COUNCIL OF THE CITY OF PHILADELPHIA COMMITTEE ON RULES - - - Room 400, City Hall Philadelphia, Pennsylvania Thursday, June 8, 2006 9:15 a.m. - - - PRESENT: COUNCIL PRESIDENT ANNA C. VERNA COUNCILMAN DARRELL L. CLARKE COUNCILMAN JAMES F. KENNEY COUNCILWOMAN DONNA REED MILLER COUNCILMAN BRIAN J. O'NEILL COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN FRANK DiCICCO COUNCILMAN W. WILSON GOODE, JR. BILL 060347 - An ordinance approving the thirty-fifth amendment for the redevelopment proposal of the Model Cities Urban Renewal Area, being the area beginning at the northwest corner of Front Street and Spring Garden Street... - - - V A R A L L O Incorporated Litigation Support Services Eleven Penn Center 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 215.561.2220 215.567.2670 2
Good morning, everyone. May I have your attention, please. This is a public hearing on the Committee of Rules. I would ask Mr. McPherson to please read the title of Bill No. 060347. MR. McPHERSON: An ordinance 10 approving the thirty-fifth amendment for the redevelopment proposal of the Model Cities Urban Renewal Area, being the area beginning at the northwest corner of Front Street, Spring Garden Street, including the twenty-seventh amendment to the urban renewal plan and the twenty-fifth amendment to the relocation plan, which provides, inter alia, for the additional land acquisition of 14 properties for residential and related uses; the additional land acquisition of approximately 66 properties for institutional and related uses; the additional land acquisition of one property for commercial and related uses; 3 6/8/06 - RULES - BILL 060347 the provision of certain relocation services, as required by the law, and declaring that condemnation is not imminent with respect to the Project.
Thank you very much. Are you waiting to testify, sir?
Please approach the witness table, identify yourself.
Madam President and members of the Rules Committee, Edgar Einhorn. I'm an attorney and I'm representing Dr. and Mrs. Daskal. Dr. Daskal was here last week and testified, but, unfortunately, because of business at Einstein where he's the head of pathology, he could not come. Madam President, I sent you a letter. I sent a copy of a letter to Councilman DiCicco, with a copy to you, and essentially at the end of the last 4 6/8/06 - RULES - BILL 060347 meeting, it was my understanding that there was going to be an attempt for the Redevelopment Authority to come up with a solution to this problem that was acceptable to everybody involved. Unfortunately, I've been advised that their solution is exactly what it was last week. They will give us a letter of protection, period. I've suggested that if they give us a letter of protection, let them also give a letter to Council that when Council reconvenes in the fall, they will have an ordinance introduced to remove these 14 properties from this bill. I don't understand why they would object to that. If they say they're not going to condemn the property, why won't they agree to remove them from this bill with a new bill when Council convenes in the fall? The alternative --
It seems to me there's two other alternatives. One alternative is, as Councilman Nutter said last week, let's amend the bill. Now there's a question whether the validity of the amendment would be upheld or not. My feeling is if you amended the bill and Mr. Blatstein, who is going to be the beneficiary of this condemnation, feels that bill is invalid, let him go to court and attack it. If he attacks it and wins, the whole bill is out, not just -- it's not going to restore his provision. The whole bill is out. The third alternative, and this is what we do not want to do, is litigation. And if there's litigation, Temple University is going to wait more than three months to be able to get their parcel. As I stated to you in the letter to Councilman DiCicco, the New London case, the Kelo case, took four years until the U.S. Supreme Court 6 6/8/06 - RULES - BILL 060347 finally made a decision in it. I don't want to hold up Councilman Clarke's condemnation portion for Temple. I want Temple to go ahead, but if the Redevelopment Authority says they don't want these properties, let them agree to give us a letter that they will put an ordinance in in the fall removing the properties from this bill. What's the harm?
Can we have somebody from the Redevelopment Authority up at the witness table, please?
Hi. I'm Michael Koonce, Deputy Executive Director for Real Estate Services at the Redevelopment Authority.
And may I ask that -- I believe the attorney from the Redevelopment Authority is also present.
No. General counsel is not present. 7 6/8/06 - RULES - BILL 060347
All right. You've heard the testimony of the witness.
