- - - COUNCIL OF THE CITY OF PHILADELPHIA - - - PUBLIC HEARING COMMITTEE ON HOUSING, NEIGHBORHOOD DEVELOPMENT AND THE HOMELESS - - - Room 400, City Hall Philadelphia, Pennsylvania Monday, December 13, 2004, 2:50 p.m. - - - RESOLUTION 040797 - Resolution authorizing the Committee on Housing, Neighborhood Development and the Homeless to conduct hearings on the revitalization efforts of the Philadelphia Commercial Development Corporation in West Philadelphia. PRESENT: COUNCILWOMAN JANNIE L. BLACKWELL, Chair COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN DARRELL L. CLARKE COUNCILWOMAN DONNA REED MILLER - - - V A R A L L O Incorporated Litigation Support Services 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 215.561.2220 215.567.2670 2 040797 - Housing - 12/13/04 - - - P R O C E E D I N G S - - -
Thank you all for your patience. Please forgive us for the delay. We were talking to some ministers. And I recognize who my bosses are. And therefore, we're sorry that we're just beginning. Today's hearing is before the Committee on Housing, Neighborhood Development and the Homeless. Having said that, just so that all of you are all clear, we will have the clerk read the resolution, and the resolution that we're dealing with today. Again, the Committee is Housing, Neighborhood Development and the Homeless. And the hearing we're dealing with today deals with neighborhood development. So we welcome you. We hope that you will have something to say. We know that some of you who deal with various neighborhood issues may want to 3 040797 - Housing - 12/13/04 know that tomorrow we have a hearing on the $35 job fee at o'clock. And we certainly 4 invite you to come back then. And we invite 5 you to stay and hear the hearing, decide if 6 you want to testify, and certainly to testify 7 today. 8 To my left is Councilwoman Blondell 9 Reynolds Brown; to her left, Councilman 10 Darrell Clarke, who are members of this 11 Committee. And Councilman Mariano, as many of you know, is sick; doing better; but is not here. And we would like to let you know that Resolution Number 040797 was introduced and passed on September 23, 2004. This examines PCDC's activities in West Philadelphia. The hearing was originally scheduled on October 20th, but was continued because our witness and the president of PCDC was out of the country. We rescheduled this hearing to November 9th, but continued it due to the proximity of the holiday and all who were 4 040797 - Housing - 12/13/04 being involved in dealing with turkeys and holiday activities; and then again on November 22nd. And so, we are here today. And having said that, we will ask the clerk to read the formal title of the Bill.
Resolution authorizing the Committee on Housing, Neighborhood Development and the Homeless to conduct hearings on the revitalization efforts of the Philadelphia Commercial Development Corporation in West Philadelphia.
Thank you very much. We would now like to ask Curtis Jones to come forward and to testify. He is the president and C.E.O. of PCDC which is Philadelphia Commercial Development Corporation. And we will let him introduce those members who are with him who are also members of PCDC, and they're all welcome to testify. Thank you again all for your patience and for being here. 5 040797 - Housing - 12/13/04
Madam chairman, members of City Council, my name for the record is Curtis Jones, Jr. O. of the Philadelphia Commercial Development Corporation, PCDC. First let me apologize, Councilwoman, to you and other members for not being available for the first scheduled hearing. As you mentioned, I was representing the City of Philadelphia in China, in reference to the Chinese manufacturers' mall, which the City is trying to solicit manufacturers to locate their businesses within the City of Philadelphia, creating jobs and opportunities for its citizens. We were modestly successful with that. Also seated with me in the chambers and available for questions are John Lenahan, who is the vice president of lending, Aqil Sabur, who is the vice president of micro 6 040797 - Housing - 12/13/04 lending in the Small Business Support Center, and Mr. Robert Smith, who is the vice president of Neighborhood Commercial Revitalization. My colleagues and I are here today to testify and present testimony to the Committee for the Homeless in accordance with City Council Resolution 040797, the revitalization efforts of PCDC in West Philadelphia. Let me start with just as background: During the '60s, there was a term that was developed by real estate professionals. It was a theory called tipping points. That concept meant that when a community hit percent or above in a 19 transformation phase, whether it's economic 20 or racial, that the transformation at the 20 percent point would become rapid, and that those changes would occur in a rapid succession. Today many communities are undergoing that same process. Today that 7 040797 - Housing - 12/13/04 same theory of investment, where it begins slow and then as it catches on and hits that magic percent threshold, it becomes rapid. 5 Many neighborhoods in the City of 6 Philadelphia are experiencing dramatic 7 economic change. Property values in some 8 cases have outpaced the ability of existing 9 residents who have historically lived in low 10 to moderate income areas, to sustain their 11 properties. 12 Similar for small businesses, that 13 transformation and that problem is occurring 14 more with large chain stores and franchises. 15 Public policy will determine the 16 future of the residents and the businesses in 17 that area. 18 I'd like to focus my testimony today 19 on four specific areas. Brief overview of 20 PCDC's role in West Philadelphia, you know, related to the economic agenda are access to capital for small businesses, providing technical assistance to small businesses, empowering businesses through the use of technology, and reviewing our role with the 8 040797 - Housing - 12/13/04 business associations and serving as their advocates. I would like to discuss with the Committee also some of the potential that West Philadelphia has and review its inventory of assets and liabilities for development. In addition, I would like to review our strategies for implementation of our initiatives in West Philadelphia, those that we currently have, and those that may be coming on line in 2005. The Philadelphia Commercial Development Corporation was established in 1974 as a quasi public, non-profit economic development corporation. During the past 30 years, PCDC has arranged financing in excess of $267 million for more than 2500 businesses. That total, of which we approved personally -- not personally but our corporation -- $90 million. Many of these businesses that received assistance are small, disadvantaged 9 040797 - Housing - 12/13/04 businesses, and are 100 percent when it comes to West Philadelphia neighborhood based businesses. In our majority lending program which is the Small Business Revolving Loan Fund, SBRLF, we have completed 54 projects, totaling $3,895,000, 70 percent to minority firms, 100 percent to neighborhood based businesses. We've provided, Councilwoman, a list of those businesses enclosed in your briefing packet. 2 million of capital.
