COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING BEFORE THE COMMITTEE ON PUBLIC PROPERTY AND PUBLIC WORKS - - - Room 400, City Hall Philadelphia, Pennsylvania Thursday, May 27, 2004 1:45 p.m. - - - BILL NO. 04331 - Authorizing the Commissioner of Public Property, to enter into a lease agreement for 4500 S. Broad Street BILL NO. 040367 - Approving certain contracts and transactions for purchase, storage, distribution, transportation and/or transmission of natural gas BILL NO. 040372 - Authorizing Commissioner of Public Property to acquire properties located at 901-47 N. Marshall St. And 910-48 N. Sixth Street BILL NO. 040373 - Authorizing Commissioner of Public Property to enter into lease agreement for properties located at 901-47 N. Marshall St. and 910-48 N. Sixth St. BILL NO. 040468 - Authorizing Commissioner of Public Property to acquire parcel of real estate located at 1208 Kater Street BILL NO. 040472 - Authorizing Commissioner of Public Property to sublease building located at 111-131 W. Hunting Park Avenue - - - PRESENT: COUNCILMAN DARRELL L. CLARKE, Chair COUNCILMAN JACK KELLY COUNCILMAN JAMES F. KENNEY COUNCILWOMAN DONNA REED MILLER COUNCILMAN FRANK RIZZO - - - V A R A L L O Incorporated Litigation Support Services 1835 Market Street, Suite 600 Philadelphia, PA 19103 (215) 561-2220 I N D E X BILL PAGE 040331 Joan Schlotterbeck, Commissioner, Department of Public Property----------- 040372 Ken Sipos, Department of Public Property-- 15 040373 Ken Sipos, Department of Public Property-- 17 040468 Joan Schotterbeck, Commissioner, Department of Public Property----------- 19 040472 Joan Schotterbeck, Commissioner, Department of Public Property----------- 23 040367 Janet Parrish, Esq., Executive Director, PGW------------------------------------- 28 Phillip Bertocci, Public Advocate, Philadelphia Gas Commission------------- 39 Abby Pozefsky, General Counsel, PGW------- 40 Steve Hershey, VP Community Initiatives, PGW------------------------------------- 44 - - - PUBLIC MEETING---------------------------- 47 - - - 3 BILL NO. 040331 - 5/27/04
Good afternoon. This is the Committee on Public Property and Public Works. A quorum is present. To my right, Councilman Kenney, Councilwoman Miller; to my left, Councilman Kelly, Councilman Rizzo. Will the clerk please read the title of the first bill.
040331, an Ordinance 11 authorizing the Commissioner of Public Property, on behalf of the City of Philadelphia, to enter into a lease agreement to lease from the Philadelphia Authority For Industrial Development portions of a building located at 4500 South Broad Street, under certain terms and conditions.
Good afternoon, Councilman Clarke and other members of Committee on Public Works and Public Property. My name is Joan Schlotterbeck. I am the Commissioner of the Department of Public 4 BILL NO. 040331 - 5/27/04 Property. I am here today representing the department to testify in support of Bill No. 4 040331, an Ordinance authorizing the Commissioner of Public Property, on behalf of the city, to enter into a lease agreement to lease from the Philadelphia Authority For Industrial Development portions of buildings located at 4500 South Broad Street, under certain terms and conditions. This bill will permit the city to lease certain office space located at the Philadelphia Navy Business Center, Building No. 501, for use as the new home of the Philadelphia Traffic Unit. The Department of Public Property supports this measure. And, accordingly, I respectfully ask that City Council approve this bill. I also ask that the rules be suspended so that the Ordinance may be passed upon second reading at Council. Thank you. I would be happy to answer any questions you may have. I also happen to have a copy of the 5 BILL NO. 040331 - 5/27/04 agreement of lease for entering into as an exhibit.
I just have a couple of questions about this lease. How much money did we invest in this building?
The renovations to date cost one million twenty-one seventy-one and eight cents, to be exact.
Traffic Police. And I probably would be able to determine that, if I read it, but help me. How long is the commitment there?
