Committee Hearing, February 21, 2008

COUNCIL OF THE CITY OF PHILADELPHIA COMMITTEE ON PUBLIC HEALTH AND HUMAN SERVICES - - - Room 400, City Hall Philadelphia, Pennsylvania Thursday, February 21, 2008 2:20 p.m. - - - PRESENT: COUNCILWOMAN MARIAN B. TASCO, CHAIR COUNCILMAN WILLIAM GREENLEE COUNCILMAN JAMES F. KENNEY COUNCILWOMAN MARIA QUINONES-SANCHEZ COUNCILMAN W. WILSON GOODE, JR. COUNCILWOMAN DONNA REED MILLER COUNCILMAN CURTIS JONES, JR. COUNCILMAN DARRELL CLARKE COUNCILWOMAN JANNIE BLACKWELL RESOLUTION 080139 - Resolution authorizing the Council Committee on Public Health and Human Services to hold hearings to investigate the City funding and operational changes of Philadelphia Safe and Sound and its impact on the delivery of social services in Philadelphia. - - - 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

Good afternoon. I see we are here this afternoon for a very spirited discussion. We welcome you all here this afternoon to the Committee on Public Health and Human Services to discuss Resolution No. 8 080139. We ask the Clerk to please read the resolution.

Resolution 12 authorizing the Council Committee on Public Health and Human Services to hold hearings to investigate the City funding and operational changes of Philadelphia Safe and Sound and its impact on the delivery of social services in Philadelphia.

Thank you very much. This hearing is based on a resolution. Some of our Councilmembers were here this morning for a hearing that lasted from 10:00 until about 15 minutes ago and will return, but let me recognize 3 2/21/08 - PUBLIC HEALTH - RES. 080139 that we have Councilwoman Maria Quinones-Sanchez, Councilman James Kenney, and Councilman Greenlee is here in his seat. As other Councilmembers come, we will recognize them, but also know that the Councilmembers can hear this testimony in their offices, over television and also over the intercom box. We thank you all for coming out this afternoon. We know this is a very serious matter for all of you, and we want you to know that we believe the children are Philadelphia's most impressionable and vulnerable population. Children are a segment of our society to which I have always stressed the importance of providing the best services for their growth and development. In this regard, we must take into careful consideration all decisions that impact their livelihood. To know that one child at any given moment is being neglected, taken for granted or 4 2/21/08 - PUBLIC HEALTH - RES. 080139 simply not challenged is not just troubling to me or the members of this Council, but it is detrimental to this entire City. It is especially disheartening to know that in the wake of unforeseeable economic times, we are left to question whether services, especially geared towards the health, safety and well-being of the City's children and youth, were allocated and managed in the best interest of children. Today, in this context, the Committee on Public Health and Human Services is holding this hearing to investigate City funding and operational changes of Philadelphia Safe and Sound and its impact on the delivery of social services in Philadelphia. Further, we will examine how funding was allocated, reduced or eliminated to various social service providers in the areas of truancy, after-school and parenting programs by Philadelphia Safe and Sound. As the City's principal 5 2/21/08 - PUBLIC HEALTH - RES. 080139 oversight body, it is City Council's duty to investigate the total scope and nature of this issue and to take any action necessary to ensure that City funds which are being used to provide services to our children are being used in a sound operational and fiscally responsible manner. From this perspective, we take our oversight role seriously, and we will always endeavor to make sure that the best interests of our children are protected and efforts to provide for our children are delivered in the most efficient way possible. That is just a brief statement. We're here today to look at the operational aspect of Safe and Sound. We're not here to point fingers or to embarrass anyone. It's really to have a fact-finding discussion about the program as it exists and hopefully, if it is continued, how is the best way to make the services better for all that receive 6 2/21/08 - PUBLIC HEALTH - RES. 080139 services from that program. So to that end, I open the floor for comments from any members of the Council. Let me recognize Councilman Goode, who has joined us this afternoon. The first witness today -- and we're going to take them in panels, and we hope that you all will make your testimony brief. We know all of you run great programs, none like it in the world. We don't want you to tell us that all day. We want you to tell us that in a couple of minutes, how great you are and the services you do provide to the citizens and to the children of the City of Philadelphia, but we hope you will be brief in your testimony. We will call on the agencies first so that we can get a sense from them of what's going on, what will hopefully happen in the future, and then we'll have the providers come forth and make their presentations. 7 2/21/08 - PUBLIC HEALTH - RES.

080139 The Chair calls on Arthur Evans, Acting Commissioner of the Department of Human Services; Richard Gold of the Office of Children, Youth and Families of the Department of Public Welfare. And we see that Donnie Schwarz is here, who is our new Health Commissioner, but you have a more extensive title. )

Thank you very much. Good afternoon.

Good afternoon.

Would you state your name for the record, please, and proceed with your testimony.

I'm Dr. Arthur C. , Acting Commissioner for the Department of Human Services and Director of the Department of Behavioral Health and Mental Retardation Services, and I am here to present testimony pursuant to 8 2/21/08 - PUBLIC HEALTH - RES. 080139 Resolution 080139, which authorizes this Committee to hold hearings to investigate the City funding and operational changes of Philadelphia Safe and Sound and its impact on the delivery of social services in Philadelphia. On February 1, 2008, Philadelphia Safe and Sound sent letters to providers notifying them of funding reductions effective March 1, 2008. The Administration appreciates this opportunity to provide you with our understanding of the background of this action taken by Safe and Sound. In early 2006, the City Department of Human Services submitted the City's FY08 Needs-Based Budget to the Commonwealth of Pennsylvania's Department of Public Welfare. This proposal included an increase in funding for prevention programming for children and youth by almost $264 million over the FY2007 Needs-Based Budget. In its February 14, 2007 9 2/21/08 - PUBLIC HEALTH - RES. 080139 response to this proposal, the Department of Public Welfare stated, and I quote, "The adjustment is denied based on the request not being supported by data provided nor evidence-based documentation. The Department will only participate in expenditures or activities which are necessary and justifiable for program operation," unquote. This was followed on April 30, 2007 by a revised letter regarding Philadelphia's state allocation for the Needs-Based Budget, which included no 15 dollars for the Violence Prevention Initiative. Then in June 2007, the PICA Board refused to accept the increase in the overall DHS budget that included at this time about $70 million of new spending on prevention services. In response to this, Mayor Street reduced the amount budgeted for prevention services. As Council is aware, throughout 10 2/21/08 - PUBLIC HEALTH - RES. 080139 the spring of last year, the Street Administration and City Council discussed the appropriate amount of support for Philadelphia Safe and Sound, ultimately leading Council to approve the FY2008 DHS budget with $54 million for Philadelphia Safe and Sound programs on June 22, 2007, in keeping with DPW and PICA's direction. This represented a ten percent increase from the FY07 budget, a 59 percent increase over the FY06 budget and a 125 percent increase over the FY05 budget. In July 2007, Mayor Street directed DHS to increase Philadelphia Safe and Sound's budget to $75 million, $21 million more than the amount the City and State approved in its budgets and $21 million more than the City's approved Five-Year Plan. An award letter was sent to Philadelphia Safe and Sound at that time and was followed by an executed City contract on August 6, 2007. On July 3rd, I was directed by Mayor Street to write to DPW Secretary 11 2/21/08 - PUBLIC HEALTH - RES. 080139 Richman to notify her that the City had appealed DPW's rejection of the funding of violence prevention programs. On August 21, 2008 (sic), Secretary Richman responded, and I quote, "DPW does not have and will not approve the use of state funds for reimbursement of these services. Therefore, if the City is proceeding with these expanded or new services, please be aware that there are no allocated state funds for reimbursement of these services," unquote. On August 27, 2007, the FY2008 Target Budget was submitted. 9 million in General Fund dollars for Philadelphia Safe and Sound. During this period, at the direction of the Administration, Safe and Sound sent award letters totalling $18 million for after-school programs and an additional $18 million for Beacon programs and issued a request for proposals from providers for additional after-school 12 2/21/08 - PUBLIC HEALTH - RES. 080139 programming, with an implementation date of September 2007. 8 million for five more Beacon programs.

At the same time, on October 4th, the Administration requested a $34 million transfer ordinance for the Department of Human Services, including an additional $21 million for Safe and Sound. This ordinance was never introduced. On November 29, 2007, the Administration resubmitted the transfer ordinances, including the $21 million for Philadelphia Safe and Sound, and again, the transfer ordinances were not introduced in Council. With it clear that no action was to be taken by Council on transfer ordinances, the City Budget Office did not allow further expenditures for Safe and Sound without a source of funds. As a result, on December 18, 2007, Mayor 13 2/21/08 - PUBLIC HEALTH - RES. 080139 Street directed DHS to send suspension notices to 200 foster care, emergency shelter and other youth services providers indicating that their contracts for FY08 would end on April 30, 2008, two months before the end of the fiscal year, in order to eliminate the $34 million deficit in the DHS budget. On January 7, 2008, the Nutter Administration took office and began to address the need to restore the funding in these programs. At the same time, Philadelphia Safe and Sound indicated that it had already made commitments for $9 million of the additional $21 million that the Administration had sought. Many of the programs above the budgeted $54 million had been newly established. Safe and Sound was directed by DHS to produce a plan to reduce its expenditures for the fiscal year to the budgeted $54 million level. At the same time, the 14 2/21/08 - PUBLIC HEALTH - RES. 080139 Commonwealth notified the Nutter Administration of its intent to audit the finances and programs of Safe and Sound in order to provide clean and reliable information on Safe and Sound's operation during the past two years. This review is scheduled to be completed within the next six weeks. On February 1, 2008, letters were prepared and mailed by Safe and Sound. Members of the Nutter Administration met with City Council, the press and providers to let them know about the intended reductions in excess capacity in order to bring the budget for Safe and Sound back in line with the Council-approved budget. Within days, it became apparent to us that we could not be assured that based on the data that we had from Safe and Sound that children's access to after-school programs would be preserved. Additionally, several members of City Council helped us to understand some of 15 2/21/08 - PUBLIC HEALTH - RES. 080139 the after-school programs, as they served unique populations like language minority children or children from neighborhoods where it wasn't safe to travel even a few blocks from a different program. We also believe that the programmatic cuts made by Safe and Sound did not include what we felt were adequate savings in the administrative expenses. As we could not be assured that children's interests were being adequately protected in the process, we have directed Safe and Sound to stop all cuts to after-school programs, preserving after-school both in general and in Beacon schools. We have also asked that the AVRP program, curfew centers and the FAST programs be preserved. We have discussed this approach with Safe and Sound and believe that with their own economizing this can be done within a budget of $58 million. The excess of $4 million would be made up through eliminating plan spending on new 16 2/21/08 - PUBLIC HEALTH - RES. 080139 prevention activities within DHS per the original budget passed by Council in June of 2007. Continued funding for other Safe and Sound programs will come from savings within Philadelphia Safe and Sound's budget, particularly their administrative costs.

If the Administration is satisfied with Safe and Sound -- if the Administration is satisfied that Safe and Sound has made the reductions and additional funds remain necessary to operate after-school programs and other targeted programs, the Administration will work with Council to locate additional funding to ensure the continuation of these programs. I thank you for this opportunity to testify, and this concludes my testimony, and I'd be pleased to answer any questions that you might have.

Thank you very much. 17 2/21/08 - PUBLIC HEALTH - RES. 080139 Is there anyone else going to testify or they're here for support? Mr. Gold, are you going to testify?

Yes. Good afternoon, Councilwoman Tasco and members of City Council's Committee on Public Health and Human Services. My name is Richard Gold. I'm the Deputy Secretary for the Pennsylvania Department of Public Welfare's Office of Children, Youth and Families. This office is responsible for licensing and supervising all county children and youth agencies, including the Philadelphia Department of Human Services, and allocating and monitoring the state funds for prevention services through the state statutory annual Needs-Based Budget process. I'm here to present testimony on Resolution No. 21 080139, which authorizes this Committee to hold hearings to investigate the City funding and operational changes of Philadelphia Safe and Sound and its impact on the delivery of social services 18 2/21/08 - PUBLIC HEALTH - RES. 080139 in Philadelphia. I am here on behalf of Pennsylvania Department of Public Welfare Secretary Estelle Richman, who could not attend this hearing due to a scheduling conflict and meetings in western Pennsylvania that could not be rescheduled. In conjunction with the Nutter Administration, the Department of Public Welfare agreed to conduct a program evaluation of Philadelphia Safe and Sound. Yesterday, February 20th, I held the initial meeting at Philadelphia Safe and Sound to introduce the Department's contractor, Public Financial Management, which will perform this intensive, comprehensive and expedited program evaluation of the non-profit corporation. The scope of the program evaluation includes, but is not limited to, the following broad categories of review: First, a review of the programmatic and fiscal management of Philadelphia Safe and Sound for the last 19 2/21/08 - PUBLIC HEALTH - RES. 080139 two fiscal years, as well as the current fiscal year. The program evaluation will assess the effectiveness of the current array of programs and services being provided by Safe and Sound. It will document all program and administrative expenditures. Furthermore, the evaluation will establish the actual and expected utilization of the social services and programs and the capacity of each service and program. Second, the comprehensive program evaluation will review Philadelphia Safe and Sound's program procurement process and its management of all of its subcontracts. This will include reviewing all written agreements between Safe and Sound and its subcontracted-provided agencies to ensure that the written agreements clearly establish the delivery of the requested services in the most efficient and effective financial manner. The program review will study Philadelphia Safe and 20 2/21/08 - PUBLIC HEALTH - RES. 080139 Sound's standards and practices for selecting and reimbursing such subcontractors and assure that such practices are in compliance, if not in the letter of the City of Philadelphia's contract reform policies, but in the spirit. DPW will also determine Safe and Sound's capacity to monitor the programmatic and fiscal compliance by its subcontractors. This will include a review of the existence and usage of Safe and Sound's internal financial controls. Last, the program evaluation will establish Philadelphia Safe and Sound's overhead and administrative allocations to determine the reasonableness of such costs in light of today's industry standards. Third, the evaluation will review Philadelphia Safe and Sound's planning and program management procedures and methodologies to determine program and service priorities. This 21 2/21/08 - PUBLIC HEALTH - RES. 080139 will include the review of demographic information about children and youth receiving services through Safe and Sound and compare such information with the Philadelphia Department of Human Services' child abuse, child neglect and juvenile justice indicators and prevalence.

