COUNCIL OF THE CITY OF PHILADELPHIA COMMITTEE OF THE WHOLE - BUDGET PUBLIC TESTIMONY - - - Room 400, City Hall Philadelphia, Pennsylvania Wednesday, April 16, 2008 3:00 p.m. - - - PRESENT: COUNCIL PRESIDENT ANNA C. VERNA COUNCILWOMAN JANNIE BLACKWELL COUNCILMAN DARRELL L. CLARKE COUNCILMAN W. WILSON GOODE, JR. COUNCILMAN BILL GREEN COUNCILMAN WILLIAM GREENLEE COUNCILMAN CURTIS JONES, JR. COUNCILMAN JAMES F. KENNEY COUNCILWOMAN MARIA QUINONES-SANCHEZ COUNCILWOMAN DONNA REED MILLER COUNCILMAN FRANK RIZZO COUNCILWOMAN MARIAN B. TASCO BILLS 080022, 080154, 080155, 080156, 080157, 080160, 080161 and 080168 RESOLUTION 080173 - - - 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
Can I have everyone's attention, please. Thank you. Thank you very much. This is a continued public hearing of the Committee of the Whole regarding Bill Nos. -- MR. McPHERSON: 080022, 080154, 080155, 080156, 080157, 080160, 080161, 080168, 080173.
I would like to set some guidelines before we start our hearings. We have, I guess, approximately 50 witnesses to testify. We would really like to hear from everyone. So what we are going to do is allow everyone three minutes to testify. Now, my opinion is if you can't say what you have to say in three minutes, it's not worth saying. Our first witness is? MR. McPHERSON: Our first panel consists of Jim Helman, Mike McCrea, Claudia Sherrod, James Royal. (Witnesses approached witness 3 4/16/08 - WHOLE - BILL 080022, etc. table.)
Please identify yourself for the record and proceed with your testimony.
My name is James Royal. I live at 3121 Norris Street here in the City of Philadelphia and I'm here talking about Recreation.
Excuse me. Please, the noise level is much too high. May I suggest you pull the microphone closer to you.
I'd just like to say that with so much going on in the City, in this country for that matter, our children need the best care that we 4 4/16/08 - WHOLE - BILL 080022, etc. can give them, and in order to make that happen, we have to have more resources at the recreational level. I work with many recreation centers in North Central Philadelphia. Safe and Sound dollars really need to be moved back. We need to support the Dell, and we need to support our children and our staffs and the families. So we just want to throw that on the record, and as the little girl said on TV, "the end."
Claudia Sherrod, President of the Point Breeze Community Development Coalition and South Philadelphia Homes Executive Director.
Good afternoon, Council President Anna Verna and the City Council of the City of Philadelphia. 5 4/16/08 - WHOLE - BILL 080022, etc. It is always an honor and a pleasure to have the opportunity to speak here in the City Council Chambers. Like always, I am here with a concern for the youth of Point Breeze and the City of Philadelphia. For over three months, I have solicited the audience of the Mayor to get his support to build a state-of-the-art Class A recreation center at the Chew Playground site. I have yet to get that meeting. I work closely with the Smith Playground facility supervisor, Todd Calistro, to promote the best recreation programs for our youth. So I can honestly say that enough is not being done for the recreation centers. Today I urge you, the City, to redistribute funds more fairly to the recreation centers' needs and allow the very children that are becoming mischief to have positive alternatives. The ball is in your court and also the lives of our youth and their families. 6 4/16/08 - WHOLE - BILL 080022, etc. That's my testimony.
Thank you. As a matter of fact, I did take a visit at Chew, I think, one day last week and I think that the new recreation leader there is doing an excellent job.
It was clean. It was freshly painted. It really looked very, very nice.
And she's doing a great job as far as programs are concerned.
Good afternoon, President Verna and members of City Council. My name is Jim Helman. I'm a resident of Grays Ferry in the 2nd Council District. I am privileged to serve my community as Secretary/Treasurer of Vare Recreation Center, Acting 7 4/16/08 - WHOLE - BILL 080022, etc. President of Smith Playground and Vice-President of Donald P. Finnegan Playground. To paraphrase Gerald Ford when he succeeded to the presidency at the end of the Nixon era, our long public recreation nightmare is over. The previous Administration has finally passed into the history it so richly deserves. We are encouraged by talk about cooperation and partnership with the Mayor and City Council. We are excited about the openness, transparency and customer-friendly City service we are hearing about. We expect a brighter future. While it certainly is not time to grab our umbrellas, we do, however, see a few clouds on the horizon. For example, in his recent budget address, Mayor Nutter never once mentioned public recreation. Apparently, our City's tremendous infrastructure of 52 8 4/16/08 - WHOLE - BILL 080022, etc. recreation centers, 114 playgrounds, 160 parks and 80 swimming pools are not sufficiently important to merit even one sentence from the Mayor. We are bothered by that. In addition, while we are grateful, we're not exactly dancing in the aisles over the very modest budget increase given to the Department of Recreation. After so many years of budgetary hatchet jobs from the previous Administration, we expected a more reasonable assessment. Even with the budget increase, it is worth noting that the Department's budget is barely half the budget of a notorious and heretofore unacceptable no-bid contract holder that funds far fewer children in far fewer programs at far fewer locations and at far greater expense per child. There are other matters pertaining to the Department of Recreation that need to be addressed. 9 4/16/08 - WHOLE - BILL 080022, etc. Let's take the Capital Office, for example. A few years ago, President Verna authorized a capital expenditure to build new basketball courts at my facility, Vare Recreation Center. Within months after the job was finished, the surface on one of the courts began peeling away. The problem was addressed with the Capital Office at least three times. Each time brought a promise of action. Here we are in April of 2008 and the south basketball court is now a peeling mess. Our children and young people pay the public price by having to play on a defective court. The taxpayers pay the financial price amounting to some $150,000 for what may well be shoddy workmanship. By any analysis, it is a shame. This benign neglect by the Capital Office would not have occurred if the office were under the jurisdiction of the Department of Recreation as it had 10 4/16/08 - WHOLE - BILL 080022, etc. been for many years. Our community would have had recourse to Department officials at all levels. The District Manager, Program Director, Deputy Commissioner and the Commissioner would all have understood much better than Capital how important that basketball court is to our children and young people and they would have done something about it. President Verna, I have color photographs I'd like to submit --
-- of the court. We are continually grateful for the support provided by City Council over the years. Frankly, we sometimes marvel at just how much the people's representatives on Council understand the importance of public recreation to our neighborhoods. An example of this happened just this year when Council insisted that the Administration fill the 57 vacant positions in the Department of 11 4/16/08 - WHOLE - BILL 080022, etc. Recreation so that the Department would be better placed to serve the citizens of our city. We also note how Council restored the funding cuts by the previous Administration each year even though that Administration didn't spend the money. As an aside, maybe it's time for the citizens to decide whether to amend the Home Rule Charter so as to require the Mayor to spend the funds appropriated by City Council. Maybe it's time to think about that. Along with Police -- (Bell rung.)
Along with Police and Fire, the Department of Recreation is one of three City departments that have regular contact with the public on a large scale almost every day. Public 12 4/16/08 - WHOLE - BILL 080022, etc. recreation will continue to be on the front lines in our neighborhoods. If a child or teenager or young adult wants something to do, they need only walk through our doors. We would rather have them in our building than on our streets. We would rather hear the noise of structured programming and free play than the noise of gun shots. We will be there for our young people. We know City Council will be there. We hope the new Mayor and his Administration will be there with us. Thank you.
