All I can tell you is that I have been involved in close to 40 years now of work in many strategic planning processes. And some of them did not work. Most of them have, because what you get in a strategic planning process is a lot of good people coming together and exchanging their ideas so that the consensus that emerges is generally one that is successful. But you're absolutely right. There's no guarantee.
I'm not asking whether there's a guarantee. I'm saying, 305 Whole - Operating Budget - 5/4/04 how will you know whether your blueprint makes sense? What will be your criteria, in terms or whether your blueprint for economic investment makes sense?
I don't know that I can give you an answer right now. I think the process itself is the thing that we're focusing on, designing a process that will encompass the broadest range of perspectives and the appropriate kinds of research, so that at the end of the day we can have a sense of confidence that we have emerged with a sense of -- an agenda of objectives that portend success in the future, in terms of our economic development activities.
Let me give you two very specific criteria that you might want to use, and then re-examine your response. Let's say you were to decide you want to recrate a blueprint that's going to leverage the largest amount of new private investment. Does that make sense? 306 Whole - Operating Budget - 5/4/04
Okay. Let's say you were to set out to develop a blueprint that's going to create the maximum amount of jobs. Would that make sense?
But those are not two things that come to mind when I ask you how will you know whether your blueprint makes sense or not.
Well, because I think that there are probably others as well. And I think part of what we're doing as we plan this process is trying to establish what the outcomes would look like.
Well, do you actually believe that there could be outcomes separate from the leveraging of new private investment or the creation of new jobs that are worthwhile or that even compete with those two outcomes?
It seems to me that we 307 Whole - Operating Budget - 5/4/04 have one overriding objective, and that's the creation of jobs and the increase of population in this community. That's the overarching objective.
Is that one of the major economic development goals right now?
So you are talking about it. And you are actually talking about community development, then creating new communities within Philadelphia.
As opposed to creating new economic opportunity in those communities that already exist.
I think that the waterfront development that we were just talking about is an example. If that is 308 Whole - Operating Budget - 5/4/04 the concept that emerges, there will be new communities developing.
So beyond the first $125 million, which is clearly going to be community development and not economic development, is the priority for the other $375 million going to be the creation of jobs?
We have no priorities. We haven't even thought yet about how we are going to put together the $375 million, let alone the priorities that will attach to it.
But you can't say as the new Commerce Director for the City that your number one priority is going to be the creation of jobs, that your blueprint for economic investment is going to be based upon creation of jobs?
You can't say that. You can't say before you have a summit or before this comprehensive 309 Whole - Operating Budget - 5/4/04 strategy, that what you're looking for, in terms of your number one priority, is the creation of jobs; that everything you do, in terms of developing a blueprint or a strategy is going to be geared towards creating new jobs in the City of Philadelphia.
Yes, I can say that. As I said before, that's the overarching objective in all of our economic development activities.
Go through the seven points again and tell me which one of those relate to creating jobs.
In what way? Which one of them is directly related to creating jobs?
Well, I can go through them one by one. Reducing and streamlining business. If we can affect the outcome of the way people do business in Philadelphia, hopefully we will attract more businesses and the businesses that are here will grow. 310 Whole - Operating Budget - 5/4/04 And that creates --
Hopefully you can attract more businesses and the businesses here can grow.
So there's no 8 direct job creation goal that's going to come from that or no path that gets you to new jobs that's a direct path.
Obviously. Do you have any vision right now for why Philadelphia is not competitive, in terms of job creation?
I think I have a number of ideas, but the whole point of this process is to examine with a lot of other people --
What the problem 311 Whole - Operating Budget - 5/4/04 and/or problems are, in terms of creating jobs in Philadelphia?
I don't know all the problems, but I do know some of the things. And that's why we have identified them as part of the working group topics here.
