At the Free Library. The library preferred, in lieu of that revenue generating proposal, to double their fines, believing that that would yield an additional million dollars in revenue. We proposed a budget to City Council that included that million dollars in revenue. We neglected to add back the million dollars in appropriations. When Council restored --
You neglected to add back what million dollars in appropriations?
The proposed FY'05 budget we had given the library had a million dollar reduction in it.
Right. Notwithstanding the agreement to double the fines and raise the money that way.
So when we 2618 Operating Budget - 4/6/05 substituted the million dollars in fine revenue for the expenditure reduction, we neglected to add back the million dollars in appropriation power.
Now, were these items a part of the budget discussion last year?
Were these machinations a part of the budget discussion last year?
Okay. So, what then happened to the million dollars that we added back by amendment to last year's budget?
Council added back a million dollars to the library's budget which brought them back to the level prior to our million dollar reduction.
Well, don't you still owe them then a million dollars?
Subsequent to that 2619 Operating Budget - 4/6/05 we had meetings with the library where we discussed the million dollars that Council added back versus the million dollars that the library felt were owed to them. I don't believe we came to any conclusion. I think we agreed that we would revisit the discussions at the time, as Mr. Shelkrot has testified. He was told currently your budget is what your budget is, which I believe was $35 million in the General Fund.
But you understand -- And it's great that you guys are having these discussions. But you understand that there has been a negative impact on the library system while this issue is either unresolved or still under discussion. I mean, you're talking about the million dollars, but you moved forward on an action item that has an impact in the same fiscal year while you have a current dispute about a million dollars in that fiscal budget, right? 2620 Operating Budget - 4/6/05
Well, I don't believe there's a dispute currently because the million dollars has not materialized.
The increased fine revenue has not materialized, and therefore there is no million dollar revenue offset currently in the General Fund.
But you could not have possibly believed that it was ever going to materialize in the first place.
If the most they've ever raised was $800,000, what makes you think they're going to raise a million dollars on top of it?
It was based on the calculations that the Free Library gave to us. 2621 Operating Budget - 4/6/05
We preferred to charge for the DVD's and the videotapes. The library asked that they be allowed to substitute this revenue, and we acquiesced.
Okay. So the bottom line is similar to -- And I appreciate you coming over to provide clarity. A mistake was made. It was going to be kept as a quiet discussion. You suggested raising fines or you suggested increasing fees for DVD's and videos. They came back to you with an alternative which is, we'll increase fines. You neglect to make the switch. We then give a million dollars. You essentially use that to plug the hole that was created in the first place to get them level. So now they don't have an 2622 Operating Budget - 4/6/05 additional million on top which they are now short. And you're still talking about it. Is that...
No. I believe we're not talking about it because the revenue has not materialized, so there is no discussion about adding back a million dollars because there's no funding source for that million dollars.
So if we had known -- If we knew then what we know now, what we really should have done was given the library $2 million, right?
In order to accomplish what the Council thought we were accomplishing with the one, since we didn't know about the other $1 million mistake.
I'm not sure what Council thought that were accomplishing when 2623 Operating Budget - 4/6/05 they added back the million dollars.
We thought we were giving them an additional million dollars, I believe.
Or at least not shorting them the million that the administration was proposing to short them in the current year's budget.
Councilman, I'm sorry. I didn't mean to interrupt you.
But it was our understanding that the million dollars was being restored for Saturday hours.
So, I mean, it starts to take us down the credibility path if we have people that we know are serious 2624 Operating Budget - 4/6/05 legitimate people come to the table, we go through the whole thing, we ask this question, that question, the other question, other conversations are going on behind the scenes. Fine; we can't know about all the other conversations. But that was the intention. It apparently doesn't play out because of either a mistake or now lack of realized funding source. So the bottom line is, they're a million dollars short from where we thought they would be at the time we took our action back on July 1. You'd at least agree with that.
I -- I don't know that I can. Because I don't know what Council's understanding of that million -- what that million dollars meant to City Council.
We thought we were restoring the budget back to where it was supposed to be, without knowing that it was already short a million because of the 2625 Operating Budget - 4/6/05 behind-the-scenes activities. That's what we thought. So, where does that all leave us?
Well, I think, going going forward, we've gone through another round of reductions this fiscal year, and in fiscal year '06. And I think that it just would have been a million dollars that we'd have to reduce somewhere else.
Well, I understand that part. So, we've had Miss Reed go through this, but would it be helpful to have your backup and support as the more tenured person. What is the presently proposed budget for FY'06 for the Free Library?
The currently proposed budget for the Free Library is $35.3 million in the General Fund and 47.8 in all funds.
