Since I prepared my Fiscal 2003 budget message, I am pleased to report to this body that we have been in negotiations with Administration through the Budget Bureau about our very serious concern. As a result of the Budget Bureau thorough analysis of our requested justification schedule needs, they have reconsidered our request for funding and will, by the use of a transfer ordinance, increase our Fiscal 2003 budget in the amount of $195,000. This funding will allow us to hire an additional two court clerks and to move forward with te automation project which began last year at the request of City Council President Anna Verna. I want to personally thank this Administration and Council President Anna Verna for their concerns. Hopefully, our negotiation with the 1958 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) Administration are not finished. However, this is a good start in meeting our over all needs. Thanks again for your time, attention, and all consideration given on this budget process and on behalf of the Clerk of Quarter Sessions. In conclusion, I remain steadfast and firm in bringing our department into the 21st Century, but I surely need your unwavering support and consideration in approving of all areas of budget requests in order to move forward. Thank you very much. Respectfully, Vivian T. Miller. Are there any questions?
Are there any questions from Members of the Committee? The Chair recognizes Councilwoman Blackwell.
Thank you, Madam President. We are happy to support the Commissioner's request. And let me say that she does a great job. As many of you know, she's also ward leader in Southwest and we're happy to support her. Thank you, Madam President. 1959 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
Could you put that in writing and just send it over to us?
We'll try to accommodate that, Vivian. Thank you, Madam Chair.
You're welcome. The Chair recognizes Councilman DiCicco.
Are there any other questions or comments from Members of the Committee? Thank you all very much.
Good morning. 1960 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) Welcome.
Good morning, Madam President and Members of City Council. In the audience is my Chief Deputy John Furey; to my left is Ralph Weiner, my First Deputy; to my right is Anthony Derose, my Finance Director; and we have Jim Tangert, my Administrative Services Officer. As required by City Council, Madam President, I submitted a two-page letter approximately two or three weeks ago basically outlining our request for our budget, also highlighting some of the things we have done in the past year to help the City in its time of fiscal restraint and its efforts to raise additional revenue. Our request for next year fiscal year is $2,875,292. This is something we sat down with Rob Dubow and basically the numbers that the Administration in keeping with our present staffing levels and present needs for next year. I'd like to point out some of the efforts. We did raise additional fees to help the City Council in the past. Some of these fees that we're raising is a result of monies that you have 1961 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) given us in the past to help computerize our offices and also bring additional equipment in which gave us the ability to raise additional fees. I believe this year alone will bring in approximately percent additional revenues over 7 last year's numbers. If you look at the numbers, 8 we're basically self-sustaining our office. 9 While we're self-sustaining, we also go 10 out in the community and provide services. We're the only marriage license bureau open on Wednesday nights in the five counties to provide a service to the citizens of Philadelphia and the surrounding counties because we tied in, if you recall, on Wednesday night we opened it so make it a night in Philadelphia. It also helps our restaurants where people come in, they get a marriage license or they go -- before or after they go to dinner in Philadelphia. So it's our way of helping to promote the City of Philadelphia. We also have two satellite office which we man with no additional personnel: One in the Northeast part of the City, and one in North Philadelphia. But we're always in the process of trying to generate additional fees and to help do our part of what's required. 1962 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) I'd like to mention what's happening in our office. And Rob Dubow, I want to acknowledge the help he's trying to give us. More and more the courts are requiring our office, because I'm also the Clerk of the Orphans Court, to do additional duties. In the past year, right after our budget was passed, we were required by the court system to implement a program called the Banner Program which is a national program which gives lawyers and the public the opportunity to go on-line to check docket entries. We were not budgeted for this and we're trying to stay within our budget, but this alone required a full-time supervisor and approximately $80,000 of man hours of dollars to just run this program. I'm giving this caveat because I don't know what else the Supreme Court may mandate next year which will require additional employees or additional time allocation on our part. I'd like to emphasize, we're trying to stay within our 70 employees and our budget. But it's getting more and more difficult when we're getting mandated by the courts to do additional duties. If you recall, Council President, many years ago when I first became Register of Wills, we 1963 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) were only getting compensated $20,000 from the State of Pennsylvania for collecting inheritance tax. The State used to have four full-time employees sitting downstairs in Room 188 across the hall -- I'm 188, so across the hall like 185 -- where they would basically process inheritance tax applications. They closed the operation and they said to our office, This is now going to be your duty.
We lobbied Harrisburg to say, Look, if you want us to do this job, we would like to have some type sliding scale because last year we collected over $60 million, the County of Philadelphia, which went into state coffers for inheritance. And I'm glad to say that now we collect over 400,000 in commissions. If we could convince the courts or whatever down the road the more that we're doing maybe we can get additional monies from court system to help these new additional duties. I want to thank City Council for all the help you've given us in the past. And hopefully if we get our phone lines from Verizon we'll be on-line with our probating which will in turn generate additional monies because we'll give the lawyers 1964 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) and the public the opportunity to go on-line and we'll charge for some of these services. Thank you.
You're welcome. I don't have any questions. However, I do want to congratulate you on a great job in increasing revenues and also for improving services.
Thank you. My credit has to go to my staff. I'm always trying to encourage them to come up creatively -- and, you know, we work in conjunction with the Bar Association. Obviously, we don't want to be the only county office in the five to charge these fees, but we're right in line with the other counties and we're probably a little bit more reasonable because I believe Philadelphia County is unique in the sense of we provide more services because of the poor in Philadelphia.
Have you gotten many complaints from the public regarding increasing the fees that you initiated August of 2001? And how do the fees compare to the surrounding counties.
Our fees are either equal or below the surrounding counties. And these 1965 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) fees are usually based on assets into this state. We try to keep the basic probate fees minimal so that the poor of the area can afford to probate an estate. Contrary to some of the counties, Council President, we don't require an attorney to probate an estate. I said contrary to the other four counties, we do not really require that you have an attorney to come in to probate an estate. We try to help the public, the lay people in the sense of if it's minor, we try to help them. Sometimes you do need a lawyer, but we assist them any way we can. We make it a user-friendly office.
Thank you. The Chair recognizes Councilman Nutter.
Thank you, Madam Chair. No question for the Register of Wills. And good morning to the other members of your team. I just really wanted to say thank you for the continued service. We've had a couple, over the past year or so, a couple unusual, if not, somewhat extraordinary situations. Your staff was most accommodating in trying to get a couple situations 1966 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) worked out, and I wanted to thank you for that. I don't think I know the other gentleman as well as either yourself or Ralph Weiner who is also ward leader in the 38th. But I want to extend to all of you my thanks and especially to Mr. Donatucci and Mr. Weiner.
