excuse me. A thought: In the effort to create jobs, instead of paying the money to a collection agency, why couldn't we -- it's only a month-long process -- hire people temporarily? That way, you don't have to worry about paying benefits, they're on a part-time basis, give them that one-month window to earn the money to come in to make those phone calls? COMMISSIONER RICHARDSON: That's a noble thought. I hear what you say. However, for us to train someone to learn taxes, the average employee takes about 18 months to have a good understanding of taxes. If you want to hire someone undergraduate at Temple, LaSalle, Peirce College --

Are you 40 12/9/09 - FINANCE - BILL 090686, etc. telling me that these collection agencies hire college graduates to do collections? COMMISSIONER RICHARDSON: I don't know what they hire. I can't speak for them.

Well, I'm trying to tell you, all they're doing is calling you, telling you that you owe a tax and you got to pay it. COMMISSIONER RICHARDSON: I understand.

It doesn't take a degree to do that. All I'm saying, there are people who are unemployed who could -- and you could use some community agencies to do it and let them hire the people and give them the script. It doesn't take much to give them a script to call a list and say, We have a tax amnesty program, and whatever else you want to say to it, because that's all you're going to get from a collection agency. You know I hate collection 41 12/9/09 - FINANCE - BILL 090686, etc. agencies. You know that, right? COMMISSIONER RICHARDSON: I didn't know that.

You know it now. But anyway, and you could stimulate the economy by people who are unemployed, who could use that little check that we have to make those phone calls, and you could use many of the community organizations that are here and in this city to make some of those phone calls. COMMISSIONER RICHARDSON: Duly noted, Madam.

All right. You might have to do that, because you still got to get that bill, right? COMMISSIONER RICHARDSON: We have to get the bill.

Okay. Next. Who is next? Councilman Green. And let me say that we do have 42 12/9/09 - FINANCE - BILL 090686, etc. a quorum in the presence of Councilman Kenney, Blondell Reynolds Brown, Greenlee, Tasco, Blackwell, Goode and Green.

Thank you, Madam Chair. I'm a little bit confused about what exactly is happening with collection agencies and this bill. There's nothing in the amendment that we're considering today that deals with the collection agency issue; is that true? COMMISSIONER RICHARDSON: Correct.

So this is just simply the tax amnesty? COMMISSIONER RICHARDSON: Correct.

With respect to the collection piece, if we pass that other bill, charging the taxpayer for the efforts of the collection agency will not be part of the amnesty program, right? COMMISSIONER RICHARDSON: It 43 12/9/09 - FINANCE - BILL 090686, etc. would not be part of the amnesty program, but it would be our hammer as part of amnesty after amnesty.

After amnesty that would be an additional fee? COMMISSIONER RICHARDSON: It would be a fee that's incurred by the taxpayer instead of the City. For example --

No, no. I understand. COMMISSIONER RICHARDSON: You understand? Okay. The taxpayer is going to pay it now.

Do we set that fee in the legislation or do we rely on you to negotiate a fair fee for the taxpayer? COMMISSIONER RICHARDSON: That is negotiated with the agency on the fee that they would be charging for collection purposes.

So if we want to limit it, we're going to have to 44 12/9/09 - FINANCE - BILL 090686, etc. put it in the legislation. In other words, there's no incentive really since it doesn't come out of the City's pocket for us to get a good deal for the taxpayers from -- COMMISSIONER RICHARDSON: You want a fair and equitable deal. You don't want to be using usury rates against taxpayers. That's unrealistic.

Would you have any objection to us adding something in there that limits the amount the collection agency can charge as a percentage? COMMISSIONER RICHARDSON: I guess we would like to talk to you before potentially doing that, because if you put a certain fee in there, it may kill us from using agencies potentially.

Thank you.

Thank you very much. Any other questions? (No response.) 45 12/9/09 - FINANCE - BILL 090686, etc.

Thank you very much for your testimony. COMMISSIONER RICHARDSON: Thank you, Madam Chairwoman and to the Committee. Happy holidays.

Thank you. Next we have our Controller, Alan Butkovitz. (Witness approached witness table.)

Councilman DiCicco has joined the Committee. Mr. Richardson, just after the other people have testified, we need you to come back and explain these amendments, please. COMMISSIONER RICHARDSON: Sure.

We'll let the other witnesses testify on this bill 21 and then we'll ask him to come back to explain the amendments. Would you identify yourself for the record, please.

Good afternoon. 46 12/9/09 - FINANCE - BILL 090686, etc. I'm Alan Butkovitz. I'm the Philadelphia City Controller.

Yes. You may proceed.

I'd like to thank Chairwoman Tasco and the other members of the Committee on Finance for this opportunity to testify. I especially would like to thank and commend Councilwoman Krajewski for taking the initiative in drafting the tax amnesty legislation and introducing it in Council. The tax amnesty program is included as one of ten action steps which were included in our recommendations last May in a report that our office issued to help the City generate more revenue and improve tax collection and compliance. Currently, there is about a billion dollars in uncollected taxes owed to the City of Philadelphia. Implementing a tax amnesty program for Philadelphia is an opportunity to collect 47 12/9/09 - FINANCE - BILL 090686, etc. millions of dollars in delinquent taxes and provide much-needed funds to support essential City services. The Administration is already projecting a $50 million budget deficit for next year and potential deficits in the following years. The funds generated from a tax amnesty program could potentially eliminate or diminish this pending deficit. The success of the tax amnesty program will depend largely on the City's willingness to adopt an aggressive mindset and strive to collect as much of the maximum amount owed as possible. A conservative collection rate of ten percent would generate almost $100 million for City coffers. Philadelphia implemented tax amnesty in 1986 when $86 million was owed. We generated $25 million back then, a percent collection rate, 24 nearly four times more than what was 25 originally projected. If we were to 48 12/9/09 - FINANCE - BILL 090686, etc. realize the same percentage of return under this program, the City would recover $350 million out of this proposed amnesty. Using today's technology to facilitate the easy payment of outstanding tax obligations online, the City could also utilize an abundance of e-marketing strategies to reach targeted audiences. The City has an array of tools at hand to reach thousands of tax delinquents throughout the City beyond the traditional mailing and advertising methods which were available years 16 ago. 17 Other cities have collected 18 millions in added revenue in their own 19 tax amnesty programs. 2 million of the $8 million owed. Phoenix anticipated a 24 percent collection rate. 25 Oakland was owed $2 million for 49 12/9/09 - FINANCE - BILL 090686, etc. 7 million, almost the entire amount owed. Its goal was a 35 percent collection rate. San Jose provided an amnesty for business taxes only and almost doubled its goal by collecting one and a quarter million dollars, a ten percent collection rate. 6 billion as the amount that is outstanding on state taxes. According to information provided by the General Assembly and by Auditor General Jack Wagner, the state has agreed to an estimate of $160 million, or ten percent in collections, and that was a contentious issue during the state budget negotiations. The Revenue Department and the Governor initially resisted that. They finally closed the deal, with the 50 12/9/09 - FINANCE - BILL 090686, etc. concession that ten percent was reasonably anticipated to be collectable. During the past year, New Jersey implemented one of the most successful tax amnesty programs in the nation. It generated more than $700 million in 45 days, a 250 percent increase in originally projected revenue. New Jersey's success was due in part to an aggressive outreach campaign that included 600,000 notices sent to taxpayers and a website that allowed individuals to quickly pay their outstanding delinquencies online. Other outreach initiatives included print, TV, radio and online advertising. Trade organizations sent e-mail blasts to their members. Tax amnesty notices were posted and displayed on digital screens at train stations, on coffee cups in convenience stores, on billboards, buses and on YouTube. Since a successful tax amnesty relies so much on an aggressive effective 51 12/9/09 - FINANCE - BILL 090686, etc.