Thank you very much. ) MR. McCREA: Good afternoon. Mike McCrea. I'm President of Philadelphia Recreation Advisory Council. Philadelphia Recreation Advisory Council comprises almost 200 volunteer organizations serving youth in every community across the City of 13 4/16/08 - WHOLE - BILL 080022, etc. Philadelphia, and as President, it continues to be my responsibility to represent the membership in many different forums throughout the year. First of all, we support Bill 7 Carapucci as Mayor Nutter's choice for Acting Recreation Commissioner and we hope that the position will be made permanent very soon. We also endorse Mr. Carapucci's "back to basics" approach. As hard as we've worked in support of our partnership with the Department of Recreation, it's been abundantly clear over the last eight years that the physical condition and the programs at all facilities were not necessarily created equal. We've always believed that all facilities should have a minimum level of custodial aid and maintenance support and an equal level of basic service. It was clear to us that the new Commissioner started pushing that agenda on his first day, and it certainly was refreshing to hear the unvarnished 14 4/16/08 - WHOLE - BILL 080022, etc. and honest truth coming from the Commissioner's office. A number of us were present at the Recreation Department's scheduled budget testimony about two weeks ago. We all appreciated the spirited discussion. Staffing has been a critical issue for some time with us, and we agree with President Verna and City Council that 468 positions is not an acceptable level of permanent staff, especially when the Department of Recreation has been budgeted for 517 for the last three years. It was brought up at the hearing that currently the Recreation Department is 18 maintenance positions short and nine program positions short; that is, short of the minimum staffing levels required at all facilities. This is one of the important core concepts of what we call "back to basics" initiatives. We also support the 15 4/16/08 - WHOLE - BILL 080022, etc. Department's decision not to utilize Camp William Penn. It should be clear to anyone with knowledge of the situation that for $650,000 that it costs to operate the facility for eight weeks a year, we could easily send more children to any number of private overnight camps in the Pocono Mountains, providing an even better experience at far less a cost. The possibility has been kicked around for quite a few years, and we are glad to see that it's getting resolved. We also look forward to continuing supporting the gateway initiative the Commissioner spoke about, which is a concentrated effort on enhancing the entranceway of every facility, including improved lighting, fresh paint and signage and a generally clean and inviting look. While we battled, sometimes bitterly, with the previous Administration, our resolve and our partnership with the Recreation 16 4/16/08 - WHOLE - BILL 080022, etc. Department has continued to remain intact due mainly to the fact that we all continue to work towards the common goal of making our communities safe and livable. As much as we all do individually and as groups, however, the sad reality is that there are still children in the City that take their lives in their hands just opening their front door every day, and that should never become acceptable. It's clear to anyone with a pulse that we have much work to do, creating opportunities in every area of our children's lives, and we certainly have to take some key steps to try and gather some momentum. This is a marathon, not a sprint, and we intend to be here to finish the race no matter how long it takes. ) MR. McCREA: We understand in the real world there are limitations and constraints both physical and financial that we have to contend with. Part of 17 4/16/08 - WHOLE - BILL 080022, etc.
our charge as individual organizations is to support our local facilities, including raising funds and sharing the workload. Some facilities are supported more by outside private funding than City funding. That's just one of the key components to the partnership. We are all stakeholders in the same fight, all of us living it every day, taking it home with us every night. When we talk about getting more bang for our buck, the Recreation Department delivers a quality service to the public for less than $2 per child per day. It's hard to imagine that there's any better value in the City's budget than this. The Recreation Department's budget was about $8 million less per year at the end of the Street Administration than at the beginning. Just to think where we could be if the budget just stayed the same for the last eight years. 18 4/16/08 - WHOLE - BILL 080022, etc. No increase; just stayed the same. Imagine the state of our youth and how lack of funding has affected the lives of so many people. " Well, it's seven years later and we're still here cleaning up the mess that was left behind. The only thing we continue to ask for is a responsible level of funding for the Recreation Department and the support to implement the necessary changes. While there have been some extreme highs and lows in the journey, we have always experienced the support of City Council when we have needed it, and it's hard to imagine where we might have been without it, and for that, we say thank you very much.
Thank you. Thank you. 19 4/16/08 - WHOLE - BILL 080022, etc. (Applause.) MR. McPHERSON: Our next panel consists of Marvin Johnson, Cynthia Johnson, Keisha Watson and Walter Marlin. (Witnesses approached witness table.)
Good afternoon. Please identify yourself for the record and proceed with your testimony.
My name is Keisha Watson. I'm a parent and also an Advisory Council President for Granahan Advisory Council. I'm in the 4th District, and Councilman Curtis Jones is my Councilperson. And I was told that my letter should be in reference to the general need of the Department of Recreation, but I'd like to share more about what our needs are in our particular community. Honorable Curtis Jones and our dedicated Council at-large, I am here to represent Overbrook, one of the many 20 4/16/08 - WHOLE - BILL 080022, etc. communities in Philadelphia that is struggling to keep our children active and learning. We all can agree that idle minds can be a major contribution to intolerable behavior and often drug consumption. Lack of activities in young people's lives often lead them to criminal life-styles. It is time to break the cycle. As we all know, crime is at an all-time high and we are losing young men and women to death and incarceration. Our neighborhood recreation centers need larger, modern facilities to develop and house resources that are established and need room to grow. Our neighborhood recreation centers need buildings that support all season activities so our young and our old may find ways of working together to bridge the social gaps that our society has ignored for generations. The Department of Recreation needs more money to implement a radical 21 4/16/08 - WHOLE - BILL 080022, etc. change to be a support to the young, precious minds we must learn to cherish. And I just want to say that Granahan Recreation Center is a pretty large facility. It's at 65th and Callowhill, and we have a lot of land that could be used properly, but we have a two-by-four for indoor facility, and I'm literally speaking a very small indoor facility. We have people that want to donate computers, that want to offer chess programs and activities, indoor activities for younger and for older people, and we have a facility that cannot harbor this. We have two skate facilities, outdoor skate facilities, that are inoperable. They have waves in the concrete. We have basketball courts that have been donated, but they are not capable to be used as accessibly as our young people need to use them. 22 4/16/08 - WHOLE - BILL 080022, etc. So I ask that we spend some time to make sure that we use the surplus money and more money that may come to our city to help our young people thrive and be active. I thank you.
Thank you very much. Who is going to testify next?
Cynthia Johnson, Robin Hood Dell East Advisory. I'm here in support of the Robin Hood Dell East. We're asking for budget money. We know that this year the Dell will be closed for repairs. We're asking that the repairs be done as quickly as possible and that money would be available for the repairs. We're also asking to take into consideration that the contractors that will be doing the job, that it will be -- we will have minority contractors as well doing the work. The Robin Hood Dell is a venue 23 4/16/08 - WHOLE - BILL 080022, etc. that has been an entertainment venue in the City for many, many years. We were saddened to hear that it was going to close this year for repairs, that necessary repairs remain. We're hoping that the repairs could be done within the one-year span that we're told, and so in 2009 that we can open with full force entertainment for our community. The Robin Hood Dell has been an entertainment community for many, many years and has entertained our community. The price of the cost -- I mean, the cost of the programming and the entertainment has always been affordable to our community. Robin Hood Dell East also has school that we have there, DEMBI, and we hope to have budget monies to keep the venue open at a longer time other than just the summer season. I'm just here in support of getting the money, the budget, to support any of the recreation centers in 24 4/16/08 - WHOLE - BILL 080022, etc. Philadelphia, any and all.