I likewise wanted to say thank you for all that you and your department does. And likewise, I have to step out for a few minutes. We see Marge and Bobby Lee back there. Hats off to you as well. Thank you.
Thank you. The Chair recognizes Councilman DiCicco.
Thank you, Madam Chair. You mentioned about $60 million in inheritance taxes turn over to the State and you said there was a time that your office wasn't compensated but now you are getting some compensation.
Yes. It's gone up every year. 1967 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
So is it uniform across the State, that compensation.
Yes. We get probably the largest compensation in the State because of the volume.
Because of volume. But percentage-wise, is it the same? I don't know what the formula for compensation is.
I can get you a copy of it, but we're maxed out. One half of one percent.
Are the other counties charging the same compensation.
So in order for you to get more compensation, there'd have to a change 1968 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) in the Act change?
Exactly. If you look at -- off the record, I mean, you can't complain collecting over 400,000.
I know, but given the fact that we are unique and, as you say in your testimony, we have a lot more poor people in our county than some of the other counties do, and I think by comparison we probably should be compensated more. Now, that may become an argument to the State Legislature, but --
Usually when you're paying an inheritance tax, the estate has substantial monies in it. It's not coming from -- and I would like to point out, the inheritance tax has been lowered in the State of Pennsylvania. It's now 4 percent and they've eliminated between spouses and it's only 12 percent between nephews or whatever, not direct decendents, but collateral. So I believe eventually years to come I think it's going to be eliminated. But as long as it's there, we do have at least four employees doing it full time.
I was just looking 1969 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) to see if there's a way in which we can helpful to see if we can do anything in Harrisburg to get that percentage up because of the fact that you're constituency, the City of Philadelphia constituency is a lot different than Montgomery and Bucks and Delaware County.
But that's a small part of our operation, the inheritance tax. A lot of our time consumption is the probate and estates. And like I said to you earlier, Rob Dubow and Harry Wellerstein and everybody over in finance, they're trying to address this problem because they realize more and more of our duties are becoming court related. Now, I don't know if eventually down the road a consolidation into the court system, but as we're getting more and more into technology, we're getting more and more required to go on-line and do A, B, and C, and our accessibility and it's costing us a lot of personnel now and, obviously, the equipment.
Thank you. Thank you again for your office, the service of your staff. They've always been very helpful.
You're welcome. 1970 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
You're welcome. Are there are any other questions from Members of the Committee. Seeing none, I thank you gentlemen.
City Commissioners will be next. (Witnesses come forward.)
Madam President and Members of City Council, good morning. I am Margaret M. Tartaglione, Chairwoman of the City Commissioners Office. I would like to thank you for this opportunity to present our Fiscal Year 2003 Operating Budget. The City Commissioners' proposed spending level of $8,187,093 for FY 2003 is allocated as follows: Class 100, personal service, $4,678,505. Class 200, Purchase of Services, $2,594,035. Class 300, materials and supplies $580,687. Equipment in 400, $52,784. Class 800, payment to productive bank, $281,082. 1971 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) This represents an additional $289,852 in Class 100 over FY 2002 estimated obligations. The above figures also provide funds for 3 percent wage increase effective December 15, 2002 in the amount of $52,841. We are excited to announce that the adoption of the Electric Voting Machine System, EVMs, approved by the electorate in the 1998 General Election Ballot will take place City-wide shortly. The new system will replace our existing mechanical machines for the use of 2002 Primary Election. This action will enable faster accurate tabulation of the vote count, reduce the dependency on outside voting machine mechanics and result in the anticipation and initial reduction of Class 200 spending for mechanics service by at least $175,000. The vendor, Danaher Controls, shall provide initial training and continue support service for the City Commissioners for the period of approximately two years on the new implemented system. During 2002 General Election, the department will hire approximately 50 outside technicians to assist three days immediate prior to the election for election day. The dependence on outside technicians is expected to become lower 1972 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) as the City Commissioners staff become more proficient and the use of the EVMs. The cost technicians has not been determined at this time. The City Commissioners had made any every effort to reduce expenses whenever possible. We hope to continue carrying out cost savings, but we are anticipating that major technology steps that we have taken will require additional funding. We will be facing higher maintenance fees or replacing cost to support older office equipment such as printers, copiers, scanners, fax machine and desk top computers. Additionally, we are projecting an increase in the cost of 101 civilian overtime for providing election seminars to familiarize both the Election Board members and the public with the technical advancement of the EVMs. Increased participation in the election seminar by the Election Board members will also increase the cost in Class 200, purchase of services. The department will also be required to obtain 50 personal computers to replace terminals for access to the election payroll system and voters files. Terminals to the currently more widely used 1973 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) Internet protocol employing PCs with network interface capability will be necessary. National Cash Register, NCR, has recommended the City Commissioners no longer support terminals base system after December of 2002. We are looking forward to continue assistance of the Mayor's Office of international information service to facilitate these transitions. This department is continued to institute sweeping changes to the system by which citizens of Philadelphia can cast their vote. As expected in most transition periods, we are faced with some challenges as we make enormous technological advancements. In order to provide the option level of service to the citizens of Philadelphia, we must continue to adopt and modernize our antiquated system in the face of all obstacles before us in the priority of this department to ensure the citizens of Philadelphia their Constitutional right to vote and to certify that each voter be counted properly. Once again, thank you for the opportunity to present our Fiscal 2003 Operating Budget.
Thank you. Commissioner, I want to thank you and your staff, particularly Bob Lee for coming to my ward meeting. He put on a great demonstration for the new voting machines. And I think at that time we had about 200 people present and he had the patience of Job. And I personally want to thank you publically. You did a fantastic job.
Thank you, Madam Chair. Good morning, Commissioner. In that same regard, how are we doing with people responding to come in for instructions? I know in years past they've been rather lax because they thought they knew everything about the machines because they had been working in those polling places for years, only to find out that they didn't know. Now that we have a new machine, how are things looking? And is there anything we can do?
The acceptance level of the machine is very high. We've done 104 demos so far. 1975 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) We have a total of 342 scheduled right now most of April. We still have time for more appointments. We're doing between -- some days you only three to four, other days you're doing 10. We're doing five tomorrow night. We're running all over the City. We're doing a lot of senior centers, senior meetings at churches. We go to the churches after mass and set up there. And the acceptance level by the voters is very high. And most of the seniors are taking well to the machine. It's just a matter of explaining to them you merely push a button instead of pulling a lever. The classes for the poll workers begin today. And what we've done is we've changed the schedule so that rather than just have an open schedule, we are attempting to get the wards there at a specific date and time so that the whole board would be together. We're going to put 12 people on a machine for a period of an hour, and 3 at a time they'll set it up, close it down, operate it. Rather than talk to them, we want them to touch it. Once you use the machine, it becomes a lot more simpler.
