And I think that most of the Councilmembers were very skeptical about what we were doing. And I can tell you that that has been a wonderful success story. I believe they were thinking of moving out of the City. They have now completed Phase II of 50 5/22/00 WHOLE COMM. - BILL 000221 PNC, and how many people do they now employ, Mr. Fina? Do you know, off the top of your head?
I believe 1500 seems to be the number there. There were 1100 initially, and I think there was a 400-increase with Phase II. And, also, there's been a huge development boom that occurred around that business ever since it went in there -- restaurants and hotels that we did not assist in any way. I think there are seven new developments of hotels or restaurants that have occurred since the PNC Bank Operations Center moved to the airport area.
Mm-hmm, thank you. At this time, the Chair recognizes Councilman Ortiz.
Thank you, Madam President. Suburbia is boring, very boring. And I think Councilman Kenney's statement about our tax structure is correct, but the issue is not whether one TIF or two TIFs or one or the other has been successful, because some of them have. The issue 51 5/22/00 WHOLE COMM. - BILL 000221 is overall, what is the return on the investment? And I think we act here as a corporate board. We are giving away in essence some economic benefits to corporations, and we have to begin asking if there is a return on the investment for us, for the City. I haven't seen the impact of any TIFs on the Barrio, I haven't seen the unemployment rate in the Barrio go down. Over the last 8 years that we have been giving TIFs, over 155,000 people have left the City, okay? And I know that some people have gotten employment. The issue is, what is the economic impact overall in terms of the City, what is the return on the investment? Does it create more new taxes, does it stimulate new private investment? And I don't see any empirical proofs of that. And if you have it, please let us see it. You know, I want to see in data, because we have gone through a process already of enough TIFs over the last eight years in which we should have, we should have proof of the economic social impact of these taxes. And if we don't -- that should be the 52 5/22/00 WHOLE COMM. - BILL 000221 return on investment, that's what you should be talking about right now, not in hypothetical terms. Because all I heard from my colleagues and everybody else is hypotheticals, no proof, no 6 empirical aspects as to the return on investment. And I'd like to see that. I would like to see what has been that return. And, Mr. Fina, if you have it, please let us see it.
I can get those calculations. We've had -- so far 19, TIFs have been approved, 8 have closed, the most recent, last week. So the oldest one is the one that Council President noted, which is the PNC, which you approved five years ago.
Thank you. 53 5/22/00 WHOLE COMM. - BILL 000221 The Chair recognizes Councilwoman Brown.
Thank you, Madam Chair. Mr. Fina, I needed have to follow up to a couple questions raised by Councilman Darrell Clarke, where I didn't hear the answer. How many new jobs did you say are being created by the TIF in front of us?
And you mentioned that the average salary will be 75,000.
That's what the developer believes the average salary of these type businesses will be.
Currently, as TIF packages are constructed, are there provisions in the plan that stipulate that a percentage or X-number of jobs should be set aside for Philadelphia residents, since Philadelphia is indeed the providing the tax incentive?
No. We don't require that language for Philadelphia residents to be hired. 54 5/22/00 WHOLE COMM. - BILL 000221 We've found out in our experience, particularly the hotels, that the vast majority of projects that are TIFed is Philadelphia residents.
Councilman Nutter requested last week a report from Mr. Hankowsky. Since we're now at 19, he stipulated several categories.
Add to that, if you will, of those that are active, you mentioned eight? What percentage of those jobs, what number of those jobs are Philadelphia residents?
Eight have closed, and we can find that information out. I believe that's what Councilman Nutter had asked for.
Okay. Now, since that's not currently a provision, does it make sense for those of you who sit around the table and craft these deals that that should be a provision?
Well, each developer provides an economic opportunities plan that is negotiated with City Council staff and the developer. In that plan, it does talk about 55 5/22/00 WHOLE COMM. - BILL 000221 voluntary goals for not only affirmative action but for local employment. So that is part of what we do today.
That being what it is, then, does -- example, the Convention Center became a reality X-number of years ago. Those that sat around the table and negotiated that plan made sure that in this specific instance, Philadelphia OIC (Opportunities Industrialization Center) had within it a track, if you will. People who did not have those skills were put on a track to ensure employment opportunity at the end of that and the completion of the Philadelphia Convention Center. Are those kinds of discussions had when the developer comes to you? We're told we're looking here at $75,000 jobs. Assuming we can't find all those people in Philadelphia, is there a link then with a higher education institution where you can ensure that those jobs go to Philadelphia residents?
Well, again, there is the economic opportunities plan. In this particular TIF, as I mentioned in my testimony, there is a 56 5/22/00 WHOLE COMM. - BILL 000221 relationship that is being formed with Spring Garden -- with Community College on Spring Garden Avenue, that the employers will have access and the students at the Community College will have access to the jobs that are offered at the Networks. We're trying to create that unique situation with this particular TIF.
That's encouraging. Is that the norm or is that the exception?
Thank you, Madam Chair. I'd like to respond, if I can, to Councilwoman Reynolds Brown's question. It may not be the norm as it relates to the arrangements between the university institution and a developer/employer, but it's the norm for the 5th Councilmatic District. We sat down with both the developer, we sat down with the 57 5/22/00 WHOLE COMM. - BILL 000221 new president and one of the assistants from Community College, and we talked about at this point, an informal arrangement. One of the things that was attractive about this particular development is that Community College had already started in a process that was going to be to provide somewhat of a feeder system to these high-paying e-commerce-related jobs. And lo and behold, we found a developer who was willing to locate adjacent to Community College, so it was a match made in heaven, so to speak. So I think we're going to craft some formal language as we move ahead, although the developer cannot guarantee, because they are in fact just the developer, but we will craft some language that will allow opportunities for the tenants of this particular development to have a feeder system directly next door. So we have work very diligently on that.
