Right. So the benefit is to people at the lower end of the income.
Because it keeps them employed and so forth and so on.
I just couldn't 97 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing figure out his logic that people who have money just invest it in IRAs and don't spend it, but whatever. I just wanted to get those statistics correct that the majority of people who work in the hotel industry are Philadelphians, and most of them, or a lot of them, a significant number of them, were formerly unemployed. Thank you.
That's right. And a fair number of our managers live in the City as well -- I do, I know Ron does, and a bunch of GMs live in the City.
Well, God rest his soul, Mike Boyle lived in Society Hill.
He was a wealthy man, and he spent money in the neighborhood, he went to the grocery stores Thank you. Thank you, Madam President.
Thank you. I also want to thank you again for coming in, and I will tell you that your employees have been absolutely marvelous. I think every one of them that 98 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing live in my district apparently have written a letter in encouraging that we vote on this bill. I have acknowledged each and every letter, and would you please convey to them our thanks for their interest in letting us know exactly how they feel.
Thank you, Madam President. Unfortunately, I may not have as many hotels as some of my colleagues, but I have had the opportunity to work with you, Mr. Rowley, and a number of the general managers of our great hotel industry. And I just want to, one, thank you for coming in. You have been a standup person during all the time that we've known each other and worked together on a couple different issues. I respect your commitment to the industry. You are correct, and we had some discussion about even the raising of the hotel tax, which, I think, actually may have taken place during 99 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing the course of an election year.
Yes, we did mention that at the time, but if the industry really wanted to have it happen and Council responded, but I think in many, many instances, the hotel industry has been tremendously responsive and provides a wonderful opportunity for the City to promote itself and better market itself, working with the other agencies around the City and the government that helped to promote this industry, but the buildings are landmarks, many of them in the City, some old, some relatively new, some were one thing at one point in time, and now they're now they're a hotel. The great service and even the greeting that you get -- not because you're anybody in particular, but just because you're literally walking into the place, I think, sends a very, very powerful message, especially to people who are not from here and may not know the wonders and the excitement of Philadelphia. You are ambassadors for this city in a 100 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing your own special way. And I want to commend you for that, appreciate you coming in to talk about this very, very important issue, the effect that it has on many of your employees. And if you mentioned it in your testimony, I apologize, but do you have a general sense of the percentage throughout the industry of the workers who actually live in Philadelphia?
Yeah, it's upwards of 85 percent. We estimate about 11,000 employees. And, by the way, if I can make a quick point. Councilman DiCicco referenced the Center City thing, which shows 6,000 hotel employees. we think there's 11,000 because there's a lot of restaurants that are farmed out but wouldn't be in that hotel were the hotel not there, obviously, so we're estimating about 11,000 employees, easily 85 percent of which live in the City.
Great. Thank you again very much for your testimony, and I appreciate your commitment.
Thank you. Any other questions or comments from 101 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing members of the committee? (No further questions.)
Gentlemen, thank you very much. Our next witness is...?
Good afternoon. Please identify yourself for the record and proceed with your testimony.
Yes. My name is Debbie A. Bell. I'm here on behalf of the People's Weekly World, and I thank you for giving me the opportunity to address you on this important matter. I, like many of the other speakers who came before me, am a lifelong Philadelphia resident and, therefore, I have paid wage taxes all of my adult career to the City of Philadelphia. Like most people, I am moved to action when it affects my self-interests. I don't directly qualify for the proposed wage-tax reductions in Councilman Cohen's bill, but there is some benefit 102 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing that I and other Philadelphians who might be considered, quote, middle-class will derive from the implementation of this bill. Much attention is paid to improving the conditions in Philadelphia to make it possible for this mythical middle class to feel comfortable and happy in our city. The health and welfare of our city is directed related to the quality of life that is guaranteed to every single citizen, regardless of their economic status. This concern covers a wide range of areas, including everything from the quality of the schools, the culture, the cleanliness, even our hotels, as we just heard, and the cleanliness of the streets, etc. Philadelphia wage tax is a regressive tax, which we've also already heard. It taxes the poor and the low-wage families at the same percentage as millionaires. If Council were to be serious about increasing money tax for our coffers, we would have a graduated tax. The wealthy would pay more than working poor. Under the Philadelphia tax plan, those who earn the least pay a larger percentage of their wages to finance the City than those who are wealthy. This 103 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing needs to change immediately. In order to ensure that our city has adequate funding, we need a tax code that proportionately taxes people according to their wealth. We cannot continue to use the working poor as pawns against other City workers. All workers, including City workers, deserve a reduction in their wage tax. Reduction for low-income workers should not be used as a reason to cut the wages and benefits of City workers. In the Cohen bill, the minuscule additional income to low-paid workers should be seen as a benefit to all residents of our city. It is pathetic that workers who are the heart of our city are being placed in opposing positions. The working poor are not the enemies of the public employees. It is unconscionable to threaten to cut City services and threaten City employees with layoffs if a minuscule tax cut is implemented. While low-wage workers are being threatened, the business community is being courted and offered further tax cuts. For decades, the business community have received favors from our city. With all of the favored status, many businesses still pick up and leave the City. This is 104 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing not a winning policy. Businesses cannot thrive if there are no 4 consumers to support them. There can't be any winners if we don't provide for every working citizen, the lowest paid to the wealthiest. Councilman Cohen's bill is a beginning towards providing an avenue to give the working-poor Philadelphians minor tax relief. 