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Minutes

Committee Hearing, March 12, 2003

Philadelphia City Council Committee HearingsMar 12, 2003

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2392 COUNCIL OF THE CITY OF PHILADELPHIA CONTINUED PUBLIC HEARING COMMITTEE OF THE WHOLE FY '04 OPERATING BUDGET - - - Room 696, City Hall Philadelphia, Pennsylvania Wednesday, March 12, 2003 9:55 a.m. - - - BILL 030004 BILL 030008 BILL 030010 - - - PRESENT: COUNCIL PRESIDENT ANNA C. VERNA COUNCILWOMAN JANNIE BLACKWELL COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN DARRELL L. CLARKE COUNCILMAN DAVID COHEN COUNCILMAN FRANK J. DI CICCO COUNCILMAN W. WILSON GOODE, JR. COUNCILMAN JAMES F. KENNEY COUNCILWOMAN JOAN L. KRAJEWSKI COUNCILMAN RICHARD T. MARIANO COUNCILWOMAN DONNA REED MILLER COUNCILMAN MICHAEL A. NUTTER COUNCILMAN ANGEL L. ORTIZ COUNCILMAN FRANK RIZZO COUNCILWOMAN MARIAN B. TASCO - - - V A R A L L O, INCORPORATED Litigation Support Services 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 (215) 561-2220 2393 I N D E X WITNESSES NELSON A. DIAZ, City Solicitor ............. 2394 CHRISTOPHER LANE, Law Department ........... 2398 LYNNE ABRAHAM, District Attorney ........... 2434 ELLEN GREENLEE, Defender Assoc. ............ 2459 CHARLES CUNNINGHAM, Defender's Assoc. ...... 2469 JAMES CUORATO, City Representative ......... 2491 CURTIS JONES, PCDC ......................... 2509 CAROL LAWRENCE, Deputy City Rep. ........... 2513 CHARLES ISDELL, Budget Officer ............ 2545 JAMES COLEMAN, JR., Civic Center ........... 2585 2394 3/12/03 - FY '04 OPERATING BUDGET

Councilwoman Verna

Good morning, everyone. This is a continued public hearing of the Committee of the Whole regarding Bill Nos. 030004, 030008 and 030010. The Law Department will be the first to testify today. Good morning, your honor.

Mr. Diaz

Good morning, Madam President.

Councilwoman Verna

We do have a copy of your testimony. If you would like to summarize, we'd be very happy, and we will make certain that the stenographer gets a copy of your entire testimony which will be transcribed in full. Thank you.

Mr. Diaz

Thank you. I appreciate that. I'd love the transcription of it completely since I think we've had a wonderful year with regard to the Law Department, and I will summarize for the benefit of time. We've had a record year, not only in regard to tax collections, but we will continue to have that record year. We've also had the third year of low indemnity fund expenditures, and we will continue that in the next Fiscal Year. 2395 3/12/03 - FY '04 OPERATING BUDGET Our contracting process is something that I'm very proud of that I hope you look at. We were serving you at 70 days and we are now down to 30 days in procedures with regard to getting contracts out. Our honors program is building a future for the Law Department, and that is one of the areas that I think will help create a great Law Department for the future. Lead Court has gotten great benefit. Compliance is up 30 percent out in the City, and that is something that I think all of you should be proud of, not only our joint effort with the Court Common Pleas, but with the Law Department. We've had a staff reduction from 234 to 207, so we have continued the decrease in our budget as required by the goals set forth by the Administration. We've reduced outside counsel expenditures by 2.1 million, and we will continue to do that in the coming fiscal year. Overall, our budget essentially is about 10 percent under what was required. Outside of the expenditures for DROP Program, we're within those 2396 3/12/03 - FY '04 OPERATING BUDGET parameters. That essentially is a summary of some of the things that I think the Law Department has provided for you. And in addition to that, we've continued our minority contracting. I'm very proud of the fact that my department contracts -- 53 percent of our contracts go to minority and women. I don't know of any other department in the City that has that record, but I am very proud of if. And also, with regard to the hiring, in terms our hiring the predominate numbers, 68 are women, 50 percent are minorities, 49 percent of the 154 attorneys on our staff are women and 35 percent are minorities. At the management level, which is where it counts, of the 8 members of the executive committee are women and are minorities; 4 of the 8 chief deputies are women and 4 minorities; and 7 of the 19 divisional deputies are women and 4 minorities. So I would hope that you would be proud of the service that I am trying to provide for you, the Mayor, and all elected officials in the City. Thank you, Madam President. 2397 3/12/03 - FY '04 OPERATING BUDGET (Written testimony attached.)