Good afternoon. My name is Walter Marlin. I'm President of the Finley Advisory Council located in the 9th Councilmanic District in the 50th Ward. I'm here today in support of the Department of Recreation and to mention a couple of things. First, we want to endorse the appointment of the Acting Commissioner of Recreation, Mr. Carapucci. We think that's a fine choice. We hope that's made permanent as soon as possible, because he's a man who has the experience and the background to move things forward. Secondly, in terms of participation in our neighborhood, it's our opinion that recreation centers, outside of our public schools, are the second most occupied buildings in the 25 4/16/08 - WHOLE - BILL 080022, etc. City of Philadelphia after school between the hours of 3:00 and 6:00 p.m., and, of course, these are critical hours that most young people find something to do other than their homework. So why can't we consider redirecting some of our tax dollars back to our neighborhood recreation centers and playgrounds where our children and our grandchildren come to recreate, to learn and participate in well-sponsored, organized programs. I take my mind back to 1988 the last time I was here for testimony when we were raising money to get Finley rebuilt. We were successful in that endeavor. When Finley was redecorated -- rededicated in 1991, I want to quote to you the words of former Commissioner Delores Andy and former Prison Commissioner Gallagher. The comment was, Isn't it cheaper to recreate than incarcerate? And in our opinion, it is much cheaper to recreate than incarcerate. 4/16/08 - WHOLE - BILL 080022, etc. So I ask that the Council seriously consider sending more tax dollars back to our communities in terms of maintenance to maintain the facilities, as well as staff to provide programming. It would be a great help. Thank you very much.
Good afternoon. Please identify yourself for the record.
Yes. Good afternoon. My name is Marvin Robinson. I'm from the Haddington's, the 4th Ward, 4th District. We have a program called Keep the Kids Off the Street. We've been having that for over 12 years. I started over at the Haddington's Recreation Center also in March of 2008. I've been an Advisory Council member for 16 years, but 2008 of this year, the people had 27 4/16/08 - WHOLE - BILL 080022, etc. choose me to be the President for the Advisory Council at the Shepard Recreation Center. My main concern is this: We have a very beautiful project going on over at the recreation center. It's a $2 million project, and what I see over the years that I've been serving as a community leader, that the funding that we need to operate to keep the kids constantly to keep coming in our building, what I see that we have a program get started and then all the sudden when they give us the program, then they stop the money for the program, and that leaves the kids with nothing. And what I would like to see more -- we have a recreation center that's ten block -- I mean, an A-1 recreation center, which is out of the top ten of United States. We are in the top ten. And I would like to see more funding come our way, because we have more -- it's a six-block recreation center and we have a 28 4/16/08 - WHOLE - BILL 080022, etc. lot of kids come through there, maybe 2,000 kids throughout the whole week, and we do not have enough activities to actually keep them focused and to keep them coming to our recreation center. I see a lot of fights outside, and I realize that if we can have more activity programs for them, these things would not be carrying on. So I'm just asking the Council -- and Curtis Jones as our 4th District and 4th Ward leader has gave us some support as a Councilman, that he will try his best to try to keep the funding and bring more activities to our recreation center. And that's the only thing is my real main concern, that we can try to bring -- keep the money in our recreation center for the kids can actually constantly come there from Monday to Saturday and have the great things to keep them out of the streets. Thank you very much.
Thank you. Just a moment, please. 29 4/16/08 - WHOLE - BILL 080022, etc. The Chair recognizes Councilman Jones.
I know you have more testimony than that. We met until 10:00 at night.
I would love to say that to everybody. I've been in the committee elections. For 28 years I've been on committee. That's how long I've been involved with election, and I have met many leaders in my community, but I wanted to really say this, while I do 30 4/16/08 - WHOLE - BILL 080022, etc. have my Councilman in front of me, we as a community -- Councilman came out on a Friday and he sat with us. And, I mean, he sat for hours with us. So I just want to say personally as a leader, thank you, Councilman, because that really made a touch in my heart as a community leader. (Bell rung.)
We're glad to have you out there, and you're doing a great job. And I saw a gym packed with young people participating in organized sports. So we appreciate you for that.
You're welcome. (Applause.) MR. McPHERSON: The next person on our list is Frank Cervone. (Witness approached witness table.) 31 4/16/08 - WHOLE - BILL 080022, etc.
Good afternoon, Madam President and members of Council. I'm Frank Cervone from the Support Center for Child Advocates.
And I'm Jane Kyler-Borgerhoff and I'm here as Executive Director of Center City Crime Victim Services and representing the neighborhood-based agencies which cover the entire City of Philadelphia, from the Southwest up to the Northeast.
I'll be testifying on behalf of the 11 victim service agencies in Philadelphia. We are Center City Crime Victims directed by Janie; East Division Crime Victim Services; the Families of Murder Victims; North Central Victim Services; Northeast Philadelphia Victim Witness Services; Northwest Victim Services; my own Support Center for Child Advocates; the Victim Witness Services of South Philadelphia; West/Southwest; Women Organized Against Rape; and Women Against Abuse. You know 32 4/16/08 - WHOLE - BILL 080022, etc. us well. We serve your clients, your constituents. We answer your calls and their calls for help. Briefly, the City of Philadelphia's victim services 7 agencies seek $730,000 in City funding in 8 2008-2009 to provide support, courtroom 9 accompaniment and advocacy to more than 10 40,000 victims of crime. Over the last 11 four years, federal support for the work of our agencies has been cut an average of 18.5 percent, more than $300,000 in cuts. With our costs rising, we need City Council Victim Services Class 200 funding through the District Attorney's budget to help fill some of this gap. Our clients and our staff simply cannot sustain more reductions in program funding and services. There's an error in our statement of need. We are not asking for an increase. We join District Attorney Abraham in asking for static funding at the level of 730, same as last year. 33 4/16/08 - WHOLE - BILL 080022, etc. We turn just briefly to the end of our statement of need by way of summary. The crimes that we engage and the victims that we help suffer the horrors that we all know and read about: Sexual assault, elder abuse, burglary, assault, domestic violence, child abuse, neighborhood tensions, gangs and drugs. Our city is fraught by gun violence. We meet the victims, their families, the so-called co-victims of gun violence. Our agencies are involved in the lives and stories of so much victimization, trauma and need, and we are provided effective and critically important responses. We ask you to consider the important returns in the City's investment. We're serving and providing an important City, a government function. Yet, as private non-profit organizations, we're treated differently from other City-supported functions and agents, 34 4/16/08 - WHOLE - BILL 080022, etc. virtually all of whom receive regular wage and benefit increases. At a time when court backlogs and staff shortages and the Police Department and District Attorney's Office have generated delays in trials and problems for victims of crime in Philadelphia, the victim services agencies have increasingly been called on to fill gaps in services. Our counseling, our aid and intervention on behalf of violent crime victims have become increasingly important. The participation of hundreds of volunteers stands as a partnership for service and symbol of community support. My own organization involves 350 volunteer lawyers from the Philadelphia legal community. They donated in excess of -- services that are valued in excess of $3 million to more than 800 child victims, and we have similar numbers from the other agencies. (Bell rung.) 35 4/16/08 - WHOLE - BILL 080022, etc.
Each year, the programs recover -- I'm so glad they don't have those bells in court, you know. Each year, the programs recover hundreds of thousands of dollars in crime victim compensation dollars, representing three times the annual City payout in program services. In summary, please provide City funding of $730,000 for services to victims of crime. Thank you.
Thank you, and we certainly applaud you for the wonderful work that you do. Thank you very much. Please identify yourself again and proceed with your testimony.
I'm Jane Kyler-Borgerhoff. I really am here just to support Frank's statement of need and to remind all of you that we provide a really important, positive response for 36 4/16/08 - WHOLE - BILL 080022, etc. these victims, one at a time, in order to help them recover some of their financial losses and to help them get back on track so that they can return to productive lives, and much of that financial recovery actually goes back to health providers within the City of Philadelphia for medical expenses, counseling services and so on. So we actually are bringing back that amount of money into the City economy through helping the victims recover through crime victims compensation. Thank you.
Thank you. MR. McPHERSON: Our next two witnesses are Kevin Dow and June O'Neill, Board members of the Philadelphia Cultural Fund. 37 4/16/08 - WHOLE - BILL 080022, etc. (Witnesses approached witness table.)
Good afternoon. My name is June O'Neill. I'm the Manager of the Philadelphia Cultural Fund and I'm going to turn my time over to Kevin Dow, who will speak on behalf of the Fund.
