COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING COMMITTEE ON COMMERCE AND ECONOMIC DEVELOPMENT - - - - Room 400, City Hall Philadelphia, Pennsylvania Thursday, March 3, 2005 3:45 p.m. - - - - RESOLUTION 040827 - Resolution authorizing the Committee on Commerce and Economic Development to hold hearings to review The findings and recommendations of the Philadelphia 21st Century Economic Development Summit... PRESENT: COUNCILMAN W. WILSON GOODE, JR., Chair COUNCILMAN FRANK DICICCO COUNCILWOMAN MARIAN B. TASCO COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN JUAN RAMOS COUNCILMAN FRANK RIZZO COUNCILWOMAN DONNA REED MILLER COUNCILMAN DARRELL CLARKE - - - - 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 I N D E X RESOLUTION 040827 STEPHANIE NAIDOFF, Commerce........ MJENZI TRAYLOR, Commerce........... 62 3 03/03/05 - COMMERCE - RES. 040827
Good afternoon. This hearing called to order. This is the hearing of the Commerce Economic Development Committee on Resolution No. 040827. My name is W. Wilson Goode, Jr., Chair of the Committee. I note for the record Councilwoman Marian Tasco is here, Councilman Frank DiCicco. Other Committee Members will be joining us. A quorum is necessary to begin. The title of Resolution No. 040827, authorizing the Committee on Commerce and Economic Development to hold hearings to review the findings and recommendations of The Philadelphia 21st Century Economic Development Summit, to take public testimony related to the Street Administration's proposed Economic Development Blueprint and Investment Fund, and further authorizing the Committee to issue subpoenas to compel the attendance of witnesses and the production of documents and other evidence. Our only scheduled witness today is the Commerce Director, Ms. Stephanie Naidoff. We will ask her to please state her name for 4 03/03/05 - COMMERCE - RES. 040827 the record and to thank her being patient and then proceed with her testimony.
You're certainly welcome. I'm Stephanie Naidoff and I'm City Representative and Director of Commerce for the City of Philadelphia. Good afternoon, Mr. Chairman and Members of City Council. My name is Stephanie Naidoff, as I just said, and I'm the City's Representative and Director of Commerce. I'm here today to provide testimony responding to the invitation to testify at this public hearing. As I understand it, the purpose of the hearing is to review the Street Administration's proposed Economic Development Blueprint. I'm really pleased to have this opportunity to review with City Council and the public the recommendations arising out of the Blueprint process and how the Administration plans to use these recommendations to shape public policy and inform economic development efforts in this City. 5 03/03/05 - COMMERCE - RES. 040827 As previously indicated in testimony to City Council last fall, the Department of Commerce has undertaken a strategic planning process for the City's economic development, a process that we have indicated will result in a strategic plan to be known as the Economic Development Blueprint. The Blueprint will provide focus and context for our economic development efforts, allowing the Administration to allocate limited resources in an informed way that best serves the interests of the City and lays the foundation for continued growth. Bringing the Blueprint to fruition has proven to be a dynamic and dialectic process. Building on the input we received from our stakeholders, we began to craft a document that was responsive to these suggestions and informed by public policy and public comment. My staff and I met with and sought more information from a number of experts so that our document would be relevant and discuss the latest developments. Draft Blueprint documents were distributed within 6 03/03/05 - COMMERCE - RES. 040827 the Administration to create a dialog and examine current policies. Administration review provided the context to translate these ideas into public policy terms and prioritize them in a manner that we feel is responsive to the needs of the City and realistic in terms of our fiscal responsibility. The resulting objectives will serve to frame the economic development efforts of the Administration in the years to come. These objectives illustrate the path the Administration will take to achieve economic growth in Philadelphia. In his speech to the Greater Philadelphia Chamber of Commerce on February 23rd, the Mayor outlined some of the objectives that came out of the summit process and indicated the full Blueprint document would be available to the public within 30 days. As the Administration continues to define and flesh out these priorities and accept comments garnered from the on-line posting of the executive summary, I would like to update you on our progress and highlight 7 03/03/05 - COMMERCE - RES. 040827 some of the most important Blueprint initiatives that have developed since we last met to discuss this issue. First, the knowledge industry. The knowledge industry is Philadelphia leading economic sector, representing percent of 8 the City's economy. The knowledge industry is 9 to the 21 Century is what the industrial 10 revolution was to the 19th and 20th Centuries. 11 It represents a diversified economy that 12 encompasses education, healthcare, life 13 sciences, technology, telecommunications, 14 financial and profession services, and 15 occupations where creative service is key. 16 Philadelphia already has world class 17 universities, students, hospitals, research 18 facilities, and service industries. In short, 19 all the necessary ingredients for a strong and 20 expansive knowledge industry. The Blueprint 21 recognizes our strengths and sees the 22 knowledge industry as an asset to build on in 23 order to grow our economy. 24 To do this, the Administration will 25 work more closely with the knowledge industry 8 03/03/05 - COMMERCE - RES.