And remember, these injections, infusions of capital are $35,000 or less. The average size is about $10,000, usually less than that. From the Small Business Administration we've been able to do five projects totaling $390,000. Through PCDC'S loan program, we have provided additional private financing, by way of packaging to banks, not using any government collars. A. based businesses. And we've done nine deals through them, totaling $200,000. Through all of these loan programs, we have settled $4,732,000 to businesses in West Philadelphia. 7 million. When it comes to neighborhood commercial revitalization, which is our corridor activity, our neighborhood commercial corridor division is responsible for 43 corridors throughout the City of Philadelphia. Over the last two years, we have provided grants to businesses which have totaled $177,000 for storefront improvement. 11 040797 - Housing - 12/13/04 Our capital improvement program has done $726,000. And our corridors are in that area: 40th Street, 60th Street, 52nd Street, and Baltimore Avenue. Through our Acquisition Grant Program we've provided an additional $144,000. Now, keep in mind we can only do the ceiling, $25,000. That's for a non-profit to acquire a commercial property that they can renovate, sell or rent. The 10 West Philadelphia corridors -- and this is an important statistic -- generate 23 percent of the total of $180 million in gross sales. PCDC has provided web site assistance, internet assistance to various commercial corridors around the City of Philadelphia, particularly to 40th Street, 52nd Street, 60th Street and Lancaster Avenue. In addition, PCDC has provided technical assistance to 48 individual businesses. A. project, we were able to work with her to disburse additional capital to some of those distressed businesses out there. And we want to applaud her for her working with those businesses. And a list of those companies are also in the packet provided to you, Councilwoman. Over the years, PCDC has participated in dozens of clean-ups, dozens of promotions -- including parades, workshops and others -- to help stimulate activity in the West Philadelphia area. So what are the economic development challenges for West Philadelphia? Well, we have taken an inventory of some of the strengths and weaknesses, and plan to use that good information, that data, to make good information and better programs working with City Council. West Philadelphia has approximately 220,000 people. 2 square miles. The mean household income in 13 040797 - Housing - 12/13/04 that area is $20,000, compared to $60,000 for the average income of citizen's households in the eight-county area. West Philadelphia has -- and that's a good point -- 58 percent home ownership. 58 percent home ownership. 4 percent African Americans. The average home in West Philadelphia was built in the 1930's. West Philadelphia has a large park system. West Philadelphia has dozens of major institutions, including hospitals and universities, which serve as a potential for economic development. One of the down sides is that we've lost over the past decades 27 percent population. And that's clear, when it comes to some of our commercial corridors and some of the business that they're able to generate from customers. A. C. and other major metropolitan areas. Ten percent of the City's work force resides in West Philadelphia. 67 percent of that work force is in health and education, 6 percent unemployment. West Philadelphia over the past years has done only 223 new housing starts in that area. So what are the opportunities, based on this data? Well, first of all, we got to give a lot of kudos to your housing efforts to start new homes in the West Philadelphia area. Clearly, without new housing starts, we won't be able to attract businesses. West Philadelphia's ten commercial corridors, again, generate $180 million in gross sales. We need to create incentives for mixed use development.
