Sure. First, I'd just like to send Liz Robinson's apologies for not being able to be here. She's the executive director of ECA, and she had to be in Harrisburg today, talking with other weatherization assistance program directors about how to ramp up that program, and you've heard a 134 3/24/09 FISCAL STABILITY COMM. - RES. 090178 little bit about that already today. ECA is one of the administrators of the WAP program, which you heard, it's -- the income guidelines have been increased to 60 percent of median income, which means that we're reaching well into the working poor as people that we can reach with the program, which is wonderful, especially because of the increased funding. The program has been funded at $5 billion nationally under the Recovery Act, and ECA expects that expansion to be considerable. So we're working really hard to make sure that that happens well and efficiently. And the benefits of that obviously are financial stability for the homeowners who have their homes WAPed. It lowers Philadelphia carbon footprint and also creates green-collar jobs, which, I think, is probably what you're more interested in. ECA is anticipating doubling our 135 3/24/09 FISCAL STABILITY COMM. - RES. 090178 staff, so that means hiring another hundred people to be auditors, air sealers, insulators, carpenters, heating technicians, inspectors, and intake staff. And these are all the people that make this program happen. So additionally to WAP, there are several areas in which energy efficiency in buildings is really important. There are opportunities for that in the retrofitting of public housing, Section 8 housing, the Neighborhood Stabilization Program, Title I, the Energy Block Grant, and the State Energy Program. So I would encourage you to consider energy efficiency as an element to all of those other programs too. So the Stimulus Fund is an unprecedented opportunity for Philadelphia to invest in retrofitting and improving our housing stock and to prepare for the era of expensive energy in which we now find ourselves. In order 136 3/24/09 FISCAL STABILITY COMM. - RES. 090178 to maximize the potential benefit to the City, we need to meet all of the following challenges simultaneously: The most important one is training. So there are simply not enough skilled energy-efficiency technicians and installers. And this is a problem that we're facing across Pennsylvania. S. Department of Energy, for the past year-and-a-half, ECA has been training energy auditors and raters to the national certification standards BPI and HERS. Currently, there's only one weatherization training center in Pennsylvania, and that's in Williamsport. This facility is currently completely oversubscribed. To meet the rapidly expanding need for training in energy efficiency and renewable energy, Philadelphia needs to become a center of training industry that mobilizes 137 3/24/09 FISCAL STABILITY COMM. - RES. 090178 technical schools, vocational schools, community colleges, and private training centers to incorporate energy efficiency and sustainable building practice into their curricula. So ECA received a grant from the John S. and James L. Knight Foundation to renovate our warehouse in Kensington into a green jobs training center. And we plan to train people at all levels, from the entry-level positions of the WAP program on up through technically difficult BPI and HERS and including solar installers. We see this training center as a vital part of a much bigger gap that must be filled in the region. We are prepared to work together with other institutions to make Philadelphia the place to go for training and for energy efficiency and solar careers. But the Knight Foundation Grant is approximately half of what we need to renovate this facility; thus, we are 138 3/24/09 FISCAL STABILITY COMM. - RES. 090178 applying for Recovery Act money to help us complete the project.
So then, the other sort of -- I'll glaze over this, although it's really important, is the importance that we have consistent standards met nationally, which is why we are putting so much emphasis on training BPI and HERS raters, which are national certifications. We want to make sure that any retrofits that happen to the Energy Star standard, which is an EPA-approved standard for both new construction and existing homes. The third point in my testimony is about the need for Philadelphia to innovate in what we're doing. And there's one suggestion for passive homes or zero-energy homes in Philadelphia. And the way that if we demonstrate, we can do that in Philadelphia, that will bring manufacturing, it will bring qualified installers to Philadelphia, and create the job market that we're looking 139 3/24/09 FISCAL STABILITY COMM. - RES. 090178 to create through green-collar jobs. , that this can happen and that this is a viable industry. But the point that I really do want to focus on is training, because that's where the jobs are going to be coming from. And we really need to build the infrastructure in order to make this happen. And ECA is prepared to do that. We're prepared to partner with a lot of other organizations and groups in the City to make that happen. I mean, we're a small organization comparatively, and so we're going to need lots of partners to make that happen, but we're definitely on the right path, and we're hoping that the recovery money will only galvanize people to join us in that. Lastly, I just wanted to invite 140 3/24/09 FISCAL STABILITY COMM. - RES. 090178 you to the first training for entry-level training, which will be happening on April 20th, at our Clearfield warehouse. And this is in partnership with the Philadelphia Workforce Development Corporation. , and you're welcome to come and see us.
Thank you. And, again, another reminder that the hearing of the Parks and Services Committee is across the hall, in the Caucus Room. Thank you.
Good afternoon. I am Leanne Krueger Branake, Executive Director of the Sustainable Business Network of Greater Philadelphia, and we're a business organization that brings together local leaders who share a common 141 3/24/09 FISCAL STABILITY COMM. - RES. 090178 interest in growing local successful companies that have a positive social environmental impact. I will also summarize my testimony today in the interest of expediency, but a few highlights. For over eight years, the Sustainable Business Network has provided green technical assistance for small businesses in Philadelphia through training programs, and we currently have 450 member-companies. So I was invited here to speak out of our position of expertise to the Green Economy Task Force, which is a coalition that the Sustainable Business Network convened last February. It has now grown to include over a hundred partners that include workforce development agencies, green businesses, local-government officials, and labor partners. And this is important because cross-sector approaches will be 142 3/24/09 FISCAL STABILITY COMM. - RES. 090178 particularly important as Philadelphia looks to maximize our opportunities with Stimulus funding. So the question that's been asked over and over again this afternoon is: How many jobs are we talking about, and where will they be created? We're specifically talking about green-collar jobs, which is the area that we've been working in most. And for definition's sake, a green-collar job is a blue-collar job in a company that improves environmental quality. So we're talking specifically about solar panel installers, auditors being as being trained by ECA, people who are manufacturing green-building products, et cetera. There's different sectors 20 that fit into green-collar jobs. 21 So how many jobs? We don't know 22 yet, but we will know soon. There are currently six or seven different organizations that are simultaneously working on research to get to the core of 143 3/24/09 FISCAL STABILITY COMM. - RES. 090178 how many jobs we're talking about here in Philadelphia. The funding that we've received through the Knight Foundation, the funding that the Office of Sustainability has received through the Knight Foundation, the funding that's already been allocated through the Philadelphia Workforce Investment Board, we're all working collectively right now to get to the answer as soon as we can of how many jobs and what do they look like. To give a potential piece, there is a study that came out in the fall from Center for American Progress that talks about if there was a $4 billion investment in the State of Pennsylvania -- which the Stimulus Plan will come close to -- then 83,000 new jobs would be created. And since Philadelphia is about 10 percent of the State population, we believe that we're talking about at least 8300 jobs, new jobs created in Philadelphia. 144 3/24/09 FISCAL STABILITY COMM. - RES. 090178 The bias of the Sustainable Business Network and the Green Economy Task Force is pretty clear: We care about creating job opportunities for low-income communities and for small businesses. So whereas, a lot of the talk that's happened about green jobs at the State level doesn't necessarily include low-income communities, that's very much the vantage point that we're coming from at the Green Economy Task Force. So our concerns about the Stimulus -- let me just jump right into those. Shovel-ready projects cannot leave out low-income communities, and this is something that will happen if local government and City Council and local agencies don't push for an alternative. Transparency. If decisions are made in backrooms, then money is going to go to the usual suspects, and we will not get different results, which is what 145 3/24/09 FISCAL STABILITY COMM. - RES. 090178 we're all hoping for through the Stimulus dollars.