outreach campaign, I would recommend that City officials form a tax amnesty committee to provide guidance on how best to maximize collections. This committee could be comprised of a representative from the following City departments: Revenue, Finance, Law, City Representative, City Council and the City Controller's Office. We need to work together if we are to be successful in generating the millions needed to help us fill our anticipated budget gap for the next year. I would urge Council to support and enact Councilwoman Krajewski's tax amnesty legislation to help provide the City with a much-needed source of funding to pay for essential City services. Again, I thank the Council for the opportunity to testify before you today.

Thank you very much. Are there any questions for the 52 12/9/09 - FINANCE - BILL 090686, etc. Controller? (No response.)

Thank you very much for taking your time to come, and I'm sure you're happy to see that one of your recommendations might become possible. Mr. Wonderling, President and CEO of the Chamber of Commerce. (Witnesses approached witness table.)

Good afternoon.

Good afternoon.

And welcome to City Council. Is this your first testimony?

This is my first testimony and it's an honor to be here.

Well, we welcome you to the City and we welcome you as head of the Greater Philadelphia 53 12/9/09 - FINANCE - BILL 090686, etc. Chamber of Commerce, and we're pleased to have you here today making this testimony.

Well, thank you, Chairwoman Tasco and members of the Finance Committee, and let me reiterate it is indeed an honor not only to present testimony today in my inaugurational role and doing so as President of the Chamber of Commerce, but getting to know a number of you over the last several months. And hopefully, and most assuredly, a productive and collaborative effort between our Chamber of Commerce and you individually and this legislative body is something that I'm truly looking forward towards. There's the old adage, a rose between two thorns. Let me suggest, at least in part of my remarks, that I am a novice between two experts, and to my right is Jonathan Liss from Grant Thornton and to my left is Stew Weintraub, who chairs our Tax Committee, 54 12/9/09 - FINANCE - BILL 090686, etc. and both gentlemen have assisted us in presentation of this testimony today and offer our services on an ongoing basis to this committee and this Council. Again, for the record, I am Rob Wonderling, President and CEO of the Greater Philadelphia Chamber of Commerce. I come before you today in support of City Council Bill 090686 amending Chapter 11 19-500 of The Philadelphia Code, entitled "Taxes and Rents - General," by providing for a temporary tax amnesty program under which delinquent taxpayers may satisfy their past due tax obligations through the payment of the principal amount of taxes due plus 50 percent of accrued interest, with waiver of accrued penalties. The Greater Philadelphia Chamber of Commerce has been an advocate of a tax amnesty program for many years. Most recently, we testified before the Mayor's Task Force on Tax Policy and Economic Competitiveness Commission on 55 12/9/09 - FINANCE - BILL 090686, etc. May 21st, 2009. There we encouraged the Administration to enact a tax amnesty program, and we cited the success of ten other states and local jurisdictions. As a pro-business organization, the Greater Philadelphia Chamber of Commerce is keenly aware of the importance the fiscal health of the City plays in keeping taxes down and also attracting new businesses and creating jobs all across our city. Unfortunately, as we know, the City has hemorrhaged jobs and population and, with that, our competitiveness. Nearly half of the 300,000 City jobs lost since 1970 could in part be blamed on excessively high and outmoded tax structure and approaches. Philadelphians are now the most heavily taxed of all large city residents in the United States. 4 56 12/9/09 - FINANCE - BILL 090686, etc. residents since 1970 while the City continues to lose several hundred thousand individuals. The 15-member Tax Reform Commission of 2003, on which we had a seat, recommended a tax amnesty program in their final report to the Mayor on November 15th of '03. In quote, "In conjunction with all increased effort to improve volunteer taxpayer compliance, a tax amnesty program could be implemented. This would bring new taxpayers onto the tax rolls and give eligible taxpayers a last chance to 'come clean' before the implementation of aggressive new tax enforcement policy," close quote. There's absolute positive proof that these programs work. Although a one-time influx of money, they are successful, and the City of Philadelphia has not taken advantage of this tool, as you well know, since 1986. That program brought in four times the amount expected in collected revenue, or approximately 57 12/9/09 - FINANCE - BILL 090686, etc. $25 million. And according to the City's Revenue Department in October 2009, there were 135,685 delinquent real estate tax accounts that owed a total of approximately $33 million. In addition to property taxes, this bill includes delinquent wage, business privilege and School District taxes as well. I will not go into details of other examples from other jurisdictions at the state and local level. Individuals have previously testified to the effect.

Done appropriately with the right resources, this could be a significant one-time shot in the arm for the City's treasury. I'd like to draw your attention to the findings of Mayor Nutter's Task Force on Tax Policy and Economic Competitiveness. One of its recommendations, as we all know, was the institution of a tax amnesty plan. We believe that this approach at this point in time would be immensely helpful, and 58 12/9/09 - FINANCE - BILL 090686, etc. so we move forward to reforming our property tax system and looking at a more business-friendly tax code in the out years. Chairwoman Tasco, members of this Committee, I would be remiss if I did not take a moment here to mention the fine work of the Private Sector Outreach Board. The Private Sector Outreach Board includes eight senior executives of leading area businesses that meet monthly with the Managing Director and other members of the Mayor's Administration to look at potential impacts and improvements and efficiencies for our government. They also identify opportunities for City departments to partner with private-sector organizations on a pro bono basis. To date, over $28 million in savings have been identified to reduce costs and improve City services through the efforts of this Outreach Board. And those pro bono services have been provided across the government. In 59 12/9/09 - FINANCE - BILL 090686, etc. particular areas of emphasis, at least in the start-up phase, were the areas of human resource, customer service and information technology. Whether or not anticipated revenues are earmarked as a result of the potential passage of this ordinance, we believe that they should be looked at. The Mayor's Tax Competitiveness Commission looked at the notion of having part, if not -- a portion of the proceeds to fund and jump-start investments in IT that would create a more user-friendly, accurate and fair way to collect a myriad of taxes in the City. We'll leave that matter to this committee and this body to determine that, but the broader point here is that we do support the tax amnesty program. And so with that, Madam Chairman, I thank you for this opportunity. We would be happy to field any questions at this time.