This will ensure that the programs selected by Safe and Sound are in sync with the highest areas of child abuse, child neglect and juvenile crime and that the funds are being used to effectuate the greatest impact for the safety, permanence and well-being of children, youth and families in Philadelphia. In addition, DPW will review the planning, management and decision-making process of Philadelphia Safe and Sound's management and staff and the involvement of its Board of Directors in the agency's policy development, oversight of subcontractors, and fundraising efforts and success. 22 2/21/08 - PUBLIC HEALTH - RES. 080139 Last, the program evaluation shall examine Philadelphia Safe and Sound's program performance evaluation capacity, targeting the agency's performance and the effectiveness of its programs. Thank you very much for the opportunity to testify. This concludes my testimony, and I'm available for any questions.

Thank you very much. Is there anyone else to testify? (No response.)

Dr. Evans, in your testimony on at the top, "During the period, at the direction of the Street Administration, Safe and Sound sent award letters totalling $18 million for after-school programs and an additional $18 million for Beacon programs." Would this be for new Beacon 23 2/21/08 - PUBLIC HEALTH - RES. 080139 programs?

I believe that was for five new ones.

It was for five new Beacon programs?

That's correct.

Again, at the bottom, the last paragraph, you talk about DHS, "as a result, on December 18, 2007, Mayor Street directed DHS to send suspension notices to 200 foster care, emergency shelter." Now, these are contracts that the Department of Human Services have with the provider?

That's correct.

So these are not programs that are run by Safe and Sound?

That's correct.

So he was asking you to send suspension notices to programs that are funded by DHS?

That's correct. 24 2/21/08 - PUBLIC HEALTH - RES. 080139

Out of your budget?

That's correct.

The budget had been approved for these services for 2008, right?

That's correct.

And so did you do that?

I'm sorry?

Did you send the notices?

We did send the notices.

Did you have any discussion with him about whether these notices should be sent?

Well, the strategy that the Administration took at the end, in my testimony I talk about the Administration making attempts to acquire the additional dollars for not only the prevention programs that were within Safe and Sound, but there were other things 25 2/21/08 - PUBLIC HEALTH - RES. 080139 that the Administration was trying to pursue through the $34 million transfer ordinance. When that did not happen, it left the Department with a large deficit, $34 million, because this spending had already begun to happen within Philadelphia Safe and Sound. The Administration was then faced with two choices since it did not have the appropriation at that point, and what the Administration -- one solution was to cut programs. The other was to do what the Administration did, which was to essentially suspend the last two months of those contracts, which would bring the agency's budget back into line. No one believed at that point that those programs would not be funded through the end of the year. It was a matter of how they would be funded. And the current Administration came in and relatively quickly began addressing that issue, and the way that the current Administration approached that was to 2/21/08 - PUBLIC HEALTH - RES. 080139 look at where the increase spending was, which was in Philadelphia Safe and Sound's budget. We directed them to reduce their budget, and as a result, that has brought us here today in terms of the decisions that were made about how those reductions should happen.

You weren't there a long period of time, so could you -- maybe you know this answer, maybe you don't. How much of the DHS budget for services for foster care, emergency shelter and other services were diverted to Safe and Sound?

Well, no dollars were actually diverted. Again, the suspension letters essentially were an accounting strategy. The theory is this: If you have $100 million that you're going to spend over a year and -- well, let's make it easy for easy math. Say $12 million, and you're spending a million dollars a month. Essentially what happened was, the Administration 27 2/21/08 - PUBLIC HEALTH - RES. 080139 said, Okay, we don't have $12 million, because two million of that is in prevention. So what we're going to do is to change the contracts so that those providers who have the million 7 contracts would now only have $10 million 8 contracts, which would bring the budget 9 back into line. But no dollars were ever 10 moved from child protection services to 11 prevention services. It was only an 12 accounting strategy.

Let me recognize Councilwoman Donna Reed Miller who has joined us, and the Chair recognizes Councilwoman Maria Sanchez.

Let me understand the sequence of events. What you're saying is when we made a strategic decision to suspend contracts, how were those providers going to cover those two months?

The providers were going -- it was known at the time that the City did not have the money for the 28 2/21/08 - PUBLIC HEALTH - RES. 080139 additional expenditures in prevention and the only way -- there were only two ways that you could pay for those expenditures, either get more money or make cuts elsewhere. The Administration tried to get more money through the transfer ordinance and then appealed that to the State. When that didn't work, essentially what the Administration did was to cut the current contracts, understanding that the next Administration would have to deal with the issue of the last two months of those contracts.

That action then leads us to being legally in non-compliance with providing services to some kids that we're legally responsible for; did it not?

Well, the Department never got to that point because --

My question is, we did that, understanding 29 2/21/08 - PUBLIC HEALTH - RES. 080139 that we would be in non-compliance legally. That's what I want to know.

That's true. That is very true.

Thank you.

What is the contractual process between DHS -- you have to forgive me. I'm really trying to deal with this flu, so I'm a little kind of groggy today. I don't feel good -- with Safe and Sound?

I'm sorry?

What is the contractual process between DHS and Safe and Sound?

In what?

Well, I guess I'm asking the question. They were told they were going to get $21 million. They proceeded to spend the money, but did you have a signed contract with them?

We did have a conformed contract with them. A letter 30 2/21/08 - PUBLIC HEALTH - RES. 080139 was first sent increasing their budget to $75 million and then their contract was amended to $75 million, approximately.

Mr. Gold, now, you're here from the Department of Public Welfare and you're responsible for licensing and supervising all county children and youth agencies, including Department of Human Services and blah, blah, blah. Let me ask you a question now that you're going to do this -- is this going to be an audit?

It is not, Councilwoman. It's more extensive than an audit. It's an entire program evaluation. So it will include both the monetary review as well as the programs.

Would you have done this without this issue being raised about the contract, no contract, the funding and the lack of funding or the request from Mayor Nutter? What is your oversight role here?

Our oversight role 31 2/21/08 - PUBLIC HEALTH - RES. 080139 is twofold. Number one, we oversee the Department of Human Services, and, second, approximately 90 percent of all prevention service funding comes from the state. So in a contract of $50 million, about 90 percent of that is state funds that go to the Department of Human Services and then to a provider. So we have a great interest in making sure that our money is being spent in an appropriate and effective manner.

Have you done an evaluation of this program in the past?

No. 17

So now we're going to do a comprehensive evaluation and you're going to evaluate all the programs that's being funded by Safe and Sound?

Yes.

How long do you think that's going to take?

Initially we expect 32 2/21/08 - PUBLIC HEALTH - RES. 080139 to have our initial findings by March 19th. So we're expecting our contractor, Public Financial Management, to be in Safe and Sound by tomorrow with a list of information that they've already prepared and start reviewing the information as soon as possible, recognizing the urgent nature of the problem.

Given the number of programs that are funded by Safe and Sound, how do you plan to interview or evaluate all of those programs by March 19th?

That's the reason --

What is the process?

That's the reason, Councilwoman, that we've employed a contractor to do it. They have the staff that's necessary, and the State is going to pay for the evaluation.

Who will determine the criteria for evaluation?

DPW in cooperation 33 2/21/08 - PUBLIC HEALTH - RES. 080139 with the City.

I again ask you at what point in this program's operation would you have done an extensive evaluation to see if DPW's money was being well spent?

Whenever money is being taken from placement services for children already in the custody and control of the City of Philadelphia to be spent on prevention services, that raised great concern for the Department.

Point of information.

Especially since right now the Department of Human Services is on its second provisional license.

But Safe and Sound has been in operation since when?

I think it's '97.

1997? And this is ten years later, and you haven't 34 2/21/08 - PUBLIC HEALTH - RES. 080139 done any evaluation of the program?

No. 4

Council recognizes Councilman Goode.

Thank you, Madam Chair. Mr. Gold, the City made an additional request for social service funding; is that correct?

Yes.

And was it known to the State that that money was for Safe and Sound, part or most of it?

Yes.

And so the State made a decision not to fund City Council at that level -- fund --

Safe and Sound?

Safe and Sound at that level?

Yes, Councilman. We made that decision in both Fiscal Year '06, '07 and for next year.

And the 35 2/21/08 - PUBLIC HEALTH - RES. 080139 State was aware of the City's actions in terms of moving forward with the contract for Safe and Sound?

Yes.

So the State was fully aware that the City was intending to spend an additional $21 million, allowed the City to go into contract with Safe and Sound and then consider it to be a crisis later on?

No, Councilman, we did not approve that. If anything, we said that they should not and that they can't use state funds to fund that.

My question was, were you aware of the process as it was taking place?

Through letters from the Commissioner, yes.

And so it was not actually a crisis that caused you to do an analysis, because, in essence, it wasn't a crisis. You watched all this unfold, and while it may be the City made 36 2/21/08 - PUBLIC HEALTH - RES. 080139 a decision that you did not agree with, as you said, you have a responsibility as a monitoring entity to be involved in the total process. So it appears to probably some members of the Committee as well as the public that what happened is that the State may be justifying its decision not to give the City more money for social service funding by actually deciding to do this first-time analysis.

That's not the reason we're doing the first-time analysis.

So at any point at which you were tracking this process, knowing the City wanted to spend this extra money, knowing the City was going to contract with Safe and Sound for this extra money, you did not intervene at that point and decide that it needed to be reviewed at that point, did you?

We did not.

That's kind of curious to us. 37 2/21/08 - PUBLIC HEALTH - RES. 080139 Dr. Evans, this is a no-bid contract?

That's correct.

And so through the new procedures, it had to be posted?

I'm sorry?

The request for proposal had to be posted?

Request for proposal for -- I'm sorry. For what?

For the no-bid contract.

No. Well, the City has been contracting with Safe and Sound for several years, actually before I even came to Philadelphia. What happened last year was that that contract, as with many social services contracts, was continued, and as I testified earlier, the last Administration increased that contract by an additional $21 million.

So this no-bid contract was not posted? 38 2/21/08 - PUBLIC HEALTH - RES. 080139

That's correct, and I don't think that at the time it was required to be posted.

So there was no competition or no other providers considered?

That's correct.

At what point did Safe and Sound, if ever, decide they needed more than $54 million?

Safe and Sound didn't make that decision. The Administration decided that it wanted to do more in terms of after-school programs, youth violence programs, and the Administration pursued -- attempted to pursue additional funding that would have gone to Safe and Sound for those activities.

So it was the Administration's decision to change the contract?

That's correct.

Thank you. 39 2/21/08 - PUBLIC HEALTH - RES. 080139

Thank you very much. Councilwoman Sanchez.

Just to clarify what the Councilman was asking, at no point when we issued a letter to our providers that we were going to stop their funding to ten years, which triggered a non-compliance, according to Dr. Evans, at no point was the State involved in that at that point? Because we were in non-compliance.

We only learned of the letters after the fact, Councilwoman.

And that didn't trigger an investigation?

It triggered extensive discussions with the Department of Human Services beginning in November, late November.

Did the State at any point correspond with the City and say, You're in non-compliance legal? I mean, we were already on 40 2/21/08 - PUBLIC HEALTH - RES. 080139 provisional licensing as it was, so we were already kind of on people's radars.

We have approximately weekly meetings between my office and Human Services, so that it was a topic of conversation between the two governmental bodies almost on a weekly basis.

And what was the position in those conversations?

That the unilateral decision to take money from existing contracts for placement services to start new programs elsewhere was unacceptable.

And that at any point did the State correspond with the City formally and advise them that we were in non-compliance?

No. 21

Can you answer why not?

Again, due to the frequency of these discussions, it's a work in progress. 41 2/21/08 - PUBLIC HEALTH - RES. 080139

DHS's budget is $870 million, of which the State funds --

670.

$670 million, of which you fund 90 percent?

Ninety percent of in-home services. It's a different formula for each type of service.

How much of DHS's budget is state budget, pass-through money? How much of DHS's budget is state money?

Approximately $400 million.

So you have oversight of $400 million in the department that's on a provisional license. They trigger a legal non-compliance and you resolve it through conversations, and at no point --

The legal non-compliance would really be between Philadelphia DHS and Safe and Sound, not 42 2/21/08 - PUBLIC HEALTH - RES. 080139 Philadelphia and the Department of Human Services.

But we were taking funds from --

Our position was, regardless of the letters, funding had to continue in May and June for those services.

But you never put that in writing?

No. 13

Thank you.

At the end of the day, when your evaluation is completed, what are you looking for in terms of outcome?

We have asked the Public Financial Management to give us their recommendations as to the strengths and weaknesses of the agency to make sure that our funds are being spent accordingly. We expect that report to be public information and shared, obviously, 43 2/21/08 - PUBLIC HEALTH - RES. 080139 with the City, as well as the general public.

At the end of the day, when the evaluation of the various programs is completed and programs may be recommended to be suspended, how does an agency appeal that decision?

Our communication would be with the City. We have no 12 contractual relationship with Safe and Sound.

So the evaluation is done and what happens to the evaluation?

We share that with the City and we work with the City to hopefully implement the recommendations of the evaluation.

The program is ten years old and you've never done an evaluation. What do you plan to do in the future?

Councilwoman Tasco, 44 2/21/08 - PUBLIC HEALTH - RES. 080139 Safe and Sound is not a licensed agency that we go -- for foster care agencies and other types of placement agencies, the Office of Children and Youth on an annual basis reviews and inspects that agency according to our regulations. With the programs monitored and operated under Safe and Sound, it's not licensed by the Office of Children, Youth and Families. So our ability to either give a full license or provisional license doesn't exist. Our relationship is with the City's Department of Human Services as to how our funds are being expended and whether or not our funds are properly being spent for the safety, well-being and permanence of the children of Philadelphia.

So why do you do an evaluation and not the Department of Human Services?

That decision was made between the State and the City that we would contract and pay for that 45 2/21/08 - PUBLIC HEALTH - RES. 080139 evaluation.

It seems to me that a more independent audit would be better.

We have a great deal of confidence in the integrity of the Public Financial Management.

I'm not questioning Public Financial Management. I know them. It's just that the jurisdiction of who is doing the evaluation or who is asking for the evaluation seems to be -- might have been better by DHS to do that. Any other questions? Councilwoman Miller.

Hi. Thank you, Madam Chair. Good afternoon.

Good afternoon.

Good afternoon.

My question concerns the status of the contracts and award letters of those 46 2/21/08 - PUBLIC HEALTH - RES. 080139 agencies that were originally cut and services restored, and I know that some of the first information that we heard said that those agencies did not have -- like some of the after-school programs did not have an award letter, did not have a contract. Do they have those now or will they be getting them? What's going to happen with that?

They should get them. I know that the Director of Safe and Sound, the CEO, is going to testify later on, and she would know precisely what the status of that is right now.

Because that seemed to be somewhat of a high level of concern and I just didn't want the lack of a contract, the lack of an award letter to spur the not funding of those services again.