At the federal level, President Obama established the Recovery Accountability and Transparency Board to look specifically at transparency and how dollars are being allocated. We recommend a similar board be created at the local level to make sure that dollars in Philadelphia are being distributed fairly. Any projects must be going -- particularly within the environmental piece of the Stimulus Plan, which is a pretty significant piece of it, we have to consider how the Stimulus money will help our region improve air quality, water quality, energy usage, and habitat preservation for all Philadelphians. So looking at emerging local clean or renewable-energy companies, that can create hundreds of thousands of family-supporting jobs and reduce or energy independence. So the 146 3/24/09 FISCAL STABILITY COMM. - RES. 090178 environmental piece is important. Second is fair labor practices. We need to be stressing the creation of good jobs, not just any jobs. So jobs that include prevailing-wage, adequate benefits, family-sustaining wages, and also strong safety standards. And preference should be given to contractors who will hire local residents and contracts going to small businesses that are headquartered here in the City. One of the cautions of the Stimulus Plan is that only a certain percentage of these jobs can go to people without college degrees. And so, because of that, there was a study recently that showed about, I think, only 14 percent of Philadelphians have a college degree. So because only a portion of these jobs can go to the people who most need jobs, we need to be very careful in directing resources to those populations; and that is training resources as well as 147 3/24/09 FISCAL STABILITY COMM. - RES. 090178 business development resources. And then, lastly, on the accountability piece, there is an opportunity to have public meetings to make sure that people out on the street are getting information about how this money is being spent in Philadelphia, who is benefiting from it. And so, we would advise both the City Council and the Administration to make sure that, again, the public is being informed about this. And, lastly, just to clarify the money that the Sustainable Business Network has received through the John S. and James L. Knight Foundation: We have not received money to attract green businesses; rather, we have received money to design a Philadelphia green jobs corps that will train low-income people with various (indiscernible) employment for positions in existing green companies. And that work -- that historic work in organizing green business is one of SBN's strengths that 148 3/24/09 FISCAL STABILITY COMM. - RES. 090178 we bring to the table, but we have not been given money at this point for business attraction. And, lastly, Philadelphia's ability to get the largest portion of money and to target where we need it really is going to come down to our ability to influence decisions that are being made at the State level as we speak about where the money is coming -- where it's coming from. So advising the State and being loud in what we ask of them is also very important. Thank you.
Thank you. I just want to follow up on that portion of your testimony, the fair- employment practices, where you just mentioned about -- because many of these jobs created by the green economy won't be suitable for people without college degrees?
There was a study that was done last month by the Center on 149 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Education and Workforce at Georgetown University that concluded that more than half of the jobs created by the American Recovery and Reinvestment Act, the Stimulus Plan, will require some college education.
Okay. Understanding that, has there been any conversations with the School District of Philadelphia? You know, oftentimes, there's a lot of emphasis about post-high school, kids going to college, but that's really not for everybody. I mean, not everybody's going to be a doctor or a lawyer or what have you. And a lot of the fields that will be secondary education may not appeal to someone in college.
Is there any discussion about what the green economy would mean?
And maybe 150 3/24/09 FISCAL STABILITY COMM. - RES. 090178 excite people in high school to want to become a part of that economy.
Which may require a college education but not to the extent that the sciences and other types of educational levels would require.
Is there any conversation going on with the School District?
So your question is: How are we getting youth pulled into this?
And then also going back to that pipeline question that I heard before from Councilman Goode. So in terms of the youth piece, the Stimulus dollars that are coming down 151 3/24/09 FISCAL STABILITY COMM. - RES. 090178 for youth job training are already here. The Philadelphia Youth Network just a few weeks ago issued a request for proposals for summer internship programs for youth. Because Philadelphia Youth Network has been engaged with the Sustainable Business Network on the Green Economy Task Force from the very beginning and because our Green Jobs Training Committee is chaired by a vice president at Philadelphia Youth Network, we've been in dialogue with them for a while. As a result, we were able to put together an orientation for the training providers who are seeking that $7 million in funding. So last week, we put together an orientation on "What Is A Green Job?" because one of the gaps that we found is on the training providers that both the adult and the youth level, the questions are: What is a green job? what are the opportunities? what are we training kids for? So there's still a 152 3/24/09 FISCAL STABILITY COMM. - RES. 090178 lot of education that has to be done.
So we were able to do some education with the providers and then point them towards resources in partnerships with each other that we think will lead to more successful internship placements. Philadelphia Academies was also at that meeting as well as a number of different youth-serving organizations. We have not had a direct conversation with the School District yet, but I would certainly invite that conversation.
I think that might be helpful. Any questions? Councilwoman Tasco. And then Mr. White can proceed.
Can I ask her something before he testifies? 'cause I don't want to lose this discussion on the -- 153 3/24/09 FISCAL STABILITY COMM. - RES. 090178
Nothing personal. And then I'll... You are the -- now, how did the -- how will these dollars flow? I think when we talk to our Sustainability Office, Mark Allen Hughes, will the dollars flow to our office or individual groups? You know, because if -- well, just first answer that question.
Sure. So it really depends on which piece you're talking about.
I'm talking about this piece, this weatherization and the green.
The weatherization is one component. The best resource that I can point you to is one that's from: Green For All Prepared: Bringing Home the Green Recovery, which is a user's guide to the 2009 American Recovery and Reinvestment Act. And I cite this in my 154 3/24/09 FISCAL STABILITY COMM. - RES. 090178 testimony.
They have broken down piece by piece on the green aspects of the Recovery Plan: Which dollars? how many dollars? where are they coming from? who are they coming from? are these earmarks? are they competitive bids? et cetera. So this is the best research that we've seen. So the answer is: It really depends on which piece. A lot of it is coming straight from federal. A lot of decisions, again, are being made on the State level. So Philadelphia needs to continue the conversations that I know Rob Dubow alluded to, advocating in Harrisburg for money to come into Philadelphia in a way that will be most useful to the people who need it most.
Yeah, and we agree with all of that, but have you given any suggestions as to who it should 155 3/24/09 FISCAL STABILITY COMM. - RES. 090178 flow through? I mean, if you got all this money coming in -- and I certainly have some concerns about the weatherization program that we don't get these fly-by-night shysters coming in and telling people they're going to weatherize their homes and charge these fees.
But what is the central location where the dollars will flow from and then go out to groups like yours or some of these other groups that are doing weatherization and/or green jobs? Who's going to pay attention to the dollars?
Well, I'm going to recommend that Energy Coordinating Agency answer the weatherization question because they've been doing this work for 20 years and our national leaders.
Now, will you get all of the dollars, the weatherization dollars? 156 3/24/09 FISCAL STABILITY COMM. - RES. 090178
No. In Philadelphia, PWDC and ECA administer the weatherization assistance program, and that money comes through... what are they called? CWEP? What is the acronym for the --
No, the DECD, DECD, the Department of Economic and Community Development at the State level. So that's -- somebody else alluded to the fact that maybe that will be changing right now. They're talking about that in Harrisburg as we speak. So, again, we don't really know how a lot of this money is going to be coming down, but I do know that currently, ECA and PWDC are the ones that administer it in Philadelphia.
Mr. White, let me hear you 'cause you seem to have the information that I'm asking for.