Thank you, June. My name is Kevin Dow. I'm the Board President of the Philadelphia Cultural Fund. Good afternoon, Madam President, Councilmembers. On behalf of the Philadelphia Cultural Fund, I want to start by expressing my sincere thanks. Thank you for providing the Cultural Fund an opportunity today to advocate on behalf of the many arts and cultural organizations throughout your districts 38 4/16/08 - WHOLE - BILL 080022, etc. and in our wonderful neighborhoods. Also, I must thank you for the support you have, as a Council body and as individual members, provided over the years to ensure our great City's cultural community remains a vibrant and critical component of Philadelphia's fabric. Our city is indeed faced with daunting challenges, problems that have existed for a long time, some of them for a long time, longer than you and I have been here. Crime, homelessness, a desire to reduce taxes, reform the Zoning Code, improve education for our children, pay for the attention of our -- pay for and increase the attention to our natural environment, build a greater credibility and accountability in our government, and, of course, the most important thing of all, to increase jobs for our residents. For many years, this Council has fought both tooth and nail to address these, what have been at times, 39 4/16/08 - WHOLE - BILL 080022, etc. larger-than-life issues. Without a doubt, you have experienced success, and I commend you for the work you have accomplished over the years to find solutions to ensure Philadelphia continues to move forward at being the great city for which we all know it to be. I've lived here my entire life, born and raised in West Philadelphia, moving out and living in Northeast Philadelphia and then now settling in the Fairmount neighborhood to raise a family. In all my years, I have never experienced the City so ready to move forward to address the longstanding issues than ever before. There is an aura around the City, a feeling that we have the chance for the first time in a long time to do something that will be transformational, something that will enable us as individuals, as a city, as individuals as a city together, to become better than 40 4/16/08 - WHOLE - BILL 080022, etc. what we are in the past. This is a point in time that does not come around often, and we must take advantage. No longer can we address the same old questions with the same old answers, because as you know, we will get the same old results. Today I am here to convince you that the Cultural Fund should remain a fundamental component of the solution to these issues. Just over two months ago our forward-looking Mayor presented his vision for Philadelphia. It was reflective of the aura that surrounds the City and the desire he has in response to the voters to challenge ourselves to lead in a new way. Mayor Nutter's vision was backed up with a plan, the details of which you are no doubt reviewing to discern what is possible and what is not. The Mayor's vision focused on six broad areas. If Philadelphia is to take 41 4/16/08 - WHOLE - BILL 080022, etc. advantage of the opportunity we have to continue to make ourselves great, we will need to think differently and be creative in our approach to each one of these areas. And know, the Cultural Fund, as do all of our grantee organizations, over 230 of them, who are your constituents, believe that there is a strong rationale that demonstrates that arts and cultural organizations and the programs that they present are integral to the solution. It has been clearly proven that kids who are exposed to, participate in and feel passionate about arts are more likely to stay involved and, therefore, stay off the streets and out of trouble. More often than not, our neighborhood groups are the first options to taking the kids off the streets, the kids that are most troubled.
And when you see and hear that marching band from Tioga, you not only experience the power of music in the child's life, you experience a program providing a solution 42 4/16/08 - WHOLE - BILL 080022, etc. to our public safety strategies. Philly is a city of neighborhoods, and if you visit Taller Puertoqueno or the Polish American Cultural Center or the Samuel Fleisher Art Memorial, what do you experience? Organizations that not only provide great artistic opportunities for children, adults, visitors and residents, what you experience are organizations that create sustainable neighborhoods. In some situations, they create a sustainable neighborhood such as the Village of Arts and Humanity. I can recall my fondest memories of elementary school in Lamberton in West Philadelphia where my yearly treks to the Philadelphia Orchestra, the Philadelphia Museum, the Zoo and the Franklin Institute. Sure, as a child, the only thing I was excited about was the walk through the big heart or seeing all the giraffes graze in the sunlight. Little did I know there was 43 4/16/08 - WHOLE - BILL 080022, etc. purpose behind it. As an adult, I began to understand that we can use art to teach history, to teach social science and to teach math and literacy, visualization of giraffes grazing in the sun to teach us about geography, or music to teach us how to add. After speaking with most of you, I know you would agree that there are benefits to a child's education if we infuse arts and culture activities in their educational experiences. A thriving culture community helps stimulate revitalization by building bridges across the City's ethnic, racial and class divides. It generates revenue, boosting residency by attracting students, artists, teachers and boosting the citywide economic development by attracting major corporations and fueling the creation of smaller ancillary businesses such as restaurants, hotels and services needed to support tourism, enhancing our 44 4/16/08 - WHOLE - BILL 080022, etc. property values, tax resources and profitability. Above all and most importantly, providing jobs, jobs and jobs. Since 1991, the Cultural Fund has played a key stabilizing role for numerous organizations by providing critical operating funding that enables them to survive and grow. )
Your leadership in creating the fund and then followed by continued support over the years has been awesome. However, I said this before and I hate to say it again, it is not yet enough. Philadelphia needs you now to take it further. This is the time to take hold of this opportunity to increase our City's support for the arts and demonstrate what we all know and believe that is a proven vehicle to answer our most daunting challenges. I mentioned the Mayor has a 45 4/16/08 - WHOLE - BILL 080022, etc. vision. He put a plan forth to achieve that vision. It included an allocation of $4.2 million for the Cultural Fund. Yes, a hefty increase, but a statement that demonstrates how he believes the Fund can be supportive in helping to resolve the challenges we all face and that we all are trying to resolve. As you continue your deliberations and review the budget in whole, I ask that you hold steadfast and you let the aura that has engulfed this city take over you so that you can sustain this increase for the coming budget year. Working together, the Mayor, you, me and the entire cultural community, can lead in a new way and provide new answers to the same old questions. I am confident together we will achieve the outcomes the City so much deserves that will make us better off. Thank you very much. 46 4/16/08 - WHOLE - BILL 080022, etc.
Our next panel. MR. McPHERSON: Consists of Marla Shoemaker, Jaleel Khabeer, Tanzania Bey, Tyreece Powell. (Witnesses approached witness table.)
And members of City Council. I'm Marla Shoemaker, the Senior Curator of Education at the Philadelphia Museum of the Art, and I'm here today with Jaleel Khabeer, Tanzania Bey and Tyreece Powell, who are three of literally dozens of teens who dedicate their time to the Museum to give back to their community through their volunteer service. They also represent thousands 47 4/16/08 - WHOLE - BILL 080022, etc. of children who attend our programs on a yearly basis. We've come here to communicate to the Council our fervent belief in the power of art and in education in and through the arts to transform lives. Education is a core mission at the Philadelphia Museum of Art. Our programs begin with pre-schoolers who visit with their classes for experiential lessons that link art to reading readiness. And I was happy to receive today in the mail this great new important book on the impact of early art experiences on literacy development. Our programs go on to serve school-age students, college students, university/graduates students, life-long learners of every sort. Several of the museums who will speak with you today help out in our family programs. Philadelphia Museum of Art has a family-friendly admission policy. Children under 12 are always 48 4/16/08 - WHOLE - BILL 080022, etc. free at the Museum, and Sundays, which I think of as family day at the Museum, admission for all visitors is a simple pay-what-you-wish donation, ensuring that people from all walks of life can experience the excitement of standing before a masterpiece like Vincent van Gogh's "Sunflowers" or Henry Ossawa Tanner's portrait of his mother. I had the opportunity to see a VH-1 television interview with Philadelphia's great R&B singer Jill Scott, who was asked by a reporter what it was that inspired her to become the artist that she is. She mainly thanked her mother, but when talking about her wonderful mother, she mentioned in particular in that interview that one of the things her mother did was bring them to the Art Museum every Sunday because it was free. We are proud of that legacy, and we hope that with the City's continued support, we can continue to 49 4/16/08 - WHOLE - BILL 080022, etc. play a role in inspiring artists and art lovers of many years to come. Thank you.