I can tell you the seven things you named to me are just an evaluation of the economic development system that is in place. That is not producing net job creation. We are still losing more jobs than we are creating. I'm talking about examining from a different standpoint. You use a term in your testimony, creating a process for introspection, in terms of how you actually come up with something that's innovative. I'm asking you to look at it from the standpoint of how you attract new private investment or how you create new jobs. Is there anything you come into this process with that suggests that you know where the barriers to creating jobs are in 312 Whole - Operating Budget - 5/4/04 Philadelphia and letting that be a driving force? It seems that the $125 million is set. It seems that the vision for the waterfront is set. It seems the timetable for the summit is set. It seems that there are so many things that you know, except for what the direct job creation strategy is going to be.
I think that that's what the process is designed to do. And as I said before, we will circulate this memo. And certainly, Councilman, if you have some suggestions --
I'm still trying to figure out -- 313 Whole - Operating Budget - 5/4/04
I'm still trying to figure out what the strategy is. You said the process is designed to do, but what is the process designed to do?
Is the process designed to have a process that takes place or the process is designed to do something very specific?
The process is designed to create an overarching economic development strategy. And the overarching goal of that is the creation of jobs.
Thank you, Madam Chair. Good afternoon. 314 Whole - Operating Budget - 5/4/04 Good afternoon.
Let me start out by saying welcome to your inaugural budget session. And let me say for the record that I do look forward to working with you on the neighborhood summit, the economic development summit that I will get to. I know that we've given a lot of attention to arts and culture. And as a former participant and user of the arts, and now as someone in this legislative body on the public policy side, I would be remiss not to let you know that I join the chorus of many across the City who are deeply concerned about the cuts.
And you know the facts. 11,000 jobs and I think it's $6.5 million in wage tax and others. We're hopeful that there will be a re-look at the decisions you've arrived at, with regards 315 Whole - Operating Budget - 5/4/04 to the cuts. I'm particularly interested in the Office of Arts and Culture. And I want to revisit that briefly. You discuss on that a number of functions of that office will be assumed by other departments. Can you speak to where you are in the process, and particularly around the percent who are in the Art Commission, please.
We addressed that earlier. And I'm happy to share with Council the full list. We started -- I started to go through it, and I was asked to provide that in writing. And I will do that.
Okay. With regards to dedicated funding streams, there has been some informal discussion amongst members of Council to create a link between... And we don't know clearly what the state legislation reads. But there's been some discussion to look to see if we can draw a connect or 316 Whole - Operating Budget - 5/4/04 draw a line from gaming and slots to dedicated funding for arts and culture. So as your department looks at that in a comprehensive way, know that there are a couple of members here who would like to be a part of those discussions. There may not be a link, but we need to at least explore and make sure we don't miss the opportunity, if we can, to create a link between the yield from the profits from gaming and trying to find a dedicated source of funding for the arts. On the economic development summit, you mention on of your testimony collaborating with regional, state and Federal agencies. And this is my request. I'm putting on my feminist hat for a minute. We all know that women face similar challenges, opportunities and disparities as people of color, when it comes to economic development opportunities. So I would like to suggest that... It's my understanding that a link currently 317 Whole - Operating Budget - 5/4/04 does not exist between the tremendous resources and information available that we get from PCDC like terrific tools like this and Department of Commerce. There's no link with that information and those who are at the Enterprise Center in West Philly, and those who are at the LaSalle, and the Wharton, and the Temple Small Business Centers. So, explore, if you will, collaborating also with non-governmental entities who are in the same business of providing resources and tools and information to the small business world, in an attempt to at least maximize the information that you have, and to close the gaps because there's no glue right now between all the worlds in the City that are in the business of helping small businesses thrive.
DROP program. The Inquirer on Friday, April 23, discussed, and I quote, cashing in on 318 Whole - Operating Budget - 5/4/04 pension loophole. Now, this, of course, was a legislative measure passed before you and my coming here. But the reality is that it was meant to cut costs, and now it is in some ways beginning to backfire. The question I posed to all City department heads is, is there a rule in place in your office that prohibits those who make a choice to retire from returning to your department to work again for the City after they've opted to take the DROP?
I don't even know whether we have DROP participants. I have to ask John Gordon. Oh, Rob. Okay.