With three 6 BILL NO. 040331 - 5/27/04 five-year options after that.
And it is strictly the Traffic Division of the Police Department?
Any other questions by members of the committee of this witness? Is this, actually, technically, on the Naval Yard site?
Yes. I believe it is the first building as you go through on your left. The first building on your left. The bottom floor is occupied by the management company.
Mr. Chairman, one of my concerns was, what did this building do to the growth or the location of more appropriate businesses in that facility? 7 BILL NO. 040331 - 5/27/04 That's been my question since I first learned that we put the police department at that location. I understand that we are accommodating a commitment to put -- have a police presence at the Stadium Complex, but I was always convinced that this facility could have been located outside of that environment and allow a profit-making organization to occupy that facility to enhance what we're trying to do there. It is easy to fill that place up with city buildings. We can put the Water Department there, the Streets Department. And I understand the need for the Police. But I felt, honestly, that there was a more appropriate place for that location.
Yes, I understand your line of questioning, Councilman. Actually, that was somewhere where I was going. My understanding is that the KOZ zone for the Naval Center was to encourage profit-making businesses; therefore, giving 8 BILL NO. 040331 - 5/27/04 those tax incentives. But if we are going to place a publicly owned facility in that, that could potentially take away much-needed space and our ability to grow profitable businesses in the facility. And I am wondering, as Councilman Rizzo has indicated, why you made a decision to do that. I am assuming, based on the incentives on the table, it is probably a lucrative site.
To be perfectly honest, I don't know the answer to your question. I know that this decision was made probably three or four years ago. And I don't see anyone here from PIDC.
All right. Commissioner, can you do us a favor -- you may not be able to do that now -- can you provide or contact representatives of PIDC and ask them, prior to the passage of the bill, what the reasoning was in terms of locating a 9 BILL NO. 040331 - 5/27/04 publicly owned facility inside a KOZ zone.
Therefore, obviously, taking away potential growth of profit-making businesses.
My understanding, I'm not discussing the propriety of the use of the building in the KOZ. But I think the reason why it happened was that there was an agreement with the neighborhood groups in South Philadelphia, vis-a-vis the Stadium Complex, that they would move the Traffic Division closer to South Philadelphia so that they could respond better. Purely from a tactical perspective, I agree with it because I think it brings more police closer to the neighborhood when those large events are there. And I think the officers are happy because many of them don't have to travel as far as they used to have to 10 BILL NO. 040331 - 5/27/04 travel. It is much easier to get to by 95 and by 76 because it is right off of both exits. Whether or not it makes sense financially is a whole other story. But the parking is adequate for both the police vehicles and for their private vehicles. And it is right -- I don't know whether or not that building has been marketed for anything. It has not been a highly sought-after building. I think the original use of the building, I think they may be still in there, are the -- not maintenance staff, but --
The management company that runs the Naval Business Center. But I know that there was something that Veterans Stadium Neighbors and Packer Park and some of the other groups wanted. They wanted the white hat police in the location where they worked, for the most part. I think that's the reason they did it.
Again, my only 11 BILL NO. 040331 - 5/27/04 input and concern was that possibly there would have been an alternative to that site; to accommodate that need, that request, and not take away a potentially lucrative opportunity for the Navy Yard.
I am not taking a position on that. I am giving the history of kind of how they wound up there. I think they looked around at a number of different sites and could not find anything to accommodate them. I think a lot of the problem was parking the police vehicles and the private autos that the police officers use to get to work. I think that was a part of the issue.
How large a facility is this? Percentagewise, what are we speaking about here?
It is about 5300 square feet, and there are 126 parking places. The first floor is occupied by, as Councilman said, by security and by their management company.
What was that 12 BILL NO. 040331 - 5/27/04 again, Commissioner?
Cushman and Wakefield is their management company, and they occupy the first floor of this building.
You know, I don't have an answer on that. I will have to get back to you. I don't want to assume that it is just the same footprint as the second floor, which would be approximately 10,000 square feet, then.
But overall the complex itself, what percentage would you say this facility takes up? Just a guess.