Thank you. 60 12/9/09 - FINANCE - BILL 090686, etc. Any questions? Councilman Green.

Thank you very much for your testimony. I look forward to meeting with you and the Tax Committee of the Chamber of Commerce to go over some tax proposals that you and I have discussed. So it's nice to meet you. And I do note for the record that your testimony did not include anything City Council has done in the past year to help Philadelphia businesses or taxpayers.

And you've done quite a bit, and we applaud that.

Thank you.

Councilman Green, speaking as Chair of the Tax Committee for the Chamber, any time you would like to come over and meet with us, we'd be happy to have you there and call a special meeting for you to be there and speak with us.

Thank you. 61 12/9/09 - FINANCE - BILL 090686, etc.

I'd just like to say -- and I don't make this statement to be anti-Chamber or anything of that nature, but I've been around long enough to have some history, and I go back to the '70s, and you say the 300,000 jobs lost could be attributed to our high taxes. I've been around long enough to know that back in the '70s, because you are Greater Philadelphia, which includes the suburban areas, there was a massive campaign to support the King of Prussia, Fort Washington areas in development and, therefore, a lot of businesses left to go to those areas. So it wasn't -- and I don't think people thought at that time of the impact it would have on the City of Philadelphia, the development of the Great Valley and all of those areas in the suburban areas. Even the Coalition, which I was a staff member at the time, was encouraging the City, SEPTA to give $250,000 that they were receiving from the federal government, we were 62 12/9/09 - FINANCE - BILL 090686, etc. encouraging them to provide transportation to those areas for people who were going out there to work. So we have to look at not just the issue of the tax base in Philadelphia, but also the other things that were going on at that time to develop other parts of the region which created an opportunity for businesses to move into the suburban areas. So all of that comes into play.

If I might just comment on that. I would suggest that that was then and this is now, and I think that if we work collaboratively, the private sector with the governmental sector and the quasi-public sector, we can create the right environment for job creation in this city. We could create the right environment from which those companies, particularly knowledge-based industry companies that sprung up in the suburbs since the 1970s, would be advantaged to come back to the City and 63 12/9/09 - FINANCE - BILL 090686, etc. establish once again their corporate presence.

I agree. I'm not being confrontational.

I agree with you.

I've been here a long time, and we were involved in those social issues back then, along with Jonathan Stein and George Gould at CLS. So we have a long history in Philadelphia. Thank you so much.

Thank you.

Madam Chair?

Councilman Green.

Thank you, Madam Chair. I do want to, because Councilwoman Tasco mentioned this, I do want to note for the record that the City of Philadelphia's decline since the early '70s is most often attributed to our tax 64 12/9/09 - FINANCE - BILL 090686, etc. rate. We had high taxes way before then as the economy was growing here, et cetera. And so it's really the fallacy of the single factor. If our schools don't work, et cetera, we lose our young families. That's a major factor. In Councilman DiCicco's district, where we sit right now, is the perfect example of people willing to pay more taxes as long as they get the service, and that is, of course, the Center City district. COUNCILMAN DiCICCO: Would you mind bringing that message back to my constituents on my behalf.

The Center City district is a perfect example where people have actually voluntarily or said they wanted to pay more taxes if they get better services. So we have to match our tax levels to the services citizens get as part of this discussion as well. Thank you.

Thank you 65 12/9/09 - FINANCE - BILL 090686, etc. very much for your testimony. We now call Jonathan Stein and Phil Bertocci. (Witnesses approached witness table.)

Good afternoon.

Good afternoon, Chairwoman Tasco and members of City Council. We are Jonathan Stein, general counsel, and Philip Bertocci, Director of the Energy Utility Law Project at Community Legal Services, and we're appearing in general support of the tax amnesty bill before Council, but we're seeking one very important modification. We respectfully urge Council, via amendment, to include water/sewer arrearages as coming within the amnesty Bill No. 090686 for all the sound reasons behind the bill itself and for the additional ones that apply to water and sewer bills. These water and sewer bills, like tax bills, constitute liens 66 12/9/09 - FINANCE - BILL 090686, etc. on the home and are under the jurisdiction of the Revenue Department, so it's perfectly appropriate to have this as an amendment to this particular bill. At Community Legal Services, we frequently see many cases of vulnerable homeowners going without a necessity of life, water service, due to the large amount of water/sewer bill arrearages outstanding. With all due respect to Commissioner Richardson, we see many people who come in with very large water/sewer bills, $10,000 and more, of which 30 percent and 30 to 40 percent, again anecdotally, are the penalties that are preventing them or constituting an additional obstacle to them being able to deal with these problems and make sure that they're right with Water Revenue. Water and sewer bills have been increasing greatly over the years. In the recent 2008 water rate case where Community Legal Services served as the 67 12/9/09 - FINANCE - BILL 090686, etc. public advocate -- we were appointed by the Mayor and the President of City Council and the City Controller -- the Water Commissioner approved rate increases, which will make the typical residential water/sewer bill increase by 30 percent between October 31st, 2008 and July 1st, 2011. The basic bill would be going up from about $40 a month to about $60 a month over a relatively short period of time. The worst recession since the Depression and the increasing poverty in the City has only worsened the disturbing phenomenon of homeowners' inability to pay outstanding water and sewer balances, which often include the accumulated penalties. It's often the case, to make this particularly poignant, it's often the case that the homeowners with these very large arrearages have never received the water service nor created the outstanding arrearage. Like many 68 12/9/09 - FINANCE - BILL 090686, etc. low-income and lower-income Philadelphians, they live in houses which are heir property, property that came into their possession due to the fact that their parent died without a will, and they are now living in the property and they have inherited with that property the water/sewer liens that were attached to the property before the death of a parent, and yet to maintain the service in this very same property, they are faced with having to deal with the penalties and interests which are accrued since the death of their parents, and in many type cases, this is simply an insurmountable obstacle. Also, there aren't very many other remedies for people in this situation. The Water Department has something called the Water Revenue Assistance Program for low-income homeowners with income under 150 percent of poverty, and this program presents somewhat reduced water bills, a $200 69 12/9/09 - FINANCE - BILL 090686, etc. grant and puts arrearages in suspense. However, the WRAP program is really an inadequate remedy. First of all, it's only available to people under 150 percent of the poverty level, and yet we know from our experience that people are unable to pay their bills in full and on time up at least to 250 percent of poverty, given the way we measure poverty in this world. And in addition, the WRAP program enrolls, we believe -- the low-income WRAP program enrolls only about 5,000 customers out of over 400,000 residential customers.