The Administration has made a very strong commitment and made it very clear that it is important to maintain the funding for those 47 2/21/08 - PUBLIC HEALTH - RES. 080139 services. So to the degree that providers don't have that in concrete terms, a letter or contract, we will make sure that they do.

All right. Good. And I, too, just had a question about why the State was going to be the evaluator of an agency. I think Safe and Sound is a non-profit, correct?

Correct.

That's contracted with the City. So I would actually think, too, that the City would be the evaluator and not the State, but however. If you're paying for it, since they say we don't have any money, that's great, as long as it gets done. Okay. Thank you.

Thank you.

Thank you, Madam Chair.

I'm going to say this with caution, and my information may not be correct, but the 48 2/21/08 - PUBLIC HEALTH - RES. 080139 Executive Director of Safe and Sound is a former employee of the Department of Welfare?

Yes.

What was her title?

Anne Shenberger was the Regional Director for the Southeast Regional Office of Children, Youth and Families.

That's your office, right?

Correct.

Thank you very much.

Councilwoman Tasco, I wanted to just make real clear along Councilwoman Sanchez's comments about non-compliance, at no time did the Department not fund mandated services. At no time was there ever intent not to fund those services. And the suspension letter that was drafted was drafted by the City's Law Department. So while it 49 2/21/08 - PUBLIC HEALTH - RES. 080139 may appear from the letter that there was a potential for that to happen, I can tell you that that just could not have happened. A lot of the services were things like residential services where children were in residence, and so there was no realistic threat that those services wouldn't have been funded, certainly not on my watch.

Thank you very much. And my last comment was not to cast any dispersion on Ms. Shenberger. She's a fine lady. It's just that we have to let people know that there's a lot of connections here with this whole situation and probably the lack of oversight goes back to those relationships.

No insult taken.

Thank you. (Applause.)

The next panel will be Ms. Anne Shenberger and 50 2/21/08 - PUBLIC HEALTH - RES. 080139 Ernest Jones. (Witnesses approached witness table.)

Good afternoon.

Good afternoon, Madam Chairwoman. Please forgive my voice. I am fighting a cold.

Join the pack. I've been sick all week.

And I should be home in bed.

This hearing was very important, so I struggled out today to be here, and I thank all of you who have been suffering from whatever is going around in the City to come out today to participate in the hearing. I'm not my feisty self because I'm sick. So now, Mr. Jones, would you like to -- are you going to testify first?

I am going to 51 2/21/08 - PUBLIC HEALTH - RES. 080139 testify first, followed by Anne Shenberger.

Okay. Thank you.

And let me begin by again saying good afternoon to you, Madam Chairwoman and the other members of City Council who are here today. My name is Ernest Jones and I am the Chairman of the Board of Philadelphia Safe and Sound, which is a volunteer position and it's a position I've held since the year 2000. Seated to my left is Anne Shenberger, President and CEO of Safe and Sound, and Anne was hired in January of 2006. Thank you for the opportunity to appear before you today. A cutback in program funding that has been very troubling for all concerned was the immediate situation that triggered this hearing, but we also know that there are ongoing questions and even misconceptions about Philadelphia Safe and Sound that we are eager to 52 2/21/08 - PUBLIC HEALTH - RES. 080139 answer. Our organization is not perfect. We are open to fair criticism and suggestions for improvements. We know that we must be accountable to our many stakeholders, state and local taxpayers, elected officials, service providers and the children and families who depend on us. We also believe that we have built a strong record of quality performance that deserves to be better known. So we appreciate the opportunity to provide information today to let the sun shine in and ultimately to turn our collective attention to what matters most: The well-being of Philadelphia's children and youth. Because I have been with Safe and Sound almost from the start, I would like to begin with some history about our organization. I believe that is helpful to know where we've come from so we can assess our performance and determine the directions in which we should go. 53 2/21/08 - PUBLIC HEALTH - RES. 080139 Safe and Sound was launched in 1997 with a multi-year Urban Health Initiative grant from the prestigious Robert Wood Johnson Foundation. Philadelphia competed for this grant by responding to Robert Wood Johnson's invitation to cities across the country to explore the possibilities of developing an initiative to create programs and take actions to foster the health, safety and well-being of the City's children. Mayor Rendell's Administration, led by Health Commissioner Estelle Richman, now Secretary of the Department of Public Welfare, and Human Services Commissioner Joan Reeves convened a diverse group of community leaders to develop ideas and plans for the new initiative. The result was a winning proposal, selected as one of only five in the nation, to establish Philadelphia Safe and Sound. The initiative was not established as a separate organization. 54 2/21/08 - PUBLIC HEALTH - RES. 080139 Rather, it was set up under the oversight of Philadelphia City government, and the City was the actual grant recipient. The original intent of Philadelphia Safe and Sound, therefore, was and remains to operate as a partner to local government, applying its independent capabilities and expertise to improve systems and services aimed at strengthening the health and welfare of our City's children. In 2000, Safe and Sound obtained its separate 501(c)(3) non-profit certification from the Internal Revenue Service. At that time, the Board of Directors was formed, and we were fortunate to have a knowledgeable, committed and representative group from both business and the non-profit arena willing and able to set the policies and guide the organization's direction and growth. Nearly half of our current Board members were recruited since Ms. Shenberger became CEO. And if you will indulge me, I'd 55 2/21/08 - PUBLIC HEALTH - RES. 080139 like to read the names of our Board members. They include the Honorable Lillian Harrison Ransom, who is a judge of the Court of Common Pleas; Patricia DeCarlo, who is Executive Director of Norris Square; Michael Karp, who is President of University City Housing; David Allen, who is an Assistant Professor at St.

Joseph's University; John Chin, who is Executive Director of the Philadelphia Chinatown Development Corporation; Walter Clayton, who is President of Garner Holdings Company; Paul DiLorenzo, who has extensive experience with child welfare issues, currently works for the Casey Family Services; Robert Listenbee, who is the Chief of the Juvenile Unit at the Public Defender's Office; Edward McBride from Local 98 of the International Brotherhood of Electrical Workers; Tom McKenna, who works at the University of Pennsylvania; Bernadette Mulligan, who is Director of Community Relations at AmeriChoice of 56 2/21/08 - PUBLIC HEALTH - RES. 080139 Pennsylvania; Jan Shaeffer, who is Executive Director of St. Joseph's Fund for Children; and Michael Pearson, who is the CEO at Union Packing Company; Lorraine Ballard Morrill, who is a News and Community Affairs Director at Clear Channel; Vincent Thompson, a former reporter and someone who worked with Councilman Ramos; and Leonard Caldwell, who is a former CoreStates Executive. We remain interested in adding leaders who will further strengthen our complement and broaden our skills and perspective. Similarly, Safe and Sound has benefited from qualified professional staff. The initial search committee under Mayor Rendell selected Naomi Post Street, an experienced attorney and child advocate, to head Safe and Sound. We all know that this selection created a public cloud and political legacy for Safe and Sound. Nevertheless, under Mrs. Street's leadership, Safe and Sound got off to a 57 2/21/08 - PUBLIC HEALTH - RES. 080139 good start, developing its signature research products, the Children's Report Card and the Children's Budget, conducting a corporate fundraising campaign and collaborating with City government and other agencies to launch valuable programs, including after-school and Beacon centers and the Youth Violence Reduction Partnership. The Robert Wood Johnson Foundation followed its initial four-year grant with another financial commitment, signaling its satisfaction and confidence in the performance of Safe and Sound. Naomi Post Street left Philadelphia Safe and Sound six years ago, in 2002. Today's leadership team headed by Anne Shenberger, a 30-year veteran of child advocacy and social service management with the Pennsylvania Department of Public Welfare, has the experience and skills needed to run a top-notch organization. It is time to recognize a new day at Philadelphia Safe 58 2/21/08 - PUBLIC HEALTH - RES. 080139 and Sound. The Board of Safe and Sound takes its fiduciary responsibilities very seriously. Our numbers are closely reviewed by the City and over the years our auditor, Mitchell and Titus, has issued clean audits, including the most recent one. Those audits are available to the Committee and we'll make those available if you wish to see them. Safe and Sound is continually reviewing its policies and practices to foster responsive and responsible financial management. We understand that the Commonwealth's Department of Public Welfare intends to conduct a new audit and the City Administration will be sending in an assessment team. We welcome both. Our financial affairs are conducted with competence, candor and communication between the Board and staff. We operate in a complex and often uncertain financial atmosphere inherent 59 2/21/08 - PUBLIC HEALTH - RES. 080139 in the public sector budget process. Safe and Sound must adhere to the priorities and processes of each City Administration, balancing them with the capacity of the organization to deliver what is required of us. The $21 million budget addition that brings us here today was one of those difficult and complex situations. It is important to set the record straight as to precisely what transpired, not to blame others or absolve Safe and Sound, but to help you understand the dynamics of the past several months and possibly suggest procedures that could avoid future occurrences.

For over a year now, Safe and Sound has been dealing with the conflicts and consequences brought about by the previous Administration's directive to gear up for a significant expansion of anti-truancy and violence prevention programs in FY08. These priorities were well publicized. Even though the State 60 2/21/08 - PUBLIC HEALTH - RES. 080139 Department of Public Welfare denied the City's request for increased funds to support these services, in August of last year, Safe and Sound was provided with a signed, fully authorized contract for $75 million, incorporating the $21 million increase and, therefore, was obligated to begin fulfilling the requirements of the budget of that contract. In October, when City Council did not act on a transfer ordinance to appropriate the additional dollars, Safe and Sound issued a letter to its providers advising them of the budget situation and suggesting that they evaluate expenditures and possible actions to be taken. Safe and Sound put a hold on filling budgeted positions. Through December, Safe and Sound submitted multiple revised budgets and contingency scenarios to accommodate the actual amount of available funds, the lower amount, but the City Administration did not accept them and instead 61 2/21/08 - PUBLIC HEALTH - RES. 080139 instructed Safe and Sound not to curtail programs or lay off staff. Although Mayor Nutter has now announced his intention to reinstate the programs, Anne will describe in more detail the steps that Safe and Sound took to identify, recommend and implement program and administrative cuts since being informed last month that the additional monies would not be forthcoming. We are well aware that the new Mayor and City Council were put in a very difficult situation, squeezed between raised expectations and insufficient funds. Our community providers, Safe and Sound itself and, most important, the children and families we serve were caught in this squeeze as well. We were motivated only by a desire to expand services for children and youth. Now it is important for us to work together to provide continuity of services and avoid future disruption. 62 2/21/08 - PUBLIC HEALTH - RES. 080139 Safe and Sound's annual budgeting process always has had its share of uncertainties and challenges, but this experience has made us even more cautious and vigilant. While addressing immediate problems, it is also important that we collectively and cooperatively focus on the future for the good of our kids. Beyond the budget, Safe and Sound is eager to work cooperatively with the City government and other community organizations to develop the best possible approaches to meeting the needs of children and families. Safe and Sound has much to offer in the way of research and program development, contract management, program evaluation, a system of provider support and access to national networks. Yet, its role as a support organization to City government is not unique. Departments rely frequently on the good work and assistance of other partner and 63 2/21/08 - PUBLIC HEALTH - RES. 080139 intermediary organizations, such as the Philadelphia Health Management Corporation, PMHCC, the Greater Philadelphia Urban Affairs Coalition and others in the City who add value to the process. It is important for City Council and others to fully understand that Safe and Sound is not given a pot of money to do whatever it wants to with it. In fact, Safe and Sound allocates the money into programs as directed by the Department of Human Services. The vast majority of money is then forwarded to provider organizations. Our job is to provide appropriate oversight, program management, support and evaluation. Put another way, the current situation we find ourselves in is not because there is a Safe and Sound or any other fiscal intermediary. This problem would exist regardless, because the Administration's directives would have been carried out directly by DHS. 64 2/21/08 - PUBLIC HEALTH - RES.

080139 We believe that Safe and Sound has provided value over the years by providing programmatic oversight and support and objectively evaluating the effectiveness of programs. It is our hope and commitment to do everything within our power to make the controversies that have surrounded Safe and Sound become old news so that we can provide even more value. But much more important than the standing of Safe and Sound is the standing of Philadelphia's children. We all should be proud that Philadelphia has built a network of constructive violence prevention and youth development programs that have brought our City national recognition and made a difference in the safety and well-being of children and teens. As we all know, much work remains to be done. So we will be pleased to answer your questions about Safe and Sound to the best of our ability today and provide all of the information you 65 2/21/08 - PUBLIC HEALTH - RES. 080139 seek. Afterwards, I hope that together we can focus on fulfilling our commitments and aspirations for young people and determine how Philadelphia will go forward to provide the highest quality services cost effectively with the least disruption and greatest accountability. Thank you, and now Anne will pick up.

Thank you, Ernie. Good afternoon, Majority Leader and Chairwoman Tasco, Committee members and other members of City Council. I am Anne Shenberger, the President and CEO of Philadelphia Safe and Sound. I thank our Board Chairman, Ernie Jones, and the other members of our Board who are here today and those who weren't able to make it for their presence, support and leadership of our organization today and every day. Following the background 66 2/21/08 - PUBLIC HEALTH - RES. 080139 presented by Ernie, my testimony will explain more specifically what Safe and Sound does and how we do it. I will, of course, focus on the detail of the current budget situation, how we arrived in the predicament of needing to cut back programs and the steps we have taken to meet the lower budget target. Given the events earlier this week, we are happy that Mayor Nutter has stated his intention to restore what we believe are essential programs for children and families. I will also say that we sincerely regret the confusion and the anxiety that's been created over the past several weeks for our providers, parents and children. We know that the problem has generated complaints and calls to Council, as well as to the new Administration. Before getting into the nuts and bolts of our organization, please allow me to tell you briefly about myself and about the members of our staff. 67 2/21/08 - PUBLIC HEALTH - RES. 080139 I am a graduate of Gettysburg College and earned a Master of Social Work degree from Bryn Mawr College. I enjoyed a 30-year career advocating for children and youth and improving services and systems in the fields of juvenile justice and child welfare with the Pennsylvania Department of Public Welfare, leaving as Director of the Southeast Regional Office of Children, Youth and Families in 2006. I was eager and honored to be chosen to lead Safe and Sound because of the important role it plays and its record of quality work and its potential to be even better. Since coming to Safe and Sound, I have focused on developing a talented and dedicated staff to improve financial management and administrative processes, upgrade program services, to make better use of our research capabilities and to engage in effective communication, coordination and collaboration with City government and other partners. The 68 2/21/08 - PUBLIC HEALTH - RES. 080139 members of our staff have the qualifications and the commitment for Safe and Sound to excel. The breadth and depth of skills and experience embedded in our staff team is required by the complexity and diversity of the work that Safe and Sound does and is reflected in the performance that we deliver. Safe and Sound's core activities are program development, project management, contract management and support, research and evaluation, and policy and advocacy. We are, in short, a resource for government, community organizations, citizens, all of those interested in advancing the well-being of Philadelphia's children and youth. Safe and Sound has been in on the ground floor, operating often in collaboration with City government and other non-profits, using local data and national research and knowledge to pinpoint the needs of children and youth and to craft programmatic solutions to 69 2/21/08 - PUBLIC HEALTH - RES. 080139 address them. This is how the Youth Violence Reduction Partnership, the Adolescent Violence Reduction Partnership, the Beacon centers, the Recreation Department's teen centers and the Childcare Facilities Fund were born. We also have served government by staffing child-related initiatives such as the Blue Ribbon Commission on Children's Behavioral Health, and we've managed child and safety-related events such as the Children's Summits. We've also been asked to manage major projects such as working with the former Department of Social Services to develop DSS-CARES, the Division of Social Services Cross Agency Response for Effective Services. That's a mouthful.