I'm always amazed 157 3/24/09 FISCAL STABILITY COMM. - RES. 090178 how my colleagues read the same stuff on policy (indiscernible). I'll send you the PDF for the -- for Bringing Home the Green for Green for All, which is an excellent manual. First of all, let me identify myself. I'm James White. I'm the policy coordinator at the Philadelphia Association of CDCs, and we are -- we have about 75 community development organizations and nonprofit organizations that have extensive experience accessing and utilizing programs to create job opportunities and building stronger communities. That being said, the first thing I want to address before I really get into my testimony is that there's also groups like Youth Build -- since we're talking about youth -- that work with youth that are from low-income environments, who have often fallen out of school, to prepare them for journeyman jobs. 158 3/24/09 FISCAL STABILITY COMM. - RES. 090178
Yeah, but the point I'm getting to is that beyond weatherization, some of the things that are available and some of the strategies here -- I'm going to re-work this. In housing development, there's a low-income tax-credit program that will get a number of dollars to fund rental and low-income development in distressed neighborhoods, which will include such things as retrofitting of homes.
Let me just ask you a question. We have all of that, we know all of that.
My question is: The young lady raised the issue of accountability --
-- and of the usual suspects who seem to be negative coming about. How do we 159 3/24/09 FISCAL STABILITY COMM. - RES. 090178 control -- who controls the flow of dollars? how do you access those dollars? and how do you account for those dollars? and to whom do you account for those dollars?
Well, she's correct in identifying the Community Economic Development -- (Indiscernible; parties talking over each other.)
So if she wants a program, she has to apply to the State for those dollars?
Some of it will be formula, some of it will also be through grants, competitive grants.
Councilman 160 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Green.
I think the real answer to that question based on recent conversations I've had with the Director of Sustainability and others is that nobody knows the answer to the Councilwoman's question. And it's okay to just say, "I don't know where the money's going." (Laughter.)
Yeah, I understand, Councilman. Thank you. I mean, there's a number of -- I think there's a number of places it could go.
But I'm saying: Who's going to work to coordinate all of this?
There needs to be a coordinating system to make sure that the dollars are not wasted, don't go to shysters.
Right. And our recommendation -- we know that Mark Allen Hughes, of the Office of Sustainability, is also the Mayor's point person on the Economic Stimulus Plan. We believe that's the right channel because he's already tied into where the money could go, where it should go, where the needs are, where the greatest impacts would be. But there needs to be some sort of an intermediary that's making sure that the linkages happen. Without that happening, the job training money's going to go here, the business-development money is going to go here, the weatherization money is going to go here, and these three parties will never talk to each other.
And so it's those new linkages and cross-communications that the Green Economy Task Force working to facilitate, and the City needs to put pressure on the fact that these conversations have to continue to happen.
And Mr. Schwartz has a -- since he prepared the report for us, let him -- we're going to come back to you, James. We're not going anywhere. (Ed Schwartz returns to witness table.)
Yeah. I just want to affirm something that was said here and emphasize it, you know, 'cause we've been around for a few years. The weatherization money has come to Philadelphia primarily through two sources: One of them you have direct authority over really, and the other indirect. In the Philadelphia Housing Development Corporation, weatherization 163 3/24/09 FISCAL STABILITY COMM. - RES. 090178 has been run since I was housing director and before. It's had a tiny little bit of money. And we, during those years, consolidated the Home Repair Division and the Weatherization Division. They are the ones -- the director of that program has been going to Harrisburg for these various meetings and getting briefed. That money, if you look at the CDBG plans, always states that it comes from the State.
A hell of a lot more is going to come from the State. So that's the direct accountability. The Energy Coordinating Agency has been out here for, you know, a lot of years, 25. They're celebrating their 25th anniversary.
And they have had their own relationship with the Department of Community and Economic Development. And they have built a 164 3/24/09 FISCAL STABILITY COMM. - RES. 090178 weatherization operation of their own that is built around teams. So they independently have also been going to Harrisburg. So those two are clear.
I believe PGW is making some kind of effort to get into this; I understand that from a couple of people there.
So that's a third area of accountability. So that the weatherization money you're going to see fairly clearly. Now, as far as the job training goes, Ernie Jones was here. They're already ramping up job training for weatherization so that the money that is going to the training programs is coming out of there. And, frankly, he was saying to me while he was here that they're short. This is a new area that's suddenly exploding, and they don't have enough 165 3/24/09 FISCAL STABILITY COMM. - RES. 090178 folks. The individual kind of economic development incentive of projects such as the one that I mentioned in my testimony that Rendell announced, that is coming out of the State Department of Energy and whatever other instruments Rendell has created for development. And that's going to be huge. And, frankly, the City of Philadelphia is not going to have much to do directly with any of that.
The challenge -- and I've said this actually to Councilman Kenney since he chairs the environmental committee, and I mentioned it. The Energy and Environment Community Development Block Grant is coming to the City of Philadelphia. This was initiated two years ago by the U.S. Conference of Mayors, and it was passed last year with no money; now it's got money, and it's going to come here. And 166 3/24/09 FISCAL STABILITY COMM. - RES. 090178 in my report, you will see that I list some of the objectives that this grant can perform. I believe -- and I've said this to Councilman Kenney and to Councilman Clarke -- there should be a hearing here about preparing for that block grant. I'm not clear who's going to administer it. There are various things it's supposed to be able to do. I think the Council and citizens ought to have some opportunity to talk about this block grant before an entire package gets put together. So I think what I've just said is about all you could know at this time about that.
The exciting thing beyond whatever the City is getting is that there are a lot of grant opportunities and loan opportunities for companies, some for nonprofits, that are in this field. And people, I can assure 167 3/24/09 FISCAL STABILITY COMM. - RES. 090178 you, in the business community who are depending on this, or hope to, are already out there trying to figure out what they ought to be applying for. And I'm sure that guide that you mention, which I certainly want to see, is probably the best source available to figure out what to do.
Thank you. Mr. White, I understand you haven't testified yet.
No, Mr. Chairman, and thank you for giving me the opportunity to testify. This is a very exciting time, I think, for all of us in the nonprofit sector because of the opportunity the president has provided for us. That being said, I think I'll just summarize some key points here, and I would concur with a lot of folks on the panel, with a lot of what they said. I really believe that there are 168 3/24/09 FISCAL STABILITY COMM. - RES. 090178 several objectives that are important to advance the stimulus in the City that we need to look at times. The City should use the resources strategically to leverage neighborhood assets, investments and plans, as well as additional private- and public-sector resources to strengthen neighborhood markets and preserve neighborhoods in danger of decline Furthermore, we should align Stimulus revenue streams with other resources to support integrated approaches to community development that advances sustainable neighborhoods development. To accomplish this task, I think we need to look at ensuring equity, transparency, collective prosperity, sustainability, and energy efficiency. Philadelphia must have a clear, transparent process for its residents to provide input and track where the money is going. With Philadelphians pinching every penny in their own household budgets 169 3/24/09 FISCAL STABILITY COMM. - RES. 090178 and lacking confidence in government, residents must be assured that they are receiving benefits of their hard-earned tax dollars. Philadelphia must meet or exceed the high level of federal oversight President Obama has set. The City must focus on creating jobs that create economic stability for Philadelphia residents and business owners, improving the environment, building up communities, especially those that are at high risk during the economic downturn We must seize the opportunity to put our communities on the path of sustainable progress. Reducing our energy use and cutting greenhouse gas emissions is a smart long-term economic growth strategy. While hard times have fallen all over the State and the Commonwealth, here in Philadelphia, several of our neighborhoods are experiencing extreme suffering and are looking to the City 170 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Council and the Administration to provide Stimulus funding and programs and opportunities. We have put together a list of some opportunities that we think are available for community development corporations through either CDBG, job training, weatherization, energy efficiency, or conservation. First of all, we haven't talked too much about housing development, but we need help to fill the financing gap in affordable rental development, utilizing the low-income tax credits, creating jobs and leveraging significant public- and private-sector, while addressing critical housing needs, and linking this with energy efficiency, such as retrofitting or green roofs or doing basic home-system repairs and some targeted housing preservations with some products and programs that we already have in place, but matching them with some of these Stimulus dollars to maximize what they can 171 3/24/09 FISCAL STABILITY COMM. - RES. 090178 do for affordable housing. I think we've heard several folks, including Mr. Greene from PHA, testify on what type of stimulus and what type of economic bang we get whenever we do construction or repairs in housing. Next, we need to invest in transit-oriented development. And that these key developments linking, whether it's SEPTA dollars with local dollars or federal dollars from the transit, are a reauthorization bill that's yet to come down the pike. This will provide new money to convert our communities into gateways, make them more walkable, transit-friendly, and also provide such amenities as pedestrian lighting, safer neighborhoods, and help to improve our commercial corridors. We talked about a lot about weatherization, so I won't say too much there, as well as greening.