5 wage-tax reduction, but it may make it possible for a family to have a modest improvement in their living standards. Most of these workers toil at minimum-wage jobs, as we just heard from the hotel folk, jobs that rarely provide medical benefits or any benefits at all. The Cohen bill might give them the opportunity to get health care or some insurance to upgrade their housing, their diet, and possibly enjoy some entertainment. This modest step, obviously, wouldn't satisfy all of these needs; however, this small relief will begin to pay for itself in the taxes the City will reap from the increased ability of the workers to spend and support the businesses in their communities.
Council debate does not address the 105 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing question of whether to employ or even to provide well-paying jobs for a comfortable living standard for all of Philadelphia's families; that would be my preference if we were going to have a long discussion about how to make things more palatable for all Philadelphians. City Council is quibbling over giving this modest tax relief to low-income workers or giving -- I'm sorry, that's a repeat. It is time to stop using the people of Philadelphia as political tennis balls to be batted back and forth. It is time to give the working poor a break. Philadelphia's a wonderful city. Our city has many attributes: A spectacular park, a historic district, delightful neighborhoods, tremendous cultural institutions, friendly neighbors, and we even have a $200 million budget surplus. In all good conscience, how can our city insist that a family of four living on less than $30,000 a year annually must share this measly sum in the form of taxes. This is outrageous. Where is our humanity, where is compassion. Council needs to demonstrate to the people of Philadelphia that they care for the citizens' 106 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing welfare by immediately passing the Cohen bill, which reduces the wage taxes for the working poor. It is my self-interest and yours to make it easier for more of our neighbors to be in a better position to share the richness and bounty that our city has to offer. Let's stop the politicking and get about the business of improving our city. We should also talk about our schools when we're talking about this equation. Thank you.
Thank you very much. Are there any questions? (No questions.)
Thank you. The next group is the Friends of the Free Library. (Witnesses come forward.)
Good morning, members of City Council. My name is Amy Dougherty, Executive Director of the Friends of the Free Library, and I am joined by Dr. Cynthia Eiseman, President of Independence Branch Friends. 107 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing I am pleased to have this opportunity to come before you to discuss a topic that is of vital importance to me and to the citizens of Philadelphia. Libraries are not simply places to find shelves of books. In the libraries of the 7 century, particularly in Philadelphia, that has one 8 of the best systems in country, libraries are places 9 all kinds of learning for everyone. All 53 branches 10 of our system are equipped with 12 computers, videos, 11 cassettes, books, magazines, etc. It is a truly 12 democratic institution where all are welcome and 13 enjoy equal opportunity regardless of ethnicity, 14 economic or educational differences. 15 The 53 branches are the largest and most 16 comprehensive providers of after-school care for the 17 City's children. The branches have gone far beyond 18 serving as mere parking places for the children. 19 Currently, they provide programs to develop reading 20 skills, computer literacy, and homework assistance. 21 In addition, they offer training for the teen leaders from the community who are the providers of after-school help. This LEAP program alone reaches 85,000 children a, year and this is the tip of the iceberg. Let me briefly list some of the other 108 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing ongoing library initiatives to increase literacy that are available at your branch library. From October through June, Books Aloud is an educational enrichment program for parents of preschool children and day-care providers that teaches adults the skills and background to read aloud successfully to their children. A child develops library skills long before being able to read. 1,800 adults took part in this program in 2001. The Science in the Summer Program introduces students to science. Brief experiment-oriented courses are taught by teachers at all open library branches. There are four 45-minute sessions for one week. In 2001, 1800 students participated in the program focused on electricity. The 2001 program subject was chemistry. Teen Summer Reading Programs for grades from 7 to 12. In the summer of 2001, 5,121 children took part in this challenge to read more. Sundays on Stage comprises free performances for children, families, and adults at the Central Library throughout the year. Philadelphia Lectures at Central Library 109 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing brings eminent authors and reaches an audience of 11,000 in 2001. Not included in this list are programs sponsored by individual branch libraries or by branch Friends groups. This is perhaps some of the many reasons why the Mayor's report on city services reports that the number of registered library borrowers reached a record high in FY 2001 to 514,000 borrowers, an increase of percent. The number of 11 visitors increased significantly as well to 12 5,934,000, a 19 percent increase. Customer 13 satisfaction is also on the rise to an all-time high 14 of 87 percent of those served who were satisfied with library personnel in spite of the increased demand. The renovation of 53 branches will be complete by 2004, leaving only the Central Library renovation and expansion project remaining. One might be inclined to ask, do we need all of these branches throughout the City? What difference could it possibly make to close one or two or three or four? Can we make do with less? In a city that is in the midst of a public-school crisis in which less than half of public schools offer greatly-reduced library 110 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing services, if at all, my response is that we cannot afford to close any library doors. And how do we choose which ones to shutter?