040827 partnership to attract students to our universities, engage them in the City while they study here, and retain them in our City's workforce after their graduation. We will commit $1 million over the next three years to KIP's programming efforts as a means of achieving this goal. Within the student population, we're committed to reaching out and retaining international students. We will do this by supporting strategies to attract international students and knowledge-based workers, enhancing the marketing efforts of KIP's International Student Attraction Campaign and by promoting the City's language and cultural diversity as assets to attract and retain knowledge workers. The Blueprint takes our established focus on students and expands it to include 20 to 34-year-olds. We will reach out to these 21 young professionals through targeted marketing 22 efforts that promote Philadelphia's quality of 23 life, promote job opportunities for young 24 professionals and the creation of a 25 comprehensive housing assistance program to 9 03/03/05 - COMMERCE - RES. 040827 act as a local clearing house and information delivery system for first-time home buyers in Philadelphia. In addition, the Administration recommits itself to workforce readiness and training programs that will prepare our residents to take advantage of growth in the knowledge industry. The City will actively pursue public resources to support training for incumbent workers so they can be prepared increase the productivity of their current employers as well as support the growth of the knowledge industry. For those individuals not in the labor force, the Street Administration will continue to strengthen career preparation and job access services so that all Philadelphians have the opportunity to contribute to the economy. Finally, the City will continue to work with the Philadelphia Workforce Investment Board to aggressively align public job training investments in support of key growth clusters, including identifying and pursuing new sources of capital to support our economic development 10 03/03/05 - COMMERCE - RES. 040827 objectives. The second is supporting civic and cultural development. We will focus our civic and cultural investments to enhance our world class amenities for the enjoyment of our residents and to attract the attention of conventions, trade shows, and tourist. To this end, we will provide support and cooperation for the expansion of the Pennsylvania Convention Center. We will work closely with the Pennsylvania Convention Center Authority as needed to move this project forward. Civic development also means ensuring the City has a voice in how and where development occurs. The introductions of gaming and expanded retail choices are poised to affect the quality of life experienced by residents and the perception of Philadelphia taken home by visitors. Philadelphia's Gaming Advisory Task Force will offer an opportunity for municipal influence on location decision that impact short and long-term City development plans. 11 03/03/05 - COMMERCE - RES. 040827 Philadelphia is a world class City with the third largest Center City population in the country, but our Center City retail mix is not as comprehensive as in comparable cities. In order to make Philadelphia more competitive in the region and to grow jobs, we propose the creation of a Retail Advisory Board to compliment our arts and cultural development with a vibrant retail mix. The Board will be an advocate Center City retail, developing a plan to attract high-end retailers and jobs supported by a growing residential population. Our Blueprint will build on yet another City strength, our vibrant arts and culture amenities. There are exciting new developments on the Benjamin Franklin Parkway, including the expansion of the Free Library of Philadelphia, the relocation of the Barnes Foundation, and the creation of the Calder Museum.
To maximize the benefit of these developments, we support the Central Philadelphia Development Corporation vision for the Benjamin Franklin Parkway that calls 12 03/03/05 - COMMERCE - RES. 040827 for creating a cultural campus in the center of the City that is inviting to residents, workers, and visitors all year round. We will focus our efforts to assist the building of new cultural attractions and make the Parkway more vibrant and pedestrian friendly. We will also renew our efforts on the Avenue of the Arts and explore the possibility of creating an entertainment district in the area of Broad and South Streets. Thirdly, the MBE/WBE business participation. Philadelphia's economic success is inextricably linked to the success to our minority and women-owned businesses. The Blueprint reflects the Administration's commitment to increased and equitable participation of minority and women-owned businesses in our economy. By Executive Order, the City will provide a strong compliance and enforcement arm for its vendors, initiate appropriate tracking tools to track the effectiveness of our efforts, and introduce streamlined certification processes to encourage minority and women-owned firms to 13 03/03/05 - COMMERCE - RES. 040827 conduct business with the City of Philadelphia. In order to increase the number of WBE and MBE firms in Philadelphia and improve access to capital, the Department of Commerce will spearhead an effort to create a funding pool that will provide financial assistance for the start-up and expansion of minority-owned businesses. This Banker's Task Force will work to craft a program that will provide, among other things, low interest loans for business priorities such as working capital and equipment purchase. In addition, the Bankers Task Force will determine appropriate underwriting criteria as well as administration and monitoring responsibilities. The Administration's goal is to increase the number of City contracts awarded to MBE/WBE firms by percent. While these 22 represent proactive steps the City will take 23 to engage under-represented businesses, our 24 goal is to increase opportunities beyond those 25 provided by City government. We will 14 03/03/05 - COMMERCE - RES. 040827 challenge the private sector to match our efforts and increase private sector opportunities for our minority and women-owned businesses to grow. Fourth, New River City. The Mayor has repeated stated his commitment to reconnecting residents with and introducing our visitors to our waterfronts. The Administration's public investment in planning, site assemblage, and infrastructure has yielded widespread private investments on our waterways, including at the navy yard, on the Lower Schuylkill River, and the North Delaware. The Administration is prepared to commit $125 million of available water and sewer bond reserve funds for appropriate New River City infrastructure improvements. These funds will leverage state and federal investments and create opportunities for private development on the waterfronts. In order to coordinate, oversee, and manage this investment, the Commerce Department will convene a New River City Task Force, bringing together the various entities 15 03/03/05 - COMMERCE - RES. 040827 that are managing waterfront development and providing a forum for communication and strategic implementation. Members will include representatives from PIDC, SRDC, Penns Landing Corporation, Planning Commission, Philadelphia Water Department, and the Philadelphia Environmental Council, among others. An executive summary of the Blueprint document focussing on our four priority objectives has been posted on our web site in an effort to engage the public in the continuing Blueprint process. We are accepting comments based on the posted execute summary as we continue to work diligently on the full Blueprint document.
In his speech to the Greater Philadelphia Chamber of Commerce, the Mayor set a 30-day deadline for the release of the full document, and we look forward to presenting with that complete document at that time. I ask for your continued cooperation as we complete this exciting and rewarding process. 16 03/03/05 - COMMERCE - RES. 040827 Thank you for the opportunity to speak on this important issue. I'll be happy to answer any questions you have.
Thank you, Ms. Naidoff. Let me first for the record say that Councilwoman Donna Reed Miller was here, had to leave, and will be back. Also members of the Committee present include Councilman Ramos, Councilman Rizzo, Councilman Clarke and Councilwoman Blondell Reynolds Brown. I have a series of questions, many of which I've shared with you. It's part of my focus to today, and I'm sure three are many Committee members with questions, so we will try to move as quickly as possible. The top of my list in terms of priorities, as you know, is access to capital and credit for minorities and women. Would you speak to both in your testimony within executive summary of the Blueprint as well as within the economic development portion of the City's Five-Year Plan? Let me ask the question if you know yet, how much money is going to be invested in 17 03/03/05 - COMMERCE - RES. 040827 the revolving loan fund to help minority and women-owned business?