But it means an integrated data and case management system that would assist people working across departments with the same families, managing contracts for 14 community-based parent truant officer providers and hiring 400 parent truant 70 2/21/08 - PUBLIC HEALTH - RES. 080139 officers. We've developed the request for proposal and manage the contracts for curfew centers. 5 Safe and Sound's research and 6 evaluation capabilities are especially 7 strong and fill a need for 8 information-driven decision-making and 9 action. We have created a data warehouse 10 called the Centralized Data Repository 11 that pulls together and analyzes data from a variety of sources, including the Police Department, the Department of Human Services, the Census Bureau and the School District. With extensive statistical and mapping capabilities, Safe and Sound helps elected officials, City agencies, educational institutions and non-profit organizations to improve services, achieve policy reforms, communicate more persuasively and secure funding for valuable programs. The slide on the top of shows the types of data that are included in the data warehouse. On the left shows 71 2/21/08 - PUBLIC HEALTH - RES. 080139 the different types of geographic areas that we can analyze from zip codes, to the Empowerment Zone, to City Council districts. The middle column shows the program resources that we have in the database so that we can plot those programs in the geographic areas. And on the right are the person-specific types of information that we have. We publish and disseminate our findings in accessible formats, including research and policy briefs, program evaluations, geo-coded maps. We recently completed a project at the request of the Department of Human Services for Police Commissioner Ramsey and his new crime initiative, and we also have our core products of the annual Children's Report Card, the Community Report Cards and the Children's Budget. We're grateful to City Council for your unanimous vote last year to institutionalize the production of these documents. I want to describe for you in 72 2/21/08 - PUBLIC HEALTH - RES. 080139 some detail the work that Safe and Sound does to manage City-funded programs and to support service providers in the community. This is really the heart and soul of our organization, because it directly touches the lives of so many children and families. It is our mutual concern for these providers and children that is the focus of today's inquiry. All of the programs that Safe and Sound oversees or monitors were initiated to respond to data indicating that children and other community members were at risk of committing violence or being victimized or engaging in unhealthy or unwise behaviors. Our key programs are after-school; Beacon programs; Youth Violence Reduction Partnership; Adolescent Violence Reduction Partnership; the parent truant officers; curfew centers; Families and Schools Together, or the FAST program; Real Everyday Alternative Choices and Help, the REACH program, which is a Saturday 73 2/21/08 - PUBLIC HEALTH - RES. 080139 anti-truancy program. And each of those on the slides of and have a 4 brief description of what the service is, 5 which I won't read. 6 We apply objective criteria 7 when we go about selecting the 8 after-school and Beacon program providers 9 and the locations for the programs. We 10 make these decisions based on a 11 competitive selection process. To determine the location of programs, we identify high-crime neighborhoods within the City. Then we look at the high-crime areas by age, focusing on the under 16 age group, by increases and decreases in 17 Part 1 Major Crime committed by juveniles, and then depending on the focus of the program, we look at the incidence of child abuse and neglect across the City. S. Census data to identify areas where there are large concentrations of youth, and we 74 2/21/08 - PUBLIC HEALTH - RES.

080139 look at community resources that are youth focused to identify high-crime neighborhoods that have large concentrations of youth but few services. So all of this information is synthesized so that we can place our new programs in high-need, low-resource areas. Once the geographic areas are identified, an open RFP process is launched to select new service providers. Staff teams review and score proposals. For those services such as the curfew centers and the Adolescent Violence Reduction Partnership, we also partner with the Department of Human Services, and their staff are included in our proposal review teams. The program elements that we look at are the agency's organizational capacity and the quality of the service program they propose, their ability to engage the community, and the quality and the efficiency of their budgets. The programs are then ranked, with awards 75 2/21/08 - PUBLIC HEALTH - RES. 080139 going to the highest ranked providers. But our work goes beyond simply issuing contracts and monitoring contract compliance. This is most apparent with the after-school initiative, which Safe and Sound began managing in 2001. We are dedicated to serving children and families with best practices, which means we take steps to stay on top of national trends. We set standards to provide regular feedback, and we support activities that will foster the highest quality programs. Recently, we instituted PCAPS, the Provider Contract Attendance, Payment and Performance System, which is a mouthful. This system captures information that enables providers to manage their programs more efficiently and accurately and provides Safe and Sound with accurate financial and programmatic oversight information. We have set regular curricular requirements for after-school programs in the field of literacy and violence 76 2/21/08 - PUBLIC HEALTH - RES. 080139 prevention which foster quality and provide a means for a better evaluation. Providers participate in a comprehensive professional development program which Safe and Sound offers in partnership with the United Way. We know that programs are not useful unless parents can access them, so Safe and Sound has developed an online program finder and a live parent assistance line to support families in searching for quality after-school services. The results of our efforts speak for themselves. Our after-school programs do help keep kids out of the system. As you know, after-school programs were created to address crime during those hours. And our data show that delinquency and arrest rates for participation in the Safe and Sound network of after-school programs in 2006-2007 were lower than the citywide rates for youth. For every additional year of after-school attendance, youth 77 2/21/08 - PUBLIC HEALTH - RES. 080139 are percent less likely to be arrested. Dependent care placement rates are also lower than the citywide rates. For every additional year of after-school attendance, youth were ten percent less likely to enter dependent care placement. Likewise, Safe and Sound gets very high marks from providers and from parents. More than 90 percent of parents surveyed last year expressed satisfaction with the program attended by their children. Eighty one percent of providers thought Safe and Sound was doing a good to excellent job of partnering with their agency to provide quality after-school programs. It's also very important to note that 81 percent of the budget of Safe and Sound goes directly out to community-based providers to run programs for children. Another 14 percent of our funding is used to monitor programs for quality assurance and contract compliance, to provide technical 78 2/21/08 - PUBLIC HEALTH - RES.

080139 assistance to the sites so as to facilitate the delivery of best practices, and developmentally appropriate services, to conduct the research that's needed to evaluate the programs and to produce the Report Cards. So you can see in the pie chart the administrative costs that are attributable to the agency's operation are about five percent. Therefore, over 95 percent of our funding from DHS is allocated for direct services and program support. Financial management of Safe and Sound is a complex enterprise owing to our numerous programs, the large number of contractors, and the high volume of invoices and other financial transactions. In order to assure that both Safe and Sound and our primary funder, the City, have the same understanding of the progress of each year's contracted scope of work and each year's expenditures and revenues, a 79 2/21/08 - PUBLIC HEALTH - RES. 080139 committee was established several years ago. The committee includes executive-level budget staff from the Managing Director's Office, DHS and Safe and Sound, as well as key programmatic staff from DHS and Safe and Sound. It meets monthly to review each line of the City designated Safe and Sound performance report and to assess estimated versus actual expenditures so that the most effective use can be made of the funds allotted. The most recent meeting was held February 12, 2008. This process has enabled both the City and Safe and Sound to be on the same with respect to all of the programs funded under the current contract. In addition to these monthly meetings, Safe and Sound has met weekly with program executives within the City in order to assure that the programmatic direction being taken was based on mutual agreement and partnership. Through this type of 80 2/21/08 - PUBLIC HEALTH - RES. 080139 face-to-face collaboration, the City has provided clarification on its expenditure expectations as well as raised any concerns that would need to be addressed by Safe and Sound financial staff. Over the past two years, Safe and Sound has made a number of improvements in its financial operations to both improve our performance and to be more responsive to the City's needs for both information and accuracy in the financial information we provide. We are continuing to make improvements in this area. Whereas Safe and Sound was launched with primarily foundation funding and early on captured significant federal and corporate, at this point in time our budget is comprised of nearly all funding through DHS. Other resources come from City departments, foundations, businesses and individuals. This allocation is consistent with our role as a support and intermediary for the City. Nevertheless, I have moved to renew and 81 2/21/08 - PUBLIC HEALTH - RES. 080139 step up Safe and Sound's external development efforts to generate more funds to complement and supplement City-sponsored initiatives. We are currently competing for a major federal grant and have our sights set on other targets. We are also interested in collaborating with the City to raise local funds to support the Administration's priorities for safety and youth development. Our overall budget has grown over the past three years from 34 million in Fiscal '06 to 50 million in Fiscal '07 to 75 million that was initially contracted for in Fiscal '08. With the growth in budget amount came a corresponding growth in programming. Our Board Chair has already summarized how the budget problem that prompted this hearing occurred. Simply put, the previous Administration wanted to expand anti-truancy, after-school and other prevention programs and allocated 82 2/21/08 - PUBLIC HEALTH - RES. 080139 funds that were not ultimately available for this purpose. Despite Safe and Sound's multiple efforts to submit lower budgets, we received in August a contract signed by the Budget Office and the Law Department for $75 million containing a scope of work that included the expanded programs.

On the strength of the City's previous funding record, the Administration's urging to proceed apace and the contract provided, Safe and Sound acted to begin implementing the new initiatives, such as contracting with community agencies to hire 400 parent truant officers to work on behalf of the City in partnership with the School District. We were advised by the former Administration that a transfer ordinance 20 would be passed. When that did not happen, we immediately wrote to all providers describing the tenuous funding situation and notifying them that Safe and Sound was assessing internal management actions it might take and 83 2/21/08 - PUBLIC HEALTH - RES. 080139 urging that they do the same. In fact, Safe and Sound put a hold on filling budgeted positions. Since then, we have also laid off employees. 4 million annually. Up until the end of the Street Administration, Safe and Sound submitted revised budgets, but was told not to initiate any program cutbacks. Upon first being notified by Mayor Nutter's Administration on January 23, 2008 that a budget cut of million 15 would be required, Safe and Sound 16 prepared recommendations for a reduced 17 budget to be effective March 1. We 18 undertook this task with extreme care, 19 knowing that any actions in this 20 direction, however necessary, would 21 inflict great pain and hardship on the affected provider agencies, employees and program participants. Expenditure projections were carefully reviewed and a process developed to make program 84 2/21/08 - PUBLIC HEALTH - RES. 080139 reduction recommendations to meet the budget target. All new programs that were funded as part of the expansion effort for after school were proposed for elimination. But because it is so far into the budget year, existing programs also had to be included in the assessment for reduction and elimination. The criteria used to assess programs were as follows: We looked at the utilization of the programs. We looked at the qualitative performance as assessed by the Safe and Sound staff who work with the providers. We looked at the results of the School-Age Childcare Environmental Rating Scale, which is a nationally validated scale used to assess the quality of after-school programs, and looked at the geographic distribution of the programs that might be eliminated. Significant cuts in Safe and Sound's organization and operations were part of the recommended budget cuts. In fact, we made a 30 percent reduction in 85 2/21/08 - PUBLIC HEALTH - RES. 080139 authorized positions. These cuts include research, program management and support, and reduction of administration within the organization. We are well aware that this situation is causing serious disruption for providers, children and families, and Safe and Sound is doing whatever it can to minimize the inevitable hardship. We established a policy of responding to all provider calls within hours and 13 providing guidance and technical 14 assistance to everyone who called. We 15 also worked to assist providers in 16 identifying alternate after-school 17 programs located within a half mile 18 radius of each reduced or eliminated 19 program, and looked into identifying any 20 capacity that might be available in those 21 programs. We contacted the Childcare 22 Information Services office and asked for 23 their assistance in helping families 24 locate programs. We provided subsidy information and applications to all who 86 2/21/08 - PUBLIC HEALTH - RES. 080139 called. We encouraged providers and others to utilize our program finder and live phone assistance line. In addition, we have acted upon suggestions made by Council during my meetings with you over the past several weeks. We are open to any other suggestions that you may have in this regard. As our Chairman said, as troubled as we are by the current situation, we are also focused on the future.

We want to be able to work together to improve systems and programs, to capitalize on the resources, knowledge, talents and commitment that City government, other community partners and Safe and Sound can bring to the table to realize our vision for a safer and healthier childhood for every Philadelphian. Thank you for listening, and we will be happy to respond to your questions.

Thank you 87 2/21/08 - PUBLIC HEALTH - RES. 080139 very much for your testimony. I appreciate it. (Applause.)

Thank you up there. I hope that was God.

You're going to be fine. Thank you. Thank you for your testimony. It certainly gave us a real strong history of Philadelphia Safe and Sound, and I tell you, I do appreciate the Report Cards that we get each year and particularly the way you do them by the zip codes, which is very helpful to us in our councilmanic districts. You may have stated this in your testimony, but, Mr. Jones, according to your testimony, Philadelphia Safe and Sound was started with private foundation dollars in 1997 and became a federal tax-exempt non-profit in 2000. Currently, approximately 98 percent of your budget comes from the City. What is your private funding and your future 88 2/21/08 - PUBLIC HEALTH - RES. 080139 development program, and what happened to the Robert Wood Johnson dollars? Was that for a limited period of time?

It was initially a ten-year period when it started, and it went away. It went up to four years. They gave us another four years at a reduced amount each year until it went away. We actually have conducted two major fundraising campaigns, one about five to six years ago before Anne came, and was able to raise, I think, $2, $3 million. We've just recently developed a new fundraising plan that we're going to -- as Anne indicated, we're going after some federal dollars and other private dollars from foundations. The problem we have encountered is that when we go to anybody and ask them for funding and they see our balance sheet or statement of activities of $75 million or $50 million or $30 million, it is very, very difficult to get them or to 89 2/21/08 - PUBLIC HEALTH - RES. 080139 convince them that they should fund Safe and Sound. So it's been an ongoing problem.

Have you made the case that as the contractual provider with the City, that the money from the City is pretty much a pass-through?