It's our position that a letter to each of the potential condemnees basically asserting that we will not condemn -- and, in fact, our Board actually met last Wednesday to -- or yesterday to reaffirm that the Redevelopment Authority will not use this bill to acquire any of those properties for that development. We've sent out certified letters to that effect.
Yes, and we do have a copy of that and it is being circulated now to all of the members of the Committee. Mr. Einhorn, do you have a copy of it?
No, I do not, Madam Chairman. 8 6/8/06 - RULES - BILL 060347
My position, though, if they've given this letter, why can't we get a letter that they will put an ordinance in to remove these properties? What is the harm of removing the properties? Our problem is, we were told time sensitivity means this bill must go through. The true people who are affected by time sensitivity are these developers. Every day interest rates are going up. The economy is slowing. Housing demand is slowing down, and they're going to have to wait and hope that they may be able to find some lender who is willing to take a risk that these properties won't be condemned. Madam President, this is the worst case of pay for politics, 9 6/8/06 - RULES - BILL 060347 pay-for-play. I heard Councilwoman Blackwell yesterday when she talked about the Housing Trust. All you had to do was substitute this ordinance for what her comments were. Is City Council to be just a rubber stamp to what the Redevelopment Authority wants? They didn't even have the courtesy to go into Councilman DiCicco and say, We would like these 13 properties. Instead, they lumped it into 14 Councilman Clarke's bill without letting anybody know. Let them remove them if they're not going to condemn them.
Mr. Koonce, can you explain I think again why we cannot delete these properties from the bill so that everybody clearly, clearly understands the reason.
According to our legal opinion that was received from our general counsel, we cannot delete the properties from the bill. First of all, 10 6/8/06 - RULES - BILL 060347 we can't amend the bill and still make it through this spring or this summer. We'd have to start all over again to run it through, which would take us until next year. Secondly, to delete properties from the bill, that's also not -- you can't do that. We can't amend the bill. It would have to go back to the Redevelopment Authority Board for approval and through City Planning Commission getting their approval before we could bring an amended bill back before this Committee.
And Mr. KOONCE, can you tell us how many times in the past have properties been authorized and never taken?
It's happened frequently in the last two or three 11 6/8/06 - RULES - BILL 060347 years, yes.
And I know it's happened in my district, and financing, as I understand it, was never a problem.
Councilman DiCicco, I see you have your light on. Did you want to be recognized? COUNCILMAN DiCICCO: No, Madam President, not at this time.
Do I understand from the Redevelopment Authority they're saying that they can't introduce a new bill that would rescind this bill and just cover the Temple properties in the fall? I don't understand why it would take eight months in the next year to do that. They testified themselves that the Redevelopment Authority in April approved a condemnation of these properties. From April until June, two months. Now how do we jump from two months to next year? 12 6/8/06 - RULES - BILL 060347
My intent wasn't to say that it took eight months to get a bill through Council. My intent was that since Council is going on recess, we lose the summer. We would --
We would have to begin over. And also, if I can continue uninterrupted, my intent was that it wouldn't just be getting the bill through Council, but it would be getting the bill 15 signed and getting the ability to acquire the properties. That is what would take another eight months.
Very well. Mr. Schwartz, I see that you've been on the edge of your seat ready to testify.
Yes. May it please the Committee, I'm here on behalf of Jared Langman, who is the owner of 950 13 6/8/06 - RULES - BILL 060347 North 2nd Street, one of the infamous 13 properties that's mentioned here today. I did want to tell the Committee that his property is not blighted. In fact, he has his own development plan that's been approved. He has permits from Zoning to proceed with this development, and, therefore, it is definitely not blighted, as we all understand that word. Secondly, as I've sat here and listened, I've heard of the obvious flaws in this bill. I don't understand why it cannot be amended right here in Committee. The problem is not with Council. The problem is evidently with the Redevelopment Authority. If they had a Board meeting yesterday, they could also have considered amending the bill as of yesterday at that Board meeting. I ask at the very minimum that this matter be put off for the final week, the final session of Council, to then be able to go forward, if necessary, 14 6/8/06 - RULES - BILL 060347 and suspend the rules of Council to give me a chance and to give my compatriot to my right here, Edgar, a chance to see if there's some way to amicably settle this with I think the real party in interest here, which is not Temple. The bill is obviously flawed, and no one wants to start a lawsuit. No 10 one wants to appeal this bill, because everyone loses when that happens, as I'm sure the Chairman understands. And this thing has been pushed through so quickly. I mean, it's only been weeks since my client was notified that his property was going to be taken. I mean, Councilman DiCicco didn't even know until last week that these properties in his district were going to be taken. So I ask that we have the time to try and seek an amicable resolution of this, because it's still doable next Thursday.