The libraries with the highest circulation like the recently-opened Independence Branch at Seventh and Market? Or the lowest circulating library where Friends and librarians are working hard daily to reach out to their community to attract more borrowers. Can, and should, children from one neighborhood have to walk further to another neighborhood to reach a library? And will they? Is it safe or on a winter's afternoon? Is this acceptable? Whose library should we close? One in an affluent neighborhood that has ample family and individual resources, or the branch in a poor neighborhood that has less access to educational resources and is, therefore, more at risk? Who is prepared to make this choice? As we as a city and nation struggle with issues over equal access to resources, can we justify closing the very institution that provides equal access in a truly democratic form? I think we cannot, and should not. I implore members of City Council and the 111 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing Mayor to consider the message that closing libraries will give: That there are those among us who are less deserving of City services than others. I suggest that it is your responsibility to ensure that this does not happen, to ensure that every child, parent, and senior in this city can take advantage of learning more every day, bettering themselves every day, and every day, having a safe place to do this. A thriving economy is only possible with a literate and educated citizenry. The 53 branches in the Free Library of Philadelphia system offers the most sustained and comprehensive means to an educated public ready to work and participate in a democracy. Thank you for this opportunity to speak to you. Dr. Cynthia Eiseman, President of the Independence Branch, will now testify.
Madam President, members of Council, and fellow Philadelphians, my name is Cynthia J. Eiseman, and I am President of the Friends of the Independence Branch Library. The Friends of Independence Library is a 112 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing subsidiary of the Friends of the Free Library of Philadelphia, a private, nonprofit corporation whose purpose is to support the Free Library system. The Independence Branch is the newest branch in the Free Library system. It opened just over one year ago, on February 28, 2001. The Friends of the Independence Branch was founded on the same day, with the purpose of promoting awareness and advocating for the branch's operations resources, services, and needs. The branch is located at South Seventh 13 Street, just off Market, and serves the communities 14 of Chinatown, Old City, Washington Square West, 15 Society Hill, and Queen Village. The people who live 16 in these neighborhoods have been without a branch 17 library within walking distance of their homes for 18 decades. Some of my neighbors struggled for 40 years to get a library branch in our community. Several years ago, a group of community leaders agreed to raise $230,000 to purchase collection materials if the City would establish a new branch to serve our neighborhoods. We raised that money, and the City built the branch. To shut down that branch, now that we have it, would be a 113 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing grave disservice to everyone who worked so hard to make it happen. The success and popularity of the Independence Branch in the months since its 6 opening is nothing short of astonishing. Within six 7 months, the Independence Branch achieved the highest 8 level of circulation of any of the 53 branches in the 9 system, and has sustained that circulation record for 10 the past eight months. Since February 2001, the 11 Independence Branch has issued over 3,550 new library 12 cards. To shut down a branch that enjoys such 13 popularity would be a grave disservice to its many patrons. Go to the Independence Branch Library, and you will find a branch filled to capacity. In the morning, you will see that many day-care centers in the neighborhood take advantage of the branch's children's collections, story times, and other special programs that our librarians developed for children. Parents and their preschool-aged children come in to enjoy story times and to read and borrow books. Also in the mornings, many adults, especially citizens, can be found reading newspapers 114 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing and magazines, working at the computers and using the extensive reference collections. Businesspeople who don't have another place in Center City to meet can, and do, use the branch for business meetings. Cutting back the morning hours would be a grave disservice to these patrons. At lunchtime, because Independence Branch also serves a significant number of people who work, but do not live, in Center City east of Broad Street, you will find such workers from nearby businesses dropping by to borrow materials or simply to spend their lunch hour reading quietly. Three afternoons a week, the branch hosts English-as-a-second-language classes for speakers of Chinese. After school is out, the branch fills up with school children who use the library to do homework, use the computers, or take part in the LEAP Program or other special programs developed by our librarians especially for school kids. Many children and adults do not have computers at home or at work and depend heavily on the library's computers to gain access to Internet resources. Cutting afternoon hours would be a grave 115 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing disservice to these patrons. The Independence Branch has a number of special collections that were created especially to serve our neighborhoods and are unique to the free library system.