Less intimidating, 1976 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) right?
In addition, as Madam President said, we're going to every ward in the City, and a lot of wards are bringing their poll workers there. We're giving them a full demonstration there, although they're not getting the hands-on there. They are getting familiarized with the machines. And while they have concerns, I think most of them see the benefits of using this system.
They all expressed such an interest. I was really very impressed; I really was. Councilman, are you finished?
Yes. Thank you. Thank you for all your support, Commissioner.
Thank you, Madam President. Good morning, Commissioner. The May election is in front of you even though it's 30 days away and we will be using the new machines. What 1977 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) contingency plans do you have in place for the rare unhoped-for possibility that machines may break down and that kind of thing even with the new machines and the extensive training that you're doing? You give a lot of discussion of that on of your testimony for General Election, but what provisions or contingencies do we have in place for the spring Primary?
We have technicians who are 11 fully trained on these machines, certified. In 12 addition to that, as part of the contract the vendor is bringing in another 35. So there will be 47 technicians on the street on Election Day. In addition to that we'll have six vans. Each of the vans will have two machines apiece in the van. This machine is pretty good because if we have a problem with a machine that we can't figure out Election Day, we bring in a new machine. We can take the ballot face off the machine that was used in the morning, take the cartridge out of that machine, put it in a new machine. It will pick up where that machine left off because of the votes will be in the cartridge. And in addition to that, the machine that is out of service will maintain the 1978 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) votes in the memory bank of the one that went out. So we're able to do repairs on the street and also swap out and replace the machine. When we went to Columbus, Ohio, they don't repair the machines on the street Election Day. They just swap in a new one and take it out. So we do have some contingency plans and we have some benefits with this machine. Additionally, there's only two moving parts on this machine. One is the protective counter, that's through a dial wheel. And I believe the other is the printer itself. You would use a printer morning or at the end of the night. So there's a lot less moving parts that can get jammed or broken or not set right.
And I want to note that if anything happens to the machine and they have to replace it, when you take that cartridge out at the end of the night it will have what time that cartridge was taken out and put in the new machine.
If you have not done so already, could you prepare and submit to the 1979 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) President the listing of when you're visiting the various wards around the City for those of us who may be interested in training as well?
What we do is we print the list. Every Friday we send an updated of the list up to the Commissioners and it's sort of two ways, one's by date and one's by ward. So if you're interested in which locations we will be in your ward in the following week, you can contact Commissioner Tartaglione's office and they can give you the demos that are schedule for your particular ward or area.
Thank you. I wanted to join in the appreciation expressed by the Council President. Your group made a tremendous demonstration at the 17 Ward. The place was overflowing onto the streets. We thought people would be annoyed. They were not. They were interested. They listened. I think it was a very successful demonstration. We want to thank you for 1980 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) it. One question now. Is there any plan for assistance on election day for the voters? If a voter has some difficulty in feeling comfortable with the machine, will there been anybody available to assist? Is there any plan to do that?
Probably the education of the voters is going to appear or happen prior to the election as much as we can possibly do that. Right now on the City's cable channel on 64 and 63 at 6 and 9 o'clock each night we have a video tape running, a public service announcement showing them how to use the machine. We also want to contact the cable office and ask them to play that before and after the Council hearings to try to get some more exposure. Those PSA tapes will be put out wherever we can get air time from all the media. In addition to that, there will be articles in the local community news papers. And Commissioner Tartaglione has said that we are going to put a full-page ad, not only in the Inquirer, Daily News and Tribune, but in every single local community paper in the City with the instructions that are included in our brochures. So that ad will appear in the issue the 1981 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) week before the election, or as far as the Inquirer and Daily News, the day before the election. We also have a web page design to put on the City's Website showing them how to use that machine how to vote. We're probably trying to do as much as we can beforehand. Probably the best way or the way they've always to vote on machines is it's going to be committeemen and judges of elections and poll workers assisting them on election day. And the pink sample ballot will be an exact facsimile of the ballot itself, including the green vote button. And we've taken the step of adding extra assistance declarations so that there's at least 150 in each division where if someone wants to take someone in the machine with them because they're unable to enter or operate the machine, they're allowed to declare that need on Election Day, sign that form and take somebody in with them of their choice. I think probably the voters are going to learn best from committeemen as they've always had. People are going work their pink sheets and show them you go up and merely push the button as opposed to pulling a lever. And I think the voters are going to take to this and realize it's a lot easier than the initial 1982 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) fear may be.
The ability of the machine to be tilted on behalf of handicapped voters is an especially desirable feature.
Yes, the machine lowers for those in a wheelchairs or those who use wheelchairs and for people who are not as tall.
I think you all to be congratulated for your effort in that regard too. Thank you. Thank you, Madam President.
You're welcome. Mr. Lee, you made mentioned about how you will be advertising in the local papers the week before the election. Do you have money in your budget to do that?
That's not currently budgeted. Our normal advertising is, but the full page ads in all the community papers, that's not currently budgeted right now.
No. We made mention to 1983 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) Mayor's Chief of Staff and Managing Director when we were at a meeting on a different issue and we'll be working through, I guess, with all the departments on that.
Very well. Thank you. The Chair recognizes Councilman Nutter.
Thank you, Madam Chair. Good morning, Chairwoman Tartaglione and Bob Lee. It's nice every now and then when we can actually start something and live to see through the completion. Doesn't often happen in the government. But I first just want to thank you, Commissioner Tartaglione, and all the commissioners who were in office at the time that this effort started back in '97 and '98. I know it was yourself. I know Commissioner Alex Talmadge was the Commissioner at the time. My memory is a little fuzzy. Was Commissioner Duda a commissioner at that point?
I thought we tried this since 1977. 1984 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
Yes, I know. It has been a while. Sorry it took so long. But nevertheless, the Council put forward the necessary legislation. I want to thank my colleague Councilman Cohen as Chair of the Law and Government Committee that had the hearings on this particular issue and allowed the voters the opportunity to vote on it, which I think they did overwhelmingly, I think 70-some-odd percent. And it's long overdue, but the time has come and I just really want to express my appreciation. It was a great thing to be able to work on. And I thank all of my colleagues for the support they gave to getting this passed. I did want to ask one question with regard to -- I heard Bob Lee talk about the switch-out, the machine switch-out event. Obviously, we have enough machines to be placed at all of the 1681 polling places and some places have one, some have two, some have three. How many, quote/unquote, extra machines do we have?
We have 3526 machines plus 10 demo machines. We expect to use about 3430 on the street. This election there will be no division that has only one machine. We will make sure that 1985 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) every division has at least two so that if there's any kind of confusion or problem, there will be a second machine there that they can continue voting on. So for this election we're eliminating our single machine divisions and putting two machines in every division. There will be some triples where the law requires it, which leaves us probably less than a hundred machines as spares.