Yes. We have definitely tried that. And I think, again, we have a development personnel, just named the person recently, and I think we'll do a lot better. We just have not focused perhaps enough on the last four, five years on doing that development.

Are there any City staff serving on your Board?

City?

Anybody who works for the City on your Board?

Not currently. I'm trying to see. When Safe and Sound was first started, it was all City. They 90 2/21/08 - PUBLIC HEALTH - RES. 080139 were all City employees. Secretary Richman served on the Board for a while up until a couple of years ago. But we currently do not have any City employees.

What role does the Board play in the evaluation of the programs that you fund?

The Board meets quarterly, although in the last four, five months it's probably been more like one and a half times a month, given all that's been going on. We receive periodic reports from Anne as to the quality of the programs. We get a complete explanation of what the programs consist of. We don't as a Board go in and actually try to measure ourselves the success or failure of any of the programs. We do ask, I think, the right questions and think we do get sufficient information from the staff, but we don't do a hands-on evaluation.

In its 91 2/21/08 - PUBLIC HEALTH - RES. 080139 current relationship with the City, does Safe and Sound submit proposals to DHS? Are all contractual services between Safe and Sound and the City based on a specific request from DHS?

Anne, you want to take that?

Yes. In the monthly meetings that we have with the City Budget and Program staff, we review -- those meetings are used to define the scope of work for each of the contracts that we have each year, and then every month we review that scope of work and where we are both in terms of the programmatic implementation as well as the financial expenditures. We provide very extensive information on the expenditures. We provide a specific provider-by-provider list of payments and tracking related to the invoices that providers submit. So all of the things that we've done with respect to starting the curfew 92 2/21/08 - PUBLIC HEALTH - RES. 080139 centers, hiring the parent truant officers, taking over the youth worker portion of the Adolescent Violence Reduction Partnership were all done at the request of the City.

Yeah. I just want to underscore, we don't prepare a proposal and submit it to the City and say, Fund this. It generally works the other way around. They decide what activities they want Safe and Sound to engage in in the upcoming fiscal year, put a dollar figure on it and say this is -- and I might add, this has caused some consternation among Board members, because some Board members do not like this process, felt that we were simply taking what the City was throwing our way without full regard as to its implication to Safe and Sound and its original mission. I took the position, however, that we're there to help the Administration. It was founded to do that, and I feel unless it's illegal or 93 2/21/08 - PUBLIC HEALTH - RES. 080139 it is something completely out of our mission, if the Administration says, We want you to handle this for us next year, we will, and we have done that.

So do you see yourself as a quasi-City agency?

I don't. I mean, we --

You weren't there, Ms. Shenberger. You were there. When the organization was set up, you had the City -- I'm not criticizing. I'm just trying to be clear. The City needed a 501(c)(3) to manage the program, so they set up Safe and Sound so that the money could flow to them and they could contract out rather than going through DHS to run these programs, which are basically programmatic activity.

Yes. That's correct. 94 2/21/08 - PUBLIC HEALTH - RES. 080139

That's what you really do, right?

Yeah, but when you use the word "quasi" government, I think we just worked on a mission statement, and I think out of that process came the statement that we are an independent 501(c)(3) organization. So we don't view ourselves as -- we view ourselves as an intermediary, an organization that helps the City, but we are certainly not part of City government.

Well, you might be better off as a quasi-City agency, because then you're going to open yourself up to competitive bidding for the program.

Right.

Because you're a 501(c)(3), and now the contracts have to be competitively bid. So you might want to determine what you want to be. I have some questions for 95 2/21/08 - PUBLIC HEALTH - RES. 080139 Ms. Shenberger.

Go ahead.

You go ahead.

I wanted some clarification going back to some of the questions that I made to the previous panel. During this whole discussion around an increase of over 100 percent in your budget, it was very public both Council's objections to the allocation. I'm assuming and -- not assuming, but in the previous panel, they talked about the discussions that happened periodically and the fact that we were entering non-compliance on the City's part, and since we're partners in this, what was the discussion at your Board around accepting money that publicly Mayor-elect Nutter had said he would question, and I think at one point he even cautioned Safe and Sound in taking? What was the 96 2/21/08 - PUBLIC HEALTH - RES. 080139 discussion at the Board level at that time?

To be honest with you, it wasn't until recently that I knew or found out that the money was to be taken from protective services, the 8 million you're talking about. What we 9 knew when the City said -- 10

It was 11 supposed to be taken from what? 12

From the protective 13 services -- is that the right 14 terminology -- program. I found that out recently. The discussions at the Board level consisted of, We know we got 54 million. And we kept asking Anne, Is it more than that? If not, let's just make a budget for the 54 million. Anne says, No, the City wants us to do 75. And when she produced to us the $75 million budget signed by the City, it sort of made it a moot issue. But I'll tell you, I don't 97 2/21/08 - PUBLIC HEALTH - RES. 080139 recall any discussions at the Board level -- let me back up for a minute. There was a discussion at the beginning when we were asking where is the additional money coming from, and there were some groups that we thought, some Board members thought, were going to get cut out as a result of that. It wasn't these groups that we're talking about now. At least that wasn't my understanding. But then we were assured, and one Board member asked Anne to make sure that that was not going to happen, because if that were the case, he would vote not to take the money. Anne talked them, and they assured her the money was not being taken out of these groups. So the Board voted. But we didn't know the specifics of the 14 million at the Board level.

Did you want to add something to that, Anne?

Well, I just want to echo what Ernie said. I didn't 98 2/21/08 - PUBLIC HEALTH - RES. 080139 know until I heard from providers that a letter had been sent out to the foster care providers.

I guess my question is, since September, there was some discussions around this increase of budget of over 100 percent. There was a lot of contention. Council took public positions, very public positions, in saying that they would not authorize the appropriations, for the money to be moved. You knew the Mayor was going to the State. You knew the State was not approving the money based on our needs assessment criteria. Mayor-elect Nutter is saying he has some questions about it, he would hope that the Administration did not move forward. All of this stuff was happening in the public venue, but you still proceeded to entertain the --

No. That's not what we did. We went back to them. Anne went back to them and said, Given all of 99 2/21/08 - PUBLIC HEALTH - RES. 080139 this, let's get the budget down to 54 and let's do the cuts now. The City said, No, don't do that. I mean, we actually -- but let me just say this: I've entered into contracts, over 100, in my professional life. I have never questioned the City. If they said you've got X number of dollars for a contract and they give you a contract, I figure it's up to them to decide where the money is going to come from. But given the uncertainty of the money -- and I kept telling Anne, Don't spend money we don't have -- she went back to the City and said, Let's get it down to the 54, and they said, No, you keep it up at 75 and we've got a transfer ordinance going that they thought was going to go through.

Who were you in conversation with?

The people that we dealt with at the City went all the way up to the Mayor's Office. So at 100 2/21/08 - PUBLIC HEALTH - RES. 080139 all levels, at the DHS Commissioner level, at the DHS budget level, at the Managing Director's level. And when the initial -- just to give you sort of the parallel chronology to what Dr. Evans talked about, we sort of had a chronology parallel to theirs. We submitted several budgets in May that were consistent with the $54 million allocation that we understood we had, and, in fact, we did get an award letter for that amount initially, and after submitting several budgets and options to the Administration, they rejected all of them and decided -- and asked us to do a scope of work in a budget for the 75 million, which we did, and we got an amended award letter in July and a signed contract in August. And then as the situation started to unfold with the transfer ordinance, I was in communication with Ernie and the Board. When the transfer ordinance initially was not introduced, that's when we sent a letter out to our 101 2/21/08 - PUBLIC HEALTH - RES. 080139 providers suggesting that all might not be well and that they would be well-advised to look at their own spending, that Council had not introduced the ordinance, that it did affect funding that had been designated for us. And we began then the internal belt-tightening. At the same time, I sent that letter to the Managing Director asking for direction in terms of whether we should curtail any of our activities, and again received direction to continue and to begin programs, to continue to issue award letters. Again, we submitted three or four different budgets between October and the beginning of December, all of which were also rejected.

Councilwoman Tasco referred earlier about members of your Board, and I notice that you have some providers that are also on your Board, and part of the problem with all of this is this image thing, and, unfortunately, the great work gets caught 102 2/21/08 - PUBLIC HEALTH - RES. 080139 up in the imaging. Do you not find that a problem, that some of the people that are on your Board are also receiving money?

We have a conflict of interest policy. There are two, John Chin from the Philadelphia Chinatown Development Corporation and Patricia DeCarlo from Norris Square. They do not participate in any of the deliberations as it relates to their program. In fact, one of them was on the hit list -- two of them to be eliminated. So, I mean, I think the Board is -- and I hope they're not here right now, but, I mean, we recognize the appearance of a conflict and I think we go out of our way to avoid that, but, again, in our bylaws, we have a provision that says -- because this is a child welfare agency, to really get the best thinking, you're going to wind up getting people who do this day in and day out, and that's why we have them on the Board. 103 2/21/08 - PUBLIC HEALTH - RES. 080139 They both are good Board members and they contribute a lot to the organization.

You talk about your budget. You say that only five percent is administrative, although some of the folks that you contract are also umbrella organizations for on the ground. So what part of their on-the-ground budget is reflected? Because you contract with several organizations, the Archdiocese, the Congresos, who are also umbrella organizations. What percentage of your contractor budgets go to administrative costs versus services?

We have an administrative cost standard, but I would need to get back to you to make sure I'm being accurate on what the standard percentage is.

You don't have a range around?

We do. We do, but I don't want to tell you that I know 104 2/21/08 - PUBLIC HEALTH - RES. 080139 that off the top of my head. I think I do, but I want to make sure.

In all these discussions going back to the previous panel, were you part of the discussions with the Department of State, Department of Welfare?

No. 10

Was there any interaction at any point by Safe and Sound with the State based on their denials for needs assessment?

No. 15

At any point during all of this stuff that's going on, was Safe and Sound -- when they were contracting with the contractors from the beginning -- your fiscal year for your contractors run from when to when?

July to June.

Very efficiently. Are we that efficient in all 105 2/21/08 - PUBLIC HEALTH - RES. 080139 departments? Very efficiently you got your award letter. At what point did your contract start with your providers?

Depending on the different type of provider. I actually have a list here, which I can provide for you.

What I want to know, when all of this stuff is transpiring with Council not approving the ordinance, when you issued those contracts, at any point did you amend any of those budgets for your providers?

We actually held a number of those contracts because --

So when you issued --

We issued the award letter and then we held the contract.

When you issued the contract to the provider and 106 2/21/08 - PUBLIC HEALTH - RES. 080139 you knew this was not going on, were they notified in writing that there was no -- that the Council had not approved the appropriation?

Yes.

And that there would be funding problems?

I have copies of the letters, which I can give to the Committee. The letters say that the transfer ordinance was not introduced and there may be funding problems, that currently we have a fully executed contract with the City. The City has not instructed us to reduce or eliminate any programs at this time, and that we will monitor the situation with the City closely and update them as we get more information.

When you began the process of cutting back, how was that handled? Were the providers brought in and discussed around their cuts? Did you give an opportunity for 107 2/21/08 - PUBLIC HEALTH - RES. 080139 the providers to --

No. 4

-- give recommendations?

We were asked to provide a revised budget within a week. So it was -- it would have been very problematic for us to actually have the time. I think that that would have been -- obviously the preferable process would have been more deliberative.

When you issued letters informing providers that there might be cuts, at any point did you say to them, If this came to a halt January 7, 2008 when the new Administration came in, do we have a plan of action? Did those conversations happen with providers?

Not in that context, no, because we were continuing to submit those revised lower budgets, which were continuing to be rejected.

There was a meeting 108 2/21/08 - PUBLIC HEALTH - RES. 080139 at some time with the providers.

Yes. We did meet with providers and tell them directly that we had concerns, but we did not use the language you just used. We used -- we said beware --

So we never gave them, the contractees, what is contingency plans if January 7, 2008 -- since the Mayor-elect had already said that he has some concerns, we never said, What's your contingency plan?

Right.

So they were never prepared?

Only to the extent that we suggested to them that they would take the same actions that we were taking, to review their costs and to be frugal about their decision-making.

So when you made some recommendations on the cuts -- because you're saying back in September you were making provisions for 109 2/21/08 - PUBLIC HEALTH - RES. 080139 a $54 million budget?

Right.

And that wasn't shared with providers around how you scale back in case that doesn't happen. When you made your reductions, was that based on your initial $54 million budget?

No, no, because so much time had elapsed. Our original submissions would have been much less drastic, because they all had implementation dates that were either full fiscal year or even six months. Several of the budgets that we submitted would have had some cutback starting in January. So when we got the information that we needed a new budget, we needed to achieve a certain target level and could only start March 1st, because we needed to give 30 days' notice. So we had to make -- the decision-making criteria were quite different.

When you 110 2/21/08 - PUBLIC HEALTH - RES. 080139 developed your criteria for resubmission of this reduced budget, what were some of the factors that you were looking at?

We were looking at the extent to which the agencies' allotted slots were used, was a significant factor, as well as the results of the quality assessment, the SACERS scores, as well as the qualitative assessment of our staff that worked with the providers, and then the geography.

Several of the contractors had several programs.

Right.

So in some cases -- and I'll speak specifically to the ones in my councilmanic district that I'm aware of. When you had somebody who had a Beacon, somebody who had a curfew and potentially had PTO, in that analysis, did you figure what the financial impact would be so that if you're eliminating a program, you're not taking out the core 111 2/21/08 - PUBLIC HEALTH - RES. 080139 and then they can't provide the other two programs? Was any of that taken into account?

We tried to look at that, but in terms of the amount of time that we had to make the assessments and to produce a budget, a week is a challenge. So we would have preferred to have had more time and we would have really preferred to have been able to sit down both with the Administration and with our providers, because I think that had we been able to sit down with the providers, we would have gotten much -- we have a very good relationship with our providers and I think we would have gotten some very good advice from them had we had the time to be able to do it.

I would just add on that point, when we finally got word from the current Administration that there was no more money, the Board got together on a Saturday. We gave up half of our day 112 2/21/08 - PUBLIC HEALTH - RES. 080139 on a Saturday to have Anne go over in mundane detail the criteria she used for eliminating different programs. And I can tell you, the Board -- there was not unanimity on the Board as to whether or not that was the best way of doing it. Some people argued that you ought to put it where the greatest need is, regardless of how well the program is doing. There was some that said we want the most effective programs. There's no easy way to do that, and as Anne said, if we had more time, we probably could have involved the providers in a different way, but we were told to get a budget together.