The Chinese language collection, the largest in any branch in the free library system, attracts Chinese readers from all across the City, not just from the immediate neighborhood. It is so popular that some patrons have already read everything in the collection. The Independence Branch also has the largest collection of gay and lesbian materials -- not just in the free library system, but in any public library outside of San Francisco. In addition, Independence has the largest circulating collection of poetry books of any branch in the free library system. The Independence Branch also has a special computer for the visually handicapped. This computer enables blind users to convert the printed page to Braille or to gain audio access to information on the Internet through special headphones. Only four other libraries in the free library system have such computer equipment for the blind. 116 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing Curtailing the hours of the Independence Branch would be a grave disservice to these patrons: The blind, Chinese readers, the gay and lesbian community, and lovers of poetry. But I'm not here to ask you to keep the Independence Branch open; I am here to urge you, members of City Council whom we have elected, to find other ways than to curtail ours at any branch or to close any branch of the library system. The Independence Branch is unique in many ways, but it is also typical of branches throughout City. Each branch serves the community where it is located. Each branch is important to the people in those communities. Going to the library has become a habit, a pleasure, a convenience or a necessity to the people who use it. To close or to curtail the hours of any branch of the free library system would be a grave disservice to those people. Thank you for giving me this opportunity to testify. Miss Dougherty and I would be happy to answer any questions.
Thank you very much. Are there any questions or comments? 117 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing The Chair recognizes Councilman Ortiz.
Thank you, Madam Chair. I think you have it wrong. We are not here to curtail the hours. You send that message to the Mayor; he's the one saying that. So the hearing here is not about cutting services, and I don't think this Council would support cuts or pass a budget that would cut those services.
So I suggest that you send that speech to the second floor, 'cause he's the one who cuts -- or decides to curtail hours. That's his decision.
Thank you very much for coming in to testify. Our next witness is...?
Our next witness is Greg Paulmier, and then following that will be Robert Sworbrick. (Witness comes forward.)
Good afternoon, 118 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing Greg.
Good afternoon. Thank you. Greg Paulmier, I'm the Democratic leader of the 12th Ward in Germantown. Good afternoon, Councilmembers and ladies and gentlemen. The City of Philadelphia is ill today. The former mayor once described our city as: A cancer patient with a gunshot wound." The gunshot wound was a fiscal crisis: Lowered City bond ratings; a dirty, dangerous Center City area; and a lack of pride in our city. That wound may be healing now, but the City is still dying of a cancer, a cancer which consists of population loss, jobs loss, property abandonment, and lack of educational and employment opportunities for our residents. Unless this cancer is cured, the City will continue to whither away. Philadelphia's wage tax is at the heart of this cancer. It is a punishing and regressive tax, which was created in 1939 as an emergency measure to save the City from bankruptcy in the Great Depression. Since that time, it has become a monster, driving business, driving people, and driving opportunity out of the City and preventing 119 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing its return. It creates blight in our neighborhoods and sprawl in our suburbs. It is punishment both for the employers and the employees in the entire economy of our town. Philadelphia is in the process of reducing this self-destructive tax, and we must remain absolutely committed to that process if there is to be hope for the future of this city. It always comes down to one thing: Jobs. Jobs means money in the pockets of our citizens. The only way to stop population loss and people moving out of the City is opportunity. And that means jobs. The only way to stop blight is reinvestment, and that means jobs. The only way to reduce the demand on City services is to reduce poverty, and that means jobs. The only way to save the schools is to increase revenues, and that means jobs. Water will not run uphill, people will not pay more in order to get less, and jobs will not come to Philadelphia as long as the wage tax remains as high as it is. No sacrifice is too great if we can reduce it, and we can if we stay the course. Another problem with the wage tax is that it's a regressive, flat tax, which punishes working 120 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing people. In a city which is seeking to reduce unemployment and dependence on welfare and social services, it is counterproductive to impose a non-graduated income tax on people struggling to live on minimum-wage jobs. It makes it that much harder to leave government assistance and social-service dependency. Federal income taxes are progressive, graduated taxes. Pennsylvania income taxes provide relief for low-income workers through the working families tax cut program. Why should Philadelphia not have the kind of progressive income tax structure which is universally expected throughout the western world. I ask Council to support Bill 82. I think it's a good bill, and I hope you'll seriously consider it and make Philadelphia the leader that it deserves to be. Thank you.