And lastly, in that regard, in other cities where these machines function and operate, if they utilize the switch-out procedure, is there any history in those cities in terms of the number of machines that have actually had to have their counters removed and placed in another machine?
Very few. Once every couple of elections they do. It's very few. These machines have been proven to be reliable. The machine has been used on the street, the machine itself, since about '83. It's a good solid proven machine. The software that we're using to do it is from 1998. All of it's independently tested for FUC standards and it's all been examined by the State. It's a very good solid machine. Generally, if 1986 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) there's problems with the machine with the electronics, it's within the first few months. These machines each went through extensive testing in our warehouse. They started delivering them back in June of '01. And our people have been testing them at a rate of about 125 to 200 a week is what the delivery schedule was and we were testing them all summer through the fall.
Just for the record, I think the original proposal was that the machines were going to be phased in. There was extensive negotiation time period as well as the building, if you will, of the machines. The way we have it situated now, all polling places will have the same electronic machine on Election Day. No one will have the old whether old shoe, new show, any other shoe, or Jamestown or anything else. All of those machines are out of our system and we're only used the one electronic machine; is that correct?
That's correct. We're using this machine City-wide. In fact, the Commissioners from the onset wanted to go with a full City-wide implementation and avoid trying to merge a hand count with an electric count which could be a 1987 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) problem. So it was decided pretty early on to go with a full City-wide implementation.
Lastly, let me follow up where the Council President was. Do you know when the issue of funds for a full public education advertising campaign -- I mean, obviously you need to start as soon as possible. Election Day is --
Yes, I know when it is. What is it, three months a from now, two and a half months from now?
I'm sure you need to get going on that. How do we get resolution to that? What do you think it will cost?
I'm not sure. The ad is ready to go. It's in my PC, it's ready to go. It's just a matter of having our people talk to the Inquirer, Daily News, these local papers and see what these full page ads are going to run.
Okay. I certainly encourage you to be aggressive about it, which I know you will be. And if there's anything that we 1988 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) can do to support that, I think it is critical that we have a good public education campaign notification. I know you're having demonstrations at a wide variety of places. You'll be coming out to the 52nd shortly. But I know throughout the City we need people to know as much as possible about the machines as well as take advantage of the opportunity to encourage more people to come out to vote who may just be intrigued by the new technology.
In fact, today they are putting two demos in the MSB Building in the basement as people come and pay their taxes and their water and all, and they will be demonstrating the machines there today.
You're welcome. Are there any other questions from Members of the Committee? The Chair recognizes Councilman Cohen.
I just wanted the record not to fail to note the great contribution 1989 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) made by Councilman Nutter of this Body in moving the whole process forward. He initiated the legislation. He fought hard as Chairman of Law and Government Committee. He was on top of me all the time until the hearings got scheduled and actually got held. I think he was certainly an honorable commissioner together with the Commissioners in moving this process forward. And I think the record ought to note his great contribution.
We congratulate him and you. Thank you. Any other statements or questions from Members of the Committee? Thank you very much.
I want to remind the Councilpeople who are ward leaders tomorrow at 5 o'clock is the deadline to file for your committee people.
Thank you. It's my understanding that Judge Jackson would like to be recognized again.
Madam Chair, I think the record should reflect that this is the first time that anyone has voluntarily come back during 1990 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) the course of a budget hearing. (Laughter.) JUDGE MASSIAH-JACKSON: Thank you, Madam Chair. I had indicated to our Clerk of Quarter Sessions, Vivian Miller, that I would sit with her and her staff as she presents her testimony. But after the First Judicial District testimony, I was out in the hallway talking to the attorneys supporting counsel fees. And when I turned around, Mrs. Miller was gone. So apparently, I think that she answered all of your questions very expeditiously and she went back to her office. But I'm here just to say that our courts, every courtroom must have a Clerk of Quarter Sessions, at least one. And even as we speak, there are insufficient numbers of Clerks of Quarter Sessions. There are 64 trial courtrooms in the CJC. They do not have enough clerks. Some of the courtrooms really need more than one clerk. And we will continue to support the Clerk of Quarter Sessions in their budget request, in their request to eliminate the hiring freeze that I believe has been imposed on them. And I know they have clerks who are in the DROP Program. All of that will 1991 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) affect the operation of our courts because, you know, judges are not necessarily the most important person in the courtroom. The Clerks of Quarter Sessions are important, the sheriffs are important, and the staff. And we really need those staff people. So that was our addition to the Clerk of Quarter Session testimony.
Mr. Dubow, I understood the Clerk of Quarter Sessions was negotiating with you for taking care of her needs. The record will reflect that Mr. Dubow was asked the question. He nodded his head in the affirmative. Thank you very much, Judge. JUDGE MASSIAH-JACKSON: Thank you. (Witnesses come forward.)
Please identify yourself for the record and proceed with your testimony.
I am Deputy City Controller Tony Radwanski. I am here to present testimony on behalf of Jonathan Saidel on the Auditing Department's Fiscal Year 2003. I am joined by Deputy City Controllers Albert Scaperotto, 1992 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) Anthony McNeil, and Office Administrator Gene Laumer. The Mayor's proposed FY 2003 Operating Budget includes a proposed General Fund appropriation of $7,501,595 for the Controllers Office. 5 percent Class 100 budget reduction. The entire amount of the modest increase over our FY 2002 budget is due to the cost of living salary adjustments negotiated with our City employee bargaining units. Our staffing level for FY 2003 stands at 131 budgeted positions. I'm very proud to report that our staff currently includes 45 certified public accountants, an all time high for the City Controllers Office. We intend to continue and strengthen our profession training program to retain and enhance this fine staff. As future challenges present themselves, we will find it increasing difficult to live with our existing appropriation and staffing levels while also vigorously pursuing the ever-increasing responsibilities placed upon our office by 1993 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) additional programs and federal and state auditing mandates. For example, the usual staff turnover which had enabled us to artificially balance last year's 100 Class budget was nonexistent this year. This may partially be due to the effects of the City's DROP Program. To date, no Civil Service employees have left the office during the entire Fiscal 2002 period, so we were unable to achieve any cost savings through the usual turnover of positions, occurring when employees leave or retire. To fully carry out our audit responsibilities, I hope this Council will consider future modest enhancements o our funding level. Our present responsibilities include conducting audits of 40 City departments, auditing the comprehensive annual financial report and federal financial assistance reports of the City and School District of Philadelphia, as well as conducting performance audits of the City and School District programs, state forfeiture audits, and grants audits, bond consent letters and various other topical audit requests. Our Pre-Audit Unit which is headed by Mr. McNeil, is chronically understaffed. The 1994 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) employees of this division struggle each day to expeditiously review and process well over 150,000 payment vouchers each year as well as monitor and inspect numerous City construction projects. Even though budget restrictions keep our sampling rate for vouchers to be well below where I would like it to be and where Jonathan would like it to be, our reviews have led us to savings of millions of dollars for taxpayers in several high-profile criminal referrals. With the start of the Mayor's Blight Program, it will soon become impossible to accomplish this vital check and balance without some reasonable additional revenues being allocated to this area. We also recently assumed the functions formerly undertaken by the Office of Director of Finance Risk Management Division regarding their fraud unit. We are currently working with the Inspector General and other law enforcement agencies to create a state-of-the-art fraud detection program, all with considerable savings to the taxpayers. Additionally, our Special Investigation Unit conducts regular surveillance as part of the City's employee injury and disability program. One of the things we would like to do in 1995 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) the future is work closely with Council in utilizing the expertise of the Controllers Offices in conducting topical audits of special interest to you and your constituents.