Good afternoon, President Verna and members of City Council. My name is Jaleel Khabeer. I'm here with Tanzania Bey and Tyreece Powell. I am a Mastery Charter student and I am currently an intern with Tanzania in the family programs. I think the Museum is important because it brings families and exposes people to art and different cultures. My favorite gallery is the Arms and Armory. I liked it because it was a shock to me to see people took tasks so many details and make it the way that it is. I have also worked at the Museum on Sundays, and in my own opinion, the Sunday programs help young people to 50 4/16/08 - WHOLE - BILL 080022, etc. be creative at a young age so they have a better idea and understanding of art. The Asian New Year's was my favorite Sunday event because I got to work with kids and also learn something new about dragons and their importance in Asian culture. I want to be a graphic designer when I get older, and this internship has prepared me with a better understanding of art and more work experience and the opportunity to work with many different kinds of people. Thank you for your time.
Hi. My name is Tanzania Bey and I'm a junior at Mastery Charter High School.
Ms. Bey, would you just pull the microphone closer to you, please. Thank you. 51 4/16/08 - WHOLE - BILL 080022, etc.
My name is Tanzania Bey and I'm a junior at Mastery Charter High School. I have been an intern in the family program for weeks. Being 6 an intern has given me work experience 7 and will help me to be a photographer 8 when I'm older. 9 I like the black and white 10 photos in the Renoir exhibit because they 11 showed me how Renoir's life had really 12 been like. 13 I like the Museum because it 14 shows earth from many different cultures, 15 and it's important for people to use different perspectives. The Asian galleries are my favorite because when you are in the Japanese Tea House, you feel like you're really there. Thank you.
Good afternoon. 52 4/16/08 - WHOLE - BILL 080022, etc. My name is Tyreece Powell and I'm a sophomore from the Academy of Palombo High School in South Philadelphia. I came to the Philadelphia Museum of Art for the first time three years ago, and since then, I have been involved with the summer photography program and the film program. I worked in family programs and volunteered as a teen docent. Through the Museum, I have been able to meet different people from different cultures. The Museum offers young people jobs and an educational place to be where we can learn about different cultures through art. I have also learned new things that make me want to work harder. I have developed better people skills and have become more responsible and organized. A lot of PMA staff that I have worked with have been mentors to me. Around my neighborhood it's hard to find good role models and I truly appreciate 53 4/16/08 - WHOLE - BILL 080022, etc. my mentors at the PMA who have stepped up for me. It is important for the City to support the Philadelphia Museum of Art so that students like me can continue to have the same opportunities and a better chance at a better future. Thank you.
Thank you very much. MR. McPHERSON: Our next witness is --
Thank you all very much. MR. McPHERSON: -- Peggy Amsterdam, the Executive Director of the Philadelphia Cultural Fund. (Witness approached witness table.)
Good afternoon. Welcome. 54 4/16/08 - WHOLE - BILL 080022, etc.
Good afternoon, Council President Verna and esteemed members of City Council. My name is Peggy Amsterdam and I am the President of the Greater Philadelphia Cultural Alliance. I represent over 350 regional arts and cultural institutions, and on their behalf, I'm here to testify in support of an increased public investment in arts and culture in the City's Fiscal Year 2009 Operating Budget and Five-Year Plan. This year, Mayor Nutter has proposed a $2 million increase to the City's Cultural Fund. We wholeheartedly applaud and endorse this increase and urge all of you to support it. The work that is accomplished by the arts and culture sector is invaluable to our city and our region. Cultural organizations communicate our individual and collective experiences. Regional arts and culture organizations provide almost 56,000 events annually, 55 4/16/08 - WHOLE - BILL 080022, etc. with over 50,000 of them taking place in Philadelphia. This means that our residents and tourists are exposed daily to over 100 offerings that contribute to increasing our tolerance for diversity, to rounding out our education, to making the City more livable, and our cultural institutions are actually visited by over 10 million people annually. The primary activity of our sector as a whole is supported by the City investment made through the City's Cultural Fund, which provides general operating grants to over 220 cultural organizations, and it's with these general operating dollars that cultural organizations can make investments in broader social areas. In Philadelphia County alone, cultural institutions support over 12,000 full-time and part-time jobs. Salary expenses, along with the standard office equipment that is needed for those employees, are paid for by general 56 4/16/08 - WHOLE - BILL 080022, etc. operating support. 7 million school children annually. These activities will not continue if organizations cannot meet their basic needs. Public support from the government helps to stabilize our sector. When public support is high, arts and cultural organizations are less vulnerable to declining funding from other sources. This is because public dollars are used for leveraging other dollars and for keeping organizations from being too heavily reliant on other sources. Public dollars help to balance the weight between an organization's other sources of income. Along with the Philadelphia Cultural Fund, the Greater Philadelphia Cultural Alliance is thrilled to play a role in Philadelphia's and the region's continued growth, and we know that arts and culture play a key role in that 57 4/16/08 - WHOLE - BILL 080022, etc. process. We are here on behalf of the entire cultural sector to extend our support to the new Office of Arts and Culture and to the City's initiatives to increase access to the arts for children and youth, to leverage the role of the arts in economic development, business and population growth, and to promote tourism. Our members and the Cultural Fund's grantees provide exemplary programming throughout the City and region and we offer the research, policy and planning tools to help government leaders and policymakers take the fullest advantage of the great work they do every day. Speaking of which, I hope that you will all join me and the Greater Philadelphia Cultural Alliance on May 8th for a very important announcement about the next steps that the region's cultural organizations will be taking to deepen our connections to residents and visitors alike. We have some very exciting news 58 4/16/08 - WHOLE - BILL 080022, etc. to share, including a major investment that will allow many cultural organizations to expand their work in engaging new audiences and further serving the residents of our city and region. We'll also be unveiling our next research report at our annual meeting this coming September.
Based on data from the Pennsylvania Cultural Data Project, the report will provide a ten-year analysis of growth in the sector, as well as a current snapshot of the state of arts and culture across the region. )
We trust that these resources will support the work that all of you do in your efforts to advance the lives of Philadelphians and will enable you to harness the power of arts and culture to continue the great trajectory of our city and region. Thank you for allowing me to 59 4/16/08 - WHOLE - BILL 080022, etc. speak here today, and I urge you to support the $2 million increase in the Cultural Fund for 2009.
Thank you very much. We appreciate your coming in to testify.
Thank you. (Applause.) MR. McPHERSON: Our next panel is Stan Shapiro, Sherrie Cohen and Jonathan Stein. (Witnesses approached witness table.)