This compares with PGW, whose bills admittedly are larger, having 80,000 customers in their low-income program serving exactly the same constituency. If water and sewer bills were to be included into the amnesty program now being proposed, hard-pressed homeowners, possibly including some without any water service now, would have 70 12/9/09 - FINANCE - BILL 090686, etc. an opportunity to secure this essential life service and make payments into the City's Water Revenue Bureau, monies that the City Water Department might otherwise never receive. We conclude also with a more general recommendation, which goes to the issue of the continuing escalating water rates. The Water Department has not been subjected to an independent management audit for two decades, and yet there is a City ordinance which requires that an audit be conducted every four years and that that audit include an investigation into the efficiency of the collection processes used by the Water Department, in which the Water Department really uses the Water Revenue Bureau as its collection agency. The Public Utility Commission, in contrast, requires utilities to have management audits every four years or five years. PGW, where the PUC acquired jurisdiction over PGW in 2000, has already had two such management 71 12/9/09 - FINANCE - BILL 090686, etc. audits. These management audits admittedly are expensive, but we think they are worth the money. And even as the public advocate, I say if the City General Fund is not willing to pay for it, it's one of the few things that I think that I would say that water customers would be willing to pay for a really first-rate management audit. At this point, I can only note that Resolution 080959, passed by City Council last year, actually authorized City Council to issue an RFP and do what was necessary in order to have a management audit of the Water Department, and I think it would also cover some issues involving the Water Revenue Bureau, but so far as I know at this time, that initiative has not yet advanced as we would like to see, and we're trying to call your attention once more to it. I think I've covered everything that I was going to cover. Jonathan 72 12/9/09 - FINANCE - BILL 090686, etc. Stein has something that he wants to add involving ways in which we think that some of these efforts can be supplemented using TANF money, and I'll pass it to Jonathan for that.

Good afternoon, Chairwoman Tasco and members of Council. This is not in the written testimony, but this is really an idea that addresses the fact that although this tax amnesty and we hope also water/sewer bill amnesty is a good idea, warrants support and passage, it's really not going to help a lot of very low-income people. Why? Because the payback period is so short, 60 days in which you have to pay the entire arrearage, plus half of interest. That amount of money is really going to be beyond the means of many people in the City, particularly low-income people. But there is a handle that would allow the City to draw down tens of millions, literally tens of millions of TANF -- this is welfare money. TANF is 73 12/9/09 - FINANCE - BILL 090686, etc. the abbreviation of it -- that would pay for the City's forgiveness program. The Congress of the United States appropriated $5 billion for TANF stimulus money for all states to use, including money that could be filtered down to municipalities like the City of Philadelphia. Only one of that 5 billion has been drawn down so far, and this over 4 billion will disappear in the next months unless states and cities act to draw it down. Now, why hasn't it been drawn down? Even though there's a very generous match of the feds matching 80 percent to percent of local state 18 money, most states cash strapped have not 19 put up the 20 percent to draw down really 20 four times that. Most cities are not even aware of this drawdown or not even thought about using various means to be the, quote, 20 percent match. We're proposing -- and we're just really today is the first time we're 74 12/9/09 - FINANCE - BILL 090686, etc. airing this publicly -- that the City in any forgiveness program it directs to low-income people -- and it doesn't have to be those at the very bottom, the poorest people on welfare who are at 7 percent of the poverty level. That's how 8 low the welfare grant is these days, 25 9 percent of the poverty level. The level 10 could be set to include those but others 11 up to 200 percent. It's really a 12 flexible eligibility level. But once 13 that level is set to a specific 14 forgiveness program in conjunction with 15 the Department of Public Welfare, which I 16 think would be very sympathetic to the 17 City in this regard, the City could say 18 any money they forgive, quote, in the 19 real estate program, tax program, in the 20 water/sewer bill program and other 21 liabilities to the City could be the, 22 quote, 20 percent match that a state or a 23 local government has to come up to draw 24 down four times that from the feds. And, 25 in fact, the City could be made whole 75 12/9/09 - FINANCE - BILL 090686, etc. entirely for all their arrearage, because the four-for-one match they're getting would take into account more forgiveness than that percent that they're 6 initially putting forward. 7 So we think this is a really 8 wonderful solution, a creative idea. 9 We're trying to get the attention not 10 only obviously of City Council today, and 11 you're the first ones to hear this 12 publicly, but also members of the City 13 Administration, who we've talked to a 14 little bit in the past, but we feel the 15 ball really needs to be carried to 16 fruition here since there's a time limit 17 on when this 5 billion will be around. 18 And I'm just adding this because we want 19 to share this with Council. And we think 20 this although is not literally an amendment to the amnesty bill before you, I think there's an opportunity to expand amnesty not just for a 60-day period, but to something that could be negotiated, a broader period to be targeted to 76 12/9/09 - FINANCE - BILL 090686, etc. lower-income people where virtually the full cost of the amnesty could be paid through this 80/20 match that's available. And that's really the addition I wanted to make to Mr. Bertocci's testimony this afternoon. Thank you.

You guys are going to have that conversation with Mr. Richardson?

Yes. We will have that conversation with Mr. Richardson following this meeting. Thank you.

Any other questions or comments? (No response.)

Thank you for your testimony. Is there anyone else here to testify on the amnesty bill? (No response.)

Okay. Now we will hear Bill Nos. 090849 and 090850. The Chair recognizes 77 12/9/09 - FINANCE - BILL 090686, etc. Ms. Deborah McColloch. Councilman Clarke.

Thank you, Madam Chair. Real brief. I know you've been here a long time already and we're only halfway through. I just want to take a moment, first of all, to thank the many advocates, some of whom are here today, for their continued support and their very hard work, both with Philadelphia and Harrisburg, for trying to move the ball forward on making sure that we continue to look at all tax strategies to get affordable housing dollars on the table. As you know, our current Trust Fund has diminished because of the downturn in the economy. In an earlier hearing with the increase in recording fees for the budget purposes, there was this conversation about coming up with a strategy to basically get the limitations that were imposed on us by the Harrisburg 78 12/9/09 - FINANCE - BILL 090686, etc. version lifted so we can do some things on the local level. And I want to thank State Representative John Taylor for moving the ball forward on his end on the state level, and I do believe we have reached an understanding between the Administration and Council as it relates to the minimum sponsors of the bill as it relates to how we will approach this particular issue. So, again, to all of the advocates and all of the hard work, I just want to thank you and commend you all for doing your great work.

Thank you, Councilman. Any other comments or questions? (No response.)