There is a rule for every agency reporting to the Mayor, that people leaving through the DROP won't be replaced except under extraordinary circumstances. And that has to be approved by the Mayor. And there are people leaving through Commerce who are in the DROP. 319 Whole - Operating Budget - 5/4/04
And you said this was a memo or directive stipulated by the Mayor?
Yeah. Either under the Mayor's signature or the Managing Director's Office, the Managing Director's signature. But that's the Administration policy.
About when was that, given the number of... And Commerce Department is not mentioned in this article, but do you recall when that was --
Yeah. In the article, it's all independently elected officials. And they don't report to the Mayor. The only two people who report to the Mayor who have been reappointed, the Police Commissioner, and the First Deputy Police Commissioner.
You say all those mentioned do not report to the Mayor.
Very well. So then the Commerce Director -- Given the 320 Whole - Operating Budget - 5/4/04 stipulation expressed by the Mayor, there's no need for the Commerce Director to put that kind of thing in writing.
Okay. Thank you very much. That's my question on the DROP program. Make sure I've covered everything. Could we please ask Mr. Longstreth to please come forward, PIDC? I have a question around the oversight committee that was in place for the stadiums.
Good afternoon. My name is Paul Deegan, and I represent PIDC.
We know that there was an oversight committee in place, and it really came about as a result of the 321 Whole - Operating Budget - 5/4/04 legislation around the stadiums that was... Chief responsibility was to ensure that there was adequate -- and that's relative -- representation of MBE WBE participation of the stadiums. In your opinion, how well do you think PIDC did in that particular area, particularly given the big picture of what we read in the Philadelphia Inquirer not too long ago, and where our City sits with regards to 96 percent of the white men in our City getting the bulk of the contracting opportunities.
Councilwoman, I'm sorry. I'm not familiar with the results of the oversight committee. I wasn't a part of it. I can get the answer for you. I'd be happy to do that.
We know that a lot of -- We've heard a lot about the activity that will be happening down on 322 Whole - Operating Budget - 5/4/04 Penn's Landing. Who will make the decision, with regards to an oversight committee, for that multi-million dollar project.
There is a selection committee at Penn's Landing that will make the decision. And part of what the committee will consider are the goals that have been set forth by the two proposers.
The two proposers who are under consideration at this point.
Okay. All 323 Whole - Operating Budget - 5/4/04 right, then.
That concludes my questioning. Councilman Goode already raised the question about the seven working group areas. I am very much interested in serving on that committee.
Particularly one that looks at how women can get more equity, when it comes to small business development in our City. Thank you.
Thank you for your testimony. Thank you, Madam Chair.
Thank you, Madam Chair. Miss Naidoff, I listened to the 324 Whole - Operating Budget - 5/4/04 comment made by my colleague, Councilwoman Reynolds Brown regarding the summit. And you certainly went through a significant amount of that information with Councilman Goode. When we heard about the summit -- and there's been some discussion in this chamber about it, I think much of which may have been with the Planning Commission Director a while ago, I didn't... I thought that the positions had already been announced and the group was set, in terms of being on the summit group. Are there other positions or opportunity to serve? Certainly the Councilwoman expressed an interest in serving. And I would certainly applaud that and encourage that. I didn't realize that there were opportunities to serve. The way it was laid out to us was that the group had already been determined, and that there was an opportunity for us to come to the summit and kind of listen to what was going on. 325 Whole - Operating Budget - 5/4/04 Is this a new opportunity?
No. I think -- And I'm sorry if there was any misunderstanding. The committee that was appointed was the planning committee for the summit. That's the group that's going to help us shape what form the summit should take. And as I indicated before, what we've done is put a concept before them. And I'm going to share that with all of you because I certainly would welcome your participation, your suggestions, your thoughts about that concept. And after we meet with the planning committee, I'd also be happy to go back and give you the update on what their thoughts are as well. But there is --
The planning 326 Whole - Operating Budget - 5/4/04 committee. But certainly with respect to the convening of the various working groups, that's where we are looking for input. And that's why I'm happy to share the memo with you, so that you can begin to think about ways in which you or your staff or other people could be participants.