Well, okay. The budget book I have indicates for fiscal year 2006 obligation level, that's column number 2626 Operating Budget - 4/6/05 8... My book reads total, all funds, $47,931,631. And what does that number mean?
It's a correct proposed budget, but it includes an estimated state revenue number that will change when the state budget is finalized.
Okay. So, you're primarily focused on the thirty-five, two six seven, six seventeen?
That's the General Fund proposed budget. 2627 Operating Budget - 4/6/05
Right. So, in the discussion that we've had, whether it's the million and a half dollars or some other figure, up to 5.5, is it now your understanding or do we have an understanding on this floor that any additional funding that Council provides for the Free Library is added to the 35 million two sixty-seven, six seventeen figure?
I'm not sure what you mean by fiscally; but legislatively, yes.
If we make an amendment to this budget, and add a million and a half dollars for the Free Library system, does it get added to the 35 million two sixty-seven six seventeen?
And will they be 2628 Operating Budget - 4/6/05 able to spend it?
Because we don't know what fiscal '06 is going to bring. If our budget remains on target, there's probably a good likelihood that they will be able to spend it. If we suffer tax revenue losses or weakness in tax collections, we're going to have to revisit additional cuts with all departments, not just the Free Library. I cannot sit here and guarantee you that.
Does the budget presently anticipate tax revenue losses or lack of collections?
Okay. Do we have tax revenue losses or lack of collections last year?
Okay. But your statement, I guess, does 2629 Operating Budget - 4/6/05 open this final area which is somewhat on the line of regardless of what amount Council makes an amendment to this budget, you're not prepared to commit that the library would be able to spend any of it. If we gave them $10 million, you're saying that it is still not certain that they'd actually have access to those dollars. Is that your...
I can't commit to increases, to guaranteeing you we would spend every dollar of any increase for any department.
No matter what the Council does. No matter what budget we pass, no matter what amendments we make, your position is, ultimately you'll decide what they actually get to spend.
No, that's not my position. My position is I cannot sit here today and guarantee you that we would spend every dollar that you appropriate.
Okay. Okay. Well, this will be an 2630 Operating Budget - 4/6/05 interesting exercise this spring. Thank you very much. Thank you for coming over. I appreciate your honesty.
Thank you. Are there any other questions or comments from members of the committee? (No response.)
Seeing none, I would suggest that Council stand in recess for a half hour. Is everybody in accord? Okay. So, we will stand in recess until 2:30. Thank you. (Lunch recess from 2:00 p.m. to 2:42 p.m.) Good afternoon, everyone. Again I regret the delay. This is a continued public hearing of the Committee of the Whole. We will now hear from the Civil Service Commission. Good afternoon. Welcome. We do have a copy of your testimony. We will give that to the stenographer. It will be transcribed in full. We would appreciate it 2631 Operating Budget - 4/6/05 if you would summarize your testimony, please.
The Director of the Commission was not able to make it, and we asked if I could come in her place. I'm Lynda Orfanelli, the Personnel Director. And Reverend Repsie Warren was unable to attend. I'll testify for her. The total budget for the Commission is $159,728, which is a decrease of $5,827 over the FY'05 estimated obligation. Under the Home Rule Charter, the Commissioners are charged with ensuring the application of merit principles to public employment. In carrying out that mandate, the Commission approves or disapproves a large variety of actions affecting Civil Service Employees. These include establishment of job classifications, residency waivers, personal service contracts, Civil Service regulations and exemptions from Civil Service. This year the Commission is involved 2632 Operating Budget - 4/6/05 with hearing appeals from layoffs. appeals have been filed, and the appeal hearings for these people will be commencing in April. There is no change in the number of employees in the Commission and no 8 significant changes in the budget to report. That concludes my testimony.
Thank you. 11 I understand that in your testimony 12 you are able to reduce your Class 100 budget. 13
Not 15 increase it, as is stated in the testimony? 16
Yes. Actually, it's 17 a shifting around of funding. 18 An employee who had provided legal 19 services had retired. And in lieu of having 20 an employee, the Commission is now 21 contracting for that service. So, the money 22 was shifted to Class 200.
What is the value of your contract for legal services, and where is it budgeted? And can 2633 Operating Budget - 4/6/05 you tell us who provides these services.
Okay. The value of the contract is 24,500. The lawyer who is providing the services is Stella Tsai, spelled T-s-a-i.
T-s-a-i. And she works for a law firm called Christie Parabue. And I don't know how to spell that. I'm sorry.
You also mention residency waivers in your testimony. Can you tell us the number and titles of waivers granted by the Commission?