I like Bill No. 92, but I don't think it goes far enough. I think that we really do need in a time of welfare reform, in a time 121 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing of trying to get people back into the job market, we definitely need to show them that they count by not taxing them so heavily. You know, a family of three, a single parent, with two making under $20,000 a year, they get an extra $600. That comes down to $50 a month. That family's also probably a family that doesn't have health care, doesn't have benefits, doesn't have vacation time. And $50 a month for a single mother with two children is enough to take her family to the movies, it's enough to go out to eat occasionally. So I think we need to take it a step further.
Robert Sworbrick, and he will be followed by Jerome Bayard. (Witness comes forward.)
Good afternoon and thank you. 122 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing My name is Robert Sworbrick (ph), and I'm a real-estate developer represent in and outside the City of Philadelphia. I represent the Manayunk Development Corporation. Manayunk Development Corporation supports the continued reduction of the Philadelphia wage tax. You'll have to excuse me; I'm on the tail-end of a bad cold, so... We recognize the importance of tax stimuli, and this wage reduction to the business community is a stimulus. It will help us attract in Manayunk the office buildings to support our restaurants and retail shops that are currently moving on the west side of City Line Avenue, Conshohocken, and Valley Forge. All one has to do is look at these three areas to see the future of Philadelphia if we don't continue down the road of reducing the burden of taxes on our individuals as well as our businesses. In Manayunk, we don't always agree -- the business community and the residential community -- but on this issue, we are united. The reduction of taxes in Philadelphia is necessary for the continued economic growth in situations like Manayunk, which 123 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing have had their hands tied behind their back with restrictive taxation. Look towards Conshohocken, look towards the west of City Line Avenue, look towards Valley Forge, and that's the future of Philadelphia if we don't continue this. Thank you very much for your time.
Thank you very much. The Chair recognizes Councilman Nutter
Yes, thank you. Good afternoon, Mr. Sworbrick. Thank you for coming in and thank you for your leadership in the Manayunk community, both specifically with regard to the development corporation, but also your work in conjunction with the residential community and the community groups in the Manayunk neighborhoods. Manayunk is a very special place, and there are many other special places throughout the City, but Manayunk has a somewhat unique situation being so literally close to our suburban neighbors Lower Merion and Belmont Hills and Montgomery County. And your testimony is quite insightful to what it is that we're trying to do here and create a better 124 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing business environment, a more competitive business environment. And so the unique viewpoint that you can bring to these hearings from the Manayunk communities is very, very helpful, and I just wanted to express my appreciation for that.
Please identify yourself for the record and proceed with your testimony.
Good afternoon. My name is Jerome Bayard, and here to represent Unite; I'm a representative. And we're all in favor of the wage- reduction tax. There should be a wage-tax reduction to reduce a little strain off the underemployed, though this should not include the upper crust, even though they may cry out or become annoyed. Lowering of the wage tax would give the poor a little more money to spend, which would stimulate the economy, in turn, benefitting business and the private sector, as well as being beneficial to our community. We must stop overtaxing and taxing people who cannot afford 125 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing to pay taxes and who have jobs which offer little or no health-care coverage. A proportional tax that's like the wage tax has a regressive effect, even though it somehow seems odd. Legislators must join in expanding tax forgiveness to poor and low-income working families. This tax break is crucial, especially during this recession, in order to help the already-struggling and the needy. The tax-back and other programs must also include the single people whom are under the blade trying to make ends meet. This program and others like it must be implemented to improve the conditions of everyday citizens in our streets. The poor pay tax on already-taxed money needed for the barest of life's necessities; while the upper class pay taxes on monies used for savings or others luxuries. Legislation must made to assist the working poor, and legislators must finally admit that it must be. No longer can we continue to overlook our financially-challenged; we must help them end their poverty. Legislators must realize that the poor are with us and that we must relax, quote/ unquote, guidelines. 126 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing Alleviate some of their tax burden, for being poor is clearly without a doubt defined
Are there any questions or comments from members of the committee? (No questions.)