Councilwoman Verna

You're welcome. How many of your employees are under the DROP Program; and when will they be leaving?

Mr. Diaz

Three members, and they will leaving the coming year.

Councilwoman Verna

Are they three attorneys or are they clerical?

Mr. Diaz

One is an administrative person, and two clerks.

Council President Verna

One administrative and two clerks?

Mr. Diaz

That's correct, Madam President.

Councilwoman Verna

And when will they be leaving?

Mr. Diaz

This year.

Councilwoman Verna

On -40 of the detail in FY '04, there's $100,000 for TWA National Airlines, US Air, United Airlines bankruptcies. Can you tell us what's that for?

Mr. Diaz

Yes. The airline industry, as you know, is going through tremendous decline, and as a result, they are filing bankruptcies and we 2398 3/12/03 - FY '04 OPERATING BUDGET need to have representation to be able to get the proper benefit as a result. Let me give you an example. USA Airline industry bankruptcy. We have an attorney who has saved and followed through the process of keeping our gates open and keeping Philadelphia the primary responsible carrier for US Air. In addition to that, we have proposed that a Philadelphian become a member of the board of US Air, and that nomination has gone forward and will give us representation right on the corporate level. So we are on a day-to-day process making sure that we protect the interest of US Air in the airport.

Councilwoman Verna

Also, on page --

Mr. Diaz

By the way, that will happen with American Airline who's going to declare bankruptcy, United Airline who has declared bankruptcy, and we had TWA prior to that, if you recall.

Councilwoman Verna

Also, on -20 you have $60,000 for PGW pensions, et cetera. Can you explain that, please? And why are we paying for it?

Mr. Lane

Council President Verna, my 2399 3/12/03 - FY '04 OPERATING BUDGET name is Christopher Lane. I'm Director of Administration for the Law Department. That contract -- there are multiple matters involved on that contract. The PGW matter on that particular contract is relatively inactive at this point. The other matters you see listed there, pensions, domain names, Penn Treaty, Park Pier, those are the matters that those dollars will be spent for in the next fiscal year.

Mr. Diaz

They've come to a conclusion, as far as I understand, the Penn Treaty particularly.

Councilwoman Verna

Well, why do we have it in FY '04 if we've already concluded it?

Mr. Diaz

In terms of closing it out. They still are doing pension work, by the way.

Councilwoman Verna

Also on that same page, we have $704,000 for labor, civil rights, pensions, and the Parking Authority.

Mr. Diaz

Yes. As you know from prior testimonies, Ballad has been traditionally the attorneys for Act 111 issues which include both the fire fighters and the Police Department. That's one area they have continually been responsible for. 2400 3/12/03 - FY '04 OPERATING BUDGET Also, prior to my coming on, they were representing the City in some of the Parking Authority litigation issues. I have taken the Parking Authority litigation issue in-house, so we are handling that in-house now. But they are continuing to represent us with regard to the Act 111. As you know, the fire fighters negotiations are ongoing and have not been completed. And that has been the cost of representing us with regard to that area. The domain name that is indicated there is probably a minor expenditure because I would have known where the money is going.

Councilwoman Verna

Also, on 22-21, we have $50,000, police officer conflicts and Eastwick condemnations. Is that for the area that was flooded or are these for the sinking --

Mr. Diaz

It's a combination of two representations. One is they are representing us in a conflict situation with regard civil rights. As you can tell from my budget and my presentation, we are not contracting any work out. So they have one case in civil rights. Secondly, there are 70 properties that need to have a transfer and to have someone do the 2401 3/12/03 - FY '04 OPERATING BUDGET transfer, and so we have hired them on real estate to represent the City with regard to 70 transfers at the Eastwick project.

Councilwoman Verna

But which project was that?

Mr. Diaz

I can't recall right now.

Councilwoman Verna

The flooded area? I know there are two different issues out in Eastwick.