And this is a very important point. And I use the example of Germantown Avenue. If you look at Germantown Avenue, going from Chestnut Hill, all the way down to Nicetown, what you'll note is that 15 040797 - Housing - 12/13/04 the larger -- the better part of, more prosperous part, has mixed use development, meaning commercial downstairs and residential upstairs. We need to mimic that and get more residents into the second floors of those commercial establishments. And that's an important point, because when you begin to look at a thing differently, you begin to change that thing. We've got to look at these assets and start to consider them assets as, opposed to liabilities, and take advantage of them. So what else can we do? We need to work to develop joint ventures with international companies to create job opportunities. I mentioned earlier the trip to China and the manufacturers mall. O. and a key manager. The rest of that employment has to come from the local population. And that is a potential source 16 040797 - Housing - 12/13/04 of jobs for the City of Philadelphia. We need to work better with our agencies, such as the Minority Business Enterprise Council, PIDC, the Philadelphia Housing Authority, to create business contract opportunities for the small businesses that we are funding. We need to develop and increase the development of strip malls these areas and shopping areas. We need to stop the gateway leaking. And what do I mean by that? We're losing a lot of our customer base. There's a lot of income in these areas, but we're losing it to Baltimore Pike. We're losing to it Cherry Hill. We're losing it to areas outside of the City of Philadelphia. And our money, we need to kind of generate means for people to shop in the neighborhoods. And that is why we support every year Spend the Holidays in your Neighborhood Campaign. We view that as a vital, vital strategic message that we send out to consumers. 17 040797 - Housing - 12/13/04 Something that the International Council of Shopping Centers said. They conducted a study of a thousand companies. And they said that in that study, that 93 percent of the respondents said that the inner cities were an important market opportunity, but only a quarter of them responded that they were currently doing business in inner cities. The ICSC also said that the cities, inner cities, needed to do a better job of marketing those opportunities and attracting them to the inner city. We agree with that. And again, that's why we think those kinds of opportunities to showcase our neighborhoods are important. On Cecil B. Moore, that jazz festival did a lot more than just bring entertainment to areas. That jazz festival showcased the best side of what the Avenue could be. And we encourage those kinds of activities all the time. , American cities, the Empowerment Zones, to create shopping centers in and coordinate our work, to create shopping centers that are vibrant. And one of the charts you'll see is that one of the major problems that we have is those railroad trestles that run through our community, that serve as monuments of the rust belt. And until we really start approaching them and holding them accountable for that infrastructure that runs through our community, it will further continue to encourage blight. We need to develop and we applaud Councilwoman Blackwell's efforts to create pedestrian pathways within walking areas within the Mantua area. We think that's a real good idea to improve the quality of life of people who live there. We want to continue to provide technical assistance to businesses, CDC's, through the use of technology. 19 040797 - Housing - 12/13/04 One of the things that we find in our travels -- And Councilwoman Miller has been a part of us hotwiring some of the commercial corridors and providing teleconferencing centers.
When we went through there and did an inventory of what they believed technology was, the number -- the mean use of technology was a calculator and a cash register. Well, they can't be competitive nationally, and now internationally, if they hold that as the highest level of technology that small businesses on average are using. So, we've worked aggressively to work with the Federal Government, to attract money to help them improve their technology infrastructure. And we'll talk about that a little later. We need to work with the Parking Authority, obviously, to deal with congestion in our commercial corridors. We need to work with public utilities, to create some rhyme and reason to some of the infrastructure repair that is 20 040797 - Housing - 12/13/04 killing some of the small businesses in neighborhood corridors. We need to negotiate and work better with the Neighborhood Transformation Initiative, to figure out what they're doing, so that we can meet them at the crossroads, so that we can make sure that once the housing agenda is done, that also the commercial and retail agenda is under way. We need to hold private property owners accountable for some of the blight that they allow to exist in our commercial corridors. We need to spend more than seven percent on economic development out of our total CDBG budget. West Philadelphia, in particular we need to look at how we reclassify some of the buildings there, some of the land there, so that we can get more commercial use. I sincerely believe that West Philadelphia is the next big thing. North Philadelphia has experienced some of that growth and some prosperity in 21 040797 - Housing - 12/13/04 key areas. But we believe sincerely, that with the right coalitions, with the right working relationship with City Council, that West Philadelphia will be the next big thing. PCDC is working closer with state and Federal Government --
You're not telling me you're ready to abandon North Philadelphia, are you?
No. This hearing is about West Philadelphia. If you want me to specifically speak to North Philadelphia, we can.
All right. No. 21 You said that... You kind of implied that we've done enough in North Philly.
Now it's time to go to West Philly. 22 040797 - Housing - 12/13/04
No. For the record, we would never abandon our friends in North Philadelphia.
Not just Germantown. I mean, we have a viable strip, as you mentioned earlier, on Germantown Avenue, all the way down to Nicetown from Chestnut Hill. And then we have our other strips, Broad and Olney, Lower Germantown, et cetera, et cetera. So... And I think you're doing a good job there. 23 040797 - Housing - 12/13/04
Thank you, Councilwoman. One of the things that I would mention -- and I'm coming to the conclusion here -- is that obviously work force development is an integral part of economic development. And we need to work with PWDC, but we also need to remember that what we're seeing is a demographic. And the good news, as was mentioned in a previous hearing, is that retailers are rediscovering the inner city. They are coming back. The bad news -- The potential bad news is that, just like in our corridor when we had it in Manayunk, 98 percent of the businesses that were there when we started development are no longer there. So, we have to be particularly mindful of how we do that development, to save some of the neighborhood businesses, and not just have franchises and CVS's, even we though we appreciate their contribution -- but the character, the flavor of inner city commercial corridors is in the individual, 24 040797 - Housing - 12/13/04 family-owned business. That's it's strength. That's it's character. And we want to work on those kinds of coalitions. Again, we applaud the efforts of Councilwoman Blackwell and this Committee for bringing us here and making sure that we connect to the total City efforts. And with that, we thank you very much.