Our next witness is John Hogan, followed by Julia Hinckley. (Witnesses come forward.)
good afternoon, Madam President. My name is John Hogan. I live in East Mt. Airy and I work at the University of Pennsylvania. I'm a member of AFSCME, and I'm here on behalf the Greater Philadelphia Chapter of the Democratic Socialists of America, including about 250 people who live, work, and pay taxes in the City. Let me first welcome my brothers and sisters in the chambers to the politics of the street march. It's always a pleasure to see people assembling in public and petitioning government for 127 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing address of their grievances, even people who have both unusual opportunities to do so in private and unusual success when they do. We just hope the police weren't too hard on you since we've heard of that happening in other places. (Laughter.)
It's hard to talk about taxes apart from spending, and it seems to me that when people complain about how high our taxes are, we're largely complaining about how little we get for them. People in businesses leave the City for many reasons, and I think the wage tax has great symbolic value: It sets us apart from other cities, and it shows up on every pay stub we get. But the claims being made for even the largest cuts on the table here, about $250 a year for what the Inquirer calls a "typical taxpayer" make it sound like we already have a fine public school system, adequate mass transit, and affordable auto insurance. We don't, and if we were to think of ways for the State legislature to get us closer to those goals, I don't think a percentage point cut in the wage tax would be in the top ten. I wouldn't mind having the money, but I 128 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing think even $250 would mean less to me than the lost tens or hundreds of millions would mean to the City and to the residents who count on it. If it means not providing fair raises and benefits for our City employees, then you keep it, because they've earned that. If it means cutting te City workforce by attrition, you keep it, because I know what that means: Fewer people doing more work for more hours at the same pay. If you look at the fine print in the Inquirer's chart, you learn that their typical taxpayer makes $50,000 a year. I don't know what the Inquirer is paying these days, but that's almost twice the median per-capita income in Philadelphia. Most taxpayers in this city are not what the Inquirer is calling "typical." But after eight years of across-the-board cuts intended to benefit the people who can afford to leave the City, you now have the chance to offer much needed help to the people who can't afford to leave. Councilman Cohen's bill would offer relief to the truly typical taxpayers in Philadelphia, and they are the people most likely to spend the money locally, and many of them are the greatest users of City 129 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing services. This bill can mean less homelessness, less blight to remove, less crime. There's now a lot of talk about how much the City gets in taxes, but less about exactly where it comes from. Mr. Cohen's bill addresses that problem: It provides relief to those who need it most, even if they're not marching on City Hall. Thank you.
Thank you very much. Are there any questions or comments from members of the committee? (No questions.)
The next witness is Julia Hinckley. (Ms. Hinckley not present.) UNIDENTIFIED SPEAKER: I have her testimony, I'll hand it in. She had to leave because of the time.
Please make certain that the stenographer gets a copy of that.
Rick Morawski. (Witness comes forward.) 130 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing
Good afternoon. For the record identification, I am not Thomas Paine Cronin, but I am here today to bring his testimony to City Council. As I morphasize here... (Reading Mr. ) My name is Thomas Paine Cronin, and I am the President of AFSCME District Council 47. I want to thank City Council for providing me with the opportunity to provide input on the most important issue of tax reductions and, in particular, the lowering of the City wage tax. In the past two weeks, we've heard a chorus of voices from virtually every segment of the community advocating substantial cuts in the City wage tax. From the comments of politicians and so-called leaders both here and in Harrisburg, we seem to be engaged in some kind of reverse bidding war aimed at seeing who can call for the most reductions in the fastest timeframe. Advocating the cutting of wage tax appears to be the latest political truth test. Advocating the cutting of the wage tax is only the first step. 131 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing The real question is, are each of you in this Council prepared to accepted the responsibility for the substantial reductions in services that may very well follow on the heels of a decision to remove tens of millions of dollars from the City's operating budget in the next few years? For years, we have been told by mayors, political leaders of every persuasion, the business community, and the very members of Council that the City budget is a precarious proposition, that even though the City accumulated a substantial surplus over the years, that that could disappear at any moment and that, therefore, wage demands, health- benefit demands, and increases in services for the community had to be carefully weighed because the surpluses could disappear at any moment with the downturn in the economy or some other unexpected event. Those statements about the precarious nature of the City budgets and the need to the City to go slow and carefully were especially prevalent around the time of contract negotiations with each of the City's unions mincluding my union. Be careful, go slow, don't ask for too 132 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing much. These were the words that we heard from our friends and certainly from the Mayor's Office and the people on the other side of the negotiating table. Now all caution seems to have been thrown to the winds. Because the words "tax cuts" and "wage-tax reductions" have been invoked, the same people in the business community and in government-leadership positions who have spoken extensively of the City's needs to be conservative and be cautious in its fiscal outlook have now apparently thrown all of that caution away and decided that there are literally tens and hundreds of millions of dollars available for the asking and which can be freely returned to the City taxpayers in the form of an across-the-board wage-tax reduction and without the need to cut any City services. How can this be? How can we suddenly have found these hundreds of millions of dollars to pay for wage tax, which will not necessitate cuts in City services? Have the people who have been speaking for City government over the years and assuring us of the necessity for a conservative and go-slow fiscal policy lie to us? Or is it that everybody wants to be identified with a tax cut today, and damn the 133 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing expense tomorrow. Ask yourself, if all of this money has been available for these years, why haven't we invested it in the City's school system, why haven't we invested it in the community in the form of new housing, neighborhood cleanups, and other community investments. Why haven't we spent this money for the public good. Why have we been hoarding it. The answer more than likely is that we haven't been hoarding it because it doesn't exist. Cuts in the City current revenue stream through reducing tax are going to cause pain.