No, we don't, Councilman. We're just beginning the process. As of February 23rd when the Mayor announced the creation of the task force and the notion that we will be examining all of our programs on access to capital, that was the start of the process and we haven't defined it better than that.
Wouldn't a loan guarantee fund be more effective rather than having a revolving loan fund?
That could be. And we would certainly be happy to talk about that with you and certainly with the bankers we gather in the task force.
That led to my next question, which is, has members of the Bankers Task Force been identified?
No. We have spoken to 18 03/03/05 - COMMERCE - RES. 040827 some and actually said we'll have volunteered their services, but we haven't begun to put it together.
Are you aware that a group of banks has already been organized by the Greater Philadelphia Urban Affairs Coalition.
How will you reconcile that? Will you work with that group, or will you reinvent the wheel?
Well, I don't think we're going to reinvent the wheel. I think that Bankers Task Force has been successful, has been some very good work. But we believe that the opportunity to bring the clout, the power, the resources of the City to this process is an important piece in moving it forward. We hope to gather information about what they have been doing, but frankly, we have had a number of the bankers, as I said, approach us about wanting to work with us, so I think we may be on the right track just from that indication. 19 03/03/05 - COMMERCE - RES. 040827
It seems a little bit strange to me. There was a Small Business Lending Task Force that was convened by GPUAC that has been in existence for a couple years. They made formal recommendations that were adopted by City Council through resolution 8 unanimously. In addition to that, those recommendations were part of recommendations that came out Economic Development Summit. Among members of that task force, there were included all the leading banks in Philadelphia, specifically, Wachovia is at the table, PNC is at the table, Citizens is at the table, in addition to No. 4, No. 5, No. 6 banks and they've reached out to other banks. Through their process, they claim that they can increase small business lending by $100 million a year, from $100 million a year to $200 million a year with a specific public investment outlined. And the largest vehicle they pointed to was actually a loan guarantee fund. So they essentially have said that, if the City is willing to work with us as we determine underwriting criteria so that we can 20 03/03/05 - COMMERCE - RES. 040827 serve people who right now we don't consider to be loan ready and bankable, depending upon how far the City wants to go in terms of reaching people who at this point don't have access to capital, we will actually seize public investment. They're starting off saying that they want to use their traditional products. They want to then maybe alter their products to reach a new market. Then based upon that underwriting criteria, look at a loan guarantee fund through public investment that will help them go further. I'm not sure they mentioned a revolving loan fund or essentially the public doing the small business lending but helping them to reach people who they are not reaching now. Where did the idea for a resolving loan fund come versus a loan guarantee fund?
I don't remember where it originated. We've had so many conversations about this, but I would say to you that we are not so wedded to it that we wouldn't be open to talking to those who have 21 03/03/05 - COMMERCE - RES. 040827 been involved and getting their best thinking on it and hopefully working together. I think collaboration is a very important piece of everything we do.
And to be perfectly honest with you, I received a phone call yesterday from people associated with that project. And in that conversation, what I said to them was if everyone's talking to the same people, eventually they will end up at the same table for the same purpose. We will get where we need to be.
Let me ask more generalized questions. The Mayor in his speech on February 23rd said that the Economic Blueprint will be done in 30 days. Is that a specific date or was that a period of time identified --
I took it as a specific date and I took as an obligation to have it ready by March 23rd.
So when will the Economic Development Blueprint be released? 22 03/03/05 - COMMERCE - RES. 040827
Well, I take it as my deadline to have it ready for release on March 23rd.
Thank you. In the end, who were or are the decisionmakers in determining priorities within the Blueprint?
The proposals that we've made went through very many stages of review, but ultimately after review by the cabinet and the Mayor's staff, it was the Mayor himself who chose those objectives.
To the best of your knowledge, what is the greater priority for the City, growing jobs or growing population?
To be honest there are some people who love some children better than others.
I don't have children, so I can say that. 23 03/03/05 - COMMERCE - RES. 040827 (Laughter.)
I would say that from the knowledge that I have after less than one year on the job, it seems to me that growing jobs is the priority. If you have the jobs and you have the opportunity to provide them to people, we will attract the population.
Are there or will there been specific goals for both? Are there going to be specific goals in the Blueprint for how many jobs you want create and how many residents you want to attract?
There are not specific numerical goals, but there are certainly goals in the sense that we do not believe that the scholarship, the studying that's been done on these subjects is sufficiently clear that we're willing to give one as opposed to the other. So we have, as you can see in the Executive Summary, indicated that we are going to be doing certain things to work on increasing the population at the same time, but I think the primary goal is increasing the jobs. 24 03/03/05 - COMMERCE - RES. 040827
But there won't be specific goals set for job creation or population growth?
I'll get back to that in a second. Do you believe the attendees of the Economic Development Summit will in the end agree with the priorities outlined in the Blueprint?
Well, we had 200 very thoughtful, very smart, very engaged individuals at that meeting, and I think there were probably 250 different opinions. I think that it is quite clear that when you involve that many good, thoughtful people in a process, you're never going to get 100 percent agreement. So I'm sure there will be some who do not agree.
Last question, which has a couple of follow-ups before I move 25 03/03/05 - COMMERCE - RES. 040827 to Members of the Committee. Does the Administration still plan to pursue $500 million investment fund?
Good answer. No 8 immediate plans for it. Do you still plan to pursue --
The last time you were asked that question in this Chambers, you said yes.
So does the Administration still intend to pursue $500 million investment fund?
I would say that at this point we're not thinking about that, we're not pursuing it. We're trying to work on the first 125 million and we're pursuing the opportunities that come with that.
Is that yes, no, you don't know? 03/03/05 - COMMERCE - RES. 040827
Could it be just 125 million? Could that end up being all that you pursue?
Could conceivably be all we pursue. There's three more years left. I don't know how much we will get done, but certainly if there is an opportunity to expand, we will do that.
The question is, if it's just 125 million, it's 125 million for New River City initiative, which means that there is no new public investment conceived for all of the priorities you've laid out.
Well, I think there are other avenues of investment, certainly in the Capital Budget and other areas. I think for the moment the original plan for the $500 million investment fund is on the back burner.