Thank you. You may proceed. MS. McCOLLOCH: Good afternoon, Councilwoman Tasco and members of the Finance Committee. I am Deborah 79 12/9/09 - FINANCE - BILL 090686, etc. McColloch, Director of Housing, and I am here on behalf of the Administration to present testimony on Council Bills 090849 and 090850. These two bills authorize an increase in the fees for recording deeds, mortgages and mortgage satisfaction documents to support the Housing Trust Fund. While the Administration supports Bill No. 090849, it does not support Bill 12 No. 090850. Bill No. 090849 increases the recording fees by $30 to directly support the Philadelphia Housing Trust Fund. Depending upon market conditions, this bill will increase dedicated funding to the Housing Trust Fund by $3 to $5 million annually. Established in 2005, the Housing Trust Fund has proven to be a valuable resource for affordable housing programs in the City of Philadelphia. Since its inception, it has generated nearly $53 million in funding to support the 80 12/9/09 - FINANCE - BILL 090686, etc. development of affordable rental and homeownership housing, housing preservation programs for low-income homeowners and homeless prevention programs. I serve as the Chair of the Housing Trust Fund Oversight Board and I see firsthand the benefits of the Housing Trust Fund. The Housing Trust Fund has provided over 500 units of affordable homeownership and revitalized neighborhoods with developments such as Pradera Homes and the Twin Homes at Powder Mill, which recently won the Philadelphia Business Journal's Judges Choice Award for best new real estate deal of 2009. It has provided over 1,200 units of affordable rental housing, offered Basic Systems Repair grants to over 1,000 low-income homeowners and made over 100 properties accessible through the Adaptive Modifications program. We cannot, of course, look at recording fees as an inexhaustible supply 81 12/9/09 - FINANCE - BILL 090686, etc. of revenue. At some point, increases in the fees for housing purposes will squeeze out the ability to make increases to the basic recording fees that may be needed to fund improvements to the underlying document recording system. At this time, however, we are happy to say that we support Councilman Clarke's efforts to provide this increased amount of funding for affordable housing and other related Housing Trust Fund initiatives. I also note that we plan to set aside a portion of the Housing Trust Fund earnings eligible to be used for administrative costs to help pay the Department of Records' costs associated with the administrative changes needed to deal with this change in the Department's fees. Bill No. 090850, by contrast to Bill 090849, would reduce the basic document recording fee by $15 and increase recording fees dedicated to the 82 12/9/09 - FINANCE - BILL 090686, etc. Housing Trust Fund by $15. Under that bill, there would be no net change in the City's revenue, but General Fund revenues would decrease in direct proportion to the increases in the Housing Trust Fund. The Administration opposes Bill No. 8 090850 because of the significant decrease to the General Fund in the range of $2 million per year. The Administration does not support any decrease to the General Fund, as all of our current budget projections and the City's Five-Year Plan have assumed this revenue. Thank you for providing this opportunity to testify on Bills 090849 and 090850. I'm happy to answer any questions that you may have.

Any questions about this bill? Wilson Goode, please. Councilman Goode.

Thank you, Madam Chair. 83 12/9/09 - FINANCE - BILL 090686, etc. Ms. McColloch, only because I can't resist to ask a few questions. So you don't support money going toward housing as a priority for the City? MS. McCOLLOCH: I'm sorry. I didn't understand.

You do not support more money going toward housing as a priority for the City? MS. McCOLLOCH: On the contrary. I do support more money going to housing as a priority of the City.

Well, we are also considering a separate piece of legislation that deals with a tax amnesty program, and the Administration's testimony was in support of that bill. That will bring in $25 to $30 million. Would you support a portion of that going toward housing? MS. McCOLLOCH: I'm sorry?

The money that would come into the General Fund from the tax amnesty program, would you 84 12/9/09 - FINANCE - BILL 090686, etc. support that going toward housing or any portion of it? MS. McCOLLOCH: It would be part of the general -- I would support whatever part of the budget got allocated to housing programs, of course.

That really wasn't the question. The question is, we're sitting in one hearing where we're considering two different matters. The first matter we were considering is a tax amnesty program that anticipates bringing in $25 to $30 million. As many people have testified, quite possibly a whole lot more. What portion of that new revenue would you consider going toward the Housing Trust Fund? MS. McCOLLOCH: However those funds have been budgeted through the Budget Office and the Director of Finance's budget would be -- some portion of it may or may not go to housing. I don't know. I haven't seen the budget for it. 85 12/9/09 - FINANCE - BILL 090686, etc.

I'm assuming those dollars -- the Revenue Commissioner can come to the table, if he'd like, but I'm assuming those dollars have not been allocated in any way. So I'm asking you, would you advocate for a portion of those proceeds from the tax amnesty program going toward the Housing Trust Fund? MS. McCOLLOCH: The bill that I'm here to testify on is supporting additional revenue to the Housing Trust Fund. So I support additional revenue to the Housing Trust Fund, but I'm not in a position --

My question is with regard to proceeds from the tax amnesty program, which are projected to be $25 to $30 million, which may very well be a hundred million dollars, do you advocate for a portion of those dollars going toward the Housing Trust Fund? MS. McCOLLOCH: I would advocate for a portion of those to go to the Housing Trust Fund. 86 12/9/09 - FINANCE - BILL 090686, etc.

Then you would understand that it would make no 4 difference to this committee if we're actually looking at one bill which is bringing $25 to $30 million into the General Fund and another bill which is shifting $2 million. It really wouldn't make a difference to this committee, as long as we support the Housing Trust Fund. We don't just see it as a $2 million decrease in the General Fund related to one piece of legislation. We also are here to support another piece of legislation that would bring $25 to $30 million more into the General Fund coffers. MS. McCOLLOCH: I --

Part of the reason I make that point is simply because there are two separate people testifying on behalf of the Administration, which is kind of interesting because your testimony in terms of your opposition to the bill, the 87 12/9/09 - FINANCE - BILL 090686, etc. Administration's opposition to the bill, is a loss in revenue, but we're here also to consider a bill that is going to bring more revenue into the City. You see my point? MS. McCOLLOCH: I do see your point, Councilman. I'm not the person that makes the decisions about the allocation of the additional resources that the tax amnesty bill would bring to the City. I'm a member of the Administration. I would advocate on behalf of the Housing Trust Fund.

I get it. I just couldn't resist. I'm sorry.

We just want to test your mettle today. MS. McCOLLOCH: Did I pass?

You did all right. You danced a little bit, girlfriend. In Bill 090850, just explain that, make it clear to me. The bill 25 would take the recording fee of $15? 88 12/9/09 - FINANCE - BILL 090686, etc. MS. McCOLLOCH: Bill 090850 would reduce the recording fee by $15 and take that $15 and put it into the Housing Trust Fund. So it reduces the funding going into the General Fund and increases a dedicated resource to the Housing Trust Fund.