Absolutely. Some preliminary questions. We'd like to know what PCDC's mandate is and who monitors your organizations activities. We'd like to know how often your board meets, and whether or not these are public meetings. That kind of gets to the parameters of who PCDC is, what it does, and what it's mandated to do.
Okay. You're going to have to help me with some of the questions. There were several. Our mission is to revitalize neighborhoods, low and moderate 25 040797 - Housing - 12/13/04 income neighborhoods, and to do so through the development of small businesses, to be succinct. We meet at least seven times a year. Our board meets seven times a year. We are monitored by both City Council, the Commerce Department, the Federal Government, and our private funders, so we are monitored by all of the people who kind of contribute to that. There was another.
By what entity or... We understand you are a quasi public entity. Or are you a quasi public entity or separate non-profit? And what allows you to receive funding from city, state and federal authorities.
Technically, we are a non-profit, just like any other non-profit. We have an independent, self-electing board. But the reality of it is, 80 percent of our money comes from a contract with the City of Philadelphia. So, you're our boss. I mean, technically we're independent. 040797 - Housing - 12/13/04 Practically, we work for you.
How many people work for PCDC? And would you provide us with their titles and job responsibilities?
Now, how does advertising fit in that? As you know, I've had a big issue with banners. And you know, PCDC advertises in newspapers, prints brochures, does banners, advertises for various organizations, individuals or businesses. What part of your budget is that and how are those decisions made?
There are several sources that we use for advertising. One is the official CDBG portion of advertising, but wherever you see an initiative like, spend 27 040797 - Housing - 12/13/04 the holidays in your neighborhoods, those are funds that we raise independently from that budget. We also get money -- We have got some advertising out of a grant. I mentioned that 80 percent of our budget comes from the City. Another portion of our budget actually comes from the Federal Government, where we were mandated to advertise, for example, those web sites that you see. And those banners were paid for out of that. So, what we were actually trying to do was encourage people to look to the internet, to start to participate with small businesses in the area. And those decisions were made -- And I take full responsibility for the error in the marketing of those web sites.
Well, you know, that's a big issue with us. If you say 80 percent of your money comes from the City, and then the City Council then conceivably has a major responsibility to monitor what 28 040797 - Housing - 12/13/04 you do, we really take offense to not being included in your decisions. I mean, an elected official shouldn't get up and see that a person who's against the neighborhood is funded to the tune of $75,000 to start up a business or that PCDC has banners up reorganizing neighborhood groups, and calling for not only reorganizing them: Renaming them, reorganizing them, and conducting elections. How can you do that, and then expect us, as 80 percent funders, to support your activities and not question it?
It was a mistake of my head and not my heart, not my intention to cause you or any -- or disrespect this Council. I've worked in government -- not as long as you -- but 20 years. And if that was the impact, that was not the intent. It was not the intent. And I want to say that for the record.
Yeah. I don't understand. 29 040797 - Housing - 12/13/04 What was the intention? Why would you -- We'd like to know how commercial corridors are chosen. I have 52nd Street, 60th, Baltimore Avenue, Lancaster Avenue, Chester Avenue, Woodland Avenue, Spruce Street. How were commercial corridors chosen to receive funding, and what criteria do you use? I only mentioned mine. The Councilwoman has Germantown Avenue. Councilman Clarke has Cecil B. Moore Avenue. And we know years ago, because we tried to get another store, the Company Store. We tried to get one out in West Philadelphia when Wynnefield was still alive, for a long time. We want to know who picks these projects, who picks corridors, and under what criteria are they chosen.
I'd like my vice president for NCR, who has been with the corporation now how long?
22 years. This is Mr. 30 040797 - Housing - 12/13/04 Robert Smith.
It has been the policy of PCDC to receive the corridors basically from the Commerce Department. It was our understanding that the Commerce Department had talked with the different Council people and designated -- and determined what corridors would be designated for PCDC to service. The criteria... The previous criteria had to do with a business area had to have at least 55 percent of the active businesses in that designated area had to already be part of some type of formal business association. We used to pretty much follow that rule, up until about eight or nine years ago. And from that point, corridors are basically just designated to us through the Commerce Department.
One other point, that 31 040797 - Housing - 12/13/04 they have to fit a criteria of low and mod income, based on the census data. That's another criteria for that, meaning that the surrounding census tracts had to fall within that.