It should be noted also for 58 5/22/00 WHOLE COMM. - BILL 000221 the record that PIDC has always -- not only do we have a policy about the affirmative economic opportunities plan, but we also notify, which was the PIC, and now I believe it's Philadelphia Workforce Development Corporation, of every TIF that we close, and we make formal contact between the TIF developer and those agencies.
I appreciate that, and that counts. Making contact is one thing; the follow-through that comes with ensuring that something happens beyond that contact is another thing. And my hope is that in the report that your office is preparing for the Chair, at the request of our colleague Councilman Nutter, that it's reflected what happens after the contact is made with agencies that can exercise or practice the feeder approach that Councilman Clarke is talking about. Thank you, Madam Chair.
You're welcome. The Chair recognizes Councilman Cohen.
Thank you, Madam 59 5/22/00 WHOLE COMM. - BILL 000221 President. Ever since the tax abatement for the Rittenhouse Hotel ten, twelve, fifteen years ago -- I don't remember how long it is, but it's quite a long time -- the City has either granted abatements or granted this newest version of what I think is the same basically as an abatement, the TIFs. Am I right in comparing abatements to TIFs in theory? And tell me how they differ, if they differ.
Well, you could define the TIF program as a 20-year real-estate tax abatement, providing those dollars go and pay for improvements within the property. So it's a form of abatement, yes, Councilman.
A basic question that I think Councilman Goode has been raising is the question of need. Is there an element of need related to the decision-making process as to whether or not you grant either an abatement or a TIF?
Whose need, and how do you define that need? 60 5/22/00 WHOLE COMM. - BILL 000221
We look at a project and the revenues and the cost of that project, the source of the funds for that project, and we determine what the market rate is for financing and what a return on equity would be. And then if there seems to be adequate revenue from the project, we will not propose a TIF. If there's adequate revenue to support debt and equity, if there is inadequate revenue to support debt and equity, as also stated by the developer in there request to us, and we make an independent calculation that that statement is correct, then we propose a TIF. So we do it on a need basis, on a financial analysis of the project, under current market conditions.
So need is limited to a particular project, not to the financial resources of the developer or the principal in the project who may or may not be the developer?
That's correct. In fact, Councilman DiCicco actually made that statement, that a project has to stand on its own merits, or someone will not make an investment. People are not going to invest in a project if there's not a 61 5/22/00 WHOLE COMM. - BILL 000221 return for it -- no more than you and I would put money in a bank if there was no interest earned on that money. We wouldn't just deposit it in a bank if we could another bank that did offer us interest. So a developer will not invest in project unless there's a return. If there's an inadequate return and we the public, you, City Council, want the project to happen 'cause it's going to create 1500 jobs, it's going to create $2.1 million in City taxes every year and it's going to create 1.2 million of School District taxes every year, then we will incentivize that developer to do that by funding some of the gap that otherwise the developer would not fund and the project would not happen. That's the analysis we make.
See, on every project that's presented to us, PIDC, whether it's through you or Bill Hankowsky, can always made an excellent case. You have a basic command of the facts, you've dealt with the developer, you've investigated the situation. It's difficult to say no on any specific project. 62 5/22/00 WHOLE COMM. - BILL 000221 But I wonder and worry about the general impact as to whether or not this is the City of Philadelphia making an investment, or whether it's the City of Philadelphia mortgaging its future. Because we do suffer, from one point of view, losses of tax revenue over the 20-year period. You argue that we make up for it by increased taxes in other situations. It seems to me that you also put every business, every developer in a bind. How come some other developer was able to get assistance from the City of Philadelphia in some form of tax rebate and you weren't it, if you are a developer or businessman that comes up with the project, you know, that indicates it can carry itself? It seems to me that you create a situation in which it's almost inevitable that the requests for these TIFs is going to be increasing. And I have a sense of unease about it, but in any one development, there's nothing we can do. I have a sense of unease, say, about the stadiums in using large public amounts of money to give to very rich people to make them even richer, if everything works out well. In the 63 5/22/00 WHOLE COMM. - BILL 000221 same sense, I wonder whether we're not doing the same kind of thing here, that developers have to be, almost by definition, very good business people, and it seems to me that a developer who does not develop his plan so that he get any assistance is not a particularly good developer. And I just wonder about whether that makes sense to have two classes of business projects in the City: those that are subsidized by the public and those that aren't. And I worry about that. Are there any theoretical writings on this subject that you're familiar with? 'Cause I understand that Pennsylvania was not one of the first states that started on TIFs; there have been TIFs in a number of other states first. What is the thinking among the economists generally in the United States?