Now, what does 849 -- MS. McCOLLOCH: And 849 increases the fees -- increases the recording fee by $30.

Right. MS. McCOLLOCH: And that total $30 increase is dedicated to the Housing Trust Fund.

And this other bill gives you another $2 million if you cut the recording fees? MS. McCOLLOCH: 849 increases -- essentially 849 increases the amount into the Housing Trust Fund by $15 a transaction, and Bill 850 increases the amount into the Trust Fund by $30 a 89 12/9/09 - FINANCE - BILL 090686, etc. transaction.

So you're going to get $45? MS. McCOLLOCH: No. So the two bills are mutually exclusive. One increases the amount into the Trust Fund by $15. The other one increases the amount into the Trust Fund by $30. But the two bills have two different -- are two different proposals.

So if Bill -- maybe I'm slow. 090849 will give you $30 directly to the Housing Trust Fund. MS. McCOLLOCH: 849 increases it by $30, yes.

By $30? MS. McCOLLOCH: Yes, by increasing the fees, overall increasing the fees.

Okay. Let's go back to 49. You're going to get an additional $15? MS. McCOLLOCH: By decreasing 90 12/9/09 - FINANCE - BILL 090686, etc. the fees, taking it out of the General Fund and putting it into the Trust Fund.

You're increasing the allocation. MS. McCOLLOCH: Decreasing the allocation to the Trust Fund. The fee remains the same. I beg your pardon. The fee remains the same. You're just changing the allocation.

Councilman, could you explain it to me, please.

It's basically a redistribution, as the term is used. Councilwoman, it's a redistribution of the existing increase in the Housing Trust -- I'm sorry; in the recording fees about -- when did we do that? Six months ago? About six months ago during the budget, the Administration raised the recording fees by $30 for the General Fund budget. During that hearing, we asked them if they had made an arrangement as in the earlier 91 12/9/09 - FINANCE - BILL 090686, etc. recording fee increase. A portion of that money was going to go to the Housing Trust Fund. They said that they were prohibited by state legislation that capped the amount that can go into the Trust Fund. So we asked Representative Taylor and the advocates asked to take that cap off of the state legislation to allow the City of Philadelphia to either redistribute that money, give half to the City of Philadelphia and half to the Trust Fund, or allow us to increase the fee in its entirety. So we put basically two bills in, one that would allow us to redistribute the current amount and the other one that would allow us to raise the fee by $30 to increase it on that way. So we basically put options on the table for the Administration to determine which one they were interested in. I hope that's a little clearer than Ms. McColloch's as I spoke. But right now, the commitment by the 92 12/9/09 - FINANCE - BILL 090686, etc. Administration to support the fee increase by an additional $30 will actually produce more money than the redistribution of the current recording fee increase. My concern is that there is an understanding by the General Assembly -- because the bill in Harrisburg was listed for a hearing, but for some reason was tabled. I heard different versions as to why it was tabled. My concern is that they understand that the Administration; i.e., the City, is now supportive of that increase of the legislation that was supported by the advocates and Representative Taylor. MS. McCOLLOCH: Yes. The Administration is in support of that.

A little bit beyond just simply having this hearing. So if a letter of support for that Harrisburg legislation could be forthcoming, it would be very helpful. MS. McCOLLOCH: Yes. We can do 93 12/9/09 - FINANCE - BILL 090686, etc. that.

Did I explain it? I hope I didn't confuse you any more.

I'm totally confused, but --

I mean, as, we all are, a person who is very interested in Trust Fund dollars, particularly given that the initial commitment by the Administration was reduced from the 3 million to zero, if we can get both bills passed, but sometimes half a loaf is better than none. So from my perspective, if the Administration is prepared to support the $30 requested increase and support it in a way that will allow the Harrisburg legislation to pass, that would be very helpful to me. MS. McCOLLOCH: The Administration is prepared to support both the $30 increase and send a letter of support to Representative Taylor to indicate the City's support for House 94 12/9/09 - FINANCE - BILL 090686, etc. Bill 1646, or whatever the number is, his bill.

And not only Taylor, but -- MS. McCOLLOCH: To whomever. Whoever we need to send it to.

There are a couple of key people that need to understand what the City's position is. MS. McCOLLOCH: We're prepared to send those letters stating the City's position, yes.

Thank you.

Councilman Greenlee.

Thank you, Madam Chair. I guess the question is more for Councilman Clarke, and he kind of partially answered it, because you used the word "option" before. We're giving the Administration an option. Now, are you still advocating both bills?

Actually, 95 12/9/09 - FINANCE - BILL 090686, etc. personally, my preference would have both bills in play, with an understanding -- because the uncertainty of how the Harrisburg process will end up, if Harrisburg decides they don't want to allow us to increase it by 30, but they would allow us to redistribute the existing amount, you know, I would like to have us in a position to have that option. But at the end of the day, we can't pass either bill -- well, we can pass both bills, but we can't implement either bill until Harrisburg authorizes it.

So it's possible if we pass both bills, even though 49 may be the preference of the Administration and maybe all of us, it's possible Harrisburg may not allow us to do that, which leaves 50 as the option that we could do?

It's possible, but the bill that Representative Taylor has will allow us 96 12/9/09 - FINANCE - BILL 090686, etc. to increase by $30.

But that may not happen, right?

Well, it was on a path to happen, but for some reason -- there was actually a date scheduled for the hearing, and for whatever reason, it abruptly stopped.

In Harrisburg things got confused? I can't believe it.

Yeah. I'm a little surprised.

Okay. Thank you.

Councilman Green.

Thank you. I actually have several questions for this witness, Councilman Clarke. If you would please swear the witness, Madam Chair, I want to make sure we get the truth from him.

Absolutely. 97 12/9/09 - FINANCE - BILL 090686, etc.

No. So you'd like us to pass bills out so they're both in play, so if it doesn't get passed or the Administration doesn't push the $30 bill to your satisfaction, Harrisburg, like use our lobbyists that we just issued an RFP for, we have an option. That's what you're saying?

That's correct. Correct. I mean, personally, I wouldn't push -- personally. Other members there, and there are actually other sponsors, one who is here, Councilwoman Blackwell, may opt to try and have both bills implemented. Personally, if we were in a position where we were able to get the $30 increase for the Trust Fund, I would be supportive of that particular bill and not have the other bill pass. But I think we should reserve the right to have an option, because it may be a situation where Harrisburg will only support the redistribution and not the $30 increase. 98 12/9/09 - FINANCE - BILL 090686, etc.

Okay. Any other questions? (No response.)

Thank you very much. Next will be Mr. White, Philadelphia Association of CDCs. (Witnesses approached witness table.)

Good afternoon, Madam Chair --

Good afternoon.