Well, I am happy to say that I'm looking at Councilwoman Miller, who concurs with me, and Councilman Clarke. Councilwoman Blondell Reynolds Brown is at-large. Nobody confers with us on which corridors are picked. That does not mean that we don't want those who are getting treated to be treated. But, you know, it's very disparaging when somebody makes decisions and groups are funded. You know, I'm looking through this book, and I don't have any problem with it when it's out of my district, but one of my former opponents had opened a store right after I was run against in an election. Come on, now. Politics is in everything we do. And we feel that if we fund it, then we have 32 040797 - Housing - 12/13/04 a right to know what we fund and what we're paying for. And it disturbs us. You mentioned that CDBG is seven percent of your budget. We contact CDBG about corridors when we talk about it, but that's our only opportunity for input, really, in commercial corridors. But Commerce doesn't work with us in that regards.
Councilwoman, if I may, two things: One, when we deal with CDBG dollars -- and I've been accused of having some understanding of politics, but obviously not enough. But let me say this: When we deal with CDBG dollars and the application of these programs, I don't make any political distinctions. Some of my best friends are elected. But when people come into the office, I don't -- I really don't check --
No; but I apologize for 33 040797 - Housing - 12/13/04 that. But what we can not do is make a distinction. If this is a good project, I'm obligated to fund it.
Clarification. What percentage of the dollars are CDBG dollars, 80 percent?
Because you shook your head when Council Chairwoman Blackwell misquoted. I thought the percentage --
But I don't mean CDBG per se. I'm saying that if businesses come to you, you say that generally, until seven or eight years ago, you dealt with 55 percent 34 040797 - Housing - 12/13/04 of it being active businesses, who were part of an association.
Well, that was until eight or nine years ago. So, that means there is apparently no criteria, or whatever criteria, somebody in PCDC determines at the time about who they want to fund. That's just not good enough. There's an association. I went and spoke before a meeting BAWP, Business Association of West Parkside. When I got to the meeting, I found -- This was approximately... I don't know... maybe two or three months ago, there were people there from the 2nd, 3rd and 4th Councilmanic Districts. As soon as I got there, I realized that I was dealing not only with my District, and so whatever I said wouldn't necessarily apply to my people. So, I was very careful. But my point of it is, this also was another organization, like the 52nd Street New Arts and Business organization, that was 35 040797 - Housing - 12/13/04 formed, that Bob Fulton was chairing. And you had people from, again, 2nd, 3rd and 4th Districts, and an election -- a new group, a new election, a new organization. I mean, how can you -- And, of course, I immediately told them I couldn't speak for my colleagues and two other districts; and that, you know, how can you folks come up with new organizations around the City, and not deal with us, and expect us to fund the freight? I mention that as another organization. And the two instances I mentioned and organizations I mentioned are issues that nobody told me about, but issues in which I have been involved and issues that I am sure about. I ask you again about BAWP. How can you again form another organization dealing with three Districts, and expect us to fund whatever it is and conduct elections?
Well, Bob 36 040797 - Housing - 12/13/04 Fulton said you did.
Bob Fulton, for the record, works for the Commerce Department. The only interaction I've had with that coalition of businesses is when Mr. Fulton invited me to speak. And when I found out that that was not necessarily something that the administration was supporting, I refused to go. And again, I didn't organize them. From time to time, I get invited to public events. I did not check. I said, okay. When I found out that that was not the thing to do, I didn't participate. But Bob Fulton clearly does not work for PCDC. Bob Fulton works for the Commerce Department.
All right. Well, okay. He works for your department, not your agency.
He doesn't work... No, he does not work with or for PCDC. He works for the Commerce Department.
Is PCDC 37 040797 - Housing - 12/13/04 under Commerce Department?
He reports to Mr. Traylor and the Commerce Director. He doesn't report to me.
And to your best knowledge, where is he housed? Where is his desk?
You don't report to Mr. Traylor or to the Commerce Director. 38 040797 - Housing - 12/13/04
But I do actually interact with them. They're on my board. Technically -- There's two -- The reality -- Like I said, the reality is, 80 percent of our funding comes from them. So, I report to them. By way of the way we're organized, we were organized to be semi-autonomous.
And the chairman of your board is? 39 040797 - Housing - 12/13/04
So is Bob Fulton with the Mayor's Business Action Team?
All right. Well, Bob Fulton sure enough mentioned you.
He said he had taken his lead from you, in also establishing another organization, with another elected board and another community entity. He compared the two as the same kind of organization, and it is what you all were doing.
Councilwoman, I'm on the record here. He does not work for me. He did not ask me to organize this. I don't know what he was -- why he would even say that. I'm telling you: We didn't organize 40 040797 - Housing - 12/13/04 that entity. Now, the 52nd Street one, yes. That West Philadelphia coalition? No. 5
So you meet about every other month with the board. And these are the people to whom you report. So you don't report to Mgenzi Traylor or to the Commerce Director.
I've worked with and worked for, yes, the Commerce Department. Not technically.
What it means is that we 41 040797 - Housing - 12/13/04 have a contract, but the board I report to is the board of PCDC.
Except your dealing with businesses, as opposed to housing.