Point of 13 BILL NO. 040331 - 5/27/04 information. The building, the existing building, or the total land?
And it is right inside the gate. And, as Councilman Kenney said, it wasn't a building that was sought after because they were always going to maintain the ground floor for their own use, which is management company use.
Any other questions of this witness on this particular bill?
So with the management company there and then -- the police department going on the second floor?
Is there any -- would there be any square footage left for anybody else?
Thank you, Councilwoman. Any other questions of this witness on this particular bill? There being none, will the clerk please read the title of the next bill.
Bill No. 040372, an Ordinance authorizing the Commissioner of Public Property, on behalf of the City of Philadelphia, to acquire from the Redevelopment Authority, for nominal consideration, properties located at 901-47 North Marshall Street and 910-48 North Sixth Street, under certain terms and conditions.
Councilman Clarke and members of the committee, I do not have written copy, but I can forward it to you. This property was part of the Marshall Mall parking lot, and last year we made it into a charter school. We leased it to a charter school. And the Redevelopment Authority 16 BILL NO. 040372 - 5/27/04 wanted to consolidate the space, so we -- the Redevelopment Authority condemned the property from the city, and the city's going to purchase it back from the Redevelopment Authority at nominal consideration. And then the next bill we will lease it back to the charter school.
The following bill. There is a companion bill, which is -- this bill is 040372, which is a bill allowing the city to purchase from the Redevelopment Authority at nominal consideration.
And the Department of Public Property is in favor of this bill. And I would like to request that the Rules be suspended so that it could be read on second passage.
Thank you. 17 BILL NO. 040373 - 5/27/04 Any questions of this witness by members of the committee? There being none, will the clerk please read the title of the next bill.
Bill No. 040373, an Ordinance authorizing the Commissioner of Public Property, on behalf of the City of Philadelphia, to enter into a lease agreement to lease to the Philadelphia Authority For Industrial Development, for further sublease to Leadership Learning Partners Charter School, a Pennsylvania nonprofit corporation, certain land located at 901-47 North Marshall Street and 910-48 North Sixth Street, under certain terms and conditions.
Chairman Clark and members of the Committee, the Commissioner of Public Property is in favor of Bill No. 21 040373. This bill will allow the city to enter into a lease agreement with the Philadelphia Authority For Industrial Development, and they in turn will sublease 18 BILL NO. 040468 - 5/27/04 this property to the charter school, the Leadership Learning Partners Charter School, so that they will be able to further develop it.
We would like the Rules suspended so that this may be passed on second reading of Council.
Thank you. Any questions? Thank you. Will the clerk please read the title of the next bill.
Bill No. 040468, an Ordinance authorizing the Commissioner of Public Property, on behalf of the City of Philadelphia, to acquire from the Philadelphia Housing Development Corporation fee simple title to, and all other real property interests in, a certain parcel of real estate with any improvements situated thereon located at 1208 Kater street, also known as the rear of 614 South 12th Street, under certain terms and conditions. 19 BILL NO. 040468 - 5/27/04
Yes. Good afternoon again, Councilman Clark. Again, I am Joan Schlotterbeck, Commissioner of Public Property. And I am here to testify in support of Bill No. 040468, an Ordinance authorizing the Commissioner of Public Property, on behalf of the city, to acquire from the Philadelphia Housing Development Corporation the simple title to, and all real estate interest in, a certain pacel of real estate with improvements situated thereon located at 1208 Kater Street, also known as the rear of 614 South 12th Street, under certain terms and conditions. The bill allows the city to acquire this parcel for use in conjunction with the adjacent property, which is leased by the city for Ready Willing and Able Homeless Shelter Program. The proposed property will serve as parking lot for storage for RWA vehicles and for placing and use of a fenced-in dumpster. This acquisition is in accordance 20 BILL NO. 040468 - 5/27/04 with understanding between the city, RWA, and the local neighborhood community group to clear the adjacent area of RWA's vehicles and improve the immediate area. The department supports this measure. And, accordingly, I respectfully ask that Council approve Bill No. 040468. I also ask that the Rules be suspended so that the Ordinance can be passed upon second reading at Council. I am available for any questions you may have.