I think, like anything, Councilman, there are two schools of thought on it. There are those who think there should not be public assistance for businesses, and those who believe, like myself and members of PIDC, who believe that it is essential to have public 64 5/22/00 WHOLE COMM. - BILL 000221 assistance to incentivize a business to come into the City to create the jobs and produce the taxes that are needed. We could look at the PSFS building. It was mostly vacant for a number of years. It was a blighting influence in Center City until we provided the incentives that brought the Tish family, who owns Loews, a very, very wealthy family, to Philadelphia to build that hotel. Yes, they expect to make a profit, and yes, we provided a TIF for that project, but for years, no one else could take on that project or wanted to take on that project to try to improve it. And we've created 500-plus jobs. Many of those jobs went to people on welfare to work who have been hired there. We've done -- there's a huge amount of taxes that are generated that does not go into the TIF Fund, that benefits the City from that project. It's a unique success. That's the type of projects that we fund with public assistance. And we do our best and analyze to make certain that it is on a need-basis. And, Councilman, you're right, we do not say yes to everyone. We've only had 19 TIFs 65 5/22/00 WHOLE COMM. - BILL 000221 approved, others are before you. Over a term of five years, that's not a lot of projects in the City of Philadelphia. We do not say yes to every business, every developer or every development. Sometimes there are developments that will happen without us saying yes and sometimes those projects do not get built, but we do not say yes to every development.
Well, one last basic comment. Yesterday's Sunday Inquirer carried a feature story on a developer that I had never heard about before, a person who's name is apparently is Tony Goldman. And it was a very interesting story. This is a developer who apparently began in New York, then in Miami Beach, and in the last two years, he came to Philadelphia. And it was a very impressive story about -- kind of on the good side of what he did in these cities, and now he's coming to Philadelphia. And I couldn't help but wonder whether what's attracted him to Philadelphia is the sudden knowledge throughout maybe the whole country that Philadelphia's a good place to go because the 66 5/22/00 WHOLE COMM. - BILL 000221 government is ready to give you very substantial savings or will become a partner kind of in your project, but let you have all the profits. And as I read the story, it told about how kind of brilliant he was, how creative, how unique in his thinking, and he's working, apparently, on a series of projects on 13th Street, between Walnut and Chestnut, and he developed the off-Broad Street approach. And it was very impressive to me. I thought, Well, maybe I've been a little wrong about developers; there's room for creativity and uniqueness. And then in the new section of the Inquirer, I noticed that despite his off-Broad Street approach, he just purchased the Divine Hotel, right on Broad Street. And that seemed to me to be reflective of developers. They always -- and they have to be to be successful, they always have a good justification for the policy that makes a lot of sense. But when you look for consistency, you don't find it. And so I wonder here whether the real situation is, are they milking the City of Philadelphia or are they producing good benefits? 67 5/22/00 WHOLE COMM. - BILL 000221 I worry about the points that Councilman Ortiz made. If it was so good and we've been so generous over the last eight, ten, twelve or more years on these abatements, why is it that there's such a heavy net loss in population and a loss in the number of businesses? And so I'm troubled by that, and I hope that in your analysis, the need that you look for is a real need, that you're really convinced that the project would not be able to get off the ground, you know, or be successful without this aid, 'cause I think we're paying a heavy price, and I don't know how you're going to resist the heavy demands the more it gets to be known that Philadelphia has kind of an open approach on these TIFs. Thank you. Like Councilman DiCicco, maybe the last comment was a comment and not really a question. But we would like that information and we'd like it -- we'd like to be able to challenge it so that if it's accurate, it stands up; and if not, all of us benefit from the knowledge that there have to be changes in the way we address the 68 5/22/00 WHOLE COMM. - BILL 000221 program. Thank you very much.
Thank you. The Chair recognizes Councilman Goode.
Thank you, Madam President. Let me take this time to agree with Councilman DiCicco, that all developers coming to town looking to develop major projects have not looked toward TIFs. PIDC's preferred clientele has also had access to hundreds of millions of dollars in HUD 108 financing borrowed against future community development block grant dollars, and they've also has access to up to $100 million and more in economic stimulus fund. My question today is whether TIFs are actually necessary. And beyond that, looking at economic stimulus programs, those economic stimulus dollars. If we're going to forego hundreds of millions of dollars in tax revenue, looking to economic stimulus dollars on top of that, what type of impact could have been had in providing tax relieve across the board? That's a 69 5/22/00 WHOLE COMM. - BILL 000221 question not only asked by me, but by PICA and the City Controller, and analyze the way PIDC has wheeled and dealed with tax dollars over the last five to eight years. That was a question.
What type of impact would we have had if had used those hundreds of millions of dollars, knowing we were going to forego tax revenue and a hundred million dollars in economic stimulus, that what type of impact would it have had if we had used up a general tax relief for businesses across the board?
I think $100 million is a lot of money, Councilman. It sounds like a lot to me.
Not a hundred million. It is at least $300 million in HUD 108. There was $100 million in economic stimulus. There is, by any estimation, I don't know, 2 to 300 million in TIF. The HUD 108 could be used for access to capital beyond that. The other dollars could have been used, if there was an actual economic development strategy that was not a 70 5/22/00 WHOLE COMM. - BILL 000221 deal-by-deal basis but actually an economic development strategy for general tax relief for businesses. What type of impact would that have had if that had been employed instead of the TIF strategy and the economic stimulus program strategy?
We haven't done it either or, but HUD 108 could not be used for a tax relief and --
I said if HUD 108 were to be used for access to capital. Beyond that, the TIFs and the economic stimulus dollars amount to hundreds of millions of dollars that could have been used for general tax relief. Would that have been a better use of the dollars?