Good afternoon. And I do have copies of my testimony. We're all going to talk about taxes from slightly different perspectives, but pretty much on point. And first I want to apologize. I completed this somewhat late last night and there are some 60 4/16/08 - WHOLE - BILL 080022, etc. sentence fragments and a few typos, but you'll have the gist of what I'm saying here in this handout. So good afternoon once again. My name is Stan Shapiro. I'm here to testify for Neighborhood Networks and for One Philadelphia on the important tax issues that are now before you. In particular, I want to reiterate my testimony of February 27th that we oppose repeal of the Cohen tax cut, particularly as a way to pay for a business privilege tax cut. Any repeal of the Cohen tax rebate in a city with a poverty rate of percent would be simply 18 unconscionable. But aside from its 19 immorality, witnesses for One 20 Philadelphia have also previously laid 21 out the economic reasons why such repeal 22 would be foolhardy. Putting dollars in 23 hands of the working poor is the best way 24 to stimulate the economy. Almost all of 25 the taxes rebated will be spent at local 61 4/16/08 - WHOLE - BILL 080022, etc. businesses or to pay for the basic costs of keeping families together, food, rent, utilities and other necessities of life. Maintaining intact families is, of course, a major objective of public policy, one that this Council has frequently paid homage to. There can be no clearer way of putting policy in service of those good intentions regarding families than to maintain the Cohen wage tax rebate. But maintaining the rebate means, in the eyes of some, competing with another essential public policy; namely, reducing the tax burden on business, especially small business. I'm not here to tell you that reducing taxes on small business would be a bad thing or that it would not be a fair thing. And it could be done easily if the Commonwealth of Pennsylvania treated the City fairly by, among other things, picking up essential county expenses such as funding the courts. But 62 4/16/08 - WHOLE - BILL 080022, etc. the Commonwealth is not doing that, as amply pointed out in the Mayor's Five-Year Plan. So this Council has to make choices, and they're not particularly pleasant ones. Among them it has to decide this: Are business tax cuts the most important thing to pay for compared to other priorities that the Council might adopt? We think not. I've already spoken on why business tax cuts should not be a higher priority than the Cohen tax rebate. Dollar for dollar it's clear that the Cohen rebate provides more bang for the buck. But other sources of revenue to pay for BPT cuts are also problematic, and here I'm talking primarily of lost opportunity costs. To cut business taxes misses the opportunity to put more funding in the schools. To cut business taxes misses the opportunity to put more money into childcare. To cut business taxes misses the opportunity to put more money into libraries and the arts. To 63 4/16/08 - WHOLE - BILL 080022, etc. cut business taxes misses the opportunity to put more money in the Housing Trust Fund. All of these missed opportunities will extend rather than end the deep chasm between rich and poor that we might well characterize as the phenomenon of two Philadelphias, one well off and prosperous, the other much larger, depressed and growing in hopelessness. And we should be clear. The Five-Year Plan makes no rosy assumptions about business tax cuts paying for themselves. The Finance Director has stated publicly and privately that the City's revenue estimates include zero dollars resulting from the Administration's proposed reduction in business taxes. So every dollar of such cuts is a dollar that this Council cannot appropriate to care for desperate City needs. (Bell rung.)
I only have one paragraph to go. 64 4/16/08 - WHOLE - BILL 080022, etc. We recognize that compromise proposals are circulating which would involve less drastic business tax cuts than are contained in the legislation that's already been introduced. Although we have only seen preliminary revenue estimates for one such proposal, we understand that it may save 60 percent of the revenue that would be lost under the broader tax cut scenario now pending. That would be an improvement, particularly if the -- and here comes the sentence fragment -- particularly if the bulk of the taxes cut go to neighborhood business. But whatever this Council ultimately chooses to do, we urge you to do it recognizing that you cannot do everything that you wish. Reality simply won't allow it. We urge you to choose your priorities carefully, and in the end, we hope that you will put at the top of your list those things which lift us all by first lifting those who are now barely scraping by. 65 4/16/08 - WHOLE - BILL 080022, etc. Thank you for your attention, and after my colleagues testify, I'd be happy to answer any questions.
Thank you, Stan. The Chair recognizes Councilman Goode.
Thank you, Madam President. Good afternoon, Mr. Shapiro.
Mr. Shapiro, are you familiar with my position on the Cohen tax cut?
Absolutely. I was probably the first person to co-sponsor it. I absolutely voted against slowing it down. I voted to override the Mayor's veto. I will not 66 4/16/08 - WHOLE - BILL 080022, etc. vote to repeal at this point, and I see no connection between that and business taxes.
Well, I certainly hope that -- first of all, we thank you very much for your position on that rebate and we think it's the correct one and we thank you for being out front on it.
The second question I have for you is, do you know how many jobs the City lost between 1970 and the year 2000?
I do not have an exact number. I do not believe that there's any proof that's ever been shown that there is --
I asked you a question. Do you know how many jobs the City lost --
-- between 1970 -- the answer is 220,000 jobs. 67 4/16/08 - WHOLE - BILL 080022, etc. During the same period of time, between 1970 and the year 2000, do you know how many jobs the suburbs gained?
The suburbs went from 870,000 jobs to 1.7 million jobs. The suburbs almost doubled the amount of jobs that they had during the period of 1970 and 2000, while the City lost 220,000 jobs, about percent of 12 its job base. I just wanted to make you 13 aware of that. 14 Thank you for your testimony. 15
Thank 17 you. 18 Thank you, Stan. 19 Who is going to testify next? 20
Hi. Good 24 afternoon, everyone. I have copies of my 25 testimony. 68 4/16/08 - WHOLE - BILL 080022, etc.
Hello. My name is Sherrie Cohen. It is appalling and unconscionable that Mayor Michael Nutter is proposing to eliminate my father, Councilman David Cohen's, tax credit for the working poor of this city. It is appalling and unconscionable that the Mayor is seeking to balance the budget on the backs of the working poor. It is appalling and unconscionable that with one hand Mayor Nutter last month presented the Philadelphia Cultural Fund's David Cohen Award given to a cultural organization demonstrating an outstanding commitment to social and economic justice and with his other hand smacked my father in his grave, as Councilman Kenney said of Mayor John Street, when our former Mayor sought successfully to delay my father's tax 69 4/16/08 - WHOLE - BILL 080022, etc. credit in 2006. How many reasons are there to oppose the Mayor's attack on working poor people in the City? To quote Helen Gym, there are 300,000 reasons, the number of working poor people estimated to live in Philadelphia. Who are these people? These are the people earning less than about $32,000 a year for a family of four. These are the people who work hard, yet cannot make ends meet. These are the people whose work fails to afford them basic dignity. " 70 4/16/08 - WHOLE - BILL 080022, etc. study. 8 percent. 9 The working poor are the people 10 whose numbers are rising faster in 11 Philadelphia than in the nation as a 12 whole. 5 percent. 1 percent. The poverty rate increased 15 almost seven percent in seven years, 16 whereas the increase in poverty in the 17 state and nation was about two percent 18 during these years. S. cities. More than 37 percent of our children in the City live in poverty, which is more than double the rate in the state at 17 percent and more than one and 71 4/16/08 - WHOLE - BILL 080022, etc. a half times as great as the national average, percent. In two census 4 tracts in North Central Philadelphia, 5 Tracts 166 and 167, 44 percent of the 6 people are living below the poverty 7 level. " 16 Low-income families in Philadelphia have 17 to pay hundreds more than higher-income 18 households to buy the same car, hundreds 19 more to borrow the same amount of money 20 for an auto loan, hundreds more to insure 21 the same car and drive, hundreds more to buy food in their neighborhood, hundreds more to obtain a short-term loan, hundreds more to establish the same type of utility service, hundreds more to use 72 4/16/08 - WHOLE - BILL 080022, etc. the same amount of gas to heat homes and cook meals, hundreds more to borrow the same amount of money for a home loan, hundreds more to insure the same value of a home, hundreds more to buy the same appliances and furniture. These are the people who do not meet the 2006 self-sufficiency standard computed by PathWays PA, which determines how much people need to live and work without public or private assistance or subsidies. Being economically self-sufficient means you can pay the rent, have a car, have a job and pay your bills. You don't need to depend on anyone for anything. You are off all assistance programs. You can pay for daycare for your children, you can buy groceries and you can pay for life's necessities. )
PathWays found that a single parent with an infant needs to earn $15.57 per hour. A single parent 73 4/16/08 - WHOLE - BILL 080022, etc. with a pre-schooler needs to earn $15.93 an hour, while a single parent with both pre-schooler and a school-age child must earn $20.12 per hour to meet her family's needs. Each adult in a two-adult family with a pre-schooler and a school-age child in Philadelphia would need to earn a self-sufficiency wage of $11.08 per hour. Among Philadelphia's working poor are those who have to reduce the size of their meals or skip meals entirely because they cannot afford food purchases, according to the Pennsylvania Health Management Corporation's 2004 Household Health Survey for Southeastern Pennsylvania, which documented 122,000 such households, including nearly 61,000 children. Among the working poor are those who have to wait five months to schedule an appointment with the doctor at a health center, according to a 2007 report released by the Philadelphia 74 4/16/08 - WHOLE - BILL 080022, etc. Unemployment Project. These are the people who will invest this tax rebate into their communities and help revitalize every neighborhood of the City. The Internal Revenue Service estimates that every dollar received from the Federal Earned Income Tax Credit puts up to $3 back into local communities. These are the people written about in "A Tale of Two Cities," the Philadelphia Workforce Investment Board's 2007 report. These people are in City Council today and are our neighbors, our family members, our co-workers, our friends. Mayor Nutter and City Council, the choice is yours. Will you write off these people and increase the divide between Philadelphia's two cities or will you choose instead One Philadelphia? Thank you.