Thank you. Any questions of this witness? COMMISSIONER KELLY: I just would like to know if the community groups that you mentioned do support this?
Could you tell me who the community groups are, or the community group in that area?
Actually, I guess I can tell you that I know through Rob Hess, who is a director of OESS, who is the 21 BILL NO. 040468 - 5/27/04 person that will be dealing with the community groups, that he has told me they have total support. And, to be perfectly honest, I do not know a name to give you, nor the name of the organization.
There are no 13 letters of support issued to any Council member here, as far as I know, or the Chair.
Thank you. My understanding from just being from around that neighborhood is that this is part of the Universal Properties work in the recreation of the King Plaza. It is part and parcel of it. It is part of the employment component. And I believe that the workers there are being used to help keep the neighborhood 22 BILL NO. 040468 - 5/27/04 clean. I have also seen them down at Franklin Roosevelt Park working. So they are kind of concentrated more in South Philadelphia, but they are all over doing jobs and cleaning. And I think it is part of the employment component of the Universal Plan down there. So I think, I am pretty sure, that it has community support. And we haven't heard any complaints. And we could probably check with Frank DiCicco
Since this is supported by Councilman DiCicco, I am sure --
I haven't heard any complaints about it. You see them in the blue jumpsuits working, keeping things clean around the area.
That's the magic 23 BILL NO. 040472 - 5/27/04 word. Okay.
Any other questions? There being none, will the clerk please read the title of the next bill.
Bill No. 040472, an Ordinance authorizing the Commissioner of Public Property, on behalf of the City of Philadelphia, to extend the terms of an agreement to sublease from the Philadelphia Municipal Authority the building located at 111-131 West Hunting Park Avenue, and to purchase fee simple title to the land and improvements thereon known as 111-131 West Hunting Park Avenue, all under certain terms and conditions.
Yes. Again, I am Joan Schlotterbeck, Commissioner of Public Property, and I am here to support this bill. It is an Ordinance authorizing the Commissioner, on behalf of the city, to extend 24 BILL NO. 040472 - 5/27/04 the term of the agreement to sublease from the Municipal Authority the building located at 111-131 West Hunting Park Avenue, Philadelphia, to purchase fee simple title to the land and improvements thereon known as 111-131 West Hunting Park Avenue, all under certain terms and conditions. This bill enables the extension of the term of the sublease for an additional four years, with the city's options to renew for an additional years and purchase to the 13 land or building at any time after the 14 beginning of the third lease year, being 15 August of 2004. This facility currently houses the city's Vector Control Unit and the Philadelphia Animal Care and Control Agency, PACCA. Public Property supports this measure, and, accordingly, respectfully asks that City Council approve the bill. And I also ask that the Rules be suspended so that the Ordinance may be passed upon second reading at Council. 25 BILL NO. 040472 - 5/27/04 Thank you.
Commissioner, when we enter into a lease or anticipate purchase, do we do complete environmentals on these buildings?
So we know what we are getting into before we do it; right?
Thank you, Councilman. Any other questions of this witness? There being none, will the clerk please read the title of the next bill. Actually, I think, Commissioner, is your testimony done for all bills?
It is. So you need me to get back to you BILL NO. 040472 - 5/27/04 specifically regarding --
Well, Councilman Kenney has clarified it. Now that we know, first of all, the building is already being used, and this is additional space, and there was agreement between the neighbors and, I am assuming, the Council President in terms of that location, so I am fine. I don't know. Councilman Rizzo, do you need anymore clarification?
I think the only question that you had was one that I agree we should get a response to. But if you are satisfied, I am satisfied. You had a question.
I assumed that the building was vacant, and the Traffic Division, i.e., the city, went in and renovated the building. But since you are telling me that the building was already occupied to an extent, it probably wouldn't make a lot of sense. It probably wouldn't be the type of building we could market in a reasonable way 27 BILL NO. 040367 - 5/27/04 for other opportunities, since there was already some activity in that building. So that was my question, as to whether or not it was a building that could possibly be made into a profit-making facility. But that's a whole other ballgame once that building is occupied. So I am okay. Councilman, are you okay?