Mr. Diaz

It's the one near the airport. Is that the one that's flooded? It's the one near the airport where we have 70 properties that need and require transfer. I can get you the information exactly which property it is. We'll get you that information right now.

Councilwoman Verna

I would appreciate it. At this time, the Chair recognizes Councilwoman Brown.

Councilwoman Brown

Good morning, Madam President. Good morning.

Mr. Diaz

Good morning, Councilwoman.

Councilwoman Brown

I believe, first of 2402 3/12/03 - FY '04 OPERATING BUDGET all, that paragraph 6, , should probably be highlighted and boldfaced and underlined because it truly reflects what's possible. You're to be congratulated for building a department that truly reflects the diversity of this City. My colleague Councilman Ortiz has introduced an important piece of legislation and in it proposes that MBEC should be moved from the Finance Department to the Law Department. Have you had a chance to review it at all yet?

Mr. Diaz

I have not been given notice of that issue, but I would welcome it. We have some excellent lawyers who have worked on that issue. Michele Flamer, for example. We are very committed to diversity, as you can tell, not only from our hiring, but from our contracting. But in addition to that, at your request, we filed an amicus brief with the Supreme Court with regard to the Michigan law case to emphasize the fact that this City is in favor of Affirmative Action. But I would welcome whatever your pleasure.

Councilwoman Brown

Well, the hearings, I understand, are next Friday. 2403 3/12/03 - FY '04 OPERATING BUDGET

Councilman Ortiz

I don't know. I've got to talk to -- Madam Chair, I did send --

Council President Verna

Why don't you put your microphone on, Councilman?

Mr. Diaz

Yes, I received it last night 5:07 p.m., and as a result, I will work on it as soon as I have an opportunity to get to back to the office.

Councilwoman Brown

But again, congratulations on your leadership because it really does start with the leadership in a department to send the message through the ranks what the mission should be with regards to minority and female contracting. Thank you for your testimony.

Mr. Diaz

I think a lot of people are just afraid of the consequences of litigation which occurs. And as you can tell from my background, I'm not afraid of litigation when you have to do the right thing. And I think it's important that you do the right thing. I've had litigation following me from HUD in terms of my Affirmative Action roles. But that's the role that one who has commitment has to conduct himself with.

Councilwoman Brown

I agree completely. 2404 3/12/03 - FY '04 OPERATING BUDGET Thank you, Madam President.

Councilwoman Verna

You're welcome. At this time the Chair recognizes Councilman Ortiz.

Councilman Ortiz

Excuse me, City Solicitor. I think I missed your beginning. Did you state how many contracts that are given out by the Law Department and how many of them go to black and Latino law firms or latino lawyers and so on?

Mr. Diaz

I'd be happy to. In the testimony that we presented, and it's codified in the record, 53 percent of all of our contracts go to minorities or women. We probably have the largest Latino service contract --

Councilman Ortiz

Could you give us a listing of those by firm and so on?

Mr. Diaz

Sure. We can provide that. We can give you all of them and then you'll be able to dissect that. In addition to that, even when we handle matters with majority firms, we try to get the majority firms to use minority attorneys so it's not just sufficient that they're getting the work.

Councilman Ortiz

I'd like those 2405 3/12/03 - FY '04 OPERATING BUDGET details on that, what are the subcontracts of those firms.

Mr. Diaz

Let me give you an example. What we're doing with Duane Morris, there are two African Americans lawyers over there, so we ask them that it would be important for them to have representation provided to us from the two African Americans lawyers. And thereby we utilize those attorneys as primary contacts with us so that not only do we do the minority contracting, but we make sure the majorities are willing to respect the minorities that are in those majority firms.

Councilman Ortiz

And this is a question I ask every year. How many lawyers do you have?

Mr. Diaz

We have 154 lawyers.

Councilman Ortiz

How many of those are Latinos?

Mr. Diaz

There was only one when you asked me the question a year ago. There are seven Latino lawyers today, three are in the management area, there's one that we have an offer out right now, and there are two others that we are sending a letter for the honest program. So hopefully, by the 2406 3/12/03 - FY '04 OPERATING BUDGET time you ask me this question next time, we will have increased our population by a thousand percent. I only committed 400.

Councilman Ortiz

I like that because I've been asking the question and this is the first time we have increases.

