3/23/06 - FINANCE - BILL 050661 COUNCIL OF THE CITY OF PHILADELPHIA COMMITTEE ON FINANCE - - - City Hall, Room 400 Philadelphia, Pennsylvania Thursday, March 23, 2006 9:45 a.m. - - - PRESENT: COUNCILWOMAN JANNIE BLACKWELL (Chair) COUNCILMAN FRANK DICICCO COUNCILMAN W. WILSON GOODE, JR. COUNCILMAN MICHAEL A. NUTTER COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN JUAN RAMOS COUNCILMAN FRANK RIZZO COUNCILWOMAN MARIAN B. TASCO - - - BILL NO. 050661 - An Ordinance authorizing the creation of a loan or loans to provide funds for and toward various capital municipal purposes, authorizing the Mayor, City Controller and City Solicitor or a majority of them to sell bonds at public or private negotiated sale, setting forth the capital purposes and the amounts for which the proceeds of the loan or loans will be expended, including reimbursement of City capital expenditures, etc. V A R A L L O Incorporated Litigation Support Services 1835 Market Street, Suite 600 Philadelphia, PA 19103 (215) 561-2220 2 3/23/06 - FINANCE - BILL 050661
We welcome you this morning. We are now in session for the Committee on Finance with regard to Bill No. 050661. This is a continued hearing, and we note for the record that we have a quorum. To my left, Councilwoman Marian Tasco; to her left Councilwoman Blondell Reynolds Brown, Vice-Chair; to my right Councilman W. Wilson Goode; to his right Councilman Juan Ramos. I'm Jannie Blackwell, Chair of the hearing, and again we say good morning. We will ask the clerk to read the title of the bill.
Bill 050661, an ordinance authorizing the creation of a loan or loans to provide funds for and towards various capital municipal purposes, authorizing the Mayor, City Controller and City Solicitor or a majority of them to sell bonds at a public or private negotiated sale, 3 3/23/06 - FINANCE - BILL 050661 setting forth the capital purposes and the amounts for which the proceeds of the loan or loans will be expended including reimbursement of City capital expenditures.
I didn't read the entire title. I can read the entire title, if you like.
Providing for the maturities and for other terms and conditions and for the form of the bonds providing that certain bonds may be redeemable prior to maturity, providing sinking funds for the bonds and for appropriations to the Sinking Fund Commission for the payment thereof; authorizing agreements to provide credit or payment or liquidity sources for the bonds and interest rates in connection 4 3/23/06 - FINANCE - BILL 050661 with issuance of the bonds and certain other actions; providing for obtaining the consent of the electors to increasing the indebtedness of the City of Philadelphia and fixing a day for holding the election for obtaining such consent and providing for the arrangements for holding such election.
Thank you very much. We have had much discussion in the past. We will ask Mr. Tustin to come forward or whomever you deem, Mr. Jannetti, Finance Chair, in the event that there are questions. We thank all of you, our commissioners, directors, who are in the room. I will now open up the committee to hear questions from members of the committee. We also note Councilman's Frank Rizzo's attendance, as well as Councilman Michael Nutter. Councilwoman Tasco. 5 3/23/06 - FINANCE - BILL 050661
Good morning. Have you all put the team together on this issue?
I'm Vincent Jannetti, acting director of finance of the City.
We would put the team together for this particular loan authorization a couple months prior to doing the actual financing.
So if this bill goes on the ballot in May, at what point would you begin the negotiations after that?
If I can back up a moment, we are currently looking to do about a $217 million G.O. financing currently to fund the '05, the '04, and the '03, most of the '03 authorizations. 6 3/23/06 - FINANCE - BILL 050661 This authorization would not be funded until those funds from that $217 million G.O. bond authorizing total funds runs out. We don't fund these until we actually need the cash. We save on debt service that way.
So right now -- so why are we voting on this today then?
This loan authorization provides the appropriations necessary to fund the capital program for fiscal '06.
So if you don't spend the money until the other money runs out, why do you need the money now?
We need the appropriations. We need the ability to move forward with the projects. We can be working on these projects and be using other cash that's available. It doesn't have to be funded until we actually need the cash, but the projects, in order to 7 3/23/06 - FINANCE - BILL 050661 be funded, not in a dollars way, but in an appropriation way, in order for them to be funded in the capital budget, we need the loan authorization.
So you would project how far down the line would these funds be expended.
We spend around 7 or $8 million a month in capital on average. I would expect about two years, assuming, you know, assuming nothing crazy happens between now and then.
Thank you very much. Are there further questions? Are there further questions from members of the committee?
This second 8 3/23/06 - FINANCE - BILL 050661 amendment has two changes to it. They are the dates of when the primary election is. The original bill listed November 8, 2005. The amendment is for May 16, 2006, and that's in Section 1 on top of . And in Section 6 in the middle of the section, that's also May 16, 2006.
And those are the only changes and this is a proposed amendment?
Thank you very much. Any other questions from members of the committee? That will conclude our hearing. We will enter into the stated meeting. And I assume you need a suspension?
The Chair recognizes Councilman Ramos for the purpose of introducing an amendment. 9 3/23/06 - FINANCE - BILL 050661
Thank you, Madam Chair. I'm proposing an amendment to Bill No. 05066. One is a technical type of amendment on of the amendment that has been circulated to all members of this committee. The change is made on top of the page from November 8 to May 16. The same change is made in the last page of the amendment sheet in the middle of the paragraph. Again that change is from November 8 to May 16. I move that we add this amendment to the bill. (Duly seconded.)
It has been moved and seconded that the proposed amendment to Bill No. 050661 be adopted. All in favor will say aye. (Aye.)
Opposed? (No response.) 10 3/23/06 - FINANCE - BILL 050661
They ayes have it and so the amendment is adopted. The Chair recognizes Councilwoman Blondell Reynolds Brown for a motion to report out this bill as amended and with the suspension of the rules.
I move that Bill No. 050661 be reported out of committee as amended. I further move that the rules of Council be suspended to allow first reading at the next scheduled session of City Council. (Duly seconded.)
It has been moved as seconded that Bill No. 19 050661 as amended be reported out of committee and, furthermore, that the rules of Council be suspended so as to permit first reading at our next session of Council. All in favor will say aye. (Aye.)
The record will note that Councilwoman Marian Tasco is a no vote. All the others are aye. And so the bill passes. That will conclude our hearing. We thank you all for being here and we welcome you to say. You know we have Bill Cosby today. Thank you very much. Thank you, committee members. (The hearing concluded at (9:52 a.m.) 12 3/23/06 - FINANCE - BILL 050661 CERTIFICATE I HEREBY CERTIFY that the proceedings of the Committee on Finance of the Council of the City of Philadelphia are contained fully and accurately in the stenographic notes taken by me on Friday, March 23, 2006, and that this is a true and correct transcript of same. ______________________________ Cynthia A. Whyte, RPR (The foregoing certification of this transcript does not apply to any reproduction of the same by any means, unless under the direct control and/or supervision of the certifying reporter.)