Mr. Chairman, I am not sure if I gave my name, it is Kenneth Sipos, Department of Public Property.
Will the clerk please read the title of the next bill.
Bill No. 040367, an Ordinance approving certain contracts and transactions arising thereunder for the purchase, storage, distribution, 28 BILL NO. 040367 - 5/27/04 transportation, and/or transmission of natural and other gas entered into by the Philadelphia Facilities Management Corporation on behalf of the Philadelphia Gas Works, subject to certain terms and conditions.
Anyone to testify on this bill? JANET PARRISH, ESQ.: Good afternoon, Mr. Chairman and members of the committee. My name is Janet Parrish, I am the Executive Director of the Philadelphia Gas Commission. And I thank you for the opportunity to be here today to present the testimony and recommendations of the Gas Commissioners in support of this bill. We have submitted written testimony to you. That includes several appendices, one of which is the Gas Commission's order and resolution adopted at its meeting on May 18, which sets forth the results of the Commission's review of these same contracts and its recommendations to Council. Also included in our submission to 29 BILL NO. 040367 - 5/27/04 you is a set of proposed amendments to the bill, which would conform it to the recommendations and approvals issued by the Gas Commission. And we are urging approval of the bill with these amendments.
Ms. Parrish, when you say, "amendments," do you mean several changes in one amendment? Because we only have one actual amendment with a number of changes. Yes. You have one package, and it contains a series of language changes and additions. And we were requested, we were told it was advisible, to submit the whole bill as one package, showing all of the amendments, so you would have the whole piece before you. And that is what is contained in that document.
Can you, without reading the entire amendment, it is rather lengthy, can you just kind of walk us through the changes that are associated with this 30 BILL NO. 040367 - 5/27/04 particular amendment that will be offered today?
Yes, I would be happy to do that. And I would refer you to the first page of the written testimony, where there are six changes outlined.
Hold on a second. Have those amendments been circulated? All the members have the amendment? Okay. Thank you. I am sorry. Please proceed.
There are, basically, six substantive changes. And I would characterize four of them as really being in the nature of wordsmithing. Some words were added here and there just, basically, to clarify the language that was contained in the original Ordinance as put together by PGW. And those are outlined in the first three subbullets on the page, if you are following along with me. There was a minor tweaking to the 31 BILL NO. 040367 - 5/27/04 definition of "financial hedging" in Section 3 1(b)(1) of the Ordinance, where it would refer to sale as well as purchase of services. There is a very minor modification in Section 1(b)(3) of the bill to make clear that the reference to liquified natural gas facilities was meant to include the sale of L & G capacity. There are also several modifications in section 4, specifically Subsections 4 A, B, C, and E. This section sets out some reporting and disclosure requirements which we feel are advisible in order to ensure that there is transparency to the transactions that PGW is entering into and there is accountability to the city stakeholders. And what we simply did is to add a reference that when PGW is filing these reports with the Gas Commission, they would also be filed or shared with the public advocate who represents PGW's customers before the Gas Commission. And then jumping down to the second 32 BILL NO. 040367 - 5/27/04 three, the set of second three bullets on the page, again, the middle one, if I can jump around a little, is another modification to the language of Section 1(b)(2), which, again, is really a clarification. This section refers to certain types of transactions, specifically outsourcing of PGW's procurement of a part or all of its gas services. And we wanted to ensure that there was clarity to the definition of what would constitute a substantial part of those services. So we added some language to indicate that the 50 percent threshold that we talk about there could be arrived at either by a single transaction or by a combination of transactions. And that leaves just two other issues, and I think these are the two most substantive changes. One is, we are recommending that you add a new Section 1(a)(2). This section would require PGW, and PFMC, to obtain advance 33 BILL NO. 040367 - 5/27/04 written approval of the City Solicitor, as well as the President of City Council and the Chair of the Gas Commission, if they desired to make any further changes, substantive changes, to these contracts as they now exist and as they have now been approved by the Gas Commission and, hopefully, would be approved by Council, as well. So this would ensure that any further amendments would have to come back to the two bodies. We don't anticipate those.