Mr. Diaz

And the other thing you should be aware of, Councilman, is that 50 percent of them happen to be Puerto Rican of the Latino lawyers. So that I don't discriminate against any Latino, but you should know that the predominate population also should be considered, and so 50 percent of the Latino lawyers happen to be Puerto Rican.

Councilman Ortiz

That's very good. Thank you.

Councilwoman Verna

Thank you. The Chair again recognizes Councilwoman Brown.

Councilwoman Brown

Follow-up to your remark that you require that prime lawyer firms do business with minority and female-owned firms that are minority. Is there a monitoring piece in place to ensure that they are indeed honoring that stipulation? 2407 3/12/03 - FY '04 OPERATING BUDGET

Mr. Diaz

It really is totally my direct contact with them, and I control every contract we have unless it comes to me as requested by the City Council for me to hire someone or it comes down from the Mayor that I hire someone. I predominately hire nothing but minorities.

Councilwoman Brown

Repeat your last statement. You predominately --

Mr. Diaz

Hire nothing but minorities and women.

Councilwoman Brown

For the subcontracting opportunities?

Mr. Diaz

No, for the contracting, for the prime. And then let them do the subcontract if they need to.

Councilwoman Brown

I see. Thanks again.

Councilwoman Verna

Are there any other questions or comments from Members of the Committee? Councilman Nutter, do you have any questions or comments of the Law Department.

Councilman Nutter

Yes, I do, Madam President. I apologize for being late. Mr. 2408 3/12/03 - FY '04 OPERATING BUDGET Solicitor, one thing I wanted to talk about was a topic we've had a fair amount of conversation about in the past regarding code enforcement. And I also notice that there is a new edition of the newsletter which talks about the Code Enforcement Division, the headline, "Law Department's Code Enforcement Division Improving the Quality of Life Through Court Action." Could you talk to us a little bit about what those activities are and, I guess, how they've been improved over the past few years? Because I've certainly had a number of situations involving code enforcement, the results of which were not necessarily the greatest.

Mr. Diaz

My testimony, Councilman, indicates under the general revenue fund that the Law Department reorganized last year, effective July 1, 2002, a new regulatory government law group was formed at no extra cost to the citizens through improving the structure of the Code Enforcement Division which is now part of this group. The Code attorneys accelerate the rate at which attorneys close matters involving management, building, electric, fire prevention, health and property 2409 3/12/03 - FY '04 OPERATING BUDGET maintenance codes. A total of 739 such matters have been closed in the first six months of FY '03, as compared to 133 for all of FY '02. For FY '03, we projected a $400,000 increase in fines collected as compared with the previous year and expect to continue this same high level of collections throughout FY '04. The Division also inaugurated a clean rails program to remediate nuisance conditions along the numerous miles of railroad rights-of-way in the City, which included a financial commitment from Conrail for clean-up of the Richmond branch in Kensington. The Regulatory Affairs Unit recovered more than 1 million in fines and environmental projects benefited Philadelphia and redirected approximately 1 million from testing of non-drinking water outlets in Philadelphia's public schools towards a quicker resolution of active drinking water outlets. Other accomplishments of the regulatory and government law group included the passage of Act 94 by the General Assembly to enhance redevelopment of blighted properties and streamline condemnation authorities. 2410 3/12/03 - FY '04 OPERATING BUDGET The Law Department continues to maintain improved case analysis procedures to allow these early assessments. Does that help you, Councilman?

Councilman Nutter

That actually was slightly narrowly focused on some of the day-to-day average life things that happen out in the community with bad properties or people not being in compliance with the code and what happens in terms of those cases. There is the ongoing wonderful circumstance of when you're working with L&I and you're trying to get compliance and does a case end up in court, does it go to Municipal Court, does it go to Common Pleas Court, or the Equity Court, and who makes those decisions? Just trying to get things to a final conclusion. We have that situation that I sent over to you not too long ago, and I know your staff responded, 6239 Laughton Street, as an example. I mean, there are multiple examples too numerous to burden this entire record with or zoning cases go on forever. The people are denied it. The Zoning Board or maybe they're approved and people appeal, as is their right, and they go to Common Pleas or 2411 3/12/03 - FY '04 OPERATING BUDGET Common Wealth or Pennsylvania Supreme Court and we still don't get complete compliance with the law. And I guess it is not completely clear to me as to who decides whether something goes to Municipal Court or Common Pleas Court and stays on it to conclusion. That's, unfortunately, been a bit of my experience. And you and I have talked to this in the past.