Well, the TIF can't be used for tax relief other than for the specific --
It can be if you decide long-term you're going to forego a certain amount of hundreds of millions of dollars in tax revenue. And at that point, you could cut taxes for businesses, knowing you're going to forego that tax revenue, and that's general tax relief 71 5/22/00 WHOLE COMM. - BILL 000221 for businesses across the board. Would that or would that not have been a better strategy than helping or so businesses 5 and projects? 6
We do not believe that would 7 have been a better strategy, Councilman. 8
Councilman 11 Kenney, you are going to be brief, I hope? 12
Just despite all 15 this, I think really good and well-intentioned and 16 civil and decent debate philosophically about all 17 of these issues, which are very, very important, I 18 don't want the people in the room to lose site of 19 the fact that the developers at Networks, we want 20 you here, we're happy you're coming. We want you 21 to develop, we want you to create those jobs, and 22 we'll figure all of this out as we go forward in 23 this Council. 24 But I don't want you to sit here, while 25 listening to this well-intentioned and important 72 5/22/00 WHOLE COMM. - BILL 000221 debate think that we don't want you here. We really do. We're excited and enthused that you have chosen Philadelphia, that this is a forward-thinking project, that the jobs you're going to create are well-paid and high-tech and maybe is going to put Philadelphia on the map, similar to what Delaware did with its banking business. And, hopefully, you'll be one of the cornerstones of having that happen. But I just didn't want you to sit here and hear this and think that we didn't want you here. Thanks.
And I would like to echo your sentiments. We certainly welcome you and hope you'll be very successful, because if you're successful, we'll be successful with you. Thank you.
Madam President, I'd like to share the same sentiment. As one of those that are debating whether TIFs are an advisable thing, I also join in welcoming the company. We look forward to -- 73 5/22/00 WHOLE COMM. - BILL 000221
Yeah. Well, I just wanted to make sure that both sides of the debate are expressing that, but we welcome the --
Which we will take, I'm sure, another day when the next TIF comes up.
Madam President, I thank you and members of Council. I also wanted to recognize my colleague sitting beside me, Sam Rhoads, who's very instrumental in the TIF program at PIDC. Thank you.
Thank you. Thank you, Sam. And, Mr. Fina, I understood you to say that the amendments are in the Chief Clerk's Office?
Yes, they are. The restated and revised project plan for all four that we've discussed so far.
Great. Are there any other questions from any 74 5/22/00 WHOLE COMM. - RES. 000320 members of the committee? (No further questions.)
We will now consider Resolution No. 230, and I would ask Mr. McPherson to please read the title of the resolution.
Resolution No. 320, confirming the appointment of Kenneth I. Trujillo, Esquire, as City Solicitor. (Witness comes forward.)
Good morning. 75 5/22/00 WHOLE COMM. - RES. 000320
Good morning, distinguished members of Council. My name is Kenneth I. Trujillo, and I am serving as acting City Council -- not an acting City Councilperson. (Laughter.)
I'm acting City Solicitor for the City of Philadelphia. Seated next to me, to the left of me is Donna Mouzayck. Donna is my First Deputy. And to my right is Bill 11 Thompson. Bill Thompson is the Acting Chair of the Litigation Group. First, it's an extraordinary honor for me to appear before you here today, seeking confirmation as City Solicitor for the City of Philadelphia. In the short time that I've served as acting City Solicitor and throughout my career, I've come to value the central role that the Law Department serves in city government. I believe and I am hopeful that I've become sensitive to the often competing interests and the competing roles that the Home Rule Charter seeks to balance through the City Solicitor's Office. I have prepared testimony, which, I believe, has been distributed to all Council. I 76 5/22/00 WHOLE COMM. - RES. 000320 am going to skip significant portions of that in the interest of leaving here today. I have attempted to meet with each member of Council, and I've been largely successful in setting up those meetings, and I'd like to thank all of you for your courtesy during that time. I'd also like to, before I complete my testimony, recognize a number of other people who are seated here today. In addition to Miss Mouzayck and Mr. Thompson, I'd like to recognize Irvin R. Siegel, who is seated over to my far right-hand side. Mr. Siegel was a senior partner at the Schnader, Harrison, Siegel & Louis law firm, and was my mentor and taught me more about practicing law than I could ever have hoped to have done, and I thank for him for all of his extraordinary mentorship. I'd also like to recognize -- seated behind me about four rows back on the left-hand side is Bill Martin, who was the acting City Solicitor in January and February of this year, before I came, and was Chair of the Corporate Department. He provided an extraordinary service 77 5/22/00 WHOLE COMM. - RES. 000320 for the City while he was here. He recently left to go into private practice, but I would like to publicly thank him for all of his support and his assistance during my transition into the Law Department. I'd also like to recognize the members of Law Department who are here and present here today. As most of you know, the Law Department is an extraordinary place, and I've felt so welcome and made at home since I've come to the City, and I greatly appreciate their support, and they're being here today. And, finally, I'd like to recognize the person who really ends up paying the price of public service, and that is my wife Laura Trujillo, who's seated far, far in the back and, I'm sure, will duck as I recognize her, but I would like to publicly thank my wife, Laura, who truly does exemplify public service because, as many of you know, when you make the sacrifice for public services, most often it's the spouse that makes the sacrifice.
Excuse me. Let me also note that State Representative Dwight 78 5/22/00 WHOLE COMM. - RES. 000320 Evans was also here all morning, waiting for this moment.