When you say sign off by City Council, you said City Council President. Does that include the entire Council, does that include this committee, or simply the Council President? No. Our suggestion was, to expedite matters, that that would be done by the President of Council or her designee, the Chair of the Gas Commission or her designee, the City Solicitor or his designee. And maybe if I can back up a little bit and say something about the total 34 BILL NO. 040367 - 5/27/04 framework of the approvals, because we haven't actually talked about that. The management agreement between the city and the Philadelphia Facilities Management Corporation generally provides that contracts for the purchase of gas would be submitted first to the Gas Commission for review and recommendations, and then to Council for approval. The market conditions under which PGW is operating have changed considerably in the last 30 years, or since the time that those requirements were arrived at. And you will have before you at your upcoming hearing on June 7 our proposal for a longer-term solution, a more proactive solution, to deal with contracts in the future. The management agreement, however, also permits that in the case of an emergency or temporary need, which the City Solicitor's office has also characterized as being a, quote, unquote, business necessity rationale, that PGW would be authorized to enter into 35 BILL NO. 040367 - 5/27/04 these contracts and then submit them after the fact to both the Gas Commission and to City Council for its approvals. And that's exactly what these eight contracts are that are before you in this bill. So, really, technically, once these are approved, they are approved.
All right. There were, however, some concerns on the part of some of the commissioners regarding the special provisions that were added to one of these contracts. And, so, I think the Commissioner wanted to ensure that there was some additional safeguard in place that would not unduly tie PGW's hands -- because they do need to be flexible in these market conditions -- but, on the other hand, that there ought to be some level of pre-review and pre-approval if there was any interest in changing any of the terms of these contracts once they had been approved dually by Council and the commission. I hope that that clarifies that.
And then there is one last recommendation that we have, and that's the last bullet on the first page. And that is a recommendation that you add one additional provision to the Ordinance, and that would be Section 1(c). This provision also was attempting to provide additional safeguards and would have Council reserve the right to direct PFMC at any time by resolution to either terminate any of these contracts or to stop entering into additional transactions to buy gas under these contracts, short of terminating them, after first receiving the recommendation of the Commission. And, again, the intent here was that, should, in the future, conditions change and it be determined or felt that the conditions under which PGW was operating with these particular suppliers had become unacceptably onerous or subjected the city to liability that it could not accept, for example -- I am just giving you a for instance -- then Council would have the right 37 BILL NO. 040367 - 5/27/04 to say, do not take anymore gas under these contracts.
So that's really, I guess, the essence of what we recommended here today. I would like to say that this bill 9 and our recommendations came after a long process of review, a long collaborative process, involving not only Gas Commission staff and representatives of PGW, also had involvement of the law department and City Council staff, including City Council technical staff, to ensure that what we were coming up with as a framework here was reasonable, was workable, it was pragmatic, and yet it met the intent of the management agreement. And I am authorized to tell you that PGW, they have submitted written testimony, they are fully in support also of passage of this bill. And I believe I saw the public advocate come into the room, and I know he 38 BILL NO. 040367 - 5/27/04 will tell you, as well, that they are supportive. And, so, with that, you know, we could ask for suspension of the Rules also so that this bill can be passed on second reading. And also there are a set of proposed amendments, as we discussed, which I know Councilwoman Tasco, had she been here today, intended to offer. And I understand that Councilwoman Miller might be willing to do that, and we appreciate that very much. I am happy to answer any other questions you might have.
Any questions by the members of this witness? There being none.
Thank you, Ms. Parrish. Can you kind of hang around a little bit, though. Any other witnesses? Please state your name for the 39 BILL NO. 040367 - 5/27/04 record, sir.