Okay. Good. On the $500 million economic development fund, just so I can understand, you talked a great deal about process. I'd also like to know about some of the mechanics. Again, a great series of questions were asked with regard to that already. What I'm trying to understand is, you anticipate putting a final plan or product, I think your testimony was, to the Mayor in October; is that correct?
Is it your expectation that the $125 million which is presently in the budget before us would be 327 Whole - Operating Budget - 5/4/04 approved now, and then you would come back subsequent and tell us how it's proposed to be spent?
That's correct. That's what I was indicating in my testimony, that we plan to come back to you before any money is expended and propose a plan for those expenditures.
So under that circumstance, you're asking us to give approval for the money at the present with no plan in front of us. Is that the expectation?
We have no details, but we do have a plan. We have a vision about putting the money together and the kinds of ways that we would secure the advice and participation through the summit and the blueprint process, and then come back to you with those details that emerge.
Well, I'd like... I mean, we can -- You know, we can take a moment to just chuckle for a second. But I mean, I've gone to the bank many 328 Whole - Operating Budget - 5/4/04 times with a lot of ideas and a lot of plans; but, you know, they really do want to see, you know, if I'm going to be able to repay the obligation, and not just, you know, that I have a thought or an idea or a plan to do something. So, I mean, it's a little difficult, at least for me, to be in a position where... I mean, I hear what you're saying. And I know, you know, no one's going to go run off and take trips around the world. But I mean, it is a little difficult to give approval to $125 million at the moment, with no idea how it's actually going to be spent. And then once you have it... I mean, the way this process kind of works: I mean, once we give the authorization, I mean, actually you could literally go and do whatever you want to do.
Yes, except we don't have any cash to back up the appropriation power. And we have to come back to you to 329 Whole - Operating Budget - 5/4/04 get approval before we get any of the cash.
Well, I understand that. But why don't you just do it all at the same time?
Because we have to go through... We have a budget process now.
So we wanted to put it in the budget, and then give you an indication that's what we were planning to do.
Okay. But there's nothing to stop you from coming back during the course of the fiscal year to get the 125, right?
There's nothing to stop us. But again, there's nothing we can do with that now either, without any cash.
Well, I understand that, but... You know. Just from a logistics standpoint... 330 Whole - Operating Budget - 5/4/04
Once you kind of have, you know, half your body and your head through the door, I mean you're pretty much coming through. Once the first part is done, it's a little difficult to not do the second part. But you are, at least at the moment, asking us to approve transferring of the $125 million. You'll come back with another ordinance. But there is no plan at the moment for how it will be spent.
That's correct. But I do want to clarify one thing. It is not that we're asking for $125 million. We're asking for the authorization to take the steps to dip into the reserve funds from those water and revenue bonds. And that will take time. And what we're saying is in that period of time we will be developing the plans, and then we will back to you because obviously we can't spend any of that money 331 Whole - Operating Budget - 5/4/04 once those reserve funds are available to us. We can't spend any of it until we get your authorization. And that takes time.
I understand that. But I mean, all you're going to do is end up in the situation where we've taken one action; and then it's just going to be, you know, that we're, you know, being difficult or holding up the process or something like that. So, you know, that's not your issue. We've been down that road a number of times before. I'd like not to revisit it. I know that you're going to put forward a list of where a variety of places are going. But it was asked earlier. And if you could, just briefly answer specifically, as I was asked: The percent for our program, where is it proposed to go? Or to be a part of?
That's going to CPO? 332 Whole - Operating Budget - 5/4/04
Okay. Question was asked about the two sports stadiums or technically one is a stadium and one is a ballpark. What I'd like to better understand now, some years later, when we had that other experience where we approved a massive project, with virtually no 11 documents in hand before the approval, has anyone done a report or a recapture of what has happened with the Kvaerner project?
No one knows whether we've done a report or an analysis 333 Whole - Operating Budget - 5/4/04 of the Kvaerner project. Did it live up to what it was proposed to be? Do we know how many people actually work there? Do we know where they came from? Do we know what they look like? Do we know what the tax revenues were that came as a result of fairly significant investments by both the federal, state and local governments? Has any analysis been done of the Kvaerner project?