Yes. I saw State Represent Evans, and thank you very much. During my visits, I tried to familiarize most of you with a little bit of my background, so I'm going to skip the largely boring parts of that, but I do note that I was born -- and I adopted Philadelphia, but I was born in northern New Mexico and came here by way of the University of Pennsylvania and became a hopeless addict of cheese steaks and the Philadelphia Phillies, and so I ended up in Philadelphia by way of law school, and I am deeply grateful to the University of Pennsylvania. My goal for the Law Department during my time as City Solicitor, if I am confirmed by this body, is to provide you and to provide the rest of our clients with the highest possible quality legal services and representation. I share with my predecessors a commitment to providing outstanding client service. Notwithstanding the inevitable conflicts that arise, the Law Department will serve the needs of 79 5/22/00 WHOLE COMM. - RES. 000320 its client and will do so in a timely and constructive manner. As I've discussed with many of you, I intend to bring an affirmative and entrepreneurial mindset to the Law Department. It is most uncomfortable to me to always be in a defensive mindset, and those of you who know my practice and my background know that I prefer to be on the plaintiff's side. Accordingly, both with respect to litigation matters and business matters, I am hopeful that we will bring an entrepreneurial mindset and an affirmative mindset to represent the interests of the City of Philadelphia. One example of those types of matters that we recently filed was the handgun lawsuit recently in April of this year. Similarly, the Law Department will continue to investigate legal avenues for the redress of any harms caused to the citizens of Philadelphia, be they financial or otherwise. In addition, given the extraordinary changes that this body has already noted on many occasions in our economy and in the technological advances of our economy, the intellectual property 80 5/22/00 WHOLE COMM. - RES. 000320 components of the Law Department must continue to grow and will play a leading role in city government, and we hope to partner with the rest of city government and with this body in that regard. With respect to City Council's relationship with the Law Department, I have tried in my short time to be responsive to all requests from City Council. You are entitled to prompt and courteous service whenever any advice is requested. And as any of you who have dealt with me know, if there's any issue with respect to any matter in the Law Department, I'm always available to discuss those matters with you. As I had mentioned to you in my testimony back in February of this year, all requests for legal advice remain confidential unless and until we are authorized to disclose that advice. City Council will also have the services of the Law Department in connection with the drafting or exploring of any legislation. If there are any reservations about the legality of the provisions of any ordinance, we will raise them with the Councilperson that has requested the 81 5/22/00 WHOLE COMM. - RES. 000320 advice, and we will explain any potential issues. We will further suggest alternative grounds and alternative methods to accomplish the goals of any ordinance that is suggested by a City Council person. When City Council adopts legislation, it is entitled to the presumption of validity. We will continue to decline to approve a bill on the grounds of invalidity only in the clearest of cases. In those rare cases, I would generally approve a request by City Council for the retention of City Council to test the legality of the bill by way of litigation. In closing, I am extraordinarily honored to be before you here today, and I commit to you that if I am fortunate enough to be confirmed by you, I will work diligently with you and I will do my best for you and for the City of Philadelphia.
I will be happy to answer any questions or supply any additional information. And, Madam President, I would also note that Stephen Presser, the Legal Director of the ACLU, would also like to address this body after 82 5/22/00 WHOLE COMM. - RES. 000320 my comments.
Thank you. Can you tell us how many attorneys are employed by the Law Department?
Our total budgeted number is 143, so we'd have 6 vacancies at this time.
Are there particular areas of law in which the Law Department lacks expertise so as to require the use of outside counsel? And if so, is it your intention to try to develop such expertise within the Law Department, or do you intend to continue to rely on outside counsel?
That depends. There are a number of areas. For instance, there are regulatory matters which will arise and which will arise on an occasional basis and which the development of inside expertise would be far more expensive than going to outside counsel. So for 83 5/22/00 WHOLE COMM. - RES. 000320 regulatory matters, a number of municipal finance matters, we will always need to go to outside counsel for those matters. The other kinds of matters that are typically going to need to be referred to outside counsel would be, A, sensitive litigation matters in which there is, for instance, a witness that is -- let's say a Law Department employee may be a witness. There are also going to be a number of matters in which a conflict of interest may arise. For instance, if we represent a police officer or something of the sort and there are multiple defendants, we would need to go to outside counsel in that regard.
Some areas of the law are undergoing particularly rapid change, such as the law relating to telecommunications and computer law. Do you anticipate the need for additional staffing in these or in any other areas?
The two areas that I have identified as requiring additional attention, and we expect in the future additional staffing, are exactly one -- is the area that you just 84 5/22/00 WHOLE COMM. - RES. 000320 recognized; that is the high-tech or intellectual property, the IT area. And I think, as this Council has noted recently, a number of vendors are going to be coming in front of Council, and there's a significant change with the Telecommunications Act of 1996, which is a complex act, and which has a very direct impact on city government. So my expectation is that the, quote, high-tech area, or intellectual property area, is an area where we will need to grow. In addition, it is my expectation, and this may be done partly by reallocation of current personnel, but the affirmative litigation area, that is where the City is out as a plaintiff as opposed to a defendant, that is another area where I believe that the Law Department, during my term at least, will need to have additional personnel on the affirmative litigation side.
How do you describe your management style? Do you tend to delegate or are you a micromanager? (Laughter.)
I think I would leave 85 5/22/00 WHOLE COMM. - RES. 000320 that to everybody who works for me right now to describe. But I'd be happy to tell you how I normally try to work. Jane Collins, my secretary, is here, and she's probably the best one to either affirm or deny this, but my desire on any given day is that any piece of paper that hits my desk, I take the advice of Allen Davis, who is the former City Solicitor, and I try to leave a clean desk at the end of the day. I am clearly not successful at that, but that is my goal. I believe that I am much more of a delegator than a micromanager and, indeed, my expectation and what I try very hard to accomplish is to utilize all of the talents of the 137, soon 143, lawyers to their fullest ability. One thing I do recognize is that most of the lawyers that work in the Law Department know more about city government and about their area of expertise than. And I do I do our clients no favor by trying to usurp any of their abilities. So in that regard, I do consider myself to be much more of a delegator. I do, though, in the areas I think I'm 86 5/22/00 WHOLE COMM. - RES. 000320 somewhat experienced, such as complex litigation areas, I do become a bit more, shall we say, inclusive; or at least I just become more involved in some of the litigation matters, and on the corporate areas is where I probably tend to delegate even more.