My name is Phillip Bertocci, I serve as the public advocate for residential ratepayers before the Gas Commission. I understand your time is limited today. I fully support the proposed Ordinance 9 for the reasons set forth in the letter which I just distributed. We were able to use an expert witness from outside Philadelphia, totally an expert in gas procurement, to look over this situation and to advise us on how best to reconcile the interests of the various parties that are involved, which in the end are all the same, to have PGW in a situation where it can buy gas at the greatest advantage for customers. And we think that this does, this bill here, sets up a forum and does it in a way that protects all those interests.
Thank you. Any questions? Thank you, sir. 40 BILL NO. 040367 - 5/27/04
Mr. Chairman, I have a question. I would just like to ask Ms. Parrish that we have the testimony here from and Abby Pozefsky. I would just like to have a question for you, if I may. I have your testimony here. I just wanted to know what your background is. How long have you been the general counsel for Philadelphia Gas Works?
My name is Abby Pozefsky, and I am the General Counsel for the Gas Works. I have served in that capacity since July of 1998. And prior to that, I was Chief Deputy City Solicitor for Regulatory Affairs with the city law department. And I had been with the law department from 1986 to 1998. 41 BILL NO. 040367 - 5/27/04
How much experience do you have with utilities, dealing with utilities?
Well, I was the Water Department's General Counsel from 1989 to 1991. I was the Airport's General Counsel from '91 through until '98. And I have been with the Gas Works from '98 until the present.
And, of course, you advise the management of PGW on many, many matters, I'm sure, throughout the year.
That's correct. COMMISSIONER KELLY: I just have reservations sometimes about PGW. Every time I see one of their bills, I think how much more are we going to be paying for anything that we pass with PGW's name on it. I know I don't speak only for myself, but there ARE many, many other Council Members that feel the same way; that the decisions that you and a lot of other people have made in PGW over the last few years, have been horrendous. And I just hope that with the 42 BILL NO. 040367 - 5/27/04 Community Legal Services here as approving this, that what we're seeing before us today is probably more or less a technical improvement, more than anything. And I hope, I just hope, that you and the management of PGW can get on the right footing and to start putting that place back to where it should be, without costing the taxpayers and the ratepayers of PGW an excessive amount of money over the last few years. I just want to make that statement. And I hope that you take it back with the management. I know for one that I am not happy with the way they are running that. You know, some time ago there was a Mayor of Philadelphia -- and this is going back many years ago -- and he called the City Council at that time the worsT legislative body in the free world. Well, let me tell you something. With the present management of PGW, that's the worsT-run utility in the entire world. And I 43 BILL NO. 040367 - 5/27/04 just want to put that on the record. That I am not happy with that management whatsoever. And you are part of it, and you have to take some of the blame for that. I know the decisions they have made have been horrendous over the last few years. I just hope and pray that we are making the right decision even on these bills. Thank you.
Would you mind if I just digress for 30 seconds? Can we get an update on where we are with the surcharge?
Frankly speaking, I was amazed that it hasn't come up yet.
For that, Councilman 44 BILL NO. 040367 - 5/27/04 Rizzo, I am going to ask Steve Hershey, who is PGW's Vice-President for Community Initiatives, and who has been involved with that, to give you the update.
My name is Steve Hershey, I am Vice-President, Community Initiatives, at Philadelphia Gas Works. Councilman, the litigation at the Public Utility Commission concerning what's called the CRRC, or the surcharge, testimony has been filed. By agreement to the parties, the administrative law judge who oversees the litigation of the case has agreed to a three-week suspension of the litigation so that the parties can pursue the possibility of settlement, which is actively being discussed as we speak. There have been several sessions, the last of which was this morning.
I thank you. Comment on, at least, the media report about the amount decreasing from where we were originally. Is that accurate, that, 45 BILL NO. 040367 - 5/27/04 because of your collection effort, the amount of the surcharge, if implemented, could be significantly less than first discussed?
It is important to be very precise when we are talking about media reports and we are talking about an issue like this one. The only number that really counts, assuming that the surcharge were approved by the PUC and implemented, the only number that will count as to whether the surcharge is imposed, or how much it is, is the collections rate as of August 31, at the end of our fiscal year. Having said that, the collections effort to date has shown improvement over last year. It is much more sophisticated, broad-based than it was last year. And there have been indications that, if things go well, there will be -- and if the surcharge is approved, there will be no increase in rates through a surcharge.