So this resolving loan fund for minority and women-owned businesses, you believe, will be 100 percent 27 03/03/05 - COMMERCE - RES. 040827 private sector funding?
But you have not identified any sources for public sector funded involvement.
So in fact, the revolving loan fund minority women-owned businesses is a wish list that may not be achieved in this Administration?
That's right. This a strategic plan. It's to set our policy objectives for future and it's to set the guidelines under which we will work for the next three years.
Thank you. Good afternoon. I have several questions. I had not read the report, but as I glanced through it, I see nothing related to neighborhoods; and I represent a neighborhood. And when you talk about the Greater 28 03/03/05 - COMMERCE - RES. 040827 Philadelphia Economic Development Blueprint for a greater Philadelphia, does that include neighborhoods?
It certainly does. You will see when you see the full Blueprint that another one of our priorities is neighborhood economic development. We just haven't gotten that into this executive summary part. What we did is we concentrated on the four priorities that contained new initiatives and that were primarily within the purview of the Department of Commerce. There are 10 objectives. The summary lists the other six, and the full Blueprint will talk about the other six; one of which, a very important one of which, is neighborhood economic development.
It is, but there are many other stakeholders within the Administration. There's the NTI Program, the Office of Housing and Community Development, the Police Department to the extent that the 29 03/03/05 - COMMERCE - RES. 040827 Safe Streets Program is involved --
I'm talking neighborhood economic development around on the commercial corridors. All those other issues are surrounding issues, but where is the plan to help stimulate economic growth in the community -- today, I met with a gentleman from Rising Sun Avenue. We've been working with him to try to help maintain that corridor and prevent flight from that business corridor by existing businesses. And if we lose businesses, what do we do to attract new businesses and how that's done. I think it's very important. Downtown is very important. I've always supported economic growth and development downtown, but when a large majority of our residents live in neighborhoods and they live near commercial corridors, we want them to look great also. And what I find frustrating is the ability to get people to focus in on those neighborhoods and how we support businesses, how we do zoning overlays to control the kind of businesses that go into a neighborhood and 30 03/03/05 - COMMERCE - RES. 040827 that we determine what the neighborhood will look like. And while Philadelphia downtown is a smaller environment, you have a much greater environment commercial corridors in the community. And certainly, I would like to see more focus on that, for me. I can only be supportive of anything that is going to enhance the economic growth of my commercial corridors which we are struggle with. And even when we struggle to try to get them to do something, you get very little support. There's no plan on the part of the City to provide any support or stimulus for them. I notice you have a Retailer Advisory Board. Will that Advisory Board extend their interest beyond Center City to the neighborhoods, and who will be on that Retail Advisory Board? Because it's important that those people who are making the decisions about the retail environment in the City understand and know what's happening in the community around that because a lot -- we do have some retail stores, we just don't have naileries, hairdressers and takeouts. We want 31 03/03/05 - COMMERCE - RES. 040827 more of a variety of businesses in these communities. And I'd like to see the task force focus in on what is going to happen in the communities. The other thing, I look here and you have all these task forces. You've got a Retail Advisory Board, you have a bankers Task Force, and you're going to River City Task Force. Well, who's going to coordinate these task forces? Because, see, what happens is we get all the little groups and nobody talks to each other. They plan and nobody is talking. And then are they talking to the people in the City who has to make this stuff happen? Are they talking to City Planning? Are they talking to Streets? Are they talking to the Zoning Board? This is a very nice idea, but when you get to the day-to-day implementation of all of this, it comes down the nit and grit of having to deal with how all this stuff gets done. So I think having discussion and come out with great ideas, but you know we deal with this every day -- I guess I'm ranting and 32 03/03/05 - COMMERCE - RES. 040827 raving because I'm a little frustrated because I had this meeting with this guy today and I can't figure out how I'm going to help him through the City of Philadelphia to work with Rising Sun Avenue, or for that matter Wadsworth or the upper half of Ogontz or other businesses when I can't cooperation I need to make it happen.
And it's not just my area, it's all areas. How do we make it happen? It just can't be for downtown. You've got to go to the table. And the people who are empowered to help us in the neighborhood who are assigned to help us have to be empowered to help us to find a way to spread some of the resources around that you talk about to the community. So that's what I'm going to be looking at when we talk about a Blueprint for Greater Philadelphia, because I want to know how to help the Lawncrest Group and the upper half of Ogontz and Vernon Road and Wadsworth Avenue and Washington Lane and 33 03/03/05 - COMMERCE - RES. 040827 Fifth Street that are in my district. What are the plans for those areas?
Your points are all well taken. Let me just say as a matter of summary that, of course, we haven't released the part of the Blueprint, the objective that relates to neighborhood economic development. At this point, we have, I'd say, two major points in it. One is that we want to make sure that over the next three years we sustain and maintain the incredible achievements of the first five years of the Street Administration in improving life, the quality of life in our neighborhoods, and we will be spending a fair amount of our time making sure that we do that so those achievements are not lost. And the second thing is a very specific reference to commercial corridors and putting our efforts in that.
Well, I hope you go back and take the message that I'd like some help by cooperation and not blocking of projects that I want done in my district. And I want the staff of those departments who have 34 03/03/05 - COMMERCE - RES. 040827 the authority to do it, to make it happen. I've asked for things to get done. They don't get done. And when I ask about the staffing, there's no problem with it, but nothing gets done.