I know you said that you have 137 attorneys in the Law Department. Those attorneys that are in the chamber, if they would stand, I would like the record to reflect that probably half of them are here, I assume to really -- (Applause.)
-- encourage your appointment. And are the other gentlemen also attorneys, or are you here to testify, those of you who are seated?
Oh, they're friends, okay. You have quite a team here cheering for you.
We have a few foes as 87 5/22/00 WHOLE COMM. - RES. 000320 well.
Okay. You know, there has always been a concern that the City Solicitor, who is required to provide legal advice for both the Administration and the legislative branches of city government, tends more often than not to favor the Administration on questions of administrative versus legislative concerns are made. Since it is your duty to provide impartial legal advice to City Council, do you require that all requests for legal advice go through you, or do you allow the Mayor's Office to direct the legal work to the Law Department?
When the Mayor's Office requests legal advice, I certainly allow them to direct the advice that they seek, that's all. I think I've actually been put in an unusual position of having opinions sought by members of this body over the last few months, the results of which have surprised a few people. But the -- as I have stated -- on my first day of work, I appeared before this body, and on my first day of work, I told members of this body that any advice that was sought by a 88 5/22/00 WHOLE COMM. - RES. 000320 City Councilperson, even the mere seeking of the advice, I view to be a confidential communication, and that that communication is not shared with anyone, absent permission by the client. And, so, the final part of your question was, do I allow the Mayor's Office to direct advice given? The answer is no. I -- only with respect to their advice is their direction, but with respect to advice to members of this body, there is no direction and, in fact, no, because they don't know about it.
Very good to hear that response, and I'm sure that Councilman Cohen is elated by it. Are you not, Councilman? (Laughter.)
Can you tell us what the amount of Class 200 appropriations in the Law Department's budget is?
I do not have the exact number here today, I'm sorry, but we can provide that to you, obviously.
Well, I would like you to provide us that information. And of that amount, how much is used for the employment 89 5/22/00 WHOLE COMM. - RES. 000320 of outside counsel? And what are the hourly rates paid to the outside counsel? And if any attorneys are hired on contingency fees. And would you also inform us as to what, from your experience, is considered to be a reasonable hourly fee for qualified attorneys in the private sector? I don't want to dominate the hearings. We do have other Councilmembers who want to be recognized. Councilman Ortiz, your light's been on. Councilman Rizzo, did you want to be recognized? Excuse me, I think you want to be excused?
Yes. First of all, I would like to congratulate the City Solicitor, and I'd like to vote yes on all of the resolutions and amendments today before the Council.
Yes. And the City Solicitor mentioned that when he first got here, he became addicted to cheese steaks and the Phillies. One of his first opinions I'd like to 90 5/22/00 WHOLE COMM. - RES. 000320 have is the future of the Phillies. (Laughter.)
And, Councilman, with regard to the TIF bill, are you voting aye on the TIF bill?
Thank you. The Chair recognizes Councilman Ortiz.
Thank you, Madam Chair. I know Mr. Trujillo now ever since he was an attorney at the U.S. Attorney's Office, and that's going back quite a lot, and that friendship has gone through many nights at Tequilla's Restaurant in discussion of political issues and other relevant matters. But Ken is probably one of the finest attorneys presented to us and one of the youngest attorneys in terms of being City Solicitor. And, hopefully, one of the questions 91 5/22/00 WHOLE COMM. - RES. 000320 that I usually ask City Solicitors will be the last time that I ask this question. How many Latino attorneys do you have? And should we expect to see more Latino members as part of the staff of the City Solicitor's? And will Latino attorneys in private practice be a part of the individuals who will be put into the selection process for contracting out of cases and so on? And I hope that this is the last time that I ever have to ask this question of a City Solicitor, and I know that that will be so. Can you give me an answer on that?
I'm not going to object to the question; I'm going to happily answer that question. When I started -- the day of February 27th, there were 0 Latino lawyers at the Law Department. On February 28th, I was the first. About three weeks after that, Milton Vellas (ph.) joined our office. I am going to continue, as you can imagine, in fact, even at the Hispanic National 92 5/22/00 WHOLE COMM. - RES. 000320 Bar Convention this year, which, by the way, Philadelphia will be hosting that convention next year. I'm going to continue to recruit and do everything I can to broaden the diversity, not just with respect to Latinos, but with all other minority groups. And the Law Department does have a significant history and, I think, a very successful history of diversity, but that diversity, as you've noted, does not include Latinos.
It does not include Latinos. And so, obviously, that's an area that we need to do a better job on. I'm hopeful that I might have a little bit of influence on that front. On the outside counsel role, again, I will tell you that I have reached out, even from my first day of work, to try to refer, and I will continue to do that, and we will continue to refer out work that can be handled by minority lawyers, whether they be minority lawyers in large law 93 5/22/00 WHOLE COMM. - RES. 000320 firms, whether they be small law firms, or individual practitioners. But you will see in the report on Class 200 funding for over the next year some names with Hispanic last names.
Madam Chair, I can only recommend to my colleagues that a unanimous vote be given to Mr. Trujillo for the position of City Solicitor. I know that Councilman Cohen will some questions to ask, but I have no questions as to his ability to exercise the role and to do it in a manner that will make us all proud and will bring honor to the office. So, again, I ask my colleagues to give a "yes" vote to a friend of mine that I think will be a great City Solicitor.