For example, in the recent past, Members of the Council have requested our office's assistance in investigating the procurement and installation of the new playing turf at Veterans Stadium, City-administered employee health care, prison health care, small business lending in Philadelphia, and most recently the structure of our local taxes, as I'm sure you'll well aware. I am very pleased with the comments we have received from Councilmembers on the audits we have been able to conduct and I am proud that you have come to rely on our office as a source for unbiased intelligent and professional fact finding. Although fulfilling all of these special requests is very important to Controller Saidel and to Philadelphia, conducting them is time consuming, expensive, and often requires the need for outside expertise. One of the controller's goals is to work constructively with Council this year to try to device a method of providing earmarked funding for some of these special audits on a project-by-project basis so that 1996 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) they may be conducted timely and professionally and be of use to this Council in conducting its public hearings and its legislative deliberations. Controller Saidel is extremely proud of the men and women of his office who always reflect great credit on our office and on the City. Our staff is often called upon to make presentation to other municipal auditors from around the country and have consistently won competitive national professional awards for their work. Controller Saidel has asked me to tell you that as long as he serves as City Controller he will continue to fight to maintain his high standard of professionalism and objectivity. On behalf of th controller and his staff, I thank the Members of this Council for your consideration, constructive thoughts, ideas and kind words. My colleagues and I will be happy to answer any questions you may have at this time.
Thank you. Are there any questions from Members of the Committee? How many people do you anticipate will be eligible for the DROP Program? 1997 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
Right now about people. However, they are in strategic positions. For example, there are two people who are in a supervisor capacity in our Pre-Audit Section, both of them are in the DROP Program, so we really have to get our training program started now to assume those positions in those roles because they're critical. That's a critical stop in the City's system of paying vendors. If something should go wrong in that system, all hell breaks loose, basically.
So you're starting the training program at this point?
We are starting it this year, yes. We have two years before these drops take effect. So we really have two years to get in gear. That should be sufficient time.
Because most of them, I think, start in October of '03. The Chair recognizes Councilwoman Brown.
Thank you, Madam President. Your question has prompted one from me as a follow-up. You mentioned that you have 10 in 1998 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) supervisory capacity that will be leaving. Is there another level of management above the supervisory level?
The people above the people who are leaving I mentioned in Pre-Audit are the Deputy City Controller and the City Controller.
And you also mentioned that you have training on-line.
We have not yet begun it. We're going to start it this fiscal year.
Okay. I am always observant of the makeup, the composition makeup of all departments, particularly at the upper level. So my hope is that women are in the pipeline to be part of the training so that they too can rise to the ranks of leadership in your department.
One of the people of the two is a woman, and we certainly will give that full consideration. We'd like that as well.
Are they Civil Service positions? 1999 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
Thank you. The Chair recognizes Councilman Nutter.
Thank you, Madam Chair. Good afternoon, Mr. Radwanski and the other members of your team here this morning. Not so much a question, but I wanted to take a full opportunity in a more public fashion -- from time to time the Controllers Office has certainly generated by its audits and by our Charter requirement the concern of the various departments that you make audit as is your responsibility and so you at times maybe take on a certain persona of these nameless, faceless people who do audits and make other people's lives difficult. On the other hand, I had occasion, and I wanted to thank you publicly, that in a non-audit capacity there was a particular night that I was actually somewhat stranded right outside City Hall, and you stopped as you were coming around the City Hall circle and asked if I was okay and then offered your assistance and helped me along the way. And I wanted to thank you for that. It was a very kind gesture and I just wanted to tell you 2000 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) thank you.
Thank you, Councilman. I would like add that we in the Controllers Office deeply appreciate the thoughtful approach you take to the legislative things that we bring to your attention. We appreciate you as well.
Any other questions or comments from Members of the Committee? The Chair recognizes Councilman Ortiz.
Thank you, Madam Chair. We've been dealing now with the prison audit for a while. We've been having some difficulties in achieving that. How far are we into that? The prison keeps on, and the administration, not coming forward with the information we need. And actually, it's becoming more and more imperative that the Controller be able to look at, if we're ever going to get a sense of how they spent $28 million.
Councilman, that's 2001 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) exactly what we had in mind when I mentioned the fact that we should develop some kind of mechanism where there's consensus in Council to do a particular audit that we can get the money appropriated to do it. For instance, like the prison health care audit is a matter of great concern to us. The City has spent over $110 million in the last six fiscal years on prison health care. And it a seems apparent from the numbers that we see that we're not getting the bang for the buck that we should. You've been very vocal on leading that issue. But we went out, we got a private firm, solicited a private firm to do the audit because it's not something that we can do in-house. It requires a certain degree of medical expertise. And we got a $90 thousand price tag. So at that point, we were kind of caught between not doing it and trying to do it to a lesser degree, which in my judgment would not have produced the effective really being able to measure the quality of prison health care. So at that point, we were stuck with what do we do. And that's why we thought of this mechanism. If we can only devise a mechanism where there's a consensus in Council for us to do a 2002 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) certain thing, we have the expertise to be run the audit effectively and most cost efficiently. However, sometimes in the office we don't have the medical expertise or other type of specialty expertise that's needed to do a particular audit. This is a perfect example of that.
And this is over a hundred million that we're dealing with and it's become obvious to your office, it's become obvious to City Council that we're not really getting the information and we're not getting the services that a hundred plus million dollars should be able to be providing the City. And I think we got the same problem in terms of information and being able to develop a policy for this Council. In Councilman Cohen's health investigation into the health insurance program that the City had contracted with, we were never able to really get all the information that was needed at that time. And we needed an audit there. I don't think we got that, right, David?