But lastly, what I would like to 172 3/24/09 FISCAL STABILITY COMM. - RES. 090178 leave this committee with -- and I do want to thank the committee for moving forward with this hearing and any future hearings -- is that PACDC is always going to come to the table and work with whatever community partners as well as the Council and the City Administration to move this agenda forward to improve the lives of Philadelphians and to revitalize our neighborhoods. Thank you for the opportunity.
Thank you. I, like you, Mr. White, I'm a little concerned about the tone of all of this as it relates to housing opportunities, because I believe fundamentally, although all of these initiatives are equally as important, but as it relates to pure job creation, be it short-term or long-term, I believe that the housing industry at this point, until we get a clear sense of the green technology and the green jobs has the best opportunity to create more jobs in a 173 3/24/09 FISCAL STABILITY COMM. - RES. 090178 much broader category of trades simply by the virtue of the nature how it works. I mean, you purchase materials, you build it, you sell it the, City collects tax, all of the things associated with construction is beneficial to the City of Philadelphia, and I think that there is a golden opportunity, given the fact that this Stimulus package alone will provide probably more than $150 million for housing-related activities initially. Some people like to characterize this particular Stimulus Program as a proposal that does not necessarily equate to a short-term solution to the City's budget problems, but I disagree. Because the reality is, every initiative that you heard here today during this testimony created a job, and that individual will pay wage tax and that individual will pay other types of taxes, and any company associated with building or purchasing will pay taxes. 174 3/24/09 FISCAL STABILITY COMM. - RES. 090178 That will have an immediate impact on the City's budget. Will it solve a $1 billion problem? Absolutely not. But will it contribute to solving it? Absolutely so. As we have this discussion, I disagree with all these people who continue to characterize this as something that cannot affect our short-term problems. So again, I just want to thank you. All of you have testified; am I correct?
I think that you're correct in that construction can definitely help the City, but I would also emphasize that we have a lot of existing structures in Philadelphia and over 400,000 rowhomes that could be weatherized, and, you know, that employs a lot of people to do that as well. So while we think about new construction, we should also be thinking 175 3/24/09 FISCAL STABILITY COMM. - RES. 090178 about making the houses that we already have more efficient and making it more affordable for people to stay in those houses. We've actually used our weatherization program as a homelessness prevention program as well because we find that often, utility bills are the single most -- one of the biggest chunks of money that a family is paying out. So if those are significantly decreased, then they have a much higher chance of being able to stay in their homes. I just wanted to add that in addition to what --
No, I absolutely agree. And when I say "construction," I didn't want to minimize existing structures. I think that particularly as it relates to the entry-level opportunities for people in our communities, that affords us the best possibilities of making sure that people can benefit throughout the citizenry 176 3/24/09 FISCAL STABILITY COMM. - RES. 090178 across the City of Philadelphia. So thank you so much for your testimony, and we look forward to continue to work with you.
I just had one other thing, Councilman, before we leave. We had talked, I think, earlier and I just wanted to finish my point on housing development and even rehabbing housing. There are a number of CDCs and groups. One group I want to point out that has an opportunity, I think here, is Youth Build that isn't here today and I'm -- but needs to be at the table because it does so much in providing opportunities for young people that are lost and sometimes need to be -- find a new way to have access and opportunities, whether they're journeymen jobs or carpentry. And in your district, they've done a lot of tremendous work, as you know. 177 3/24/09 FISCAL STABILITY COMM. - RES. 090178 But I just hope that there's a move forward that we make sure that we are inclusive of everybody, especially those who suffer the most and have the least.
One closing comment on the construction piece. Youth Build is a member of the Green Economy Task Force, so they're a part of the coalition of a hundred organizations that we're currently working with, and they will be receiving significant funding that's allocated specifically to Youth Build in the recovery plan. On the construction piece, just one question that we need to continually raise is: Who will be doing the building? who will get those construction jobs? We know that the challenge between labor and low-income and minority community inclusion has been a challenge historically in Philadelphia as well as 178 3/24/09 FISCAL STABILITY COMM. - RES. 090178 in other cities. One of the models we're looking at is better pre-apprenticeship programs that will truly move people into union positions. And one of our staff, our green jobs coordinator, is actually out in Oakland right now, visiting a training center set up for that purpose. And, you know, we're following the green jobs stimulus dollars at the federal level and the state level, and we're happy to continue to be a resource for Council on this issue.
Thank you. I agree with you wholeheartedly. I've always said -- and this is some of my conservative roots -- that I think the best social-service program is a good job.
And a person can take care a lot of things on their own if they have a good job. So I agree with you. 179 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Thank you.
I'll call the next panel. I believe we have Rob Holdsworth, Scott Holmes, Tom Cooper. And, Mr. Carter, this last name is -- George Awad. Thank you, sir. (Witnesses come forward.)
Good afternoon, gentlemen. Thank you very much for making yourselves available for this very important issue today. Please proceed, state your name for the record, and we'll go from the left to the right.
My name is Kevin Corrigan, and I'm here in Rob 180 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Holdsworth's stead. I'm managing director for Energy Edge Technologies/Rob regrets not being able to be here. He was en route, got caught up in traffic, and didn't make it. I appreciate --
That may have worked three hours ago, but I'm not sure we buy that now. (Laughter.)
Councilman, I guess we really have to improve that infrastructure anytime it takes you three hours to get to here.