Thank you. The Chair recognizes Councilwoman Tasco.
Thank you. Good morning, and I enjoy meeting with you and I wish you well. I just have one issue to raise with you that has been brought to my attention, and it's 94 5/22/00 WHOLE COMM. - RES. 000320 something that you don't have to respond to now but could look at in your office. I have a person who attempted to buy a building, and their concern was that there was no one person in the Law Department dedicated to the final closings of these housing -- if it's a City-owned building and the building is being sold or given to a community group or a nonprofit, there does not appear to be any one person who might be dedicated to that process, that they could go to any other lawyers in the Department. And that's the issue that I was trying to raise with you some time ago.
Okay. Well, thank you. I appreciate that, Councilwoman, and I believe Henry Schwartz, who's the head of our Real Estate Department is right behind me, and we will get a response back to you and we will look into that immediately.
Thank you. Are there any other questions or comments from members of the committee? 95 5/22/00 WHOLE COMM. - RES. 000320 (Councilman Cohen turns indicates he has a question or comment.)
I would have been very disappointed, Councilman.
Thank you, Madam President. I'm probably going to disappoint everybody because my vote's going to be for Mr. Trujillo, and I am very confident that he will be an outstanding City Solicitor. I hope that he is able to move the Department ahead in considering certain matters where this Council often has been unhappy with City Solicitors, whoever they are, because it has seemed to us over time and consistently that whenever there has been an issue between the City Solicitor and the Mayor -- between the City Council and the Mayor, the City Solicitor has seen himself or herself as the representative of the Mayor. We know that that's a natural development that occurs, because most of 96 5/22/00 WHOLE COMM. - RES. 000320 the time, you are probably working on matters affecting the Administration much beyond the matter of what to do for City Council. But I would hope that in interpreting the legality of actions taken by City Council, that what you've said about the presumption of legality is kept seriously, because we have -- at least speaking for myself, it has been has not been my thought that City Solicitors generally presume City Council's actions to be legal unless that's okay with the Mayor. But if ever the Mayor's unhappy, it seems the City Solicitors generally tend to find in favor of the Mayor. I did want to question in a very recent matter that I discussed with your office involving the prosaic matter of a newsstand. In the opinion you've given to me, there was a statement that the client of the City of Philadelphia was the government of the City and not the people in the City, and that's distressing, and I would hope that that would be looked at in the future. We hope that you're going to try to do an impossible job that the Home Rule Charter places you under because, obviously, it's 97 5/22/00 WHOLE COMM. - RES. 000320 extraordinarily difficult in matters where Council and the Mayor disagree for the City Solicitor to be the attorney for both, and that's going to be a very difficult matter for you to resolve, but that's the fault of the Home Rule Charter and not the fault of the City Solicitor. But we wish you success, and we're looking forward to a period of peace between the Mayor and the City Council, as far as the City Solicitor's Office itself is concerned -- maybe not on the stadium issue or other issues, but on the basic issues. So welcome. And, Councilman Ortiz, unless there's somebody else that's going to object, you will have the unanimous vote for the City Solicitor. Thank you, Madam President.
You're welcome. Are there any other questions or comments from members of the committee? (No questions.)
Seeing none, do we have anyone else to testify on this 98 5/22/00 WHOLE COMM. - RES. 000320 resolution? (Witness comes forward.)
Madam President, my name is Stephen Presser, and I'm the Legal Director of ACLU of Pennsylvania. And I thank the Council and also my colleague Kenneth Trujillo for this opportunity. I came today for one reason, and I'm going to add a second. The first is to urge you, as you seem likely now, to vote unanimously for Mr. Trujillo's ascension as City Solicitor. I think both his background, large law firm, United States Justice Department, the creator of a law firm, makes him uniquely well-qualified for this position. But further, the breadth of his intelligence, the depth of his compassion, and also his gentle good humor will make him, I'm firmly convinced, if not the finest City Solicitor we've ever had, then surely one of them. But, Madam President, I would like just very briefly to pick up on an issue you first raised, and that was the issue of outside counsel. I commend to this City Council, for instance, one of the soon-to-be-new City 99 5/22/00 WHOLE COMM. - RES. 000320 Solicitor's underlings, Carlton Johnson. He's a spectacular employee of the City Law Department, and has been so for some time. He runs the Civil Rights Unit. On several occasions in litigation I have been fortunate enough to be a party to, he's made what I think are important contributions, which, if accepted, would have cured Constitutional problems and also moved agencies on in creative ways. Unfortunately, in some of that litigation, previous City Solicitors had retained outside counsel. And sometimes I think there's been a tension between adopting good policies, which might have cut off litigation, which might have cut off the retention of these outside individuals. And I do think this is something that the new City Solicitor needs to take a good look at, and I commend you for having raised it and I commend this City Council for what I am sure will be a unanimous vote on his new position. Thank you.
Thank you very much. Do we have anyone else to testify on 100 5/22/00 WHOLE COMM. - PUBLIC MEETING this resolution? (No response.)
Seeing none, this will conclude our public hearing. We will now go into our public meeting. And the Chair recognizes Councilman Clarke regarding Bill No. 000221.
I make a motion that the amendments to Bill 221, as mentioned in today's testimony, be adopted. (Duly seconded.)