Mr. Diaz

Councilman, relating to 6239 Laughton Street, the property was on the Mayor's walk on August 6, 2001. Almost immediately, L&I cleaned up and sealed the vacant house. And the Health Department abated the vermin. Inside the house was total disarray with the floors covered with several feet of discarded clothing and filled plastic trash bags and open boxes. The amount debris was astounding, and I have sample photos of that. Subsequent to that, right now there was a pending violation notice that had been placed against 6239, calling for repairs to loose drains, sprouts, repairs to loose window seals. These are fairly minor violations but do contribute to noise disturbance to the neighborhood. Deadline for repairs on March 9th was given by the City Law 2412 3/12/03 - FY '04 OPERATING BUDGET Department. And the City's Law Department is in contact with the owner's attorney to get those repairs complied with.

Councilman Nutter

I'm sorry, you went a little fast for me. What happened on March 9th?

Mr. Diaz

Deadline for repairs was scheduled for March 9th.

Councilman Nutter

You're saying deadlines?

Mr. Diaz

Yes, sir. As you know, we are trying to avoid the fact that -- we want to treat everybody the same, and the fact that this owner is a City employee at the Recreation Department is also embarrassing to us so we have to make sure that the enforcement efforts regarding this property is being imposed just as it would be against any other property owner.

Councilman Nutter

I'm not asking for any extra enforcement because the person's a public employee. Although, as you say, it is certainly extra embarrassing and that's just something that the government has to deal with. On the other hand, there is certainly a perception in the community that but for the fact that the person happens to be 2413 3/12/03 - FY '04 OPERATING BUDGET a public employee that they're actually getting a bit of a break. I don't know where the line is. I don't really care what the person's status is. What I care more about in this particular example or any other example is that we have good, fair, timely enforcement. And this one has, as I say, bedeviled us for an extended period of time, and I don't really understand it. And as I mentioned, there are many other situations.

Mr. Diaz

Now, one of the questions you asked relating to whether you go to Municipal or whether you go to Common Pleas Court, basically it's an equity. And the Municipal Court judge is sitting as an equity judge, which means he's sitting as a Common Pleas judge assigned to that court by the Common Pleas President Judge, therefore, he's acting as a Common Pleas judge.

Councilman Nutter

But don't some of the L&I enforcement matters actually get processed through the Municipal Court, not just the Equity Court?

Mr. Diaz

That's as a result of the President Judge procedures which allows a Municipal Court to sit as an Equity Court. 2414 3/12/03 - FY '04 OPERATING BUDGET

Councilman Nutter

I'm not talking about the Equity Court. My question is, I thought that there were some violations that just automatically went or were processed through Municipal Court, having nothing to do with Equity Court.

Mr. Diaz

Again, the Municipal Court sits as an Equity Court. Now, the fact that there are complied with through the Municipal Court and the fact that L&I processes them without our participation is something that has occurred.

Councilman Nutter

Why is that? Why would L&I be processing violations to court without the Law Department?

Mr. Diaz

Because you can't afford the amount of legal cost that they claim they want to participate in that area.

Councilman Nutter

What's the amount?

Mr. Diaz

I have no idea what it would cost to staff a full time court.

Councilman Nutter

To the best of my knowledge, that issue has not been raised. And we had L&I, I think, for four hours last week and that particular issue never came up. 2415 3/12/03 - FY '04 OPERATING BUDGET

Mr. Diaz

It is an additional cost to staff the municipal courts.

Councilman Nutter

Well, I think we should at least have the opportunity to either affirm or deny that kind of policy and procedure on behalf of the citizens of this City who expect a certain level of enforcement. I think they deserve a certain level of enforcement. And if we can at least know what's involved in making the system work better and not either by omission or by design have a system that functions at a less-than-decent level because a decision was made away at least from the Council about whether or not to have such a system in place because of cost. I mean, I think that's, quite honestly, a part of what the budget process is all about.

Mr. Diaz

I would agree with you. I'll give you that information because essentially the ones in Municipal Court are low level matters, we'll be happy to give you that information.