Thank 75 4/16/08 - WHOLE - BILL 080022, etc. you very much. (Applause.)
Good afternoon, Councilwoman Verna, President Verna, City Council. My name is Andre Butler. I am the Board Chairman of the Philadelphia Unemployment Project, and I'm here to lend support to what my colleagues have said about we are against the proposed repeal of the Cohen tax cut. These people -- I am part of the working poor, and I'm going to be a half an hour late for my job because I wanted to say something here to City Council today. Let's not forget that two years ago we were the fifth largest city in the country. We're now the sixth largest city in the country, and if we continue to go down this particular path such as wanting to repeal the Cohen tax cut, we're going to soon become the seventh, 76 4/16/08 - WHOLE - BILL 080022, etc. eighth, ninth or tenth largest city in the country. We're driving people away. As Councilman Goode noticed about the amount of jobs going to the suburbs, we're going to be sending more to the suburbs if, in my opinion, our opinion, if this particular tax rebate is repealed. These are the main people that need their money. I happen to have witnessed a foreclosure last week of people that I actually knew. Every month they were just pennies short of that payment, and the mortgage company would not accept pennies short of the payment. You have to pay exactly what the mortgage said, and they could not accept the payments being pennies or dollars short. Therefore, they continued to regress and regress and regress and regress, and last week they were foreclosed, evicted out of their homes. And that's just one family. 77 4/16/08 - WHOLE - BILL 080022, etc. There are thousands of others who will be because of the subprime collapse of the subprime market. They're senior citizens, people every day who need their medications, who need that $5 or $10 to pay for that co-pay. They can't pay 4.95 or 8.95 or 9.75. They must pay the full $10. They must decide between whether they want to eat or get their medications. Therefore, it's important this tax cut stay in law as it is now, as it is now in the law. Let's -- in our opinion also, if you repeal this tax cut, that's not tax reform. That's tax regression. We're supposed to be moving forward, not going backwards. And to do that, it would not be the most prudent thing to do. And briefly, on the business privilege gross receipts tax cut, remember, the reason why many of those tax cuts were put into place, because they said they're going to bring jobs to 78 4/16/08 - WHOLE - BILL 080022, etc. the City. Well, remember, people like Comcast and Wal-Mart people, they bring workers from out of state in here. They didn't do much for the people that are here that want jobs. Most of those jobs are people that are out of state that are brought here to work. And so let's remember that we are a city of brotherly love, and to fully and totally show brotherly love, let's respect the people on whose backs this city really is built. And if I can say a few words to the sentiment of your heart, as Sherrie Cohen said -- and I'll say it in my own words -- let's honor a dead man's wish, who was well loved by everybody in this city. Thank you. (Applause.)
Thank you. The Chair recognizes Councilman Goode. 79 4/16/08 - WHOLE - BILL 080022, etc.
Thank you, Madam President. Very briefly, as part of, I think, some legislation that might be proposed tomorrow, there has been tax data circulated for years 2005 and 2006. Are you familiar with that data?
When you refer to those businesses like the Wal-Marts and other large businesses that actually bring in over $10 million a year, are you familiar with how many there are in the City?
In 2005, there were 790. In 2006, there were 885. Don't you think that's kind of ridiculous for a major metropolitan city to have less than a thousand businesses with revenues of that much?
I would say that 80 4/16/08 - WHOLE - BILL 080022, etc. for what -- if the numbers that you're giving, since that's not my expertise, if it's saying that the revenues are less than they should be, I have to agree with that.
There are about 80,000 people who pay business taxes within the City of Philadelphia, and roughly only about 800 out of the 80,000 have that level of revenue, and that is a problem and that is a major problem for the City of Philadelphia and a major reason why we don't have enough jobs. Thank you.
Yeah. Thank you, President Verna and fellow Councilpeople. I'm Jonathan Stein, general counsel at Community Legal Services, on behalf of PUP and also a former member of the Tax 81 4/16/08 - WHOLE - BILL 080022, etc. Reform Commission of Philadelphia. If I can -- I really just want to address my remarks. I won't read my prepared statement, nor will -- and this is a list of all the organizations that support continuing the Cohen tax cut. But if I can just address Councilman Goode's questions, which really may not have gotten -- perhaps they were rhetorical questions, perhaps they were questions seeking some answers, but there's -- no one doubts that jobs have been lost, that you have -- your 800 companies are the largest that pay the bulk of the business privilege tax. The question really is, what is the nexus between cutting taxes and growing the economy and adding jobs. Do we seriously believe that giving a tax windfall to Wal-Mart will get them to expand their business or to add more employees? Well, that's a rhetorical question, but I'll invite your answer in a question, though.
I'll be glad 82 4/16/08 - WHOLE - BILL 080022, etc. to answer it.
Because there are a lot of studies -- and this is why this is a debatable subject -- about is tax cutting really going to bring the panacea. We see from the City's budget that not one job is predicted to be created by the business privilege tax cuts. Not one dollar will be generated in expected revenue, that the most -- just as another just a recent example, maybe you've read the op-ed that was in the Inquirer a couple days ago by leading urban thinkers from the Brookings Institute and from the Greater Philadelphia Economy League. What do they talk about growing the metropolis like Philadelphia? They talked about promoting innovation, job quality, workforce quality, infrastructure. Not one word in this entire long op-ed about cutting taxes as a panacea to growing a metropolis. And without really trying to debate that point right here, I'm just 83 4/16/08 - WHOLE - BILL 080022, etc. saying there is --
It is something of wishful thinking to believe that business tax cutting will work. Nevertheless, I'm ready to concede, my colleagues, other groups are willing to concede that if one wants to cut business taxes, cut them for small businesses, for businesses in Philadelphia, and let's not give away the store with business tax cutting. Let's draw some reasonable lines that could be between the biggest businesses that have revenues over 10 million, it may be favoring Philadelphia businesses over suburban businesses who pay the business privilege tax so we give a message to businesses, It's better to stay in the City, we're going to reward you, as opposed to running outside the City. I mean, there are ways of fine tuning business tax cutting that will save money, promote the services that we 84 4/16/08 - WHOLE - BILL 080022, etc. heard needed support, like recreation services, and allow the Cohen tax credit to take effect, but also see if the business tax cutting will work for the businesses that most people, I think, in this Chamber have in mind, which are the smaller businesses in neighborhoods that really deserve a break. (Bell rung.)
I'm sorry if that's not a real question or an answer to your question, but the only -- my only testimony I wanted to address really, the point of the affordability of the Cohen tax credit, and I'll very briefly make those points. One, the City has pretty much admitted that they have overestimated the cost of the Cohen tax credit. I don't think they did their own numbers. They just took numbers from the prior Administration, didn't look into how they were calculated, but it appears that they assume that 100 percent of all eligibles 85 4/16/08 - WHOLE - BILL 080022, etc. would on day one, Fiscal Year 13, claim the Cohen tax credit. They are way off, we think, in their estimate, and I think we'll suggest some more reasonable numbers for those out years that they're worried about, eight, nine, ten years from now. Two, the City has not assumed any gaming revenue coming into the City, and we know that whatever the future of casinos, they will be down the road, gaming revenue, and that will allow for relieving funds that would go to across-the-board wage tax and that could further allow a Cohen credit. Another point is, the City doesn't have to go down the course of cutting the wage tax in the way being proposed. Mayor Nutter has already accepted a slowing down of the wage tax cut, and that could be slowed down even more to save more revenue. And I should add, there's no mandate that says you have to continue to cut the non-residents 86 4/16/08 - WHOLE - BILL 080022, etc. wage tax cut. The non-residents wage tax cut is already lower than the City residents, and if you leave it frozen, it will still be lower than City residents down the road five years from now. And, lastly, we've talked about other ways of looking at the business privilege tax, and we urge the Council in its deliberations to consider fine tuning it so we don't give away the store. We provide targeted wage tax cuts to those businesses that we really think that need it. We don't think the Wal-Marts or Targets necessarily need it. We don't think that perhaps suburban businesses may need it as much as inner City businesses, and we think that's a further way of saving revenue. And that concludes my testimony.