So it's wildly believed that Tony MacIntosh, who heads PHDC, works for the City.
Well, their perception is that you work for the City and you report directly to the Commerce Department.
So while we understand technically you don't work for the City --
I do. I mean, 80 percent of my money comes from you guys. I work for you.
Okay. Sorry. So I just wanted to clarify that. I mean, the questions, you know, from a technical perspective may not be correct, but the 43 040797 - Housing - 12/13/04 reality is when there's administration testimony during our budget hearings from the Commerce Department, you're sitting there along Mgenzi Traylor and Miss Naidoff. So the natural assumption is that you're a member of the City's administration.
Well, then, 13 are you unionized, as are his? We've met with their people when they have union problems. So which union are you a part of?
Okay. So, well... Okay. Then when you pick businesses such as are listed in this book, does your board okay them?
Yes, a subset of the board, which is the Director's Loan Committee, meets and evaluates the business proposal, made up usually of a banker and 44 040797 - Housing - 12/13/04 myself and another party.
For informational purposes, you say that 80 percent of your funding comes from the City. Break down for us, if you would, the balance of percent. Where does it come from? 8
The Federal Government, 9 SBA; PMBDA, Pennsylvania Minority Business 10 Development Authority; different grants that 11 we've applied for, private foundations. 12
And the dollars 13 in question that were used for advertising, 14 those dollars came from where? 15
They came from the 19 Federal Government's technology grant to us, 20 SBA.
I see. Just for my own information, to give a little bit of discussion of programs, on of your testimony you've discussed briefly neighborhood railroad trestles and how 45 040797 - Housing - 12/13/04 they -- We know the role they play in blight. But what potential exists if we as a City could move towards getting rid of them?
And while he is approaching, I will note that we found a board of directors list dated '03. And I'll only mention a few names that some people may be aware of because they're active, like Barbara Shabo, President of Advantage; Reverend Campbell from Mount Carmel Baptist Church; Floyd Austin, Beech Corporation; Jerry Walker, President of Walker Communications; David Wang, President of Asia America; Lavina Marshall Blake, Independence Blue Cross; and, of course, yourself and Mgenzi Traylor; Greg Ross from Temple. Just a few people that some people may know. And Mike Driscoll at Finnegan's Wake, with whom I'm working with on stop and gos. Donna Frisbee Greenwood, Executive Director of Inner City Games. That's just a few names from an '03 list. 46 040797 - Housing - 12/13/04
Particularly talking about... One of the things that we found to be disturbing is, for example, this railroad trestle at 82nd and Lancaster Avenue --
And that is in Councilwoman Blackwell's or Councilman Nutter? Help me out. I'm not clear about the boundaries.
One of the things that when we talked to developers, because as you know, we funded the developer at 56th and Lancaster, the shopping center there. We funded a number of businesses along there. We've also paid very close attention to what State Representative Bisher and her organization up there had to say about the Lancaster Avenue corridor. To a developer, they asked about... To a developer they asked about what the disposition was, what the plan for that 47 040797 - Housing - 12/13/04 particular station was. And when we start to look at people who are investing their life savings and sometimes their personal property, you know, it seems to me that we need to hold the Federal Government a bit more accountable. Now, I understand, through my own research, that Congressman Fattah has appropriated some money for the restoration of that particular stop; the money has been appropriated for it.
Well, in instances like that, procedurally, what then happens with the connect, with the... You mentioned the state rep with the city rep, because I think that that's the core of the issue, to ensure that the City Council member is then in the loop of information.
I'm glad you brought that out. One of the main reasons that I'm glad to be here is because insanity is to repeat the same thing over and over again. I do not want to offend this Council not another time. So what I hope to come out 48 040797 - Housing - 12/13/04 of this is a communications process that allows me to let you know what we're trying to do, and you to tell us what you need done, and so that we can avoid this kind of thing.
The Councilwoman is correct, because when it comes to Lancaster Avenue, that's a dividing line between the 4th and the 3rd, myself and Councilman Nutter. So, he has one side. I have a developer for my side. And I will tell you, you know, development is what I like to do, and it's what I enjoy doing, and what I believe in, and where I focus my activities, that and education. So I have a developer for every inch of the 3rd District. We fight hard. It's what I spend my time on. And it presents a problem. I may run into, as I did last week, Councilwoman Bisher, who tells me that 49 040797 - Housing - 12/13/04 they're involved in something in my District. Now, I naturally have a relationship. But I have two state reps already, Waters and Roebuck, who are in mine, and I have a new one, Tommie Blackwell. So I already have three of my own state reps. I have two State Senators, Vincent Hughes and Tony Williams, and then so if I have to deal with another state rep, who's not necessarily... She's not in my District. So I have no need to do that, unless it's on our dividing line. And while I don't know the City dollars are focused there, then that, you know, is different. If Councilman Clarke and I are working on a common area, that's different. We know to work together. But I have no reason to go to somebody, outside of those people I just named. And it does create a big problem, when they're working on something or when the City is funding projects that I don't know anything about. I got enough of my own I 50 040797 - Housing - 12/13/04 want to fund. I may decide that I don't want one funded someplace else or at least have the opportunity to have the discussion. And that's part of the -- That's part of the question. What about State Redevelopment Capital Assistance and the state budget? You've talked about the City budget. How much of those funds --
Well, we've gone after particular -- And again, I want to just underscore how we communicate better in the future. But we've gone after a million dollars in state money, to provide low interest no interest loans to the same distressed businesses that are suffering from the el project. Now, we are going to wait for your instructions on how we kind of work that through the process. But we've applied for that. We have already received a grant for 51 040797 - Housing - 12/13/04 $750,000 to do bus stop shelters. And we want to work on how and where they're -- and particularly for West Philadelphia, in the area that has been negatively impacted by the construction. So we want to work on a plan that makes sense.