I believe there must be some analysis. I just don't the answer to it, and no one who is here with me today knows that answer. It doesn't mean that it hasn't been done. It doesn't mean that it doesn't exist. We'd be happy to look into that and I'll get you an answer on that.
Here he comes. 334 Whole - Operating Budget - 5/4/04 Mr. Deegan, weren't you involved in that little transaction a couple years ago?
I don't believe -- I think that there's a separate entity created, the Philadelphia Shipyard Development Corporation, which was a joint state-city entity which actually owns the Kvaerner facility and to which PAID conveyed the real estate to.
I think there's a separate board and a separate agency that handles the funding.
And would probably be the people who could provide the reports.
They would probably be the people who would keep closest track of jobs and investment.
Okay. Have we 335 Whole - Operating Budget - 5/4/04 done anything independent of them? I mean, wasn't... My recollection is, after a fairly extensive hearing process -- I mean wasn't PIDC somewhat intimately involved in that transaction?
Yes, we were initially. And I think during the hearings, I think before the Philadelphia Shipyard Development Corporation was created, before the state money came in, because we actually controlled the real estate.
Yes. I'll find out what kind of reports have been done by the Philadelphia Shipyard Development.
-- you've said it enough times to give me concern as to whether it actually exists or not.
I can't -- I can't sit here and tell you that it does exist. I haven't seen it.
Let me tell you, Mr. Deegan, as a long-time public servant, you have covered yourself well... (Laughter.)
...in your response. You are completely Teflon coated.
No, no, no, 337 Whole - Operating Budget - 5/4/04 you'd never want to do that. Okay. Madam Director, as the Commerce Director, what is your position on the report of the Philadelphia Tax Reform Commission, related to a variety of proposals to change the tax structure of the City of Philadelphia?
I think, you know, that the Mayor has indicated that he would like to implement the recommendations of the Tax Reform Commission in a fiscally responsible way --
I don't mean to cut across your testimony, but I have a pretty decent sense of what the Mayor's position is. I'm asking you what your position is as the Commerce Director for the City of Philadelphia.
My position is the 338 Whole - Operating Budget - 5/4/04 same as the Mayor's. I believe we need to implement a number of those recommendations as quickly as we can and others over time, and to make the tax structure of the City more business friendly and more... put us more in a position that we can attract business and make sure that the job growth and population growth objectives are achieved.
I understand that. Do we have job growth and population growth objectives at this point?
Yes. We have that as the overarching goal, as I said before.
No. I heard that earlier. But I guess what I'm saying to you is, do we have specific job growth and population growth objectives on a year-by-year over the next five-year time period?
If you're talking about specific numbers, no, we do not. 339 Whole - Operating Budget - 5/4/04
We do not. Are we expecting that out of the summit process as well?
Okay. You mentioned earlier that some of the Tax Reform Commission proposals should be implemented and others over time. Which ones should be implemented immediately?
I'm afraid I'm not the person that can answer that question, Councilman.
Okay. Do you anticipate providing testimony with regard to the tax bills that are coming up on Monday?
Okay. The reason I asked this is because the last time when we had a tax discussion, a very serious tax discussion, a couple years ago the Commerce Director did participate. So I just -- I'm trying to figure out what the lineup is. 340 Whole - Operating Budget - 5/4/04 Okay. All right. So your position as Commerce Director is the same as the Mayor's position, implement some now and the rest over time. But which ones?
Okay. Lastly, let me go back to... Let's go back to art and culture for a second.
Given everything that you've said, the proposals to help the art and culture community, whether it's the Art Museum or African American Museum, Atwater Kent, Cultural Fund and the like, what do you expect will happen, based on the way the budget is presently put together and proposed? What's going to happen on July 1, 2004, and what actions will you be taking as Commerce Director to move into this next phase of assistance, with regard to the art and culture community?
I think the actions 341 Whole - Operating Budget - 5/4/04 that I will take will depend on how the budget process comes out. I think that if we --