Thank you, Mr. Chairman. Good afternoon. I concur with or I understand exactly what Councilwoman Tasco is speaking to. And I'll just digress for a minute. Way back in 1995 when I first ran for City Council, there was a lot of criticism the neighborhoods that the Rendell Administration was paying so much attention to Center City. And I defended the Rendell Administration because I tried to explain to people the importance of economic engine for the City is Center City and there's 300,000 jobs and the pressure some day would move further north, south, east and west. And for me in my 35 03/03/05 - COMMERCE - RES. 040827 district east of broad, I've seen the results of a lot of that activity south in South Philadelphia where I live and further up the river. But I haven't seen the reinvestment in the neighborhood corridor, shopping corridors, commercial corridors that I would like to have seen. Housing is there. There's demand for housing, but -- and I can go on like the Councilwoman said, I can give you Ninth Street, Market, I can talk about South Seventh Street which now an Asian commercial/residential community and would be very helpful if we could talk a little bit more about that, not that C Center City has been totally completed to where we want it to be, but it's pretty much far along. We've accomplished, I think, the things we wanted to do for City. So just to piggyback on her statement, I think that's something I'd like to see involved in this Economic Development Plan as bell. You mention in your statement something about developing an entertainment venue at Broad and South. Is that the plan 36 03/03/05 - COMMERCE - RES. 040827 that Kenny Gamble had presented? Is that a follow-up to that plan? Is that something all new and different?
We are working with Kenny Gamble and his group and studying the feasibility of an entertainment district. And as you probably saw in the press recently, we have assisted in the efforts to relocate the R&B Foundation to Philadelphia, and we hope that it will be a galvanizing force in moving this whole project forward.
Just for your information purposes, I wanted to be certain that it was the same piece as opposed to a new plan.
So that's still on track, which is a good thing. When you refer to North Delaware Avenue, what is North Delaware Avenue in your mind? See, for me, North Delaware Avenue is north of Spring Garden. 37 03/03/05 - COMMERCE - RES. 040827
The North Delaware for most of the purposes that we've discussed is north of the Betsy Ross Bridge. But there are some projects that are below that, but I would say that Spring Garden Street may come within some person's definition of central waterfront district. It's a moving line.
AND the reason I ask that is because in your statement you say that under the New River City item you mentioned that in order to coordinate, oversee and manage this investment you're bringing together various entities to manage the waterfront development and you do have Penns Landing Corporation, which by your definition is not North Delaware Avenue. And they really have no investment or any holdings, I believe, north of Spring Garden.
That's correct, but we were also looking at the central waterfront district as part of the River City Initiative.
That's good. So my next question is, will there be any community representation on that task 38 03/03/05 - COMMERCE - RES. 040827 force? I think you may recall that I had asked the Mayor to convene a meeting with a number of community groups that are representing the riverfront development area, Penns Landing, for the purpose of the Penns Landing development. We have invested $50,000 in a study that we engaged Wallace and Roberts and Todd to do. We are prepare, thanks to the gracious generation of Senator Fumo, another 50,000 to further that. So we obviously want to be a part of it early on. And in addition to myself who represents the District, if we can figure out a way we could get some community representation on that, I think it would be helpful. Because we don't want to do what we've been doing in the past, coming up with a plan that may not be acceptable or satisfactory to the needs of the community and then we have to get into all those debates on figuring out what we have to do to make the community happy anyway. So I think it's important that we bring somebody on board very early, and that could be among others. 39 03/03/05 - COMMERCE - RES. 040827
I must say, though, going back to what Councilwoman Tasco was talking about before, one of my motivations for presenting this idea to the Mayor was the notion that it seemed to me there was large opportunity coordination even within the Administration and among all of these organizations that are mentioned. There's a lot of one-on-one dialog, a lot of conversation. A lot of us attend a lot of meetings. But getting everyone around the same table, I think, would be very productive. And then beyond that, involving the communities that have a stake in the outcome is certainly an important step.
Because for, I guess, two years now even before this recent task force that I put together, the prior task force that was in place to deal with the Simon project development, I've been asking when that project went away. The Planning Commission keep telling me they have a plan. And I keep asking to see it and I have not seen a plan. So if you know of a plan and 40 03/03/05 - COMMERCE - RES. 040827 have access to it, I'd like to see the plan. Again, only for the purpose of involving the community earlier on, because they're going to be involved. There's no way of getting around them, and they should be involved. I'd like to have some input into that as well. The brain drain --
What distinguishes what you're proposing from what we already have in place from several years ago where we have the college festivals and all those other things?
Senator Fumo and I originally funded all that. And it's a good thing. I had gotten away from it. The City Rep's office, I think, was primarily in charge of putting that event together, and it's been successful. Just curious, is there any change to that in your mind?
Well, there's been 41 03/03/05 - COMMERCE - RES. 040827 tremendous progress, as you noted, over the three years that the knowledge industry partnership has been in existence. The Mayor started it three years ago, and it's been growing and I think growing well in that time. But our sense is that it's time for it to go to a whole new level. That's why we're talking about increased funding. We're talking about increasing the focus to the 11 to 34-year-olds because we think that's a very 12 important segment of our population that we 13 need to devote effort to and make sure that 14 we're reaching out and encouraging them to 15 stay in Philadelphia and be part of our growth 16 potential. And also making specific efforts 17 with respect to international students and 18 international knowledge workers. These are 19 all efforts that we hope to use as a way of 20 expanding the focus of the knowledge industry 21 partnership. I think it's time to go in that 22 direction. 23
And I agree. 24 One more question, Mr. Chairman. 25 Again, with the KIP industry, the 42 03/03/05 - COMMERCE - RES. 040827 housing assistance program, could you expound on that a little bit? I presented some thoughts a few years back, getting some sort of a tax credit to students. Or students who were, as an example, graduate students who were pursuing a career in education, if they would devote so many hours of community service or working in the school system that the value of the their work would somehow help offset the cost of the mortgage or the monthly payments, provided they live in a house for a certain number of years. Kind of like what the military does. You know, if you join the Air Force and you up for five years, we'll give you an education but you have to stay three or more years as a way of paying back for that education. Is there anything that you can tell us about -- and those ideas they said were good, but they were supposedly unconstitutional, under the Uniformity Act we couldn't do certain things. Could you expound on where you think you're going to be?