In a letter dated July 2nd, which is real fast -- I'm telling you, I never saw anybody else work that fast -- from Dr. Evans, it states that the allocation of 75 million to Safe and Sound is contingent on availability of City and/or State funding. What did you understand 113 2/21/08 - PUBLIC HEALTH - RES. 080139 that to mean?

That's their standard award letter. So it's the same award letter that's issued every year.

And you passed that same letter on to the providers?

Yes. They're told that it's subject to the availability of funding.

Right.

But this time you got tricked.

Yes.

That's right. That's right.

Who told you to receive provider services when you knew the funding was not available?

That came from both the Finance Office and the Managing Director's Office.

Who was the Managing Director? 114 2/21/08 - PUBLIC HEALTH - RES. 080139

Loree Jones.

I guess you answered the next question. It says why did you proceed with funding commitments without having the funding. Because?

Well, one, because our contract has two signatures from the Budget Office on it that clearly say that the funding is appropriated and encumbered. So one is because of those two signatures. And the other is because we were directed to do so. And, again, I think in Ernie's testimony, the issue is, to some extent, ours, because we have the contract, but the Administration would have ordered those services be delivered whether we were the conduit or not. So it wouldn't have changed the financial situation that providers are in right now, because the Administration wanted to deliver the service.

It seems 115 2/21/08 - PUBLIC HEALTH - RES. 080139 that you really, based on your experience of working with the City Administration, you had not had any problems in the past, so you didn't see that there was any problem this time --

That's correct.

-- with that? Let me ask you a question. I think Councilwoman Sanchez asked it. Going back to if you really had the $54 million and you knew that was your budget, then you wouldn't have sent letters asking for new Beacon programs; everybody would have received the same funding for the same programmatic activities that they had?

Right.

But based on the letter stating you were going to get $75 million, you proceeded to allow for the providers to implement -- or see to increase their budget, expand their 116 2/21/08 - PUBLIC HEALTH - RES. 080139 programs and then set up new programs?

That's correct.

But the difference in that is, we didn't just decide that with the extra $21 million we could decide on our own what it was going to be spent on, as if we wanted to build a house. We could not have done that. With the extra $21 million came very specific instructions from DHS as to how you spend it. They wanted these number of Beacons schools increased and the other sort of -- FAST program, the other services. So, again, the point I want to make is, we don't get money. I mean, they don't just dump money in our lap and say, Go spend it. The money and funding come with very specific instructions, almost sometimes on what staff you need to oversee the programs, and this comes from DHS. So we're not a loose cannon out there just running around. 117 2/21/08 - PUBLIC HEALTH - RES. 080139

Were you ever told which programs to fund specifically?

You mean in terms of which agencies?

Yes.

In terms of the curfew centers, the way that RFP was issued, we issued the RFP and a joint group reviewed the proposals, and then the final decisions were made by DHS, and they notified us of their final selection. So in that case, yes, we were told which providers.

I have a question related to the curfew centers. In the case -- because I notice that in the last six months, there were lines that were redrawn because there was additional money available, and I want to talk specifically to the case of Lighthouse that began the program in the second round and had a very effective program in their boundary lines, and then 118 2/21/08 - PUBLIC HEALTH - RES. 080139 the boundary lines were changed. And the reason I bring this up is because it has an issue with if they're not meeting their numbers. So they went from serving the district that they physically lived in to serving two districts that they physically don't live in, and this happened within months of when all this stuff was going on with additional funding to accommodate new providers. So we took agencies who spent a lot of time setting this up and, because we wanted to redraw the lines, gave them another territory that then they have to start from scratch from stakeholders, and then we go back and we cut them because they don't have numbers. I mean, who was involved in some of those discussions?

Those discussions were primarily conducted within DHS and between DHS and ourselves, but in terms of the driver, I guess, of the curfew policy-making is with DHS.

Who from 119 2/21/08 - PUBLIC HEALTH - RES. 080139 DHS was making those decisions specifically?

The Curfew Manager is a guy named Ron George, and he, up until the Administration changed, worked very closely with the Managing Director's Office and the Division of Social Services and then also obviously with us.

I think it will be important if they can stay around as we hear from the providers just in case we have some additional questions that might arise.

Sure.

I just made a little snide comment, Mr. Jones, on your testimony on . You say the million budget addition that brings us 21 here today was one of those difficult and complex situations. It is important to set the record straight as to precisely what transpired, not to blame others or absolve Safe and Sound, but to help you 120 2/21/08 - PUBLIC HEALTH - RES. 080139 understand the dynamics of the past several months and possibly suggest procedures that could avoid future occurrence. And my snide comment is, don't trust outgoing Mayors. Thank you. Would you stay around?

Sure.

Actually, Anne will stay around --

Don't trust outgoing Mayors.

Thank you.

Thank you.

Thank you. I often wondered the comments that were made at a curfew center opening in my district, one of the few programmatic activities I attended with the former Mayor, he kept saying that Councilwoman Miller and Councilwoman Tasco would not let these curfew centers close, and I think he understood clearly what he was doing with the $21 million. 121 2/21/08 - PUBLIC HEALTH - RES. 080139 Next we have Margaret Zukoski, Diane Cornman-Levy. Are you here? (Witnesses approached witness table.)

Good afternoon. Would you state your name for the record, please.

I am Margaret Zukoski.

You may proceed. And then we'll let you introduce yourself, ma'am, and proceed with yours.

Good afternoon again. I am Margaret Zukoski and I am pleased to offer testimony to the Public Health and Human Services Committee today as the Associate Director of the Pennsylvania Council of Children, Youth and Family Services, a statewide membership association of private providers of services to children, youth and families. Again, we thank 122 2/21/08 - PUBLIC HEALTH - RES. 080139 Councilwoman Tasco and members of the Committee for convening this hearing. I would also like to take this opportunity to thank the Administration for restoring some of the cuts and programs like the Beacons, curfew, after-school and Adolescent Violence Reduction Partnership, which were put into place on February 1st. Providers support efforts to ensure that public dollars are used efficiently and effectively in the delivery of services. The Pennsylvania Council represents more than 130 providers of child welfare, juvenile justice and prevention services. In total, our member agencies employ 20,000 Pennsylvanians. The majority of our member agencies serve Philadelphia children, youth and families through purchase of service agreements with the Philadelphia Department of Youth and Services directly and its intermediaries, like Philadelphia 123 2/21/08 - PUBLIC HEALTH - RES. 080139 Safe and Sound. Our member agencies deliver a broad array of services, including high-end services for children and families involved with the child welfare system, those children who have been abused and neglected or placed in foster care, group home and residential facilities, as well as youth in the juvenile justice system. Many of our member agencies also have as part of their primary mission the delivery of services aimed at supporting children and families at risk for involvement with the child welfare and juvenile justice systems through the delivery of prevention services. These providers are keeping Philadelphia children safe in after-school programs, safe by keeping them off the streets. They're supporting permanency in families and ensuring the overall well-being and health of our children. Today, I would like to address 124 2/21/08 - PUBLIC HEALTH - RES. 080139 three points relevant to recent events: The role of private providers in the delivery of prevention services, concerns that the private provider community has about the notification and response to funding concerns, and, finally, make some suggestions for how we can move ahead to ensure that we have a comprehensive system of prevention services to support our City's most vulnerable children and families. We cannot take our eyes off the next funding year beginning July 1, 2008. Since the year 2000, Philadelphia has been in the forefront in our state of delivering prevention services through contracts with private providers. It should be noted, however, that for decades preceding the creation and expansion of publicly funded prevention services, providers recognized the value of these services and were delivering them with private dollars. Because there was no overarching plan or 125 2/21/08 - PUBLIC HEALTH - RES. 080139 support for services, there was an absence of consistent programs throughout the City. Some neighborhoods were fortunate to have programs; others not. With the commitment of public dollars, services were expanded and targeted to the City's neediest neighborhoods and their children. With these dollars, providers were afforded access to evidence-based programs, technical assistance and training. Family and children now access programs that were well resourced based on best practice and were expected to deliver defined outcomes. Citywide programs have stemmed youth violence, truancy and kept kids safe. Even with the advent of public support, however, private providers continued to contribute both funding and in-kind services to support programming.

For example, the curfew centers provide space at no cost for the City program, and Beacon programs contribute at least 126 2/21/08 - PUBLIC HEALTH - RES. 080139 percent of program costs. Private contributions to services, although significant, are seldom, if ever, acknowledged. I'd like to talk now about providers' experiences with the recent cuts. There are a number of providers here who will speak in much more detail and more eloquently about the impact on children and families with regard to the cuts. Private providers first became aware of potential funding shortages last year in August when they became aware that the transfer order of $34 million, million of which was designated for Safe and Sound funding, was not going to be forthcoming. They asked questions about this and did receive a letter from Safe and Sound indicating that they should be cautious and look for cost-saving methods within their own agencies. In December, providers of 127 2/21/08 - PUBLIC HEALTH - RES. 080139 mandated services, over 200 of them, received letters from the Department of Human Services, suspension notices, advising them that they would have to because of funding shortages terminate mandated services to almost 14,000 children receiving these services as of April 30, 2008. Although this has been characterized by the City as an accounting artifact, this did not provide providers in our system with the confidence that the City could move forward to protect its children. Providers have not been privy to the internal conversations and dialogues that you have heard about today between Safe and Sound and DHS and the City Administration. Although we asked questions, we were often met with few answers and no good responses. When information finally became available, it did not come from DHS, the City or Safe and Sound, but from a news report that appeared in the February 1st edition of 128 2/21/08 - PUBLIC HEALTH - RES. 080139 the Philadelphia Inquirer. Families and children who rely on these services, Beacon, after-school, parent truant officers and the AVRP program and staff working in these programs, read about the cuts and terminations of programs in the morning edition of the Philadelphia Inquirer on the way to their jobs. Private provider administrators were faced with distraught families and staff asking about whether services they relied on would be available, would they have jobs. The provider administrators could not answer the questions, because they themselves heard about the cuts and terminations at the same time in the Philadelphia Inquirer. In the late afternoon of February 1st, DHS convened a meeting of the affected providers. They were brought together and heard for the first time about the situation that resulted in the cuts facing them. Even then, on 129 2/21/08 - PUBLIC HEALTH - RES. 080139 February 1st, at 3:30 in the afternoon -- it was a Friday afternoon -- providers had not received any definitive information regarding who was cut, to what degree they were cut. Providers were told letters were in the mail --

Excuse me. You're saying February of 2008?

Yes. (Applause.)

Providers were told by City leaders that the letters to their individual agencies detailing the degree of their cuts were in the mail. That was not true. Late Friday evening, February 1st, and early Saturday morning, February 2nd, providers received faxes telling them what the degree of the cut was to their agency. When they finally arrived, many providers had questions based on unclear and conflicting information in the letters. In the week following the announcements, we struggled to get clear 130 2/21/08 - PUBLIC HEALTH - RES. 080139 information about the impact of the cuts. Providers wanted to ensure that when they were laying off staff and informing families, that they had correct and accurate information. Providers, when they did receive information, began laying off staff and telling families about the closing. However, the information has been shifting. Last Monday, February 11th, providers were alerted that the AVRP program Youth Worker component was not going to be cut as they were originally told. Providers heard this from DHS, not Philadelphia Safe and Sound. And when they tried to get clear direction again about the scope of the cut, they are still waiting for that information. This past Friday, before the long weekend began, rumors began to surface that other programs would be preserved. Although welcomed news, it was not confirmed. Providers who had not 131 2/21/08 - PUBLIC HEALTH - RES. 080139 already done so were giving layoff notices to staff on Friday to meet the March 1st deadline for program closing and downsizing. When we finally did hear that rollbacks in the cuts were forthcoming, once again, it did not come from the City, DHS or Safe and Sound. We learned about it through press releases. We're still waiting to receive letters relevant to the rollbacks in the cuts. Providers are reluctant to rescind layoff notices because they, to date, still do not have accurate information with regard to the degree that their programs are being preserved. (Applause.)

I just heard within the last 15 minutes that providers are receiving voicemails and text messages from the DHS staff asking them to look at making cuts in their AVRP center-based programs and to get the information to DHS by Sunday. This is 132 2/21/08 - PUBLIC HEALTH - RES. 080139 pretty consistent with how information has come to the provider community over the past several weeks. We, the provider community, we, those who are responsible for delivering direct services, those who are living in the community, serving the families and children, ask one simple thing. We ask that we be part of the planning and decision-making process, that we be provided with accurate and timely information. (Applause.)

We have felt caught in the middle of what we characterize, frankly, as a political battle, with no access to reliable information on which to act. (Applause.)

As a result, consumers have lost confidence in our commitment, and experienced and qualified staff are leaving our programs. Who would stay? They're frustrated and 133 2/21/08 - PUBLIC HEALTH - RES. 080139 disillusioned with our City. You will hear more from our providers about the difficulty of recruiting and retaining qualified staff. Programs are being restored. Will we have the staff to man them at this point? We face huge challenges filling jobs. We will face huge challenges filling these jobs when funding for the next fiscal year beginning July 1, 2008 is still so undetermined. I would like to make some suggestions about how the City should proceed as we work our way through this current dilemma, and I want to reiterate that while providers are supporting and making every effort to keep their programs going through the end of the year, we have to keep our eye on what is going to happen to prevention services beginning July 1, 2008. You heard Dr. Evans reference the Needs-Based Plan and Budget process, and I would like to talk about that a 134 2/21/08 - PUBLIC HEALTH - RES. 080139 little bit here, as this will form the basis for funding in the next few fiscal years. In 1991, the Commonwealth enacted Act 30, which established a funding mechanism for county children and youth agencies based upon their identified financial needs and certified by DPW. Act 30 of 1991 created a process that was intended to provide adequate funding to meet the wildly differing needs of Pennsylvania's 67-county children and youth agencies in an equitable manner using consistent standards. Each county children and youth agency, including DHS, is required annually to submit a Needs-Based Plan and Budget to the DPW Office of Children, Youth and Families. The plan includes a funding request for the following fiscal year in which it is submitted, as well as a request for any changes in the current fiscal year. It is intended that this document accurately reflect the needs of 135 2/21/08 - PUBLIC HEALTH - RES. 080139 each county and be a product of a collaborative county planning process involving children and youth, juvenile court and Council. The act also requires that community input be actively solicited and incorporated into the process. The total DPW certified amount for all the counties is the basis for figures presented to the budget, to the Governor for the state budget. Each county is required to make its plan and budget available for public review and comment before submission. For the past two years, the Needs-Based Plan and Budget process in Philadelphia has fallen far short of the legislative intent. Provider and community input has not been solicited or incorporated in a meaningful way. In July 2006 and again in July 2007, plans were submitted for public review without the budget information attached. In July 2006, after public comment was given, the 136 2/21/08 - PUBLIC HEALTH - RES. 080139 plan was significantly revised behind closed doors, not incorporating public comment, and submitted to DPW. In July 2007, once again, a plan was made available for public comment without the budget attached. Comment is significantly limited when information about how public dollars will be distributed is not available. There has been no transparency in the system. And as we heard earlier from Richard Gold and Dr. Evans, DPW did not fully fund or appropriate the dollars necessary to support the prevention programming. It was based on the Needs-Based Plan and Budget submitted in these past years that we see ourselves here today. As the City and DHS look ahead to the upcoming fiscal year and the next fiscal year, Pennsylvania Council recommends that consumers and providers be included in this planning process in a meaningful and thoughtful way. We must 137 2/21/08 - PUBLIC HEALTH - RES. 080139 begin to look at how prevention services will continue to operate in Philadelphia.