Councilman Nutter

Okay. I'd appreciate it. Tell me a little bit about the decision -- in the past there was a document that, I 2416 3/12/03 - FY '04 OPERATING BUDGET think, would actually cover much of the same information here. It used to be called City of Philadelphia Law Department Client News, which some seem to be attributed to specific lawyers based on their expertise and others were general in topic matter. Tell me a little bit about the decision to switch now to te Philly Solicitor and what was involved in that.

Mr. Diaz

We didn't have a way of communicating issues that related to importance to the entire City. In particular, for example, so many editions include public access to City records under the Pennsylvania right to know. The Philadelphia Law Department Civil Rights Unit in terms of the fact that the's a national landmark and a model for the Country based on the ability to reduce cost to its citizens and ethics on boards and non-profits. Those are utilizations that needed to be disseminated to and within the government, and that's why we created the Philadelphia Solicitor.

Councilman Nutter

What was wrong with the Client News?

Mr. Diaz

It only touched upon some legal issues within the department and was not 2417 3/12/03 - FY '04 OPERATING BUDGET utilized in the same fashion.

Councilman Nutter

And you pay for this particular service now?

Mr. Diaz

Yes, we do.

Councilman Nutter

Who provides that?

Mr. Diaz

We do it in-house much as possible, in that we have a layout and consultant that we use on an as-needed basis, which is Keel Associates.

Councilman Nutter

You mean Keel Communications?

Mr. Diaz

Keel Communications.

Councilman Nutter

And what exactly does Keel do for the Law Department.

Mr. Diaz

Essentially, it provides to our folks the layout and any editing that's necessary and make sure that it's printed on time and on schedule.

Councilman Nutter

And this is viewed as an essential service of Law Department to have someone layout a newsletter?

Mr. Diaz

It's essential to have a newsletter. The question is we didn't have the capacity. I tried to get a public relations type 2418 3/12/03 - FY '04 OPERATING BUDGET individual who would manage that hired inside, and it was denied.

Councilman Nutter

Well, who was doing the Client News?

Mr. Diaz

The Client News was coming out sporadically, as I indicated to you, and it was not adequate in terms of providing the information that was necessary to the City, and that's why we created the Philly Solicitor.

Councilman Nutter

Well, who writes the copy for the Philly Solicitor.

Mr. Diaz

The lawyers in the office.

Councilman Nutter

Who are the same people who were writing the Client News.

Mr. Diaz

Not necessarily.

Councilman Nutter

Well, there were lawyers writing the Client News, right?

Councilman Nutter

It may not have been the same people all the time, but they were lawyers.

Mr. Diaz

Well, it was not the same. If you look at the prior one, it was really not writing. A lot of it was just redacting what you got from a case law. It was not necessarily a 2419 3/12/03 - FY '04 OPERATING BUDGET writing or an editing or a compilation or response in English so people could understand. So that when you pick one up, you know that you have to comply with the Right to Know Act and whether or not you have 5 days, 10 days, 12 days in which to file. That information, whether you're involved in non-profit organizations, you have the opportunity to understand whether or not there is prohibition to be involved in fund-raising with regard to non-profit organizations and whether or not you can hold yourself out in the participation of that and what time and how to do it and what the limitations were either within the Ethics Act of th State or the Ethics Act of the local requirements under the Charter.

Councilman Nutter

How many of them are printed?

Mr. Diaz

Just one issue a month.

Councilman Nutter

I understand. How many do you print.

Mr. Diaz

800 to 1,000.

Councilman Nutter

Who do they go to.

Mr. Diaz

They go to all the employees in the City, essentially our mailing list within the 2420 3/12/03 - FY '04 OPERATING BUDGET City.

Councilman Nutter

What was the last part?

Mr. Diaz

The mailing list within the City.

Councilman Nutter

Within the City.

Councilman Nutter

And who prints them?

Councilman Nutter

So we don't use any outside printing service?

Councilman Nutter

And that is $60,000 in the current fiscal year and $40,000 next fiscal year?

Councilman Nutter

There's a story in today's Daily News that I'd like to ask you some questions about regarding a meeting allegedly regarding yourself, the Managing Director or the Finance Director and the City Representative/Commerce Director. Is the report in today's paper accurate?