The pain isn't going to be felt directly by the members of City Council but it is going to be felt by the people that you represent, because when you have to come back here in a year or two years to pay the piper by reducing services and eliminating personnel, you're going to be talking about closing health centers, libraries, and rec centers that serve your constituents. Those constituents and their children are not going to have a place for needed medical care, education, or recreation. And the reason why they are not going to have access to those services is 134 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing because you are being asked today to do a reckless thing. You are playing with their money. You are going to give this money away in the form of wage-tax cuts on the unsubstantiated hope that thousands of new jobs are going to miraculously appear because of the wage-tax reduction, which will more than make up for the losses in revenue that you are being asked to undertake today. I certainly wish for this miraculous appearance of thousands of new jobs. I also remember a former mayor of this city advocating riverboat gambling as a means of balancing the budget. I have yet to see a paddle wheeler with slot machines coming up the Delaware. I expect that this miraculous appearance of new jobs is as much in the same vein as the gambling boats. They are not here yet, and they are not coming anytime soon. I am sure that some of you think, Oh, well, there goes Cronin again trying to protect his members. And you are right. I am for my members, I am for what's good for them, including a decent wage, good health benefits, and a decent retirement. Why shouldn't I be. Isn't that the American way of life. However, this is more than just about my 135 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing members' interests. Remember, they are taxpayers and they all live in the City of Philadelphia. They would benefit from a wage tax. This is also about the quality of life which will be left if we make irresponsible tax cuts. If we have to cut City tax services -- cut City services, my members are the people who live in the City and will be deprived of services. Yes, they could lose their jobs, their benefits, and their pensions. It's not a pretty picture, but it is a reality. The City cannot afford an irresponsible fiscal policy, and I guess there's somewhat of a role reversal here when the Chamber of Commerce is sponsoring public rallies and demonstrations and I'm the one sitting here talking about fiscal responsibility. But someone has to be reasonable and someone has to be responsible, and the people who are advocating mass, across-the-board tax cuts, which will remove tens and hundreds of millions of dollars from the City's operating budgets are neither. And they won't have to pay the bill; I will and my members will, and everybody who lives in the City 136 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing will when we have to cut services to the bone to pay for these irresponsible actions. And I assure you that if all of these rosy projections are wrong and the tax cuts cannot be sustained without cuts in services, these same business community types aren't going to be standing before you supporting your decision to raise the taxes again; they'll simply say cut the services. I say we cannot afford to cut the services now, not when the economy is bleak and the budget is precarious. So I say to you, be reasonable, be responsible, and be real. Don't make rash decisions which will cost the City its future. Above all, don't jump the gun on wage-tax cuts. Thank you for this opportunity to provide testimony on this most important issue.
Thank you very much. Any questions or comments from members of City Council? (No questions.)
Ruth Burchette? 137 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing (No response.)
Is there anyone else here who has not been called who would like to testify?
Please approach the witness table. (Witness comes forward.)
Thank you, sir. Good afternoon. And kindly identify yourself for the record.
Thank you. My name is Robert Latimore. I'm a Philadelphia citizen for almost 60 years, a businessman, a father, and, like I said, a longtime resident. I'm from your district anyway.