-- esteemed members of the Committee. Thank you for the opportunity to testify. I would ask that I come with two of our members as a panel. Any interest of expedience in time, given the hour is late and upon us. My name is James White and I'm the Policy Coordinator of the Philadelphia Association of CDCs. As an Association of 80 affordable housing developers and community development 99 12/9/09 - FINANCE - BILL 090686, etc. practitioners, PACDC is pleased to come before you today to address the issue of expanding the Philadelphia Housing Trust Fund. As you're aware, Bill No. 7 090849 is the local companion ordinance 8 to the state authorizing legislation HB 1645 currently pending in the House Appropriations Committee that would give the City the option of whether to raise its deed and mortgage recording fees to support the Philadelphia Housing Trust Fund. Bill No. 090849 would do just that by increasing these fees by $30 and dedicating this revenue to the Housing Trust Fund. 5 million per year for affordable homes. As Commissioner Decker testified in May 2009, the recording fee increase represents a very small portion of the total settlement and closing 100 12/9/09 - FINANCE - BILL 090686, etc. costs, and the financial impact is minimal on new home buyers. Yet an additional investment in the Philadelphia Housing Trust Fund will positively impact the housing market and help create thousands of new housing opportunities for families and individuals who are struggling to hang on to their homes or looking to invest in new homes in our city. The Housing Trust Fund is a flexible source of funding to enable CDCs and others to address a range of housing needs, such as building new homes, rehabilitating old ones and helping homeowners make repairs and keeping homeowners from facing foreclosure. In addition, these investments create jobs, strengthen the City's tax base, advance neighborhood revitalization and save the City millions annually in emergency services. There are numerous compelling stories of how the Housing Trust Fund 101 12/9/09 - FINANCE - BILL 090686, etc. resources have assisted families and individual. As a first-time home buyer who purchased their home rehabbed with the support of the Housing Trust Fund put it, Finally our dream has come true. I knew it was attainable. I saw the home I was going to get go from abandoned through construction to how it actually looked, and it was gorgeous. The feeling you get from being a homeowner or saying, I'm purchasing my own home or having the option of owning my own home is an unbelievable feeling, he said. Or consider the homeless veteran who moved into a transitional housing facility supported by the Trust Fund who stated, I want a place where I can put the key in the door and say this is mine, this is what I can take care of. Hopefully we can walk out of here and start brand new. People here have hope. There are thousands of other Philadelphians in neighborhoods that would benefit from the expansion of the 102 12/9/09 - FINANCE - BILL 090686, etc. resources of the Housing Trust Fund. However, the demand for the Housing Trust Fund resources far exceed the supply. In response to the City's most recent affordable housing RFP for the Trust Fund and other federal resources, 49 proposals were received requesting over 50 million for production and preservation of 1,800-plus affordable homes, but they were competing for a small amount of only $10 million that were available in funds. In addition, there is the long waiting list for home repair, and increasing numbers of families are in need of assistance from foreclosure and homelessness prevention. We urge the City Council and the Nutter Administration to support Bill 20 No. 090849 as well as the state authorizing legislation to restore funding to the Philadelphia Housing Trust Fund that was lost as a result of the recent budget cuts and drop-off in the real estate market. 103 12/9/09 - FINANCE - BILL 090686, etc.

We want to thank Councilman Clarke for his undying leadership and passion as well as the leadership of the Committee on behalf of Philadelphians in supporting affordable housing. Thank you for your time.

Thank you for your testimony. Next, sister.

Hello. My name is Christina English and I'm a volunteer for WCRP.

Proceed with your testimony.

I'm introducing my name again because this is part of my testimony. Hello. My name is Christine English and I am a single mother of a beautiful four-month-old son. I am a volunteer for WCRP. I am here today because I know too well the struggles that the people go through in Philadelphia to find housing. Me and my 104 12/9/09 - FINANCE - BILL 090686, etc. son are currently living in North Philly with my mother. Before I had a son, I worked at the Fashion Bug in Center City. It was a good place to work, but I didn't make enough money to live in any of these regular houses in Philadelphia. Every time I would look for a place to live, I wouldn't have enough money to give the security deposit and first month's rent. People were asking for over $1,500 up front. I couldn't afford that kind of money selling clothes. Since I quit my job to take care of my baby, things have gotten even worse. Now that I am looking for a job, nobody is hiring. And with the money I get from SSI, I can't afford high rent in the City. I have been on housing waiting lists for over seven months now, but now there's not enough affordable houses for all the women with children like me who need it. 105 12/9/09 - FINANCE - BILL 090686, etc. Throughout the City, there are thousands of families that are dealing with these same problems. WCRP did a Listening Project where we talked to hundreds of people in our neighborhood. More than seven out of every ten people did not believe there was affordable places in the neighborhood for their families to live. That's because this city needs over 60,000 more affordable homes than it has. We have to do something now. Increasing funding for the Philadelphia Housing Trust Fund will allow organizations like WCRP to build the affordable houses that this city really needs. It will get people like me off the waiting lists into homes we call our own. Thank you to Councilmembers Clarke, Sanchez and Blackwell for sponsoring a bill to make this happen. We urge all the members of this committee to vote for this bill. 106 12/9/09 - FINANCE - BILL 090686, etc. Thank you.

Thank you so much for taking time to come out to testify.

You're welcome.

I appreciate it. Sister Majeedah.