Well, I can't really 43 03/03/05 - COMMERCE - RES. 040827 expound on details, because, again, I want to remind you all this is a strategic plan. This is really just an effort to set forth what our goals are. We haven't really developed a plan, it's just that we thought it was a good idea to explore that. We think that part of encouraging the to 34-year-olds and 9 particularly encouraging the creative class, 10 as we talk about through this document, may be 11 to try to come up with something that makes it 12 possible for them to really put down roots 13 here and buy a house and stay in Philadelphia. 14
You mean 15 Drexel's done it. It's similar to the Drexel 16 plan, and I think we can do it on a much 17 larger scale from the City and I encourage 18 that. Again, if there's anything I can do to 19 be involved in that -- 20
The Chair 25 recognizes Councilwoman Reynolds Brown, then 44 03/03/05 - COMMERCE - RES. 040827 Councilman Rizzo, then Councilwoman Tasco.
I have one comment, and then I want to go on record with where my very narrow interest will be. I have on of your testimony document, it speaks to the Mayor's effort to determine appropriate arts and cultural funding models. So know that I will be paying close attention to the efforts of the Administration along the way and say to you publicly what I've said privately, that I'm interested and willing to be a part of discussions to be a part of discussions and task force or whatever that move us to that reality as you put in the next three years, capital region funding plan, knowing that I believe it was in 1996 the Philadelphia Inquirer had a very comprehensive way of looking at regional funding for the arts and then it reached a place of no return. There was no action taken on their recommendations. So to know that that is back on the table, 45 03/03/05 - COMMERCE - RES. 040827 because I think we need to look that way if we're serious about dedicated funding streams for the arts, know that my interest remains. My very narrow focus in this document and the actual strategic plan around Economic Development Blueprint for our City will rest in this one area. Looking to see how we as a City can do better and/or differently when it comes to eliminating the cost and barriers, impediments, hurdles, red tape, that emerging small businesses have to endure. So we're taking that up in my office. I'm doing the homework now. I know I have to talk to a number of city department heads who are at some juncture intimately involved with individuals who want to start small businesses. That's separate from the capital concerns that Councilman W. Wilson Goode has. So I will be looking to hear what and how we as a city can to better with regards to streamlining that whole process.
Well, I would urge you to talk to Vincent Dougherty in our department who is the head of the Mayor's Business Action 46 03/03/05 - COMMERCE - RES. 040827 Team. We do a lot of that. Obviously, can't do it all with the small group that we have, but we're very eager to work with you and find ways that we can make our work more efficient and more applicable to the kinds of things you're concerned about.
I appreciate that. To the extent that we can do better at that, then I believe all of us get less noise from budding entrepreneurs who want to create jobs but have to jump hoops for months and years to where they're licensed and legally able to open up a business and create jobs.
I had a call just yesterday from a person I've known for many years in the community who's been a very successful businessman, and he was up in North Philadelphia this week and got involved with a 47 03/03/05 - COMMERCE - RES. 040827 young man who wants to start a printing business and he wanted to support him and he wants to support him financially, but he wanted to know how to get through some of the City system. And I said that we would have our MBAT represent walk her through the process.
Director, this is a little bit off the subject. Bear with me for a moment because it will, I think, come back on subject. You drive through Center City, I'm sure, a lot or walk through it also. The conditions of the roadway in our City, Center City, are disgraceful. Just on the way over here walking myself, Juniper and Market, there's a prime intersection. It's got a pothole that is -- it will gobble someone up 48 03/03/05 - COMMERCE - RES. 040827 if they walk. But I drive up Market Street, I drive up Walnut, Chestnut occasionally. It's like you need an all-terrain vehicle. The roadways in our Center City so bad. Someone has to do something about it. And to see a pothole in the 1500 block of Market -- and no 8 disrespect to the District Councilpeople because they have a lot to do. But we really need to do something about the condition of the roadways in Center City. I mean, I have people from out of town that they just can't believe how the streets are. And you walk them and I know -- I mean, we can't even get a curb cut right where it rains and you four inches of water when you come down the curb. Doesn't somebody understand you've got to level and grade something so when it rains the water goes the other way? I mean, it is so embarrassing when I'm walking with visitors through this City and see the condition of the streets in Center City. I mean, we really need to do something, coordinate with the utilities better because when they dig the streets up they don't repair them properly. 49 03/03/05 - COMMERCE - RES. 040827 It's just not a good situation, and I think that you need or your department needs to coordinate with the Streets Department. I know there are state highways to look for funding to get them resurfaced, but they are in such bad shape.
Well, maybe we can get SEPTA since their busses probably ruined m many of the roadways. I'm not making light of this. I think anybody in this room will agree if you've driven -- occasionally I like to drink a cup of coffee while I drive. You don't do it in Center City because you'll be wearing it.
I'm just trying to use as an example. It's just a very, very embarrassing and bad situation, the condition of the streets in Center City.
Well, again, in my 50 03/03/05 - COMMERCE - RES. 040827 interest in being a good person for coordination and collaboration within government, if there's ever an opportunity for you to let me know about a situation that you think needs attention, I'll be happy to work with the Managing Director and the Streets Department.
I've asked the Center City District about this. I walk down the Avenue of the Arts. The blocks, the Belgian blocks, are missing at Broad and walnut. Well, I figure within a few days this would have to be fixed. Broad and Walnut, this could not go on like this. I've suggested to this Administration that not just in Center City but throughout the City that they create a position of a facilities inspector. If a Councilmember, all my colleagues and their staff can come with a legal pad full of stop signs down and potholes and street lights that are out, if we only had a person who was out looking seeing the same thing that we see, it would proactively take care of these things. 51 03/03/05 - COMMERCE - RES. 040827 I had to call Paul Levy and say, "Paul, the Belgian blocks are missing and people are tripping at the corner of Broad and Walnut. "Well, our people are supposed to report that kind of thing." Well, you would think that -- and I'd appreciate maybe talking about that to see if there is a way where that group of people that are in the Center City District that see dangerous conditions like a post was knocked down in front of the Union League, directional post, and it was in the gutter for two weeks before it got picked up. This just can't be in a major City when you have tripping hazards that are on one of the premiere intersections in our City. How can that be and first class? It can't be.
I agree. I'm certain that the Managing Director would be happy to talk to you about it, and I'll be happy to work with him if you'd like.