Well, I do intend to take this up with Rob as soon as I leave here because I am here, and I'm sure he's engaged in something worthwhile, but I will try to serve in his stead here. I would like to thank everyone 181 3/24/09 FISCAL STABILITY COMM. - RES. 090178 here, Mr. Chairman and all the other Councilmembers, for the opportunity to speak with you today. As I say, my name is Kevin Corrigan, and I'm the managing director for Energy Edge Technologies Corporation. We are an engineering firm specializing in guaranteed electrical cost reduction. We have LEEDS-accredited professionals and a client list of over 200, ranging from midsize companies to mom-and-pop or sole proprietorship manufacturers up to and including Fortune 500 companies and everything in between. After hearing the issues raised today and the resolution presented, we at Energy Edge Technologies feel that we can help the City of Philadelphia shore up their budget shortfall as well as meet their goals to modernize infrastructure by reducing their electrical consumption and greenhouse emissions. Time Magazine recently wrote about our approach when they said, and I 182 3/24/09 FISCAL STABILITY COMM. - RES. S. has a renewable energy resource that is perfectly clean, remarkably cheap, surprisingly abundant, and immediately available. " And in the same article, President Obama called energy efficiency the cheapest, the cleanest approach with the fastest payback. And he is absolutely correct. There are several things which distinguish our approach from others. We take first the whole facility look; we don't just focus on what we term the low-hanging fruit in the industry such as lighting; we do do that, of course. But we also look at heating and air- conditioning, refrigeration, equipment and motor loads. And we look at the entire electrical distribution system, in fact. 183 3/24/09 FISCAL STABILITY COMM. - RES. 090178 And it's by gaining small to moderate savings in all of these different areas, the aggregate of which can add up to something pretty substantial -- anywhere from to 30 7 percent savings overall. 8 All of the engineering approaches and technologies that we employ are recommended and approved by the Institute of Electronic and Electrical Engineers (the IEEE), as well as the Department of Energy and Energy Star. As I mentioned, we are an engineering firm; we are not a technology manufacturer. So, we are not limited to using only one type of technology or one approach; we do not have to be concerned with adapting our technology to your environment or to your facility or, worse yet, adapting your facility to our technology. We have the opportunity to pick from the best and we do. And it is the facility in question that will 184 3/24/09 FISCAL STABILITY COMM. - RES. 090178 determine what it is we use and how we use it. These technologies that I speak of are passive in nature. There's no 6 turning off loads, there's no changing of equipment or monitoring or maintenance costs associated with that. And they are completely reliable, with a proven minimum ten-year track record of success in the field. We will not take the professional risk, nor will we ask our clients to take the operational or financial risk, by putting in anything that is not untried or unproven into your facility. We are oftentimes asked, If this is so great, why isn't everybody doing it? The short answer is, They are. We oftentimes don't get the press coverage because it's difficult to explain energy efficiency in one or two sound bytes. The other reason is, we don't advertise. Our business model provides for the fastest payback possible. And if we had 185 3/24/09 FISCAL STABILITY COMM. - RES. 090178 to incorporate and advertise an expense into that, it would not be to our clients' best interests. And as Time Magazine did say, it's boring. It doesn't have the "wow" factor that solar power or wind generation has.
But that's okay because, without a doubt, we can provide the fastest payback and return on investment of any energy-savings measure that you could possibly undertake. And the same goes for reducing your greenhouse emissions. And I think you will agree, you know, we would gladly trade off a little bit of "wow" factor for a 24- to 36-month pay back. And I think that's where the real "wow" factor comes in. With respect to the City of Philadelphia and how the City can take its best advantage of the Stimulus Plan, we provide all of the information that you could need to decide whether or not this project is right for you. 186 3/24/09 FISCAL STABILITY COMM. - RES. 090178 This information we provide at no cost or obligation, and it includes a guaranteed savings percentage, a guaranteed project cost, a guaranteed payback and return on investment, and capital leasing options as well. All of the above numbers, as I say, are guaranteed in writing and backed by a surety bond underwritten by Lloyds of London to remove all of the financial risk to you. S. Department of Energy. The world is finally catching on to what we have been quietly doing and have known about for a good number of years now; and that is, investing in energy efficiency is the first best way to helping your own bottom line by saving money. It's a win for the client, it is 187 3/24/09 FISCAL STABILITY COMM. - RES. 090178 a win for the environment, it's a win for the taxpayer, and it's also a win for the electric utility, because the cheapest power plant is the one you never have to build. And in closing, I'd like to just share one small story with you. A few years ago, one of our network affiliates did an installation at a General Electric plant up in upstate New York. And this was at a time when New York State was going through their electrical deregulation. They confided that they were facing a 16 percent electrical rate hike, and that if this went through without any adjustment to their operating cost, that this would effectively wipe out their profit for that division and put some 2500 jobs seriously at risk. Well, when they left, they were able to save them a bit more than 16 percent; but more importantly, those 2500 jobs were not put at risk. 188 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Now, does this happen all of the time? No. But I don't think it takes any stretch of the imagination to know that in today's environment, these kinds of, you know, crises situations are happening more and more in companies of all size and in municipal entities as well. Energy cost reduction has never been more sorely needed, nor have the benefits been greater. I appreciate your time. And I'm willing to take any questions that you might have. Thank you.
First of all, thank you guys for your patience. And the number of Council people here is no 21 reflection on the importance of this testimony. We are multi-tasking; we have over 50 applicants applying for Parks and Recreation, and our chairman here had to go spend time over there to give 189 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Councilwoman Reynolds-Brown some relief. So we've been kind of shuttling back and forth. But you're absolutely right. As chairman of the Transportation and Public Utilities Committee, I am concerned, and I'm glad the chairman of Fiscal Stability is looking at the impacts possibly of deregulation of electric on our operating budget. Every streetlight out there that keeps our streets lit at night is paid for out of the electric rates that the City has to pay. So efficiency is not only in our buildings but in all the bills that we pay to the electric company is of paramount issue. Now, when it comes to these audits, are we -- I mean, you know, I mean, how do we guarantee at the back end the successes that are recommended and paid for at the front end? I mean, simply put.
Well, that's a 190 3/24/09 FISCAL STABILITY COMM. - RES. 090178 good question. We provide all of the information that you might need, Councilman, to make that financial decision; that's what we bring it down to. I mean, all good ideas aside, it has to be -- it is a financial decision. You know all of that information up front without cost or obligation. Our work does eventually include audit work; it has to. We have to evaluate each facility individually on its own merits. But you know what the minimum savings is that you're going to have in that facility, you will know what the minimum payback and return on investment is, and you will know what the maximum cost is before we ever get to that point.
Thank you, Mr. Chairman. 191 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Who gives us the money back if your estimates are not correct?
If, say, we have a shortfall between our initial investment and what the audit turns up; let's say, for example, we go in and say that we can guarantees you a minimum of ten percent. You pay for audit, the audit reveals we can only deliver -- guarantee 9 percent. You are refunded in full the cost that have audit, regardless of what you decide to do.
Okay. But, I mean, if we go ahead -- and there are companies, and yours may not do this, that guarantee the savings and bond it and do other things like that so that you can actually effect the savings that they project you're going to get.
If you go ahead -- if I understand your question, Councilman Green, if you go ahead with the project, okay? We do the 192 3/24/09 FISCAL STABILITY COMM. - RES. 090178 installation and the M&V reveals that you're not getting percent, you're 4 getting 9 percent -- 5
-- our guarantee 7 is backed by Lloyd's, and you will be 8 made whole. 9
We will make up that difference, okay? Typically, there is nothing in our -- we have a very conservative bias to this.
No, you answered the question. I appreciate it. Thank you.
Thank you. My name is Scott Holmes. Thank you very much for 193 3/24/09 FISCAL STABILITY COMM. - RES. 090178 the opportunity to be here today. I've been trying to think how I can position my presentation, because it's so totally different from everything that everybody's talked about today. One thing I thought that's been interesting is that nobody has mentioned the single item in the budget that has to be solved and that will be solved and that the president has allocated an extra $19 billion to solving it: And that is, we've got to have a health care system that keeps our people safe and that pays for itself. And they're going to spend -- the government is going to spend a heck of a lot of money figuring out how to make that happen. And I'm here today to tell you that I believe that Philadelphia has the wherewithal to pull that off. And then I'll tell you what the financial consequences of that could be. But there are essentially two 194 3/24/09 FISCAL STABILITY COMM. - RES. 090178 issues that stand behind solving it and not solving it. One is a technical issue, which we happen to have a small company in Malvern that I'm close to solve that issue, and, you know, the appropriate people can easily validate that. And it has to do with inter- operability. For those of you who know health care, you that the lab systems don't talk to the lab systems, hospital systems don't talk to hospital systems. You carry your paperwork with you when you go to the doctor or the hospital because the paper doesn't get there automatically. That's called "interoperability." And that problem's been solved very nicely by this Philadelphia company. I think the second issue that stands between the solution to this problem is the political will to make it happen. Do we have leaders who will make it happen? And I would say to you, 195 3/24/09 FISCAL STABILITY COMM. - RES. 090178 having read the T. Rowe Price report talking about the consequence of unfunded employee benefits, that we can take the savings that come from implementing this new system and use those to apply to cover those benefits. So there's an enormous financial incentive in terms of ongoing jobs; jobs would go on forever. This program -- this country's going to need to continue providing health care, safe health care forever, and that's going to be an ongoing thing. So I guess what my point to you is, is that we can put together a team that can beat the cities that we'll be contending with for this money. How much money we go after depends on whether we bring Rendell into the program or whether we bring the School District into the program; it depends on how many people we want to provide better health care and less expensive health care. That's just a calculation. I've done a calculation that 196 3/24/09 FISCAL STABILITY COMM. - RES. 090178 shows if we just covered -- if we only covered the underinsured City employees, we would save close to $450 million a year, one heck of a lot of money. So I will, I think, at that point close and ask if there are any questions. But this is a -- this is all about a lot of money, and I think we're good enough as a city to and as a state to beat the others that we'll be contending with.