That's still ongoing, Councilman. That audit is still ongoing. It should be done very soon, within the next couple of weeks. 2003 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
But these are investigations that have been ongoing now for like two years. And we -- because of the financial difficulties and the ability to get information really has become extremely difficult to get a good grasp on the factual situation that we're encountering.
Well, we would appreciate your support in trying to get that through. In the meantime, we'll be happy to work with you to try to do something that we can do with our present means. We're very concerned also that this whole prison health care fiasco or prison health care system that they have now exposes the taxpayers to a lot of lawsuits that they would not necessarily be exposed to if the system were operating right.
That's right. So that's very important because it saves a lot of money for the taxpayers down the road.
The Chair 2004 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) recognizes Councilman Cohen.
I raise this question in a very tentative way, which for me is unusual. In addition to looking for a mechanism whereby Council and the Controller could work more closely together on specific audits, it seems to me that there's another area of great need for this high level of participation, and that is this -- I think your office is outstanding in the studies it conducts. If you're not the best in the country, you must be right next to the best, though I think it would be awfully hard to find any controllers office, whatever it may be called, that's enclose to yours in the superlative quality and product produced when you produce it. The question I have is that too often it seems to me that your work is wasted in the ultimate sense and that you raise issues, some departments feel kind of free to ignore them and then there seems to be nowhere for the Controller to go. I want to express to you that, speaking for myself, hopefully for a majority of the Members of the Council though we've never consider it, I think there ought to also be in your agenda a method of 2005 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) working together to be able to see that your studies produce results. They're wonderful in their analysis. But like the Planning Commission's recommendations, the can be completely disregarded. And I think we ought to find a way maybe not to change the legal impact but to make your recommendations have a much greater chance of being accepted because I think they're vital and very important to the health of the City. So I just suggest for your consideration, it's not a question at all, but if you wanted to comment that would be fine. I would just like to see your work have the ability to have a lot of clout behind it so that you have a method whereby -- and if we can help in City Council, we'd like help see that your recommendations are carried out.
I would just like to say, Councilman Cohen, I think your point is well taken. Jonathan Saidel is very good at utilizing the bully pulpit to get things done. This is very important because, as you say, we have no legal means of getting our recommendations enacted. It depends a lot on the Administration and its willingness to take what we say and act upon it. 2006 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) We have do an audit retrieval system that does quantify all of our audit findings and they remain on the books for a few books until we figure that there's never going to anything done about it. But we do keep track of it. If you'd ever like to see it, we'd be more than happy to share it with you. Any things that you have, any ideas that you have to help us better put forth our ideas to the public, which is -- you know, as it is yours, a lot of times you need the public support to get anything. We're very happy to get any suggestions and work with you closely on anything you might have.
Thank you very much. I cannot resist not asking this question. Not being an auditor, what does it mean -- and I ask this tongue in cheek -- when an auditor uses the expression found on of your testimony "artificially balanced"? Because we know if an administration official used that it would send signals, rightfully so, given the role and 2007 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) responsibility of your office. But what does it mean when an auditor uses the expression "artificially balanced"?
I don't think we meant it as a term of art, Councilwoman. But what we meant by that is the fact that in past years we have balanced our budget through attrition, through people leaving and the delaying of filling positions as well as other economies that we're able to afford. So we'd like to work with Council and the Budget Office who's been very helpful. I'd like to thank the Budget Office for working closely with us to help us make ends meet this year which was really a nip and tuck operation. But what it means to us is we have to produce extraordinary means to make our 100 Class budget meet ends at the end of the fiscal year. We'd like to be in a position where if everybody stayed and did their job and nobody left and everyone's happy, that we make ends meet at the end of the fiscal year. And we're not in that position right now.
Thank you very 2008 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) much. Are there any other questions from Members of the Committee. Seeing none, thank you very much.
Council President Verna, thank you, as always. Thank you Members of the Council.
Good afternoon, Council President and Members of City Council. My name is David Glancey. I'm the Chairman of the Board of Revision of Taxes, and with me at the table this afternoon are Rick Foglia, the Executive Director of the Board; and Robert Nix, the Secretary of the Board. I was about that far away -- and I say that particularly to Councilman Nutter -- that far away from simply resting on our written testimony, but it seem to me there was a pattern in the short time that I was here questions concerning the DROP Program, so I think I should probably just say that initially and if there's any questions that Council would have, we'd be happy to answer them. We have roughly 19 members of our staff 2009 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) who are going to be affected by the DROP Program. Of that 19, however, approximately are in the 4 evaluation section of our program. We have 5 generally, I think similar to the Department of 6 Revenue, generally a graying staff. And those 16 7 are going to take advantage of the DROP Program 8 probably the end of '03 beginning of '04 I guess is 9 when that will actually hit. And I have spoken to 10 Mr. Dubow about this particular situation in that 11 what we need to have are entrance level folks now so 12 that we can do something when -- have at least some 13 of the institutional knowledge that some of these 14 folks have as they leave transfer to some of the 15 entrance level folks. But that is our situation. 16 We consider it serious. We've talked to both personnel and have talked to the Budget Department about it. Hopefully, we will be able to if not completely replace everybody, we'll have enough replacements early on so that we can function properly. And with that, I will take any questions you may have.
Are they Civil Service positions? 2010 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
I don't need to see it. I just was wondering if they had to advertise, given a test, or whether there is an existing list available.
We have existing list for certain of those who are going to leave. An existing list that we are asking personnel to make, however, is a list of entry level folks. We have folks that we can promote, but what we need to have are entry level positions that will take the place of those who are leaving. We can always promote internally, and I believe -- there may not be a list for every position, but for the real important positions, there is a current list.
We all have copies of your testimony, and I wanted to make certain that the stenographer did have a copy of it so that she could include it in her notes. Mr. Glancey, how long has the BRT been 2011 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) using the geographic market areas as the basis for the Equalization Program.
I believe we're going into our third year. Let me just ask my staff. Yes, this is the third year.
Will this program reduce the number of assessors?
What is the percentage of appeals received following a market value change?