I thought you were directing the questions to Stephanie 52 03/03/05 - COMMERCE - RES. 040827 because you had the inside information that she will be the new Managing Director.
The new Managing Director is going to be Pedro Ramos, correct?
But I would think that the Commerce Department would be as interested in this as I am because how do you showcase Center City when it looks like a third world country in some areas on the streets, the roadways?
I think we have to put our best foot forward always, and I think we ought to be attentive to those kinds of things.
And I think there are people in this room who are probably agreeing with me because they've experienced what I've experienced. Thank you. Thanks for that opportunity, Mr. Chairman.
Councilwoman 53 03/03/05 - COMMERCE - RES. 040827 Tasco.
I guess, Stephanie, we're not angry with you, it's just that as Councilpeople we hear, you know, the issues that people raise with us are -- and we want to look at the big picture in terms of the growth for Philadelphia. But it's the basic little things that make the quality of life better for the visitors as well as the people who live in the City, residents of this City. I want to ask you a question about River City. This $125 million, I've heard it bantered around so often for water and sewer, for infrastructure. What are the boundaries of River City. What is River City? Where is it? What does $125 million buy?
The boundaries of River City are hard to define. What we've always said is River City 38 miles of riverfront along the Delaware and the Schuylkill. So it's the attention to the waterfronts of Philadelphia and that haven't fully developed despite all of the efforts of 54 03/03/05 - COMMERCE - RES. 040827 of many years standing. So we are now going to try to coordinate a lot of separate projects, the Navy Yard, the Schuylkill River projects that are being carried out by the Schuylkill River Development Corporation, the North Delaware planning efforts by the Planning Commission and the Planning Department, and try to bring all of that together so that we are approaching it all in a more coordinated fashion.
How did we get 125 million? Why isn't it 200 million or 40 million or 300 million?
I think that I can explain. Actually, I think the Finance Department will be able to give you more technical explanations. But as I understand it, it is the amount of money that sits in the reserve funds in our water and sewer bond transactions. And by having a surety bond 55 03/03/05 - COMMERCE - RES. 040827 which we can purchase for, I believe it was $4 million, we can then unlock the 125 million that sits in the reserve fund and use that money for water and sewer related purposes.
But where? Do you have projects identified where you're going to spend the money? Or do we just set $125 million and set it in a bank account and spend it as we need to? Are there definite plans for -- because it's only for water and suer infrastructures, I understand. And there ought to be some idea about where this money is going to be spent, how much, what you're going to strengthen, sure up, how much it costs. Is a defined plan for it? Does it cover two blocks, three blocks? If you get to two blocks or three blocks, who's going to purchase those blocks? If it's not enough money, you need six blocks you only get two blocks, who will do the other four blocks? There are a lot of questions around -- you know, 125 looks like a lot of money, but it's not enough money for what you want to do if you're talking about the entire 56 03/03/05 - COMMERCE - RES. 040827 riverfront. So that's what I'm interested in.
At this point, the Administration is working to identify specific projects. The first step in that is that we're working with the Law Department to determine what the eligibility criteria are under the various bond restrictions.
Yes. I will tell you that we have identified four separate categories of funds that we've asked them to look at for eligibility purposes. One is infrastructure to support the new residential communities on the North Delaware. The second is infrastructure improvements of the Navy Yard. The third is infrastructure to support the Waters Edge improvements and the extension of the Schuylkill Trail south to Grace Ferry. And infrastructure to support the water quality and sewer employment in NTI neighborhood projects.
Well, is there a budget attached to each of those projects? 57 03/03/05 - COMMERCE - RES. 040827
No. That's my point. That's what we're trying to do now, but we have to work first with the Law Department to find out whether those general categories of interest that we have at this point meet the criteria for the restrictions that exist in the bond deal. And then we've also suggested to them --
Well, it seems to me that you ought to have a plan before you float a bond about where you're going to spend the money and what the overall plan -- we've been dealing with this waterfront long before I came on Council. And certainly, there was some early activity about development and there were plans brought forth to the City for development and then the economy dropped and the plans weren't followed through. So now we land banked and we put up clubs and parking lots and all that. I don't see any definitive plan for the waterfront. It seems to me always been piecemeal. It's always been my contention the 58 03/03/05 - COMMERCE - RES. 040827 City should have an overall plan for it and let people come in and buy into it. But this lot here could be a circus. This could be a gym. This could be a hotel. This could be something else. It's just a hodgepodge of nothing. It doesn't look like anything. You have hotels, you have this, you have that. Where is the theme? Where is the theme for the waterfront? We have no theme for the waterfront. It's whoever has the money to develop it, you just give them the land and let them develop. So I'm really concerned about just plucking 125 million out because we could probably find some neighborhood stuff that we could spend this $125 million on street infrastructure or water infrastructure in neighborhoods. I want to see a plan for it. I want to know the overall plan for the waterfront, what is the theme and all of that. Because I think it's very important because we just don't seem to do things here in a coordinated way. It's just haphazard. Just my day, Stephanie. I'm sorry. 59 03/03/05 - COMMERCE - RES. 040827
That's okay. I obviously only have one year's experience with this, but I will tell you that when the Mayor announced his vision about New River City last year at the Chamber speech, it was with exactly that idea in mind. It was the idea that we needed to coordinate, we needed to integrate all of these separate projects that were going on. We have this enormous potential with the 38 miles of waterfront that we weren't capitalizing on. And the whole idea of New River City was to try to do it in a coordinated fashion. I think that these steps with the 125 million is really only one piece of it. Putting a task force together so we get everybody around the table talking to one another and we have the side guidelines and the same conversations going on with each of the projects that are going on is really the most important part of this.
Good afternoon, 60 03/03/05 - COMMERCE - RES. 040827 Madam Director. More or less on the same line of what my colleague Councilwoman Tasco has asked already on two occasions this afternoon. Before this hearing, we had a hearing in the Committee of Labor and Civil Service on the reality of unemployment in Philadelphia. I believe the last person to testify was my long-time friend, Mr. Curtis Jones of the PCDC. And he wrapped up his testimony by saying that -- I believe he indicated he was part of a visit to the Republic of China and that there was an international joint venture by China's manufacturing mall project and that over 100 manufacturers wish to make Philadelphia their corporate headquarters in America. Are you involved in this project?