Yeah, thank you. I'm sorry. Thank you, Mr. Chairman. You believe that the City of Philadelphia can save $450 million per year from its current health care costs by implementing technology?
Better and safer health care systems. The whole trick is simple: When the patient arrives at the 197 3/24/09 FISCAL STABILITY COMM. - RES. 090178 doctor's office or at the hospital, his or her current information is available. They don't have to, you know, ask -- send a cab down the street for it.
Would you please provide the chairman with written information about exactly how the City can --
-- achieve these savings and what we would have to do specifically in terms of grants or other requests we'd make with the federal government for --
And who the team would be that you would propose? And I think the chairman would forward this to the Administration and recommend that we have to meet.
It's actually been 198 3/24/09 FISCAL STABILITY COMM. - RES. 090178 submitted. So it will not be difficult for me to do. But it's --
It's close to a no-brainer, but in terms of what we need to do on an ongoing basis as a city, I mean, it really deserves to be looked at, I think.
Thank you, Mr. Chairman. We have a situation in the 4th Councilmatic District where I do not have a public health center sponsored by the City of Philadelphia. We do, however, have an excellent, excellent health-care provider located at 57th and Haverford that is federally funded and subsidized, handling a lot of the needs of the 24 percent population below the poverty guideline. 199 3/24/09 FISCAL STABILITY COMM. - RES. 090178 When I took the tour, one of the things that struck me almost as very archaic was the fact that we walk out of their space into an outer room, into another room where there was a room maybe a eighth of the size of this that had nothing but physical files. In fact, they had the old revolving files that, you know, almost looked like a dry cleaner's rotating file system. And I asked them, "Well, if a patient who is on subsidy needs an operation, an emergency operation, how does the file get to the University of Penn or whoever is providing the procedure?" and they said, "A courier." Now, the difference between that file being instantaneously available to a physician and the four or five hours it may take to finally get it and move it to its proper location and get it into the hands of the physician might be a matter of life and death, life and death.
So particularly, I don't know who in the City of Philadelphia has a plan to take advantage of these kinds of updating of files and systems and getting us up to speed on the electronic transfer. Second, to what degree does telemedicine play in this? And how can we inculcate that into the Stimulus package? Example, I mentioned earlier that I do not have a health district paid for by the City, and under today's economic climate, it doesn't look like I'm going to get one in the near future. However, there are telemedicine products available that you can take a rec center in your district or my district, and within a hour, convert it and be able to actually plug people into an apparatus that is incentive enough to qualify for insurance, and insurance companies have accepted this method of examination as legitimate and be able to 201 3/24/09 FISCAL STABILITY COMM. - RES. 090178 take medicine to where people are. So the question becomes: Does the Stimulus package allow for those kinds of innovations through technology?
The Stimulus package in health care really calls for almost anything because the federal government threw up its hands and said, We've not been able to solve our health care problems in this country. We're going to make this billion available; 13 you come back to us with what works. 14 So I believe there will be 15 technology coming out of the system. I 16 think that I would solve your first 17 problem first: Connect the systems. I 18 mean, right now, we can go to HUP and 19 Lankenau; they have their own systems. The technology exists to branch those together. So I probably would suggest that we connect that which we have and then look in the second phase, would be my guess, as a professional. 202 3/24/09 FISCAL STABILITY COMM. - RES. 090178
Thank you for that comment. But one of the things that that telemedicine aspect allows you to do is to advise a specialist that is in California. That medical record goes to him. We're on a split screen talking to each other and conferring about a person's lung that may be in another city. And so, you know, it seems that we might want to take advantage of this opportunity. Instead of piecemealing it, design something.
But the real savings today is for your members and Blue Cross's and everybody else's for either kids who have a chronic illness, for them to be able to be seen, using teleradiology to identify that there's an overweight condition, there's a blood condition. And so I don't want to completely -- I think there are less 203 3/24/09 FISCAL STABILITY COMM. - RES. 090178 sophisticated uses of the technology that are immediately available today. Blue Cross has got a project going here in Philadelphia. So there is stuff going on. It's got to be pulled together. But that's clearly going on.
And we can get out and talk to the guys at Blue Cross; they'll tell you exactly -- I mean, I know it's going on.
I mean, Blue Cross is a great Philadelphia firm. I mean, tradition, and a lot of kids in my district have benefited and grown up and had kids of their own based on the good work of Blue Cross. But I don't want that to be the only vision. I want there to be a comprehensive thought so that we get ahead of the curve, not run to catch up to the crowd, but get ahead of the crowd by way of being -- Philadelphia, this is a core industry. Medicine is one of 204 3/24/09 FISCAL STABILITY COMM. - RES. 090178 the --
If we get everybody networked in, all of the -- everybody networked -- the providers, the patients, we're going to have an asset that we can really leverage and use to hire more people. I mean, that's your leveragable asset that grows for five and ten years. I mean, that's really -- and I think that's, in a way, what you guys were searching for today.
And that's ultimately where this comes down. And we -- this little company, they've got like 40 different, 50 different facilities in East Bay and Oakland that they're all connected, sharing information. I don't know, like 2300 doctors.
Thank you, sir. Thank you very much for the recommendations. 205 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Just one thing for the record, that one of the invitees was the Deputy Mayor Dr. Schwartz, because we understood that there was going to be a significant contribution that's related to health care, and we had anticipated that he was going to be here to talk about that, but he was not available today. And we anticipate in a follow-up session that we will be focused soley on the Administration's readiness as it relates to all of the Stimulus opportunities, and that he hopefully will be there at that time.
And we would be very pleased to come back for that specific hearing as well.