That we've already gotten. And we want to work on the design of those shelters, where they're located and when they should be implemented because that construction has a long time to run.
Yeah. In fact, as all of you know, in Cobbs Creek it's off. And they don't even have anyone, nor did they tell us even in our hearings when a new company would be hired. They fired him the day of our hearings. It was obvious they knew he would have big issues about what was happening to 52 040797 - Housing - 12/13/04 the businesses. They fired him that day, saying they were 712 days behind. But we still don't have anybody now doing the work, when the completion date isn't until the end of '08. So we have big problems. And while we're on the S.E.P.T.A. project, as many of you know, this initially started in 1999. We have big problems. We've gone to our... I've gone to both Congressmen. I've gone to our state folks. We've done everything we can to try to ask for dollars for these people. And finally, after there was none forthcoming, we did as I always say, what Booker T. Washington said, lower the buckets where you are. We came to Council and took out our own budget, S.E.P.T.A.'s budget. We didn't want to take out of our budget because the City can't afford it, but out of our S.E.P.T.A. money. The Council saw fit to take out $500,000 last year, and the businesses got a check to between $2400 and $3200. It's 53 040797 - Housing - 12/13/04 actually $3163. And this year we put in a similar bill, but instead of $500,000 in S.E.P.T.A.'s budget, we made it seven fifty, to allow $250,000 for community entity to clean it, so we wouldn't have to keep begging all the time for them to clean, we wouldn't have to fight them like we did to get port-a-toilets where workers were urinating on front lawns, we wouldn't have to fight everything it takes to get it down. And I say this to say that, you know, and now the Mayor... We believe that as part of the S.E.P.T.A. budget money, you know, we don't want to tie it up with the City budget. We don't have those dollars. But the S.E.P.T.A. budget we want those dollars to come from. And we asked... It was our choice as to how we gave the businesses the money. It was our choice, that out of this, all we asked for was that they have a Business Privilege License because it's not enough money to change anybody's life. It's only 54 040797 - Housing - 12/13/04 enough money, we thought, to let the businesses know we care, and they were hoping that somehow they can hold on because as all of you know, the biggest problem with S.E.P.T.A. is that they go a block, and then they work there a month. And then they close it off, and then they go back there again. So, as soon as the people start coming back a month later or month and a half later or two months later, they come back and close it again. So, businesses never get a break. But all of these things, we say we chose PCDC. In spite of all these issues, we asked PCDC to write the check that we signed. You know? No matter how many problems we have, all of this -- You know, PCDC didn't help us come up with the idea. We begged everybody for money. But we have really, really, really been fighting hard. And we tried to work with our City agencies, to try to get these businesses some help. But we signed the check and we made 55 040797 - Housing - 12/13/04 PCDC to pay the conduit for the money. Could have used anybody. We didn't have to use PCDC. We could have used any non-profit, but we try to work with the agencies that are available to us. We just need you to work with us and to, as a point of these hearings, realize that we're here. And insofar as I'm concerned, and I believe I can speak for Councilman Clarke and Donna Miller, when I say when you're working in our districts, we got to be included. We've been around too long. We have our plans. (Applause.)
We can only end up in having problems when we are not included in the issue. You mentioned, too -- We still have a lot of questions. You mentioned something on...
Can you please 56 040797 - Housing - 12/13/04 finish real quickly for me this --
Well, basically, what we want to try to do is, where these gateways are -- And I don't mean to always point out what other communities are doing. If you see these same trestles in Bryn Mawr or in Delaware County, they're painted, they're well maintained, they almost blend into the scenery of the neighborhood. In our neighborhoods, they're not maintained. What we've discovered in some of our clean-ups, Councilwoman, is that the urban budgets for a lot of the maintenance are cut, as opposed to the surrounding counties. And we really need to take a hard look at that and how these railroad trestles and public properties are maintained versus suburban areas versus inner city areas.