We are quickly approaching the new fiscal year, and this discussion about the scope, funding and management of prevention programs cannot be delayed. DHS is relying on a comprehensive system of prevention services as part of its redesign of in-home protective service and the alternative response system. Before plans to redesign DHS's children and youth component can proceed, the prevention services system must be secured. While the City continues to focus on Philadelphia Safe and Sound and its role as an intermediary, we urge you that the City does not lose sight of the bigger picture and include the provider community and consumers of services in planning efforts. This concludes my testimony. Thank you very much. 138 2/21/08 - PUBLIC HEALTH - RES. )

Thank you very much for that testimony. We'll come back to you with questions.

Good afternoon. My name is Diane Cornman-Levy. Thank you so much for giving me this opportunity to provide testimony. I am the Executive Director of the Greater Philadelphia Federation of Settlements, an umbrella organization with a mission to develop safe, healthy and thriving communities by creating high-quality capacity-building opportunities for its network of settlement houses and neighborhoodöööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööö öööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööö öööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööö öööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööö öööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööö öööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööööö öööööööööööööööööööööööööööööööööööööööööööö 139 2/21/08 - PUBLIC HEALTH - RES. 080139 serving as an incubator for creating new approaches. Since 1906, the Federation has worked with its affiliate agencies to improve the lives of hundreds of thousands of children, youth, adults and families. Many of these community-based centers, some of whom you will be hearing from today, have served multiple generations of families. Collectively, our member agencies have well over 500 years of direct services to children and families in Philadelphia. Currently, our network is composed of 15 affiliate community-based 17 settlement houses that collectively provide services to more than 100,000 children, youth and families per year in 45 economically challenged neighborhoods throughout Philadelphia. Programs and activities include, but are not limited to, parenting classes, out-of-school youth development activities, summer camps, adult education classes, domestic 140 2/21/08 - PUBLIC HEALTH - RES. 080139 violence prevention programs, senior centers, emergency assistance, family center, case management, intensive behavior wellness, workforce development and professional development for those who work with youth. Today, I would like to speak on behalf of our network -- and, again, you're going to hear more from some of our affiliate members -- about the financial and social impact that the Philadelphia Safe and Sound cuts has had on the Federation and our affiliate agencies. I would also like to address the manner in which the agencies were informed about these budget cuts. 5 million of revenue for six of our affiliate agencies, as best as we understand it. One of these agencies alone has lost over $600,000 of revenue. That translated into individuals 25 losing their jobs and more than 300 141 2/21/08 - PUBLIC HEALTH - RES. 080139 individuals losing services. Another member agency lost just under $600,000 of revenue, resulting in individuals losing their jobs, and 6 they have already been notified of their 7 jobs being terminated. We still don't 8 know the impact of how many children and 9 youth have lost services, because there's 10 still unclear information about the 11 amount of budget, how much money is being 12 cut at this point. 13 For the Federation, we lost a 14 significant amount of funding for our 15 youth development training program that 16 allows for the professional development of youth workers, many of whom are in great need of research-based training that improves their effectiveness in youth development practice. Research has shown that youth workers who are not properly trained to work with youth are not only often ineffective but often cause more harm to youth with respect to their emotional and social development. 142 2/21/08 - PUBLIC HEALTH - RES. 080139 The funds that we receive through Philadelphia Safe and Sound, which was originally from DHS, were supporting this professional development training program. We are now no longer able to provide that training.

During a time of escalating rates, of poor health, depression, suicide, high school dropouts, truancy and functional illiteracy among youth across our City and nation, cutting funds for prevention -- and I would rather call it investment in our youth -- has a potentially devastating impact on the lives of thousands of children, youth and families. )

Thank you. With respect to the social impact of these cuts, receiving notices in the midst of the school year and the providers' fiscal year has resulted in turmoil and anxiety within the agencies and for those receiving services. In 143 2/21/08 - PUBLIC HEALTH - RES. 080139 addition, many children and families our affiliate members serve have been emotionally hurt due to violence in their lives. As such, building trusts with those we serve is critical to helping those heal and for building healthy communities. Cutting services to them without much notice or without any back-up plan is not only cruel, but potentially devastating to the emotional well-being of the individual and the health of the community. By cutting services, we are sending another message to those who have been hurt many times that we do not value them, that they are dispensable and that they do not belong. These acts feed into despair -- (Applause.)

-- and hopelessness that many youth and families feel, ultimately resulting in greater violence. For those affiliate agencies that lost funding, they're doing their 144 2/21/08 - PUBLIC HEALTH - RES. 080139 best to keep programs open, because they are deeply committed to serving the needs. They are doing this by cutting supplies, assigning more youth to each youth worker, and using volunteers who have no experience working with youth. This results in compromising the quality of their programs and increasing the risk of burnout and turnover among their staff, which you just heard. We are losing a lot of good staff. We should not and cannot afford to keep asking the health and human service providers to do more with less, as the needs of those they serve continue to increase in both number and complexity. With respect to how we were notified about the budget cuts, I must admit that the process was disorganized, disrespectful and deeply confusing. The Federation and its six affiliate agencies received notices via fax from Philadelphia Safe and Sound on February 145 2/21/08 - PUBLIC HEALTH - RES. m. Many of the letters, including the one addressed to me, had wrong addresses, incorrect spellings of names, and vague or no 6 information about how much money was going to be cut. With no clear or accurate information from Philadelphia Safe and Sound, our affiliate agencies were left hanging with unanswered questions. As such, they could not make any plans for the immediate future and could not answer the many questions that children, youth and families were asking them. It is now February 21st, and the questions are still unanswered, as you just heard. Frankly, I think this is inexcusable. If funders expect service providers to be transparent, then the City administrators and others need to be transparent, too. With respect to what criteria Philadelphia Safe and Sound used to determine which program services would be 146 2/21/08 - PUBLIC HEALTH - RES. 080139 cut, Anne Shenberger responded with, We cut those programs that were either not functioning at full capacity and/or were located in the vicinity of another organization that provided similar programs. Out of the programs that 9 were either terminated or received less 10 funding amongst our affiliate members, 11 ten programs were functioning at full capacity and five programs had a waiting list of people to join their programs. For the affiliate agency in which cuts resulted in a loss of 300 individuals losing services, there were no other programs in the vicinity that could accommodate those children and youth. As such, families were and continue to scramble to find a place for the children to go after school. So my question about the decision-making process remains. What was their source of data with respect to identifying those programs that were cut 147 2/21/08 - PUBLIC HEALTH - RES. 080139 or received less funding? From our experience, the data was either grossly inaccurate or the decision-making process was capricious. My final comment has to do with the notion that funding is no longer there to support these programs and services. From our perspective, this does not make sense. Many of the programs that lost funding were originally funded by DHS. The allocated funds were transferred to Philadelphia Safe and Sound in May and June of 2007. On October 30, 2007, we received a letter from Anne Shenberger stating that organizations that were originally receiving fundings from DHS for Fiscal Year 2008 -- I'm sorry. Anne Shenberger sent a letter to organizations that were originally receiving funds from DHS for Fiscal Year 2008 that Philadelphia Safe and Sound had signed a contract from DHS for Fiscal Year 2008. In the letter she wrote, The contract is sufficient to 148 2/21/08 - PUBLIC HEALTH - RES. 080139 support the operation and management of existing programs.

The Federation programs that were terminated -- and ours and others in some of our affiliate agencies were existing programs, as were many of the programs that were cut among our member agencies. If this is the case, then why is there suddenly not enough funds to support these existing programs for Fiscal Year 2008 if the funds were merely transferred to and from Philadelphia Safe and Sound? Where did the money go? So I hope that this testimony provides you with a better understanding of the impact Philadelphia Safe and Sound cuts have had on the service providers and the many children, youth and families who benefit from these services. I hope that our questions are answered quickly. I hope that the money will be quickly restored to providers as soon as possible. Speaking of that, we received a 149 2/21/08 - PUBLIC HEALTH - RES. 080139 letter from DHS stating that we were getting our funding back. I talked to our affiliate agencies. They haven't heard anything yet. I hope we all learn from this incident that communication between City officials, funders, service providers needs to be timely, clear, open and honest. As we move forward as a city, we need to invest in the people in our city by investing in organizations that are accountable, reliable, transparent and effective. I have great faith that the new Administration will ensure that no child and no family is truly left without essential care services. Thank you very much, and this is the end of my testimony. )

The Chair recognizes Councilwoman Sanchez.

For both of you, you're both providers and receive 150 2/21/08 - PUBLIC HEALTH - RES. 080139 funding. How much of your funding was cut? What percentage of your budget?

The Pennsylvania Council is a membership organization. We do not receive any funding from Philadelphia Safe and Sound.

And you don't have an assessment of what your provider organizations were cut?

Because the information with regard to the degree of the cuts, the confusing information, the inaccurate information, we have not been able to secure definitive information about the dollar amount. It's changing day to day.

We are in the same situation. I can tell you right now they've been told with the letters it was about $1.6 million collectively. For a couple of these agencies it was a large percentage. But, again, the information is changing, it's not accurate, so we can't even give you accurate information 151 2/21/08 - PUBLIC HEALTH - RES. 080139 at this time.

For example, we have one member agency who received a letter indicating that there was a cut in the number of slots for an after-school program, but the dollar amount for their contract was raised. This was the confusing and conflicting information that we're trying to get answers for.

Ms. Shenberger -- is she still here? We asked her to stay because there might be questions. Would you stay? We're going to proceed with further testimony. Ms. Zukoski, you talked about Act 30 and you're saying that the county has to present a Needs-Based Budget?

Needs-Based Plan and Budget. It's under state statute. Every county children and youth agency in the state, all 67 of them, submit a plan and budget on an annual basis to DPW. It's based on their identified need for 152 2/21/08 - PUBLIC HEALTH - RES. 080139 services that the State determines the level of funding, what they're going to fund, and presents a budget, the total budget, to the Governor.

Thank you.

I have one more question related to that. So what you're saying is that in the past -- because I know there have been some issues with DHS, and obviously the leadership transition and instability hasn't helped. In the past, providers have not been part of the development process of our needs assessment --

Correct.

-- going to the state?

Correct. Not in a meaningful way. We are -- and the Pennsylvania Council annually provides comments on the Needs-Based Plan and Budget at a public hearing hosted by DHS. In the past two years, we had to comment on a plan without any budget attached. 153 2/21/08 - PUBLIC HEALTH - RES. 080139 The budget was released later and submitted to the state without any public comment.

So since 1991, you haven't had any community input --

Pardon me?

-- in a meaningful way?

I can only speak to my tenure in the City, and I would say at least going back eight years, there has not been a meaningful and collaborative effort with the City to engage, I believe, consumers and providers of services who are on the ground, who are delivering services, who have a wealth of knowledge and expertise that they could share with the City. There has not been a meaningful dialogue with the City to inform the plan.

And you've been aware that up to about last year we were turning away between $60 and 154 2/21/08 - PUBLIC HEALTH - RES. 080139 $80 million in preventive money that was unused?

Yes.

Thank you.

Thank you. Ms. Shenberger, would you come back to the table, please. (Witness approached witness table.)

Some questions have been raised relative to the insufficient communications about the cuts, what would be cut, why the cuts. You may have heard the questions that were raised. Could you respond to that, please?

I didn't hear the specific questions, but I can say that given the time frame that we had to prepare the budget and notify providers, I can fully understand their concern about the lack of communication and the need to sit down and talk about what the 155 2/21/08 - PUBLIC HEALTH - RES. 080139 letter said. So it certainly was not an optimum process and not one we would want to repeat if we had the opportunity. It should have been a much more deliberative process and involve the providers and others who had knowledge of the communities in a much more direct way, but given the time frame that we had to work in, it was extremely challenging, and then once the budget recommendations had been decided upon, then the request for notification of providers was immediate. So we were really operating under a lot of time constraints, and that's one of the reasons that we wanted to be responsive to providers, because we expected lots and lots of questions once the letters went out, and we're still -- we've scheduled meetings with providers. Our executive staff had a call list of providers to make sure that everyone got a phone call to make sure they got the letter, to see if they had any questions about it, to offer a meeting, because we 156 2/21/08 - PUBLIC HEALTH - RES. 080139 knew it wasn't an optimum process.

How many providers do you have, approximately?

We have -- it depends on how you phrase the question, because we have over 200 programs, but we have about 100 different providers, but for this process, we sent out over 300 letters.

To all of the programmatic --

Because individual providers might have more than one program. So all told, we sent out over 300 letters. So some providers got four or five letters because they had four or five programs, which then I think added further to the confusion, because they were trying to sort out what does the letter mean. There were three different template letters. One was very clear, your program needs to close March 1st. But then there were two others, one of 157 2/21/08 - PUBLIC HEALTH - RES. 080139 which was a slot reduction and one of which was just a budget reduction with the same slot numbers. So imagine yourself being an agency that provides five different services contracted through Safe and Sound and getting a variety of these letters for different sites saying slightly different things, because the impact on each site might have been different. So it was not an optimum process all the way around, and we would hope that as we go forward, we're able to sit down more deliberatively with the Administration and make sure that we're all clear on what the budget is that we're implementing and how it impacts on the providers and that we do have sufficient time to make sure that people are properly notified in a respectful way.

I may have misheard Ms. Zukoski. It seemed to me that she said most of the communication 158 2/21/08 - PUBLIC HEALTH - RES. 080139 came from DHS. Did you say that most of the correspondence you --

She actually said the paper.

Well, the paper.

Right. And that was another complicating fact that I think neither the City nor we had any control over, that there was information that got out to the media ahead of any of the meetings with the providers, which was very problematic.

Was it too difficult or too confusing to have sort of a meeting of all the providers to give an explanation or would that have been too confrontational?