Thank you very much. Councilman Goode, you will be brief. 87 4/16/08 - WHOLE - BILL 080022, etc.
Yes. Thank you, Madam President. I'll try to be brief. Mr. Stein, are you familiar with the data that's being circulated regarding tax years 2005 and 2006?
For those businesses with revenue between $1 and $100,000, is it your recollection that there were more of them in 2006 than 2005?
I can't really answer it in front of me. The only thing I remember from that data, Councilman Goode, is that the largest businesses --
Well, without having it in front of me, I'm not sure, but maybe you could --
For those 88 4/16/08 - WHOLE - BILL 080022, etc. businesses that had revenue between $100,000 and $200,000, do you remember whether we actually gained in businesses from the year 2005 to 2006?
For those businesses that had revenue between $500,000 and a million dollars, do you know whether we gained or had business growth between 2005 and 2006?
For those businesses between a million dollars and $5 million, do you know whether we had business growth?
Of course not. My same answer. I've looked at that data and my memory is that the largest businesses in the City --
Mr. Stein, 89 4/16/08 - WHOLE - BILL 080022, etc. I'm not finished yet.
My last question is, for those businesses that had revenue over $10 million or more, was there growth?
There absolutely was. It went from 790 businesses to 885 business. For every category I named before that, the number of businesses actually decreased in terms of those paying BPT. And I raise that point in the context of this: Our problem is not necessarily just business and job creation. Our problem is business and job loss and trying to stem business and job loss. If this environment is not good enough for small business and we want to 90 4/16/08 - WHOLE - BILL 080022, etc. primarily create a better business environment for small business, but this environment already is not big enough for small businesses, how exactly do you think we've been stemming the tide of business and job loss? The truth of the matter is, when you look at the fact that we lost 220,000 jobs from 1970 to the year 2000, while the suburbs gained over 800,000 jobs during the same period, we recognize that whatever we do and whatever your strategy is for job creation, that's fine. Whatever your strategy is to create 5,000 jobs a year or 10,000 jobs a year, that's great. But at the same time, if you're losing 10,000 jobs and 15,000 jobs, if you're always losing more jobs than you're creating, you will always have net job loss. So my simple question is, what is your strategy to stem or stop business and job loss? Because you have not mentioned it once in your criticism of 91 4/16/08 - WHOLE - BILL 080022, etc. anything.
Well, what I am questioning -- the question requires a much longer than answer that I have the opportunity to.
I asked you a question. You can answer it, not answer it, and then you can give whatever comments you want.
The strategy is a variety of factors that affect job growth which --
No, no, no. 15 My question was, what's your strategy to stem or stop business and job loss? I didn't talk about business and job creation. I didn't talk about business and job growth. I said how are you going to stop business and job loss. What's your strategy?
So you don't have one? 92 4/16/08 - WHOLE - BILL 080022, etc.
If you have one, just simply state what your strategy is to stop business and job loss.
Well, there's no 10 one-word answer I'm afraid I can satisfy you with or one-sentence answer.
Well, don't tell me what it's not. Tell me what it is. What is your strategy?
You improve the work -- you improve the workforce so there's a quality workforce. You improve services that businesses need, like transportation and access to resources. There's a list that businesses will give you that don't include in the top five or top ten cutting the business privilege tax.
In terms of why they leave or in terms of why they 93 4/16/08 - WHOLE - BILL 080022, etc. come? You want to continue to have a conversation with me about whether this is about business attraction and whether this is about business and job creation. What I'm posing to you now is whether this is actually about business retention and job retention and whether our major problem is business and job loss and how do you stem it.
Well, okay. My answer is very similar. Those factors I've mentioned are critical to business loss -- business growth or business loss, and that the business privilege tax is way down the list of factors that are going to influence that result.
But the truth of the matter is, I never said that that was the answer. I simply asked you a question, what is your strategy to stem business and job loss.
Okay. I'm sorry if I'm limiting my answer, because we're talking about taxes and business 94 4/16/08 - WHOLE - BILL 080022, etc. privilege tax. I'm sorry if that's my focus. You're owed a more extended answer, which I'd have to put off for another time.
The number one reason why businesses and jobs leave is the cost of doing business in the City.
And what percentage of their costs is the business privilege tax?
It's a whole number of things. It's the cost of labor. It's the cost of any number of different things that contributes to the cost of doing business.
Well, studies that have looked at costs of businesses -- and I cite one in my testimony -- have shown, a major study, that taxes are a very low piece of cost of businesses, that labor costs, utility, transportation costs, lots of other things weigh much more heavily than that piece that is a 95 4/16/08 - WHOLE - BILL 080022, etc. business privilege tax.
But that's not the question I raised. The question I raise is, why do businesses and jobs leave, and the number one reason is still the cost of doing business in terms of why they leave.
It has nothing to do with the point I'm making. The point I'm making is, if our major problem in this city -- we can have a debate over attraction and creation, but that's not what I'm discussing. What I'm discussing is business and job loss, and what I'm saying is that the reason why businesses and jobs leave is the cost of doing business in the City.
We can agree that costs are a major factor. I don't think that we'd agree that costs are the sole factor or even --
Of why 96 4/16/08 - WHOLE - BILL 080022, etc. businesses and jobs leave?
So I don't think we have a disagreement really, since our testimony was about taxes. We can agree that costs are a major factor. There are many elements of costs. Mr. Stein has indicated many of them. We also think the environment in which a business exists and, as a matter of fact, the environment for the Chief Executive Officer many times --
Many studies have shown that the environment that the Chief Executive Officer lives in is a major factor.
Mr. Shapiro, to be perfectly honest, I'm pretty through with this. This is actually the data which you're presenting to make your 97 4/16/08 - WHOLE - BILL 080022, etc. case. You're not even familiar with it, aside from the points that you want to highlight. But in addition to that, when I pose a question of how do we stem job loss, if you had never thought about how to stem job loss, then just say, I never really thought about that, and that would suffice.
No one said we haven't thought about it. We said that that's not what we're testifying about.
Thank you. Just a moment, gentlemen. I would ask the Budget Director to please approach the witness table. (Witness approached witness table.)
I'm certain that you have heard the testimony 98 4/16/08 - WHOLE - BILL 080022, etc. from this panel. Can you tell me if the Administration has had any input on the Cohen bill?
Madam President, members, Steve Agostini, Budget Director. Yes. We actually met with a group headed by the three individuals you see here. I was a little taken aback by the statement that the Administration has backed away from its original estimates. I don't believe that that's the case at all. In fact, Mr. Dubow, the Finance Director, and I have just had a conversation. We are still standing by those estimates. In fact, we believe they were carefully done. What we offered is that we would look at additional information that was to be provided to us to make sure that we had good estimates. But we have not backed away from those estimates, and I'm a little concerned that that statement was made, and for the record, it is not a correct statement. 99 4/16/08 - WHOLE - BILL 080022, etc.
We are still looking at these estimates, Madam President and members, and we are still looking at the impacts of that and have had conversations and have offered to do some follow-up on some of these items. So we're still awaiting the sort of ongoing conversations and where we are with those conversations.