Sure. Good afternoon, Chairman Clarke and committee members. Thank you for inviting us today to speak about improving the substantial inefficiencies currently experienced in 206 3/24/09 FISCAL STABILITY COMM. - RES. 090178 the delivery of health care by the City of Philadelphia to its beneficiaries. I would also like to thank Councilman Bill Green for his leadership and vision in seeking technology solutions to address efficiencies in health care as well as across all of City government. My name is George Awad, and I represent VIIAD Systems, a Pennsylvania- based technology development services company providing a patent-pending health-care information solution that has been proven to substantially reduce costs and significantly increase reliability in the delivery of health care services. Sitting behind me are John Zuback, CEO of VIIAD Systems and Harvey Mitgang, president of VIIAD Systems. And they are also equally pleased to have this opportunity to speak to you today and to also answer your questions. It is our understanding that the City of Philadelphia has requested 207 3/24/09 FISCAL STABILITY COMM. - RES. 090178 funding to be provided by the American Recovery and Investment Act of 2009 to support programs aimed to substantially decrease health-care efficiencies through the deployment of various health-care information technology solutions. Specifically, the City aims to reduce itself of the cost expenditure currently required to track and monitor health-care services provided to prisoners incarcerated at Philadelphia prisons to the deployment and management of electronic medical records. Additionally, it is our understanding that the City will participate in the CARES Project, which is a statewide electronic health-care initiative aimed to unify the messaging of electronic health-care data across various participating agencies to reduce overhead costs, increase reliability, and improve quality of health care. With respect to the CARES Project, having over three decades of 208 3/24/09 FISCAL STABILITY COMM. - RES. 090178 experience in managing data surrounding health-care transactions, VIIAD Systems has developed various data-interface systems as part of its overall health- care transaction data-processing platform that allow for data-agnostic communication of health-care transaction data, including, but not limited to, claims data, patient history data, benefit-plan description data, billing data, patient-identification data, whether it's electronic or non-electronic. VIIAD has successfully deployed this platform to aggregate data from numerous health-care benefit payers, claims processors, and patient information databases to facilitate the generation of what we call the VIIAD health ticket. It's an on-demand real-time electronic health-care identification and direction document that can be transferred electronically or carried by the person as the first step 209 3/24/09 FISCAL STABILITY COMM. - RES. 090178 in the gateway of actually starting the health-care transaction at any given health-care provider. Governmental agencies can tremendously benefit from the deployment of the VIIAD health-care data interface, the aggregation of management processes and platform. VIIAD's platform of technology solutions can operatively interface with numerous legacy systems to retrieve various data regardless of data formats for communication between and among these legacy systems. Such capability can significantly contribute to various cost-savings, including lower overhead costs and administrative costs. Specifically, with current practices, a number of administrative personnel might be required to manage the manual aggregation of health-care data across various cooperating agencies. Further, additional personnel might be required to manually manage the communication of such 210 3/24/09 FISCAL STABILITY COMM. - RES.
090178 data across and between these cooperating agencies according to prescribed health-care-data-reporting protocol. VIIAD's technology solutions can eliminate these unnecessary administrative and/or overhead costs for these cooperating agencies, allowing for improved health care and overall reduced costs. With respect to the prison system's health-care initiatives, VIIAD Systems has developed a comprehensive technology solution allowing for the management and use of electronic patient-subscriber data, including patient-history and medical-records data in the context of performing health-care transactions. As mentioned, VIIAD's technology solution includes the use of the VIIAD health ticket, an electronic (indiscernible) direction document that is generated in realtime and contains up-to-date data, including, but not 211 3/24/09 FISCAL STABILITY COMM. - RES. 090178 limited to, the patient subscription data, the benefit plan, the patient medical history data, and the provider network data, as well as other data representative of all of the contractual obligations, whether it be private or public collaboration, between the parties of a health-care transaction. Additionally, the health ticket can act as a unique key to access a patient's electronic medical record that can be generated, stored, and managed from the VIIAD platform. The VIIAD health ticket operates part and parcel (indiscernible) V network, which comprises the nationwide (indiscernible) health-care network, offering substantially deeper discounts that aren't currently available by nationally deployed health-care networks much like the Blue Crosses and the Aetnas of the world. VIIAD has successfully deployed its platform to aggregate data from 212 3/24/09 FISCAL STABILITY COMM. - RES. 090178 numerous health-care benefit payors, claims processors, and patient- information databases to facilitate the generation of what we call the VIIAD Health Ticket. VIIAD can service Philadelphia's prisons by deploying the VIIAD technology platform across these prisons to generate health tickets, which can be used to, among other operations, identify prisoner-patient benefits, direct prisoner-patients to proper medical facilities, track health-care transactions, convey prisoner-patient medical history, and retrieve prisoner electronic medical records from VIIAD data source. Additionally, VIIAD can work with the prisons to convert existing prisoner medical records to electronic formats for storage on the VIIAD electronic medical data source. Prisons can tremendously benefit from the deployment of the VIIAD health 213 3/24/09 FISCAL STABILITY COMM. - RES. 090178 care data the aggregation and management processing platform. Specifically with current practices, a number of administrative personnel, much like the CARES opportunity, may be required to manage the manual aggregation of health care data -- and in this context, it would be medical records -- across various data repositories. Additional personnel might be also required to manually manage the communication of such data across and between these cooperating parties of the prisoner-patient health-care transaction according to prescribed health-care data-management and storage protocol. VIIAD technology solutions can eliminate these unnecessary administrative and or/over overhead costs with its cooperating parties, allowing for improved health care at a substantial cost reduction for prisoner-patients. In summary, the VIIAD (indiscernible) successfully deployed in 214 3/24/09 FISCAL STABILITY COMM. - RES. 090178 numerous markets nationally and has been fiscally proven to provide an immediate to percent in cost-savings for the 5 delivery of health-care services for each 6 covered person. 7 As a proven technology that's 8 readily available for deployment with 9 nominal capital expenditure -- I'll 10 repeat that, it's nominal capital 11 expenditure -- for the City's side.
12 VIIAD's Health Ticket can be 13 utilized within 30 to 60 days from the 14 program's inception, which translates 15 into immediate cost-savings, job creation, and establishes a baseline of savings which continues as a residual cost-savings in the future. I'd like to thank you for the opportunity to testify today. And I, at this point, would be happy to answer any questions that you might have about our testimony.
Thank you so much for your testimony. 215 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Councilman Green.
Thank you for coming in today. Do you have any sense of how much the implementation of your technology would save the City on an annual basis in the prisons and then separately in our health-care system?
Sure. Our research has indicated -- specifically, you know, the idea of trying to offer the VIIAD solution in the context of the Stimulus package, we looked at two very specific projects that the City of Philadelphia requested funds for. One was the CARES Project, which basically goes across State agencies. We don't really have a metric type to really say how much in actual dollars that we'll save, but we realize that any type of interoperability of data among cooperating agencies will reduce overhead toward administrative personnel. With regards to the prisons 216 3/24/09 FISCAL STABILITY COMM. - RES. 090178 specifically, it is our understanding that there's about 10,000 Philadelphia prisoners in the Philadelphia prison systems. If you look at the average cost of health care per person in the private sector, it's about $1300 per person. Our numbers indicate that on a 10,000-per-person population basis, we can save anywhere between and 40 11 percent of that cost savings per year. 12 So immediately in the prisons, 13 we're looking at 25 percent of $1300, 14 which is about $400. So at $400 per 15 patient, so then automatically, we can 16 probably translate that to almost 17 $4 million in savings; that's 18 per-prisoner population. 19 The reason that we focus our 20 target right now on specifically the 21 prisons in CARES is because, again, we 22 find that it's going to be nominal 23 capital expenditure from the City's 24 budget. This is money that's going to be 25 allocated -- by that's already been 217 3/24/09 FISCAL STABILITY COMM. - RES. 090178 allocated by the Stimulus package for these projects. And we're going to come in and try to give you the cost-savings immediately by that capital expenditure. That said, we believe that VIIAD has a significant cost opportunity across the City of Philadelphia as a whole. There are a number of specific opportunities that we can actually go to for the community health centers, which Councilman Jones has alluded to, as well as for the specific opportunities in helping the City try to understand their specific spending on benefits for their units as well. We understand that those specific contracts are in place, that your specific budget is also somewhat locked from a year-to-year negotiation process. However, with this tool in hand and requiring those specific unions to use this tools, you can actually reduce your specific expense from anywhere from 15 to 40 percent. 218 3/24/09 FISCAL STABILITY COMM. - RES. 090178 And we're very happy to offer that specific solution on a citywide basis as well.
Thank you. Have you presented this service or product to the unions themselves who currently run their own health-care plans?