This year we received -- I'll talk about this year specifically and then say generally what we get. This year we received around 5,000 appeals out of 200,000, roughly, noticed that went out. For the last two years, that has been somewhat average, 1/2, 1/2 percent. We have had years in the past where we've had 10 percent. I think the reason, even though we sent a greater amount of notices and have had a fewer amount of appeals is noted in our testimony on . We have improved the communication that we have with each and every taxpayer who gets noticed. We've 2012 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) improved the communication with each and every taxpayer who doesn't get noticed. We try to send out in a water bill, which we have done, FAQS, the facts about what to do if you get an increase in your market value and just kind of tells you what our office is. We have a Website that will answer those very same questions. And, of course, our notice has been revamped to give folks more information about what the value of their home is, why we think it is that value, and ways that they can contact us and talk to us and see why we do what we do. And that, again, can be either through computer, it can be through e-mail, it can be through fax. Or it can be a person-to-person conversation on the telephone. So having said all of that, I think the reason that we have seen appeals decrease even though notices increased is that the process is somewhat more transparent. I mean it can get more transparent. We hope to always be as transparent as we can. And that folks are starting to understand more and more what we do. And I also believe that we are better at doing what we're supposed to be doing. We're not there yet. We're not a hundred 2013 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) percent of where we should be. However, I believe that our Equalization Program, although it obviously is going to cause some pain folks because if you increase the value that means your taxes are going to go up. But we have to look at it just as what our job is. Our job is to try and track values as best we can. Of course, we don't do that in a vacuum. We attempt to do that while also understanding the kind of human anguish that that sometimes causes. But we also know that our driving force is to try and track values. So if you we do a bitter job and we communicate to folks what we're doing, I think we'll see a lower amount of appeals and the ability to do this on a yearly basis, which is what really the best practices are. Now, doing it on a yearly basis doesn't necessarily mean that there is always going to be humongous increases. If we did it on a yearly basis, it may very well be that smaller increments year by year by year would be much more acceptable. I mean, those are of the kinds of things that we work on in between assessment periods along with whatever changes in technology that come along to help us do what we're supposed to do. 2014 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
Thank you. The Chair recognizes Councilman Nutter.
Thank you, Madam Chair. I'll be brief. Mr. Glancey and Mr. Nix, as Chair and Secretary of BRT, first I want to thank you for the continued good working relationship between my office and my staff and your staff on the very delicate issues that we often find ourselves trying to work on. When constituents receive their assessment bill, the number may not be a number that they think is appropriate, and your office has been very kind and quick to try to either get someone scheduled or get them an explanation. So I want to thank you for that very sincerely. Mr. Foglia as the Director has also provided tremendous service to constituents. And I've had the occasion a number of times to literally drive Joe Williams crazy, but he continues to take my calls and I deeply appreciate it. Lastly, I would ask if we could have Mr. Davey come up and spend about an hour or two explaining, as he often does, how the Board actually does its work, how assessments are made. 2015 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) (Laughter.)
And, Mr. Glancey, you were too kind. I think the reason that you're probably seeing fewer appeals is I believe more people are being given Mr. Davey's phone number, and as a result of any of those conversations, people realize that there is no way in the world that they're assessment he its going down. (Laughter.)
And I would say with my good friend Mr. Dubow in the back that, Mr. Dubow, you still have a ways to go in terms of being able to explain something in such a way to meet the standard that Mr. Davey has attained. If you keep working on it and one day you, too, will be at that level. (Laughter.)
Mr. Davey knows that I'm only joking with him. I do tremendously appreciate what he does in a very complicated system. But the office provides good service, and I wanted to thank you for it.
Thank you, Councilperson. I might just add parenthetically that the Gene Davey 2016 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) road show is tomorrow evening at Society Hill Towers if you care to attend.
I can only imagine what that will be like. (Laughter.)
Thank you very much for your kind words. We really appreciate what you said thank you.
Thank you. Good morning, gentlemen. Let me start off by echoing Councilman Nutter's comments with regard to the service that your office renders. I too can speak from personal testimony particularly as it relates to the assistance you gave us with the due diligence around the land value tax. And as a follow-up to those discussions, you shared with me that you believe your budget would need to be increased by approximately 7 million. If we were able to, A, get it passed out of City Council and signed by the Mayor, and then, B, implement it, can you speak to that today, share with us how you arrived at that estimation and what tremendous 2017 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) impact that would have on the City's budget both positively and negatively?
Certainly. That number, as you know, we tried to put together as quickly as we could when we talked to you in your office. And also, we had a little more time and we thought we might be here for some testimony January 30th, but obviously whatever happened, happened. And we were not able to present testimony then. We believe that if a land value tax is implemented, there would be a need to revalue every parcel of land in the City of Philadelphia at its highest and best use. And I think I saw Professor Robert Inman agree with that. He said if you're going to start a program like this, you have to do it correctly. You can't simply take the land allocation that is currently there. Let me backtrack one quick second. We don't value land. Our evaluators value the land and the improvement. Example, you pay $100,000 for your property. Basically, that's what the evaluators value, that's what real property appraisers value. We have to artificially place an allocation on the land under that improvement. So when your property -- I would ask you a question or anybody a question. 2018 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) How much did you pay for the land under your property? Nobody knows what that is really. They know what they paid for the improvement in its entirety, and that's what our staff values. So I think as a rule of thumb, and this is very rough, our evaluators because the law calls for them to do it would say if it was a hundred thousand dollars parcel, the house and the land under it will cost you $100,000, we'd put roughly percent or a third 11 on the land. But nobody's really done a study of 12 whether that's what the value of that land is 13 because we don't have to. I mean, it's something 14 that we wouldn't do. It would waste an awful lot of 15 time and then obviously have not benefit to what we 16 do in putting values on property. 17 However, having said that, that's why I 18 believe we would have to re-value every parcel of 19 land in it City to try and get an accurate highest 20 and best use. Highest and best use for a vacate 21 piece of land in Center City would probably have to 22 be valued at more than whatever it is today, 23 obviously. It could be and office use at that 24 particular location. And I'm just making this up 25 hypothetically. So one of the problems, as I think 2019 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) as I told you with the land value taxation, was we now have to look at that and say, Okay, the market says we shouldn't be building offices. Right now the market is not -- I mean, that is happening. We shouldn't be building offices. However, because we have to put the highest and best use on this property, highest and best use value on this property, we would value that land as if it could be an office development. So what would be as vacant land, no real high use, say at bucks a square 12 foot would all of a sudden be 80 or 90 bucks a 13 square foot, a significant increase. 14 That's not what your question is and 15 that's really not the problem. That's something that we would have to do systemically. But what I have and I can share this with you and with Council if you'd like after this hearing, is that we believe that we would currently have to increase our salary costs by about 4 million because we would need to completely reshape our organization. We'd have to have land value specialists because once you institute it, you have to maintain it, obviously. We also think -- and again, these were very rough figures -- that we would probably have to 2020 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) add about $650,000 for Class 400 and Class 200 types of expenditures, you know office and equipment, furniture, desks, chairs, all that kind of thing that goes along with adding some staff. We believe that, again, and I say this to that total of 4 million 6 and the 600,000 comes -- I'm sorry. With benefits added in. The 4 million 6 would be salaries. The benefits would be about 6 million 7.