Thank you, 46 BILL NO. 040367 - 5/27/04 Councilman Rizzo. Any other questions by members of the committee of these witnesses? Thank you. Thank you very much. Any other witnesses for this bill? There being none, we will now move from the Public Hearing into the public meeting. (Public Hearing adjourned.) - - - 47 COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC MEETING of the COMMITTEE ON PUBLIC PROPERTY AND PUBLIC WORKS - - - Thursday, May 27, 2004 - - - Public Meeting conducted by the Committee on Public Property and Public Works, held in Room 400, City Hall, Philadelphia, Pennsylvania, on the above date, to consider action on the following: BILLS 040331, 040372, 040373, 040468, 040472, 040367 - - - PRESENT: COUNCILMAN DARRELL L. CLARKE, Chair COUNCILMAN JACK KELLY COUNCILMAN JAMES F. KENNEY COUNCILWOMAN DONNA REED MILLER COUNCILMAN FRANK RIZZO - - - 48 PUBLIC MEETING - 5/27/04
Councilwoman Miller, do you want to read the first bill, call for a motion.
I move that Bill No. 040331 be reported out of this committee with a favorable recommendation and further request that the Rules of Council be suspended so as to have our first hearing at our next session.
All in favor of the bill? All opposed? The bill is reported out. Councilwoman Miller, the next bill, 040367, I believe, you have an amendment.
We have an amendment. The amendment has been circulated. And I move that this amendment be approved. (Duly seconded.)
All in favor of 49 PUBLIC MEETING - 5/27/04 the amendment? All opposed? The amendment is approved. Councilwoman, can you please make a motion on the bill as amended.
Okay. I move that Bill No. 040367, as amended, be reported out of this committee with a favorable recommendation, and further request that the Rules of Council be suspended so as to permit first reading at our next session. (Duly seconded.)
There being a second. All in favor? Those opposed? Bill No. 040367 will be reported out of committee as amended. Councilwoman Miller, motion on Bill 20 No. 040372.
Okay. I move that Bill No. 040372 be reported out of this committee with a favorable recommendation, and further request that the Rules of Council be suspended so as to permit first reading at our 50 PUBLIC MEETING - 5/27/04 next session. (Duly seconded.)
All in favor? Those opposed? Bill No. 040372 will be reported out of committee with a favorable recommendation and Rules suspension. Councilwoman Miller, on 040373.
I move that 040373 be reported out of this committee with a favorable recommendation, and further request that the Rules of Council be suspended so as to permit first reading at our next session. (Duly seconded.)
Those in favor? Those opposed? Bill No. 040373 will be reported out of committee with a favorable recommendation and with a Rules suspension. Councilwoman Miller, motion on 040468.
I move that Bill No. 040468 be reported out of this 51 PUBLIC MEETING - 5/27/04 committee with a favorable recommendation, and further request that the Rules of Council be suspended so as to permit first reading at our next session. (Duly seconded.)
All in favor? Those opposed? There being none, Bill No. 040468 will be reported out of committee with a favorable recommendation and with a Rules suspension. Councilwoman Miller on Bill No. 14 040472.
I move that Bill No. 040472 be reported out of this committee with a favorable recommendation, and further request that the Rules of Council be suspended so as to permit first reading at our next session. (Duly seconded.)
Those in favor? Those opposed? There being none, Bill No. 040472 will be reported out of committee with a 52 PUBLIC MEETING - 5/27/04 favorable recommendation and with a Rules suspension. That concludes this public meeting of the Committee on Public Property and Public Works. Thank you very much. (Public Meeting adjourned at 2:25 p.m.) - - - 53 C E R T I F I C A T I O N I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia of Thursday, May 27, 2004, were reported fully and accurately by me, and that this is a correct transcript of same. RE: COMMITTEE ON PUBLIC PROPERTY AND PUBLIC WORKS _________________________ DEBRA A. WHITEHEAD