Mr. Diaz

I haven't read the paper. 2421 3/12/03 - FY '04 OPERATING BUDGET Would you please let me know what it is.

Councilman Nutter

Sure. It's a Daily News story on , headline, "Mayor's Staff Meets Campaign Team." The story goes on to talk about seven high-level City officials gathered at the Mayor's re-election headquarters for a meeting with several campaign operatives, including the poster communications consultant, field researcher, and communications director approximately two weeks ago. Is that accurate?

Mr. Diaz

There was a meeting held in which that we were told parameters as to why we should not communicate anything with regard to the political part of the street operation and that we are to organize ourselves with regard to the governmental side and avoid any participation on the political side.

Councilman Nutter

Who told you that? MR DIAZ: That was the meeting that we went to, to tell us the parameters.

Councilman Nutter

Who communicated that message?

Mr. Diaz

We were all asked to attend by the City, by the 2nd floor. 2422 3/12/03 - FY '04 OPERATING BUDGET

Councilman Nutter

Mr. Solicitor, the City is a pretty big operation.

Mr. Diaz

It appeared on my calendar as a request from people on the 2nd floor, and I showed up.

Councilman Nutter

And as City Solicitor, you needed to go to a meeting about how to function and operate in a political environment.

Mr. Diaz

I had no idea what the meeting was about before I was invited. I was asked to attend a meeting, and I attended the meeting. When I found out what the meeting was about, obviously it was an appropriate meeting for the cabinet to know what the parameters were.

Councilman Nutter

The parameters of what?

Mr. Diaz

Of involvement in political activities.

Mr. Diaz

Well, you advise the entire government about the appropriate involvement of political activities because you put out a political guide. Let me finish my question. As the City Solicitor, and I think 2423 3/12/03 - FY '04 OPERATING BUDGET recently in the e-mail blast from MOIS, you're the person that puts out the political activity guide, right? And you advise all the public employees about the nature of their involvement, what it can and cannot be in political campaigns, don't you do that?

Mr. Diaz

I put that out as a result of that meeting.

Councilman Nutter

Mr. Solicitor, we get one of these like clockwork every year. This is not a new service of the government.

Mr. Diaz

Not on MOIS it hasn't been. It's the first time it's ever been on MOIS on Internet web page, Councilman.

Councilman Nutter

I'm sorry?

Mr. Diaz

The first time that it's been on the web page.

Councilman Nutter

I don't care whether it's on the web page or not. What I'm telling you is that every year under every Solicitor we've ever had, at least during my time, somewhere around about this time of year we get a fairly standard document that lays out the do's and don'ts of political activity. This is not a new phenomena. Whether 2424 3/12/03 - FY '04 OPERATING BUDGET it's on the web, whether it's available in other parts of the universe is not unique to the current situation, nor I would think particularly unique to the fact that you had a meeting with campaign consultants. Didn't you put out one of these guides last year?

Mr. Diaz

I don't recall when it was put out, but that triggered making sure that I put it out.

Councilman Nutter

What triggered it?

Mr. Diaz

The fact that we had the meeting.

Councilman Nutter

The fact that you as City Solicitor and other officials had a meeting with campaign staff inspired you to put out this notice?

Mr. Diaz

Reminded me that the political season is coming, we have to do it again.

Councilman Nutter

Okay. But I think when you check your records, you're going to -- I mean, you were here this time last year, right?

Mr. Diaz

I've been here about 15 months.

Councilman Nutter

So you were here 2425 3/12/03 - FY '04 OPERATING BUDGET this time last year?

Mr. Diaz

I started on December 2nd of a year ago prior to the Governor's raise.

Councilman Nutter

Right. December 2, 2001. But you're saying you don't have recollection that probably within the first two months of 2002 the City Solicitor's Office would have put out a guide to all public employees reminding them of what their actions can and cannot be with regard to politics?

Mr. Diaz

I may have because I wanted to read it myself to understand what my limitations were. I would have read it sometime during the gubernatorial race, so I would have put it out soon thereafter.

Councilman Nutter

So whether you participated in the meeting, again I'm going to say to you, it is like clockwork that this document comes out. Whether you had the meeting or not, the Solicitor's Office would have sent out this document.