Good afternoon, Honorable Councilmembers and everyone here with us today. I want to first thank Council for allowing me to testify with my colleagues today. My name is Majeedah Rashid and I'm the Executive Vice-President of the Nicetown Community Development Corporation. The Nicetown CDC was founded in 1999 and has worked diligently to establish affordable housing development in Nicetown and the surrounding neighborhoods. For seven years, our Nicetown CDC/NAC program has delivered an array of OHCD-supported housing assistance programs to low- and 107 12/9/09 - FINANCE - BILL 090686, etc. moderate-income residents in a census tract area in Northwest Philadelphia. The Nicetown CDC has been an active member of the Philadelphia Association of CDCs since 2002. Nicetown, like a host of other neighborhoods in Philadelphia, is often overshadowed by grim statistics that illustrate the gravity of the current housing crisis. Like the rest of the City, our neighborhood has one out of five households that have to pay more than they can afford on housing. CDCs are challenged by the increased need for affordable housing for homeownership, and there is still a deficit of 60,000 units of affordable rental housing. The Nicetown CDC has a plan in place that aims to stabilize and preserve Nicetown's existing housing stock and increase the number of units for affordable homeownership and rental. We began implementing phases of that plan in 2006, targeting the redevelopment of 108 12/9/09 - FINANCE - BILL 090686, etc. existing housing along Nicetown's commercial corridor and the residential blocks that connect to it. Our housing efforts have been funded with both public and private funds, most notably the City's Homeownership Rehab Program and the Housing Trust Fund. Our first affordable housing development project was a challenge because it involved two historically significant properties. We had to do the usual gut-rehab while preserving the historic nature of the properties, which resulted in numerous delays. Time is money, and complying with the additional requirements of the Historical Commission proved extremely costly. Had it not been for resources such as the Housing Trust Fund, we would not have been able to complete the development of these homes, which now have brand new homeowners. The properties are shining examples of what can be done, and represent the strength of the 109 12/9/09 - FINANCE - BILL 090686, etc. neighborhood. The Nicetown CDC's affordable housing development plans have grown progressively over the years. Today, we are in the pre-development stage with our first green housing construction for homeownership, and Nicetown Court, a low-income housing tax credit project funded by the Pennsylvania Housing Finance Agency. When complete, Nicetown Court will yield 37 affordable rental units and will establish nearly 4,000 square feet of commercial space on the street level. 8 million in funds from the Philadelphia Housing Trust Fund and has already begun to leverage future affordable housing developments in the area. This substantiates and exceeds the statistic that states every $1 invested into Housing Trust Fund yields a return of over $11 in leveraged funds for affordable housing needs. This 11-to-one ratio is an impressive return on 110 12/9/09 - FINANCE - BILL 090686, etc. investment and makes the Housing Trust Fund one of the most effective tools in solving the City's dismal housing crisis. These are just a few instances which illustrate the productivity, effectiveness and potential of the Housing Trust Fund and how it has built the capacity of CDCs like the Nicetown CDC and others across the City. Its flexibility enables us to address a full range of housing needs, including building new energy-efficient homes with new construction or by rehabilitating and preserving old ones.

The Housing Trust Fund also allows us to help homeowners make repairs and improvements and assist homeowners faced with foreclosure. The City of Philadelphia recently released an RFP for affordable housing which received numerous responses that outnumbered available resources by a ratio of five to one. This depicts the critical need to increase the level of funds dedicated specifically to the Housing Trust Fund. 111 12/9/09 - FINANCE - BILL 090686, etc. In conclusion, the Nicetown CDC strongly encourages the City to expand funding to the Philadelphia Housing Trust Fund in response to the growing need for affordable housing. We also urge the City to support the legislation that has been introduced by the state as well as City Council to authorize the expansion of funds. Respectfully.

Thank you very much. Are there any questions or comments from the Committee? (No response.)

Thank you all for coming in. As usual, you're on target. We appreciate your taking the time to come testify.

One more thing, if I may, Madam Chair. We had a number of members who could not be here today because of other commitments, who submitted written testimony, and we do 112 12/9/09 - FINANCE - BILL 090686, etc. ask the Committee, in their due diligence as always in their work effort, to peruse and review their testimonies as well. Thank you for your time.

Thank you. Their testimony probably has been circulated and it will become part of the permanent record of this committee. Thank you.

Thank you.

Next is Jennifer Rodriguez.

She submitted written testimony.

Okay.

She had an RDA Board meeting.

Is there anyone else here to testify on this bill? (No response.)

Okay. There being none, we will now move into our public meeting. The Chair recognizes 113 12/9/09 - FINANCE - BILL 090686, etc. Councilwoman Blackwell to submit the amendments for Bill 090686.

Thank you, Madam Chair. I move that the amendment to Bill No. 090686 be adopted. (Duly seconded.)

It has been moved that the amendment to Bill 10 090686 be adopted. All in favor will say aye. (Aye.)

Is there any opposition? (No response.)

There being none, this motion is carried. Now I call on Councilwoman Blackwell to report Bill 090686 out of committee.

Thank you, Madam Chair. I move that Bill No. 23 090686, as amended, be reported out of committee with a favorable recommendation and also a recommendation that the rules 114 12/9/09 - FINANCE - BILL 090686, etc. of Council be suspended so as to permit consideration at our next session of Council. (Duly seconded.)

I'd like to talk on this bill for a second.

Sure.

I'd just like the record to reflect the hard work of my colleague, Maria Quinones-Sanchez, on this matter. Since the beginning of 2008, she has been talking with the Administration and trying to get them to put in place a tax amnesty program, and we were pleased to support -- I know she was pleased to support Councilwoman Krajewski once a bill was put forward on this issue. But this has been something that she's been pushing for several years. She couldn't be here. I wanted to have the record acknowledge that.

Okay. Thank you. The record will reflect your 115 12/9/09 - FINANCE - BILL 090686, etc. acknowledgment to Councilwoman Sanchez. Any other comments or discussion on this bill? (No response.)

We now call for a vote. Bill 090686 -- I call for a vote. I lost where I was. All in favor of Bill 090686 will say aye. (Aye.)

Is there any opposition? (No response.)

There being none, the motion is passed that Bill 090686 will be reported out of committee with a favorable recommendation and a request for the suspension of the rules so that this bill can be heard at Council's next session. All in favor will say aye. (Aye.)

Thank you. 116 12/9/09 - FINANCE - BILL 090686, etc. The Chair recognizes Councilwoman Blackwell to report Bill 4 090849 out of committee.

Thank you, Madam Chair. I move that Bill No. 7 090849 be reported out of committee with a favorable recommendation and also that the rules of Council be suspended so as to permit consideration at our next session. (Duly seconded.)

It has been moved and seconded that Bill 090849 be reported out of committee with a favorable recommendation and that the rules of Council be suspended so this bill can be heard at Council's next session. All in favor? (Aye.)

Any opposition? (No response.)

There 117 12/9/09 - FINANCE - BILL 090686, etc. being none, the motion is carried. The Chair recognizes Councilwoman Blackwell regarding Bill 5 090850.

Thank you, Madam Chair. I move that Bill No. 8 090850 be reported out of committee with a favorable recommendation and also a recommendation that the rules of Council be suspended so as to permit consideration at our next session of Council. (Duly seconded.)

It has been moved and seconded that Bill 090850 be reported out of committee with a favorable recommendation and that the rules of Council be suspended so this bill can be considered at Council's next session. All in favor? (Aye.)

Is there any opposition? 118 12/9/09 - FINANCE - BILL 090686, etc. (No response.)

There being none, the motion is carried. This will call for the adjournment of this committee. Thank you all very much. (Committee on Finance concluded at 3:10 p.m.) - - - 119 CERTIFICATE I HEREBY CERTIFY that the proceedings, evidence and objections are contained fully and accurately in the stenographic notes taken by me upon the foregoing matter on December 9, 2009, and that this is a true and correct transcript of same. ______________________________ MICHELE L. MURPHY RPR-Notary Public (The foregoing certification of this transcript does not apply to any reproduction of the same by any means, unless under the direct control and/or supervision of the certifying reporter.)