Both. In some cases they're state dollars. In other cases they're federal dollars. 57 040797 - Housing - 12/13/04 But it's not just these kind of railroad trestles. And I won't name -- I will not name the large chain store. But we were doing a cleanup in, I believe, your district (Indicating Councilwoman Miller). And we approached one of the major drugstore companies as to allowing some of their employees to help us with the cleanup. And when I asked about, you know, the shrubbery in the area, they told us that their budget for maintenance was cut. But when you go outside of the City of Philadelphia, they maintain it. And at some point we have to address that, and take a look hard look at both these federal transportation bridges and trestles, but also is there an equal application of maintenance funds for suburban shopping areas versus inner city shopping areas. We need -- This Council needs to take a hard look at that.
There is a letter that PCDC sent to various businesses. 52nd, 53rd, 54th and Market, 56th and Market. I have three or four copies of them here. 58 040797 - Housing - 12/13/04 And the letter reads as follows: Dear Miss Johnson: Enclosed is your check for the S.E.P.T.A. transit impact at West Philadelphia Small Business Retention and Financial Assistance Program. During this S.E.P.T.A. project and at any other time, please feel free to contact us here at PCDC and our neighborhood commercial revitalization, NCR division, for any technical assistance you may need. And NCR's direct telephone number is 215-790-2235 or 215-790-2233. What technical assistance are you offering?
We offer a wide variety of technical assistance from contracts, with the City of Philadelphia helping them prepare for that. We offer grants by way of facade rebates. We offer --
For the S.E.P.T.A. transit impact. As you know, since at least the year 2000, we have been asking you all to come up 59 040797 - Housing - 12/13/04 with a program for low interest, no interest or grant for facade treatment. We've been doing that, not only for the S.E.P.T.A. project but overall. So we'd like to know, again, for the S.E.P.T.A. people what that means, and then you can expand the answer.
Well, first we had some dollars that -- Med Cap Funds that were federal dollars. And I think we met some years ago when this first problem started to arise. What we were hoping to do was get those old dollars reprogrammed by the Federal Government, so that we could use that in a fashion and grant fashion. Believe you me, the Federal Government had no interest in doing that. And in fact, when we asked them about it, they then sent us a letter, requesting the return of those dollars. So, we had to do that. So, what we were able to do was work through the local Congressman, Congressman Fattah and Congressman Brady, to get the 60 040797 - Housing - 12/13/04 F.T.A. to re-appropriate new money... to appropriate new money which is $750,000. But specifically what they said that it could be used for was enhancing of transit stops. So the best thing we could come up with was bus shelters for that. And what I was then -- What I then did was contact Senator Hughes up in Harrisburg and asked him if there was any relief. What he was able to do was put in a budget, $1 million for low interest and no 14 interest grant loans to S.E.P.T.A. impact at West Philadelphia businesses.
I understand. And I've been hearing that. But as you said, we've been trying to get money. These letters were sent out as recently as November 1st, offering assistance, you know. And yet I believe that we have to keep hope alive, as Jessie Jackson said, but I also believe that we have to be honest. And I don't offer people assistance 61 040797 - Housing - 12/13/04 I can't provide or I don't put myself in a position to have to respond to something, if it's not the real thing. So if you didn't have money November 1st to --
We have money. We have money. Our loan dollars aren't impacted by the grants that we're talking about. As a matter of fact, we did how many deals last months? In West Philadelphia? UNIDENTIFIED MAN: Six.
Wee, we know that for the S.E.P.T.A. project businesses for the first year were telling me, I'm down percent. 9 The second year they were down 30 10 and 40 percent. 11 A lot of them -- One person they 12 testified the other day, he had 80 people. 13 He was down to 10 last month. 14 He's there by himself. Their credit 15 is bad now. They're having a hard time 16 keeping their lights on, you know. 17 And I'm sure at this point it's very 18 difficult for them to have any collateral or 19 to have the ability to borrow. 20 I don't know if the City would even take some of them. They're trying. But in terms of the S.E.P.T.A. project, I don't know if they would even qualify for them, which is why I asked and have been forever for a grant program or lower note interest program or 63 040797 - Housing - 12/13/04 combination program. You know, I've been asking for this stuff, you know. And then -- But you send a letter out saying, you know, call me. And I don't even know what you're offering. And I'm not putting myself in the position to have to respond to what I don't know that you're offering.
Well, you're right. Our communication needs to be better. So that... You know -- And for the record, we do grants. And we did how many grants last week or last two weeks?
$177,000 worth of grants. Even though they're not specifically S.E.P.T.A. related grants, we still did nine deals last month in that area. And we're going to continue to -- Now, hopefully the cavalry comes and brings us some more money. But until then we're going to use the ammunition we have with our current programs. 64 040797 - Housing - 12/13/04 And we're going to keep lending, and we're going to keep providing grants. And we're not going to wait until the Federal Government decides to catch up to us. (One man applauds.)
Well, I'm glad your clapping. I would like to know where they are, you know. And I'm not saying they're not there. I hope they are. But we really want the information and the dialogue. You mentioned on that in the past years an average of 223 building permits for new housing development happened in West Philadelphia.
Do you know where in West Philly? You're talking about just new housing starts, are you talking?