Mr. Diaz

I can't tell you it's like clockwork. I can only tell you what I do, Councilman. 2426 3/12/03 - FY '04 OPERATING BUDGET

Councilman Nutter

Well, I understand that. I can tell you from my experience it's like clockwork. So what did you learn at the meeting?

Mr. Diaz

That the political individuals were the ones in charge of the political issues and these were the individuals and we were to stay away from our involvement.

Councilman Nutter

And who explained that to you?

Mr. Diaz

I don't know the names of the parties that were there. They were from the -- I don't know them. I've never met them before.

Councilman Nutter

So you testimony is is that the political aids explained to you as a City Solicitor what you can and cannot do as a City Solicitor for the City of Philadelphia?

Mr. Diaz

Not to me, to the party that was congregated there.

Councilman Nutter

Everyone else?

Councilman Nutter

And the final determination was?

Mr. Diaz

I don't know the details. 2427 3/12/03 - FY '04 OPERATING BUDGET All I know they told us that they are involved in the politics and we're involved in the government.

Councilman Nutter

But you probably knew that before you went to the meeting, right?

Mr. Diaz

I had no idea what the meeting was about before I was invited to the meeting, Councilman.

Councilman Nutter

Forget about the meeting. You knew that -- you didn't need to go to that meeting to find out that you were involved in a government and not involved in a campaign, right?

Mr. Diaz

I don't know, Councilman. I can't answer that question because I don't know what the details of the additional information that was given to the other members of that group. When I got there, the meeting was ongoing.

Councilman Nutter

Well, I understand that. But you did read the guide that you put out last year on the one you put out this year or the one that you read shortly after you came into the government, and I know you must be familiar with the Charter Section 10-107. I mean, you're familiar with that?

Mr. Diaz

I'm familiar as a result of 2428 3/12/03 - FY '04 OPERATING BUDGET correspondence that I received that I responded to it in which I have essentially been accused of involvement in political activity, which is a lie.

Councilman Nutter

Who accused you of that?

Mr. Diaz

One of the republican members of the Republican Party, I assume.

Councilman Nutter

I have no knowledge or idea what you're speaking about. But you're not saying that I've accused you of being involved in politics?

Mr. Diaz

You're enunciating that I've been involved in political activities by going to this meeting.

Councilman Nutter

No, I'm asking questions about the meeting. And I paid my 60 cents and I got a newspaper today and I'm trying to understand what happened.

Mr. Diaz

What I'm telling you is all they talked about was the parameters between the government and the politicians. They did not discuss the law.

Councilman Nutter

Okay. Who is Greg McGarrity? 2429 3/12/03 - FY '04 OPERATING BUDGET

Mr. Diaz

Greg McGarrity is my attorney.

Councilman Nutter

You have an attorney?

Mr. Diaz

My personal attorney, yes, sir.

Councilman Nutter

Advising you in your private citizen capacity, or advising you as the --

Mr. Diaz

Representing me in my private capacity.

Councilman Nutter

Let me finish the question. Representing you in your private capacity as a citizen or in your capacity as a City Solicitor of Philadelphia?

Mr. Diaz

As a citizen.

Councilman Nutter

And he is therefore empowered to make or give opinion as to the City Charter?

Mr. Diaz

As to my involvement, yes, sir.

Councilman Nutter

Why wouldn't you get advise from the Law Department? I mean, you're a public official.

Mr. Diaz

Because I'd like protect 2430 3/12/03 - FY '04 OPERATING BUDGET myself personally from any innuendos or anyone who's trying to ruin my reputation and anyone who is trying to defame me.

Councilman Nutter

This is in general, not specific to this particular situation?

Mr. Diaz

Specific to this innuendo.

Councilman Nutter

What's the innuendo?

Mr. Diaz

That I went to a political activity and that I violated the section that you named in the Code.

Councilman Nutter

Well, Mr. Solicitor, I've made no charge or allegation. I've simply asked you about a newspaper story reported in a publication of general circulation in which a person is quoted indirectly as being your attorney. And I've not experience a situation where the City Solicitor had a lawyer. And then I, maybe incorrectly, assumed that like the rest of us when we need legal advise or some question arises, we usually go to the Law Department and ask for advice.

Mr. Diaz

Not when there's an attempt to defame me.