I think that it would be helpful, but almost as soon as the letters went out, then the discussion about what the impact was and the discussion with Councilmembers 159 2/21/08 - PUBLIC HEALTH - RES. 080139 started. So now at this point, if we had a meeting with all providers, I'm not sure what specifically we could tell them, because we need to get clarity on what the revised City position is. So things have just been moving very rapidly.

So you don't know yet what's going to happen?

Right. We don't yet have a revised award letter from the City.

Well, you --

Do you have a range? I mean, in all these discussions on Tuesday, the Mayor made an announcement. Were you given a range of a budget allocation?

Well, we got a phone call from the DHS budget staff saying this is the number that you're going to get in an award letter, but what it's for specifically in terms of the 160 2/21/08 - PUBLIC HEALTH - RES. 080139 number of slots to be restored, the actual total budget line item amounts for AVRP and the curfew centers, we don't have that kind of detail.

What is that number?

The number that we received was 57.9 million.

So you still have to --

My understanding was that the Administration, when this whole chaos started, the Administration asked Safe and Sound for recommendations on cuts. What were the recommendations that you had made as it relates to going back potentially to the 54?

Many of those recommendations are what the providers received, but we also went back to our evaluation process and there were some additional recommendations that we made that the City did not accept, and one of 161 2/21/08 - PUBLIC HEALTH - RES. 080139 those is one that came out in the newspaper ahead of time and that was regarding the curfew centers. And one of the issues with the curfew centers had to do with the fact that for a number of them there are a number of days where there are no kids being picked up, so that the utilization of the centers is not as high as had been predicted. So that was one suggestion that we thought the City would want to consider in terms of the expenditure versus the number of kids being picked up. And there are issues with the availability of police to be able to have the time to pick the kids up, and I think that was their choice, was that with more attention on the police side, that the centers themselves would be more effective. They'd get more kids because the police would be picking more kids up.

Are those centers where I mentioned earlier we redrew the lines on them like two 162 2/21/08 - PUBLIC HEALTH - RES. 080139 months ago?

Right. This evaluation was done before that.

So when you were working on a $54 million budget and everybody was going along with the 54 million and then you were told you were going to get million and letters went 10 out to the providers that there will be 11 additional money coming in and then you 12 funded new schools, were you asking -- 13 I'm trying to get this in my head. If 14 you had a $54 million budget here and 15 people sort of expanded, did you ask them 16 to cut back their expansions and let's 17 get back to the 54 million? 18

In most cases, 19 that -- in the after-school programs, 20 that's what we did. We recommended in 21 this most recent revision that the expansion of after-school programs be closed March 1st, because some of them were slow in getting started and we felt that the impact there would be less 163 2/21/08 - PUBLIC HEALTH - RES. 080139 severe.

What about the new Beacon schools?

The new Beacons, what we did with those was, we ranked all 40 Beacons according to the criteria that I talked about earlier, whether they were expansion or existing, and looked at those that ranked in the bottom ten based on the utilization and the SACERS scores, the geography and the internal assessment of their administrative capacity.

So a Beacon school that had been open for a long period of time could find itself closed?

The utilization is a significant factor, because if we're paying for kids and families to use slots where the utilization is less than 60 percent, then the research shows that kids need to be going to programs more than once a week 164 2/21/08 - PUBLIC HEALTH - RES. 080139 and consistently over a period of years to achieve an impact that's positive on their behavior and their academic performance. So the number of kids who use the slots is really an important criteria. So that was weighed very heavily. So a program that had been in existence for a long time but only had maybe percent utilization would be 11 more at risk for being closed than a new 12 program that was up at 80 or 90 percent 13 utilization already. 14

But for 15 the cuts, though, they would have 16 remained open? 17

Right. 18

Well, at 19 some point, I think maybe you want to get 20 together with some of the -- the two ladies who testified who offered testimony regarding communication. I think that needs to be better improved --

Yes.

-- so that 165 2/21/08 - PUBLIC HEALTH - RES. 080139 people understand what's happening to them.

Sure. And they are absolutely right in that.

Now, I noticed that from the Mayor's fact sheet from his testimony on Tuesday that you've been asked to look at your salaries and benefits of your organization. Have you done that? I mean, what would the impact be on your salaries, your staffing?

Well, we did reduce our -- I actually have that information in my cheat sheet, so I can provide that to you. But we had a budgeted staff in the $75 million budget of about 103 positions and as of today, we have 73. So that's in my testimony. I talked about what we did is a belt-tightening process. And we laid off a number of people at the beginning of February as well. So with respect to the actual salaries and benefits when I first came 166 2/21/08 - PUBLIC HEALTH - RES. 080139 to the organization, I engaged a compensation firm to do a salary study and establish a compensation plan for the organization. So we implemented that in the fall of 2006, the fall and winter of 2006. So we've had a compensation plan that's based on industry standards since that time.

Also in this fact sheet -- maybe you can answer if you want to -- the Nutter Administration's FY08 actions announced February 19th hold children harmless while directing Philadelphia Safe and Sound to reduce its administrative budget, preserving all after-school programs, including Beacon after-school programs, preserving all curfew centers, preserving FAST, truancy and parenting programs, preserving AVRP services, directing of Safe and Sound to identify additional savings elsewhere in its budget, particularly in administration so as to maximize services for children, 167 2/21/08 - PUBLIC HEALTH - RES. 080139 administration seeking funding sources elsewhere in DHS, installing a City monitor with Safe and Sound to monitor its use of City funds, and preserving foster care and protective services for 14,000 children and youth by restoring 200 contracts cut by the Street Administration, to provide Safe and Sound with funding above the level approved by City Council and the State. Now, what do you think about that?

Well, that's a mouthful to comment on. So we're looking forward to sitting down with the Administration and making sure that we're both on the same page in terms of the restorations and what they'll cost, and certainly we will be looking at our own costs to see where else we can reduce them as well.

Well, that's not for you to answer. I mean, because you can't answer it. That's the 168 2/21/08 - PUBLIC HEALTH - RES. 080139 Mayor's promised commitment to these actions. So based on this, I would not send out any other announcements until you had a discussion to see --

That's right.

-- how all of this is going to take place, because it further exacerbates all of the pain and anxiety that the providers are experiencing at this time.

Exactly.

So hopefully --

Hopefully that will take place soon.

Thank you.

I'm going to add one thing to that that's not on here where I'm in disagreement with the Administration, and that is of the PTOs, because in all these discussions -- and I'm sure we have some testimony from PTOs -- I have a big concern around how we lay off 300 parents that we've engaged 169 2/21/08 - PUBLIC HEALTH - RES. 080139 in our school-based prevention program. (Applause.)

So that if the number is 57.9 million, or whatever it is, that we really look at how do we reduce things in a way so that we can preserve what we can until at least June 1st, almost at the end of the school year, but that we also look at what is going to happen next year and that we, again, impact that needs assessment program. But I will put on the record that I will continue to push the Administration to revisit the PTO situation in a way just like we've done with the kids. And while I understand that the focus is the kids, these are parents of those kids. So it's still -- (Applause.)

-- having an impact on their families.

Sure.

Okay. 170 2/21/08 - PUBLIC HEALTH - RES. 080139 Would you still stay around?

Yeah. I will be around. If I'm not here, I'll be out in the hallway.

Thank you. The Chair calls on Mr. David Fattah and Tracey Gordon. (Witnesses approached witness table.)

Tracey, you're familiar with this process. You come at 10:00. You stay until 6:00.

Yup. And I'm going to do ten minutes on this. Good afternoon, Councilwoman Tasco. Thank you for holding these meetings, and welcome and good afternoon to you, Councilwoman Sanchez. I just want to comment that if we can't trust a Mayor, whether he's incoming or outgoing, then we elected him, he was the Chief Executive Officer of the City, and I would wonder why he's not here testifying, along with his 171 2/21/08 - PUBLIC HEALTH - RES. 080139 Managing Director. I'm not here representing any particular group. I'm coming here as a parent, a parent who was born and raised in Philadelphia and, unfortunately, when I was married, I was in a very abusive relationship and had to leave, and without the support services that I got from the City, I would not have been able to take my four children to a safe haven, go back and get my college degree from both Community and Temple with honors and -- (Applause.)

-- not to mention be comfortable working a 9:00 to 5:00, knowing that my children, who all were at the time ten and under -- I had an infant at one point and that had to go to a provider, and I was very, very, very leery about leaving my kids, because I was his housewife and, you know, I have certain dietary rules and certain things that I want my kids to be exposed to, and 172 2/21/08 - PUBLIC HEALTH - RES. 080139 in this environment where you don't know -- volunteers is one thing, but when people are working around my children or anybody's child or grandchild, I want them to have a criminal background check and I want them to have child abuse clearance and I don't want them to be pedophiles and all that kind of stuff. This is a serious -- this is a blemish on the City of Philadelphia. This is a contradiction to Mayor Nutter's campaign that he wanted us to restore safety in our neighborhoods and he wanted to graduate more kids. When you suspend 300 truancy programs -- and you know for a fact that this was the first year that I ever received a letter that told me that, Your son was absent on this day and we didn't get a note. My kids are hardly ever absent and I had to think, because I'm like when was he absent, and that was as a result of this truancy program and the partnership with the School District of Philadelphia. 173 2/21/08 - PUBLIC HEALTH - RES. 080139 (Applause.)

And I think -- to fund parks is great and to fund recreation is great, but when you don't fund for a parent -- a lot of us are single parents, male or females, and a lot of us are struggling to work from day to day. A lot of us got to take two jobs. You cannot be efficient on your job when you don't know where your child is. (Applause.)

And $21 million is cents when it compares to the safety 16 of our children. 17 (Applause.) 18

I'm a community 19 leader as well. Okay? Studies will tell 20 you -- we don't have to do no more 21 studies. Between the times of o'clock and o'clock is when our children between the ages of and are introduced to drugs, pre-marital sex, crime. That's a study that's been done. 174 2/21/08 - PUBLIC HEALTH - RES. 080139 You go over the Youth Study Center and most of the kids, I will guarantee you, that are in Youth Study Center have never had the chance to be in a program that after-school programs provide, and for us to be dillydallying over $21 million, it is a disgrace. (Applause.)

It is a disgrace. And I took off from my job and I wrote a letter, and I know they say I have a big mouth, but I'm going to continue to have a big mouth, because how in the world could you tell a parent that they got until March the 1st to find an after-school program? How in the world are you going to tell -- (Applause.)

By the way, I've worked for one of the subsidiaries of Safe and Sound and I do believe -- this is my own opinion -- that it must be like a personal vendetta, because Safe and Sound always was synonymous with Naomi 175 2/21/08 - PUBLIC HEALTH - RES. 080139 Street, and it never -- when you say Safe and Sound, let's talk about the good things. I worked for -- I ran an after-school program. In one week, one week, I recruited 100 and had to turn almost 50 to 100 families away. I was over capacity, but I said we were going to make this work. And this was in Southwest Philadelphia. I have Hispanic families that was in that program. The parents could not even speak English from Dominican Republic who would bring their little kids to me, and I would have a six-year-old translate to their mother and the mother translated back to their child, because they needed a safe haven, because they had come here from Dominican Republic, come to work and they didn't have to worry about an after-school program because the after-school program was in the school that they attended until 6 o'clock. And not only that, not only that, we fed -- we not only fed those kids, they partnership with 176 2/21/08 - PUBLIC HEALTH - RES. 080139 programs like Spirit Puppet where they came in and taught the third and fourth graders not only how to write a play, produce a play, direct a play, they created their own super sized puppets and performed the play and performed it for the Paul Robeson months later to preserve those -- we had Drexel University coming there and teach those children and bring their families in and teach them what to eat and what not to eat. These programs are good, and this was all for free. The public school system every other week, half a day or -- you can't take those many days off at work and then -- (Applause.)

-- the Administration is going to tell Welfare to Work, you get off welfare because we're tired of you on welfare. Well, those Welfare to Work mothers have children and somebody got to take care of those children. And the programs -- and 177 2/21/08 - PUBLIC HEALTH - RES. 080139 the applications that we have -- by the way, I had 100 people signed up. It's this thick. Them parents filled them out. I had the lady that was Hispanic couldn't even read it. I had the six-year-old sit there and translate the entire -- because they needed those programs. So for us to be dillydallying around here for $21 million is a sad blemish. And as far as the Administration goes -- and we welcome it, a new day, a new way, whatever. You know what I mean? How in the world are you going to have people graduating when the parents don't even know where they kids is? And I'm telling you, I'm a community -- I'm in my community every day. I look out my window. I'm the noosy neighbor. The kids that don't go to after-school programs in my community are the ones that are either now in jail or now they're getting out of jail and 178 2/21/08 - PUBLIC HEALTH - RES. 080139 saying, Ms. Tracey, I'm trying to do the right thing. The kids that had supervision, whether the supervision was your mother said, You better not leave out this house until I come home, or they had them in music programs, those are the kids on my block that are now in college, graduating from college. So $21 million is chump change compared to what we need in these programs, and it is really a shame. (Applause.)

Thank you very much.

It is a shame. And then lastly I will say, we got one of the worst graduation rates in the country. The City of Brotherly Love, the worst graduation. And we're going to suspend the truancy program. The truancy program, them parents was going out in bad neighborhoods, knocking on them doors, you know, taking a chance of being assaulted by the children. The parents 179 2/21/08 - PUBLIC HEALTH - RES. 080139 who may be on drugs or knew they was wrong, maybe the kid wasn't going to school because they was being abused. And we are in the beginning stages of a serious Blood/Crip gang problem, and we better get more after-school problems, because we are getting ready to get just like Los Angeles is and just like Trenton is right now. And I just ask you, Councilwoman Tasco and every Councilperson that's here, $21 million is cents when it 14 compares to what our kids need. This is 15 crazy. And Mayor Nutter, as educated as 16 he is -- he has a daughter, Olivia. She 17 the one that put him on the map with that 18 commercial. She has. She put him on the 19 map. 20 (Applause.) 21

That girl, I bet you she in an after-school program. And from what I heard, that she got on the bus and went to her mother's job and was with her mother. How many of y'all can 180 2/21/08 - PUBLIC HEALTH - RES. 080139 bring your kids to your job and sit them there until you get off work? It's unfair, and we need to just stop playing these games. And that lady gave some statistics. How come we sent back money -- we should have never sent a cent back to DPW. That's a blemish on the community. That's a blemish on the City of Brotherly Love. And we need -- and, yes, he had to reverse that. He had to reverse that because he knew that the people that he doing the most damage on is the ones that was voting for him. It's a shame. (Applause.)

Thank you very much.