It has been moved and seconded that the amendments be adopted. And I understand the Chief Clerk's Office has a copy of that amendment in her office. All in favor will signify by saying aye. Those opposed. The ayes have it and the motion is carried. And the Chair recognizes Councilman Clarke.
Madam Chair, I move that Bill 221, as amended, be reported out of 101 5/22/00 WHOLE COMM. - PUBLIC MEETING committee with a favorable recommendation. (Duly seconded.)
It has been moved and properly seconded that Bill No. 221 be reported out of committee with a favorable recommendation, as amended. All those in favor will signify by saying aye. Those opposed?
The record will show that Councilman Goode voted no. And this bill will be reported out of committee with a favorable recommendation. The Chair recognizes Councilman DiCicco regarding Resolution 000192.
Thank you, Madam President. I move for the adoption of Resolution 20 No. 192. (Duly seconded.)
It has been moved and seconded that Resolution No. 000192 be reported out of committee with a favorable recommendation. 102 5/22/00 WHOLE COMM. - PUBLIC MEETING All those in favor will signify by saying aye. Those opposed? The ayes have it and the motion is carried. The Chair recognizes Councilman DiCicco regarding Bill No. 000193.
Thank you, Madam President. I move for the adoption of Resolution 11 193. (Duly seconded.)
It has been moved and seconded that Resolution No. 000193 be reported out of committee with a favorable recommendation. All those in favor will signify by saying aye. Those opposed? The ayes have it and the motion is carried. The Chair recognizes Councilman DiCicco regarding Resolution No. 000194.
I move for the adoption of Resolution No. 194. 103 5/22/00 WHOLE COMM. - PUBLIC MEETING (Duly seconded.)
It has been moved and seconded that Resolution No. 000194 be reported out of committee with a favorable recommendation. All those in favor will signify by saying aye. Those opposed? The ayes have it and the motion is carried. The Chair recognizes Councilman DiCicco regarding Resolution No. 000195.
Thank you, Madam President. I move for the adoption of Resolution 16 195. (Duly seconded.)
It has been moved and seconded that Resolution No. 000195 be reported out of committee with a favorable recommendation. All in favor will signify by saying aye. Those opposed? The ayes have it and the motion is 104 5/22/00 WHOLE COMM. - PUBLIC MEETING carried. The Chair recognizes Councilman DiCicco regarding Resolution No. 000196.
Thank you, Madam President. I move for the adoption of resolution 7 196. (Duly seconded.)
It has been moved and seconded that Resolution No. 000196 be reported out of committee with a favorable recommendation. All those in favor will signify by saying aye. Those opposed? The ayes have it and the motion is carried. The Chair recognizes Councilman DiCicco regarding Resolution No. 1197.
Thank you, Madam President. I move for the adoption of Resolution 22 197. (Duly seconded.)
It has been moved and seconded that Resolution No. 000197 be 105 5/22/00 WHOLE COMM. - PUBLIC MEETING reported out of committee with a favorable recommendation. All in favor will signify by saying aye. Those opposed? The ayes have it and the motion is carried. The Chair recognizes Councilman DiCicco regarding Resolution No. 000198.
Thank you, Madam President. I move for the adoption of Resolution 13 198. (Duly seconded.)
It has been moved and seconded that Resolution No. 000198 be reported out of committee with a favorable recommendation. All in favor identify signify by saying aye. Those opposed? The ayes have it and the motion is carried. The Chair recognizes Councilman DiCicco regarding Resolution No. 000199. 106 5/22/00 WHOLE COMM. - PUBLIC MEETING
Thank you, Madam President. I move for the adoption of Resolution 4 199. (Duly seconded.)
It has been moved and seconded that Resolution No. 000199 be reported out of committee with a favorable recommendation. All those in favor will signify by saying aye. Those opposed? The ayes have it and the motion is carried. The Chair recognizes Councilwoman Blackwell regarding Resolution No. 000230.
Thank you, Madam President. I move that Resolution No. 230 be adopted. (Duly seconded.)
It has been moved and seconded that Resolution No. 000230 be reported out of committee with a favorable recommendation. All in favor will signify by saying 107 5/22/00 WHOLE COMM. - PUBLIC MEETING aye. Those opposed? The ayes have it and the motion is carried. (Applause.)
I'd like to continue, please. The Chair recognizes Councilman Kenney regarding Resolution No. 000329.
Madam Chair, I move that Resolution No. 329 be approved. (Duly seconded.)
It has been moved and seconded that Resolution No. 000329 be reported out of committee with a favorable recommendation. All those in favor will signify by saying aye. Those opposed? The ayes have it and the motion is carried. The Chair recognizes Councilman Kenney regarding Resolution No. 000330.
Madam Chair, I move 108 5/22/00 WHOLE COMM. - PUBLIC MEETING that Resolution No. 330 be reported out of this committee with a favorable recommendation. (Duly seconded.)
It has been moved and seconded that Resolution No. 000330 be reported out of committee with a favorable recommendation. All those in favor will signify by saying aye. Those opposed? The ayes have it and the motion is carried. This concludes the public meeting of the Committee of the Whole. Thank you all very much. (Adjourned at 12:10 p.m.) - - - 109 C E R T I F I C A T E I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia of Monday, May 22, 2000, were reported fully and accurately by me, and that this is a correct transcript of same. RE: COUNCIL COMMITTEE OF THE WHOLE RESOLUTION NO.'S 000192, 000193, 000194, 000195, 000196, 000197, 000198, 000199, 000320, 000329, 000330 BILL NO. 000221 __________________________________, JOSEPHINE CARDILLO, Registered Professional Reporter