We have not had the opportunity, but that's actively on our agenda, and we're looking to provide that specific information to the unions.
Thank you. I'd be happy to try to make an introduction.
Thank you, Councilman. Thank you. Our last witness -- oh, please make room available for this gentleman. (Witness comes forward.)
Good afternoon. 219 3/24/09 FISCAL STABILITY COMM. - RES. 090178
My name is Mark Rupp. I'm the one of the founders and the chief operating officer of Network Acquisition Company, LLC. You know, as you're all aware from your testimony heard today and your own readings, the broadband funding under the Reinvestment Retirement Act of 2009 represents an unprecedented opportunity for all stakeholders in Philadelphia to benefit from the improved quality of life and enrichment of the economic conditions within the city that will result from a comprehensive broadband strategy. The broadband funding in the RRA will provide the resources to coalesce various information driven across various resources in the City, transforming the City of Philadelphia of Philadelphia into a true information-driven community for all of its citizens. By way of background, Network Acquisition Company, you know, has extensive wireless network, and it's 220 3/24/09 FISCAL STABILITY COMM. - RES. 090178 well-suited to become the foundation of this comprehensive broadband initiative. We maintain and run the largest wireless WiFi and fixed wireless network in the United States, here in the City. We provide service to over 150,000 unique users each month here in the City, and our WiFi services are actually free to all consumers -- residents, tourists that visit the City -- saving an estimated millions of dollars already, and, you know, it's our belief that those savings from not having to procure your own broadband service is being reinvested back into the community. With additional funding for enhancing our network and commitment by all key stakeholders to use the network service, the network can evolve from a unique consumer broadband access point to a true innovative sustainable community information network. And I want to give you a couple examples of the benefits, and these are 221 3/24/09 FISCAL STABILITY COMM. - RES. 090178 live examples. In Oklahoma City, they use a very similar network to the one we have here in Philadelphia for productivity of its field service -- the city itself uses for its field service personnel. They estimated that they save 9300 hours of field service time, which is a 30 percent increase in productivity. There is a dedicated broadband wireless resource for public safety that could reduce crime and save money and increase efficiency. And in that particular initiative in Greensberg, Texas, police officers spend one extra hour per day on the street as a result of being able to use a very similar WiFi network, which is about percent 20 savings on time, you know, and translates into reduction of overtime and increased time on the street for public safety. You know, in our vision, the City -- the WiFi network that we have here in the City could be used as a base 222 3/24/09 FISCAL STABILITY COMM. - RES. 090178 of access to Philadelphia's public library system, which, as you know, is being reduced in size. But our ability to extend the Free Library system into communities where they don't have a library or one is being closed can be tremendously enhanced by being able to bring broadband services into those community centers which could effectively substitute for free libraries. On the emergency response time, in Milpitas, California, they estimate on their WiFi network that they have a 16 percent faster response time in terms of 17 emergencies, and we've talked a lot about 18 health care here in this particular 19 panel. 20 One of the technologies that 21 we've been testing with a number of the 22 health care institutions here in the City 23 and some of the gentlemen here today is 24 telemetry, which is, you know, the technology side of telemedicine, where 223 3/24/09 FISCAL STABILITY COMM. - RES. 090178 we're using mobile devices off of our network to be able to place on ambulances so that emergency-care attendants in the ambulances themselves are immediately sending data back to the health care practitioner in the emergency room so that before the ambulance pulls up, they have very basic information.
It's not telemedicine, as Councilman Jones, you were talking about. There's not a video screen coming in, although that is a potential down the road. But you have all of the basic information so that you know what the patient's condition is as they're rolling, and there are tremendous efficiencies as well as lifesaving opportunities there. A continued offering of the free service to all residents, tourists, and commuters will have an overall impact in closing the digital divide that still exists in this city. So, you know, just in 224 3/24/09 FISCAL STABILITY COMM. - RES. 090178 concluding, here the cornerstone of the broadband programs under the RRA is sustainability and job creation. And they call for innovative funding proposals that will have a high impact on all of the constituents in the community. And we certainly encourage the City and all of its stakeholders -- not just the City government itself, but all of the colleges, universities, health- care institutions, and public-service institutions to use this network. It is a network that exists today; it just really needs to be used. And we are very, very encouraged and have been working with the Administration and with some of its members on various programs to try to better leverage this network that is citywide. That's it. Thank you.
Thank you, 225 3/24/09 FISCAL STABILITY COMM. - RES. 090178 Mr. Chairman. And thank you for your commitment to the City of Philadelphia. By way of increasing access to the Internet through WiFi and moving into communities that otherwise would have a wider digital divide and not be able to access all of the wealth of information that's on the Internet. Do I understand your infrastructure for this system is about, what, 80 percent complete?
Yeah. Our current network is comprised of 4300 nodes which about sit on 4300 lamp posts. It covers about 80 percent of the geography of the City.
And you, as a private concern, can apply directly for some of these Stimulus dollars to complete that 20 percent?
And when you 226 3/24/09 FISCAL STABILITY COMM. - RES. 090178 say "enhance," how would that -- how would these funds allow you to enhance the --
I'll give you a very good example. Our current wireless network uses unlicensed frequencies, which are suitable for broadband Internet access but may not be very suitable for things like public safety, particularly police. The City owns 4.9 spectrum to be able to use our infrastructure and our back hall facilities which, you know, we have high-tower sites scattered 16 throughout the City, we have about 17 a-gig-and-a-half of back hall that exists 18 in that network today to do a 4.9 19 gigahertz overlay onto our network which, 20 you know, would cost money to do. 21 We would be able to enhance that 22 80 percent of the footprint that we're 23 already looking at and provide a public 24 safety overlay for the police and fire. 25
And the 227 3/24/09 FISCAL STABILITY COMM. - RES. 090178 implications would be to not only the health-care industry but the Police Department and others. You gave specific examples?
Yeah. It spans from health care, police, fire, public safety, licensing and inspection by, you know, trying to eliminate paper in the processes. Being able to take PDAs out into the field, a licensing and inspection field service technician would be able to carry probably in their entire database in what is the equivalent of an iPod touch out into the field, being able to talk right back to their local-area network and their existing database. Ticketing, meter-reading, very mundane things as well as the more sophisticated services like police, fire, and health care.
So are you coordinating with the Administration to look at where the applications --
We are. We're 228 3/24/09 FISCAL STABILITY COMM. - RES. 090178 working with the Administration, we're working with various other institutions in the City and as well as other vendors that are looking to provide service to see them.
Would you say Philadelphia is more uniquely positioned because of your private investment --
This is the largest wireless network in the country, right here in the City. We were fortunate to get it from EarthLink, who walked away from it, as you know, but we've been maintaining it since June of last year, when we acquired it. We are now looking to be able to enter into some partnerships with the City as well as the other key stakeholders, not just the City government that we would think should be 229 3/24/09 FISCAL STABILITY COMM. - RES. 090178 using this network but everyone else to truly take advantage of it. It is a phenomenal asset that needs to be taken advantage of.
Well, I would only ask that you provide other applications and other aspects of it. As we go into the budget process over the next intensified 90 days, it would be helpful for the chairman to dispense to members of this committee how your efforts will impact the bottom line, the budget of a department like L&I, who will then be able to send more people into the field and get reports back quicker. You also mentioned how the application would help policemen possibly stay on the street another hour. All of those things have a fiscal impact on our budget-making decisions, so that information, that data will be helpful to us.
I'll be happy to provide it. 230 3/24/09 FISCAL STABILITY COMM. - RES. 090178
And I just want to add, these applications that I'm talking about are not applications that we need to invent; I mean, they're already in place in various markets throughout our country as well as in Canada.