Madam President, I think the real reason why the 15 6/8/06 - RULES - BILL 060347 Redevelopment Authority is pushing this bill is, plain and simple, they do not want to come under the new act that goes in effect in September, and that new act specifically says, "Eminent domain for private business, prohibited. Prohibition: Except as set forth in Section B, the exercise by any condemnor of the power of eminent domain to take private property in order to use it for private commercial enterprise is prohibited." They don't want this bill to come in effect because they did know they can't condemn these properties for Blatstein. Plain and simple, this is for Bart Blatstein's benefit and nobody else's, and if he isn't a commercial developer, I don't know who is. And if you want to look at blighted properties, Committee, go down and look at some of his properties. He has structural steel -- (Applause.) 16 6/8/06 - RULES - BILL 060347
He has structural steel that for two and a half years has been sitting abandoned. And he has the audacity to ask the Redevelopment Authority to condemn Mr. Langman's property that's going to have a $4 million development on it and my client's property, who has been a developer that's invested $5 million in Northern Liberties. Pay-to-play, that's his nickname.
I'd like to correct one statement that I believe is in error, and that is the fact that we will not be able to do this this fall. We would in fact be able to do this this fall. If you read the bill in its entirety, it doesn't apply to redevelopment areas that have already been created. This one has been created since 19 -- has been in effect since 1969.
Thank you. 17 6/8/06 - RULES - BILL 060347 The Chair recognizes Councilwoman Brown.
Thank you, Madam President. To the RDA representative, knowing the urgency and complexity of this particular issue, help us understand why this was not put on RDA's agenda Board meeting list when we had a Rules Committee hearing, I think, less than a week ago wherein we discussed in full-blown detail the sensitivity, the time issues.
Let's play it out. Let's say it had been put on -- let's say that very afternoon if we had held a Board meeting, it still would have had to have gone to Planning Commission, which meets once a month. After Planning Commission approval, it then would have had to have been advertised for three consecutive weeks. Then ten days after the last ad, it would have -- you would have then been able to have had a 18 6/8/06 - RULES - BILL 060347 hearing. That probably puts us in July or August.
Litigation is going to put us four years until we get it decided. July or August. Do you want two months or do you want four years? That's what it comes down to if there's litigation. And we don't want to hold up Temple. And in all honesty, Temple's representative testified their time sensitivity is, two months' delay is going to hamper their recruiting researchers for a building that's going to take two and a half years to build. Now, you tell me what person is going to sign a contract with Temple to do research for them in two and a half years.
Thank you. The Chair -- I'm sorry. Councilwoman, are you finished?
The 19 6/8/06 - RULES - BILL 060347 Chair recognizes Councilman Goode.
Thank you, Madam President. My question actually is for Mr. Koonce from the Redevelopment Authority, but he's walking away.
Oh, okay. Mr. Koonce? Do you have a question of the attorneys, Councilwoman?
Well, I just have a question. Where did Mr. Koonce go? I just wanted to go back to the letter of protection just for clarity purposes for myself. You said in your district, Council President, that you have used similar situations, a letter of protection to help developers --
Right. And there has not been an adverse effect, 20 6/8/06 - RULES - BILL 060347 correct?
As far as I am aware of, I've never had any one of my constituents indicating that they could not get funding as a result of that.
Thank you, Madam President. Mr. Koonce, can you explain again to the Committee and to Council why the bill can't be amended today?
I assume the bill 18 could be amended. We don't believe that it would --
Why would it not be legal? 21 6/8/06 - RULES - BILL 060347
Because the Redevelopment Authority's Board hasn't approved it and also because City Planning hasn't approved it.