Yes, thank you. I'm here in support of the bill for taxes -- reduction of taxes. Not only that, I'm here 138 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing for any bill that is in benefit of uplifting the Philadelphia neighborhood as a whole. I don't care if it's a increase in taxes or a decrease; if it upgrades the living standards of Philadelphia, then that's what I'm for. Other than that, I'm here -- I spoke in front of City Council, this is my second time. The first time was in '99, October, and it was for my community, the Hawthorne community, and I'm here this time for myself and my family. I have been put upon by, I would say, the so-called increase in housing, the Hawthorne neighborhoods situation, and overall -- excuse me. If I'm nervous, it's because I do have a nervous commitment.
Okay. When I confronted City Council, I distributed one of these (holding up document) to every member of City Council, every member, including the Mayor. It tells you my plans to upgrade what was my business at the time, my plans to increase revenues for the City, my plans to upgrade my community, my neighborhood. 139 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing And from that point, I was put upon, like I said before, by the Redevelopment Authority, who came in my community and took all of my property, six properties.
I apologize for interrupting you. You understand that this hearing is about the wage tax?
And I understand -- no, you're speaking about the property in which --
No, I'm speaking about you and others all day have said that they wanted a reduction of taxes to bring businesses into the community. I'm here to say that I had a business for 30 years or more in my community, and Redevelopment came around and took my business and put me and my family out of business. And I don't appreciate it, and I'm saying to you that I'm still in it because I haven't signed anything, and I want a opportunity -- 140 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing
I've said to you on a number of occasions, including yesterday, that I would be willing to sit with you and Universal Homes to see what we can do about resolving your problem, as I said to you at the time of the public hearings two years ago, but I --
You may not have heard me, but I'm letting you know now that if you want, I will schedule a meeting with you, myself, and any other person you want from Universal Homes and the Redevelopment Authority to discuss your particular issue.
Okay. Well, I'll say -- that's okay, but I'm telling you here that I'm here in support of your bill. 141 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing
And I'm here in support of my family, which is suffering to no end. From that day, May 2000, we have suffered out of business with no income, and I don't appreciate it from my so-called representatives that they -- that Redevelopment took my property. I made -- that year, I made $54,000, and Redevelopment came in telling me that I'm a whatever, and just took my property without even consulting, because I was -- at the time I was sick, a heart operation and all of these things, seizures. But now I'm telling you I'm here and I'm raring to go to upgrade my community and to upgrade Philadelphia as a whole. I'm not here to stir up any of the resentments that anybody might have. I want -- I want a fair and just action for me and my family. We worked in this city for -- I worked since I was nine years old here, and I've raised -- and I've never been locked up and I've raised a family. All of my kids are grown now. And at this time in my life, when I'm ready to turn over a new 142 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing leaf to put in apartments and broaden my business and so many things for the community --
-- it takes it -- it takes it from me. And I'm just saying because it's really gotten me upset to know that I've worked all of these years, and especially a Democrat all my life, and have the Democrats put upon me this stressful situation. And I don't understand this. So I'm sorry that I got upset, President Verna.
Just take your time. I understand, I understand.
I'm here because this is a dire situation for me and my family. I'm saying we are almost out in the street. I've never had that problem before. And thank you, anyway, for hearing me.
Thank you very much for testifying, and I'm sure that if you work with Councilman DiCicco's office, he would do everything possible to try to help you. Do we have any other witnesses to testify? 143 4/9/02 WHOLE - TAX-REDUCTION BILLS, cont'd. hearing (No response.)
Council President and members of City Council, my name is Tim Kearney, and I'm a legislative aide for City Councilman David Cohen. I would like to hand in two written copies of testimony from people who -- well, from one person who couldn't stay this late and had to leave earlier today; and another paper from the Keystone Research Center in Harrisburg called "Tax Relief for Philadelphia's Poor," and the gentleman who wrote this paper couldn't get to Philadelphia today, so I only have it in written form. Thank you.
Thank you. Do we have anyone else to testify on any of the bill? (No response.)
Seeing none, this committee will stand in recess until o'clock tomorrow afternoon, o'clock, tomorrow afternoon. Thank you all very much. (Proceedings end at 11:31 a.m.) 144 CERTIFICATE I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia's meeting of the Committee of the Whole of Tuesday, April 9, 2002, are contained fully and accurately in the stenographic notes taken by me, and that this is a true and correct transcript of same. RE: Ordinance No's: 020030, 020035, 020096, 020116, 020144, 020145, 020182 _______________________________, Josephine Cardillo Registered Professional Reporter and Notary Public (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.)