We roughly figured 40 percent plus or minus on the benies of that. We are conservative. We went over what I think we would actually have to spend because I think we have to give you the most conservative look. The total was roughly $7 million. I think that -- you know, it might be high. Maybe it's 5 million. But that's still a lot of money. And then in the first couple of years you'd probably have to sustain it at that kind of level. It may drop off, it may go down as we go further into a program like that. But one of the things is we don't really know. Without getting into the merits of the tax itself, I'm not sure what it would actually cost to maintain a system. The other thing, Councilwoman, which I think is very important is that during the 2021 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) institution of such a program, we would almost have to have two systems. We'd have to keep our current system while we are an instituting this system, similar to what we all do with computers today. You have to keep your current system going before you can institute the new system. So with this, though, we're talking about our current budget of 7 million something, plus an additional, we'll call it 5 to 7, you know, trying to get these new system oriented. Again, these figures are the best we could do at that time. We can try to refine for if you wish, but I think that they're ballpark accurate, at least for the first two, three, or four years if we went to that kind of program.
Well, you've certainly answered my follow-up question, which is, would that figure hold for all subsequent years to follow. And then lastly, given that level expenditure, would the benefit outweigh, the benefit that we're trying t yield from this split rate tax, would that outweigh the tremendous expenditure that we're doing on the front end?
My opinion is it does not. 2022 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) But there's lots of opinions about this. Because you really are getting to the merits of whether a land value tax is some that is useful. My opinion is that if the point land value is encourage development, and that really seems to be what all the proponents say, that if make land value higher, the holder of that land will do something with it as opposed to sit there and speculate. That's in a nutshell is the point. My opinion is that unless there is a market demand for development in whatever that area might be, if also there has to be favorable interest rates to borrow money in order to do that development, and there has to be kind of a City-wide land policy that allows this kind of development to take place. That, in my estimation, is much more important than the tax policy. I think -- and again, to be fair, the proponents of land value tax say, "Well, this will create the demand." I haven't seen it. That may be the case. What I had suggested initially to the City Controller was why don't we just get an honest broker to do some kind of a pilot study in a portion of our City and see if this can work. Don't use the 2023 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) land allocation numbers that we currently have because they're not values. It would seem to me if we had a econometrics and some appraise that would volunteer their time -- and maybe the reason we don't have that is because nobody is volunteering their time because it would be a pretty expensive proposition, it seems to me, to take a third or a quarter of the City, revalue the land up there and see whether or not by using all kinds of modeling whether or not it would encourage development at least according to me. Look, there's been on both side of this issue I think that there's a lot of emotion. There are those who think -- the proponents thing that this is the greatest thing since sliced bread, and there are those on the side who said that this just pure hokum. I fall somewhere in the middle. I honestly believe that if there were to be some sort of fair study, a study that's not done by either a proponent or opponent, it would be something interested to see. But there's one think I would add -- and I know I'm being windy here about this. It was in something called the Illinois Real Estate Letter. A Professor Edwin Mills, is land taxation 2024 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) practical. Professor Mills who teaches at Princeton and Johns Hopkins and is a renowned urban economist, is a proponent of the land value tax. He's an absolute proponent of the land value tax. However, his conclusion after answer the question, is land taxation practical, he states, and this is a 1998 study, The theoretical advantages of shifting the property tax base entirely or predominately to land alone are great. So he says that theoretically this is a great thing to do. However, the practical problems of land taxation make it sufficient implementation inconceivable. He doesn't say difficult or hard or we don't know. He says inconceivable. And that's the proponent of land value tax. So I do believe that the practical problems that we speak about, and when you and I have talked about it, are such that it would be a very expensive proposition. And I'm not so sure the upside is worth it. Sorry for taking up all that time.
I really appreciate it, particularly the new information that you've gotten since the introduction of this bill. And my 2025 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) opinion at this hour simply makes for a hard sell given the kind of information you've shared. So thank you for that. My second and final question speaks to that your office now has Internet access for residents who want to look up property records? You mentioned that there is now Internet access. Is this up on the Web now.
And I know that Mr. Goppelt and his hall watch piece also does something along those lines. What are the differences as you view them?
Well, I think ours is more current. One of the conflicts that we might have had initially was that Mr. Goppelt did not want to pay the cost of what we sell our CD for. That was two months in the making, I guess, that squabble over a hundred dollars, I might add. That's all it cost. But our information is more current because we will update it. And if we update it, that means that those who have purchased the CD have the CD they bought. We would love to update monthly. 2026 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) We're not there yet. The last update, I believe, was in November. Yes, November 27th was the last update that we have on the screen. I might add, however, though, that we receive from MOIS from January 18th until February 26th, that site received 327,000 hits. So it was really being utilized greatly. And we try to do everything we can to encourage that kind of use.
Thank you. The Chair recognizes Councilman Goode.
Thank you, Madam President. Good afternoon, Mr. Glancey. This may be a more appropriate question for the Revenue Commissioner but I forgot to ask it while she as the here. In your testimony, you talk a lot about real estate tax incentives, abatement programs. Do you know in terms of Fiscal Year '03, can you give me an estimated amount of foregoing revenue for all tax 2027 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) incentives on real estate?
What your real question is, what is the taxable amount of the abated assessment if it were taxable. It's roughly 6 million, 7. As you note in the testimony also, it's 7 right after the appendix, there's two pages that 8 shows all of our abatements listed in chart. It 9 also indicates that the taxable amount of those 10 abated properties is about 5 million 9 or 5 million 11 6 or something like that. But the abated amount, if taxable would be 11 million 7.
Could you tell me roughly, if you know, what that figure would be under this Administration since January 2000?
Can you tell me what the figure would be for the administration from January 200 to the end of this fiscal year?
I would have to see if I can figure that. It's a running you're asking for?
Yes, running total from January 2000 until the end of the fiscal year.
Okay. So the first six 2028 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET) months of this year calendar-wise.
Yes, that's correct. Could you just forward that to the Chair.
Sure. I'm sure we can do that, I just need to double check. Yes, we will forward that to you. Thank you, Councilman.
You're welcome. The Chair recognizes Councilman Ortiz.
Good afternoon, Mr. Glancey. You know, that thing about empty land, the neighborhood that I now live in, Northern Liberties, has quite a few lots that have no building on it. And the prices on those lots have been skyrocketing in terms of the value of empty land. I say value because real estate individuals are asking a lot of money for them. My wife's cousin went to try to see if they could buy one, and from September to the end of November, the price has always doubled.
The price or the asking price? 2029 3/11/02 - WHOLE - BILL 02001 ('03 BUDGET)
The asking price. I said to them, I said, "Why don't you go into see what the market value is in terms of your shop." And the value that your shop had given was like the minimus compared to the asking price of the real estate. Obviously, a demand is there.