The Redevelopment Authority's Board took action yesterday and the City Planning action I think is irrelevant, because what's the purpose of City Planning action?
It's relevant before an ordinance is introduced. I'm not sure it's relevant in terms of amending an ordinance.
Well, you should bring an attorney here then, because I think you're wrong. I think you're talking more about process and your process than what's actually legal. I think it's probably legal to amend this 22 6/8/06 - RULES - BILL 060347 ordinance based upon the Redevelopment Authority's Board action yesterday. The purpose of City Planning's action in crafting an ordinance is to make sure that they are approving a redevelopment plan and the plan is a sound redevelopment plan and that the projects can move forward in a way that makes sense. That's the sole purpose of what the City Planning Commission does, and to certify blight for redevelopers. So the parts of this project that need to move forward have already been certified by City Planning Commission. The parts of the project that remove properties by the Redevelopment Authority basically were acted upon by the Redevelopment Authority Board yesterday. I think it's probably perfectly legal to amend the bill today. And it is very reasonable why your general counsel shouldn't be here to say why it isn't.
RDA has 23 6/8/06 - RULES - BILL 060347 stonewalled this thing all along. Why isn't the Chairman of the Redevelopment Authority here to answer the questions why they did not submit to their Board the request to file a bill in the fall to remove this? COUNCILMAN DiCICCO: Point of order, Madam President.
Excuse me, Mr. Einhorn. COUNCILMAN DiCICCO: Point of order, Madam President.
The Chair recognizes Councilman DiCicco for a point of order. COUNCILMAN DiCICCO: Thank you, Madam President. I believe Councilman Clarke has an announcement to make that will finally put this issue to rest. Thank you.
I would be very happy to recognize Councilman Clarke.
Thank you, 24 6/8/06 - RULES - BILL 060347 Madam President. Madam President, we have had side-bar conversations with Temple University and the Redevelopment Authority about the Homeownership Zone issue, because there are three projects that are in my Councilmanic District that are part of this bill. One is Temple to build a new institution. The other is a Homeownership Zone. We are attempting to authorize the condemnation of individuals who have agreed and want to move so they can move into the new houses that are being built. It was our understanding earlier that the only way that they could move, they must get the compensation that comes as a result of the condemnation. We're going to try to figure out a way to hopefully compensate that individual in another way in the interim so they can move to the new houses. The other project, which was 27th and Girard, at the earlier hearing 25 6/8/06 - RULES - BILL 060347 we've already indicated to both the developer and to this Committee that we were not going to proceed with the final condemnation. We are trying to arrange a meeting to talk about the ultimate resolution of that site. So as a result of that, I will agree to hold the bill and I would like to ask Mr. Koonce if they can as soon as possible get Board approval for a newly configurated bill that deletes properties in Councilman DiCicco's district and get Board approval as soon as possible so we can move these other properties as soon as possible.
Councilman Clarke, on behalf of my client, let me express my thanks to you for severing the Gordian Knot.
Thank you. This will conclude our public -- yes, sir.
My name is Daniel Reisman. I represent the owner of the property at 27th and Girard. We appreciate the fact that the bill is going to be withheld. We are going to request -- and we know that Councilman Clarke has graciously agreed to meet with us regarding the 27th and Girard property. We would request that that property also not be included in the Board when the RDA considers that resolution.
Yes, sir. Please identify yourself. Are you together? UNIDENTIFIED SPEAKER: I 27 6/8/06 - RULES - BILL 060347 believe counsel said it all.
Very well. Do we have anyone else that would like to make a very brief statement? (No response.)
Seeing no one, this bill will be held until it has been resolved and at the call of the Chair. Thank you all very much. (Applause.) (Committee on Rules adjourned at 9:35 a.m.) - - - 28 CERTIFICATE I HEREBY CERTIFY that the proceedings, evidence and objections are contained fully and accurately in the stenographic notes taken by me upon the foregoing matter on June 8, 2006, and that this is a true and correct transcript of same. ______________________________ MICHELE L. MURPHY RPR-Notary Public (The foregoing certification of this transcript does not apply to any reproduction of the same by any means, unless under the direct control and/or supervision of the certifying reporter.)