Our department is. Mjenzi Traylor, our First Deputy, has been our leader on the international activities and has been working very hard, as a matter of fact, on something called Splendor of China which is very much connected to that. Perhaps he can address this. 61 03/03/05 - COMMERCE - RES. 040827
But I want to go right to the second part of my questioning. I want to, if you can if you have done it, how is it that you coordinate this with PCDC? You take a trip to China. You have a hundred manufacturers that want to set up shop in Philadelphia. They're going to create jobs. I don't know what kind of manufacturing jobs. But how are you coordinating that? How are you following up? Because anyone that comes into my office on a much, much smaller scale, comes up with an idea, I usually jump on it, get a letter out, make some calls, get moving, call a meeting, get a task force, do something to get it moved past the idea stage. If you have doing anything, can you describe what you have done?
Yes. This is the gentleman that he has done, and he has done it many times.
Tell me how close are you to bringing these 100 manufacturers? I came here to City Council with one mission, not the only mission, but my 62 03/03/05 - COMMERCE - RES. 040827 principal mission, job creation. And this definitely, as we were wrapping up the another hearing before this one, grabbed ahold of my attention.
It's Mjenzi Traylor. I'm First Deputy Director of Commerce Department. I think the first thing that we want to make certain that's clearly understood is that they will not be bringing manufacturing operations. These will be manufacturers who will be seeking to have primarily distribution operations here in the United States. So most of the jobs would be in terms of warehousing, maybe some packaging, maybe some final assembly work for those items that may justify being finally assembled here. But for the most part, these would be showrooms, warehouses, and they would be wholesaling operations. They're looking primarily at the old Defense Supply Center. 63 03/03/05 - COMMERCE - RES. 040827 And to answer your question of how soon we can anticipate 100 of them locating here, we don't really know that yet. We know that there are a handful that are ready to make the move now. It does not justify going to the Defense Supply Center until there are a greater number of them. So the developer that is working on this here in the United States is seeking to temporarily locate some of them in other places until that larger number has been identified to come here at the Defense Supply Center.
So there's a handful of the 100 that are ready starting. And what you describe as what they would do are things that will create jobs, without a doubt. How do you coordinate with PCDC? Did the ball get passed over to you? Do you pass it over back to them? Or are you working together with Mr. Jones' office to make this happen in a timely manner?
We are working directly with Mr. Jones' office. In fact, we specifically asked for the involvement of PCDC 64 03/03/05 - COMMERCE - RES. 040827 because we think that a lot of these businesses, as they locate here, will use the types of services that are already provided by PCDC.
That's what I see us needing to do more of. I always get very skeptical when I read reports and we have formed a Committee there, a task force there, not that they're not necessary. And all of a sudden, we're now trying to coordinate maybe what PCDC and Commerce is doing but now we're trying to coordinate four or five or six different new committees that we have formed. So I get skeptical about too many committees. But I know that to a certain extent they are very much needed. Is that coordination, are we going to get anything done the next few years that we definitely need to get some of these good ideas, put them into action by getting together with all the interested parties to get these moved. Because if not, these ideas, like many ideas, will land up in the trash can. We want them to land up in the history 65 03/03/05 - COMMERCE - RES. 040827 books as projects that have actually had an impact on the economy and the job creation for our people.
Well, I think we're doing -- in this case, we're doing a pretty good job of leveraging our strengths in the correct way to get them here.
Thank you again. I just want for the record -- earlier when I made my comments about Center City and the investments and the consideration was given to Center City, I don't want you to think that I don't appreciate the work that Mjenzi and Duane and Vince have done in my district and helping me with some of the commercial corridors. But when I hear about bonds about 125 and $500 million, I just would like to see some of that significant money get invested into those commercial corridors. We've done as best we can. With the exception 66 03/03/05 - COMMERCE - RES. 040827 of the Ninth Street infrastructure which had to be done, it was a hundred-something years old. We get a quarter of a million dollars here, 200,000 there, and it's helpful, we appreciate it; it's just not that infusion that we think we can use and would better move those commercial corridors up to speed. So, again, I don't want anyone to think I don't appreciate all the work that your department has done and PIDC and others. Thank you.
Questions or comments from Members of the Committee? (No response.)
Ms. Naidoff, thank you for your testimony. Thank you for the work you've done so far on the Blueprint. I believe in the last hearing you heard a lot about neighborhood commercial corridors from people who testified. I believe today you've heard a lot about neighborhood commercial corridors from Members of this Committee. I think you will continue to hear a lot about 67 03/03/05 - COMMERCE - RES. 040827 it. So far the Executive Summary of the Blueprint talks about coordinating existing resources. We don't believe that's enough. Part of what we believe will help neighborhood commercial corridors, aside from a lot of the great things that are done in terms of capital improvements and storefront rebates and all of those great things, is access to capital for those businesses there. New River City in and of itself is not an economic development Blueprint for the City, it's not a strategy for the City. There are lost opportunities every day by things that are absolutely within this Executive Summary, things that I expect to be within the Blueprint, but things I still don't believe are going to be realized under this Administration unless they get serious very quickly. I'm not sure whether that's going to affect the $125 million that you want for New River City or not, but I can say that this City is hungry for economic growth. This document begins to speak to it, but it does not lay out a plan yet and definitely does not 68 03/03/05 - COMMERCE - RES. 040827 go where people who have testified before this Committee and Members of this Committee have asked that it go. So we look forward to the release of that document on March 23rd. And this hearing is recessed to March 31st at 2:00 p.m.
Thank you very much. (Council recessed at 4:55 p.m.) - - - - 69 C E R T I F I C A T I O N I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia of Thursday, March 3, 2005, were reported fully and accurately by me, and that this is a correct transcript of the same. RE: COMMITTEE ON COMMERCE AND ECONOMIC DEVELOPMENT _________________________ Lisa C. Bradley, RPR