I can. We have a report, if you give my deputy a moment to come up with the report.
I'm Celia O'Leary, the Deputy Personnel Director. I have a report for Council on employees who have residency waivers at this time. It's 61 employees at the moment.
And what 2634 Operating Budget - 4/6/05 are their titles?
At the moment we have many waivers in existence. They're not all being used. They're available on our web site, if Council would like to look at what classes have a waiver.
Wait a minute. I'm not going to go to the web site. I'm asking you.
I would like you to provide it to us. Do you have it with you?
I have a list of the employees. If you were looking for a list of --
Yes, it does, ma'am, but there are many more. 2635 Operating Budget - 4/6/05
Maybe we could have copies made. Please. How do the 61 waivers compare to previous years? Would you make copies, please?
Do you have the previous year? We don't have the report from last year with us. We can check and find that out. From my recollection, it's pretty close to the same number, but we can verify that and get back to you with the exact number.
Very well. And while we're waiting for that information, I would like to recognize Councilman Nutter.
Thank you, Madam Chair. Good afternoon, Miss Orfanelli.
I just would be 2636 Operating Budget - 4/6/05 stunned to know that I only really have one question, which has to do with our prescription drug program. There seems to be a fair amount of back and forth and maybe some difference of opinion with regard to the issue of a 30-day supply that public employees can get for the single co-pay versus this issue of mail order through a third-party operation which, at least according to the information you provided, seems to create a significant discount. What I wanted to know is, one, what are the estimates for how many people will actually utilize this particular program; and second, has there been any consideration or thought given to the impact that this program may have on our... primarily on our independent pharmacists or stores throughout the City?
In answer to part one, there was no way to do an analysis of how many employees would take part in this. Due to HIPAA, we're not privy to 2637 Operating Budget - 4/6/05 personal medical information of employees, so analysis of that nature could not be done. However, we have done a comparison of the costs for the first quarter of '04 to the first quarter of '05. And we have... And by making these changes, we have gone from a per member per month cost of one fifty-eight twenty-nine to this year's one thirteen forty-one. That's only the first quarter. So we're showing already a savings of $44.87 per member per month. That overall amount is almost a million dollars to the City. Now, did we consider the impact on the independent --
Well, there are significant discounts to us by using the mail order service, and I do mean significant.
And I mean, it's your position -- Again, obviously, you don't have access to certain information. But it's 2638 Operating Budget - 4/6/05 your position that these savings are coming as a result of a significant number of employees pursuing the 90-day supply?
We did have an increase in the co-pay this year. Generic drugs stayed the same, but the top tier drugs which do not have generics and are not on our formulary, went from $16 to $21, so that there's a $5 difference.
All right. So, let me make sure I'm understanding this. We go to the 90-day supply. We've also had an increase in our co-pay. You believe more employees are utilizing or some number of employees are utilizing 90-day supply. And the end result is the City is saving money, but the employees are paying more.
If they are using generic drugs, they are not paying more.
If they are using non-preferred drugs, they are paying $5 more.
Okay. Have you had any... And you've seen the correspondence. Have you had any direct consultation with kind of the pharmacy association about the City's program?
Would you be so kind as to have an in-person meeting to address some of the issues that they raise which seem to be not only directed at the potential impact that this program might have on the pharmacies, but they also seem to have some slightly differing views, in terms of economic benefit to the City. CareMark, as I understand it, is not located in Philadelphia; is that right? 2640 Operating Budget - 4/6/05
CareMark is located several places in the country. They have mail orders in Wilkes-Barre. They have their financial center in Arizona. They have offices throughout the country. I would be glad to meet with them, yes.
I'd appreciate it. It's PARD. They've obviously been in this business for a long period of time. They might have, you know, a few interesting perspectives, some innovative strategies. And I think if we have local people, regardless of what their interests might be, I think you would agree that we could possibly learn from their hundreds of years of pharmaceutical experience.
I'm rather curious about the 61 waivers. When we grant 2641 Operating Budget - 4/6/05 a waiver, is it for a protracted period of time or is it an indefinite waiver.
There are different types of waivers. We have time specific waivers. We have indefinite waivers. Most of our waivers are for a specific time period and need to be come back to the Commission if they want to renew them. So, we have a large number of waivers that are for one year only, for very specific types of jobs. Most of those jobs are under grant programs, and they are not for Civil Service positions. The other large category are for doctors, who we have trouble... I know other Council people have found this difficult to understand, but we have trouble finding doctors who want to work half time days at our health centers. And as a result, we do have doctors that live in Philly, but we have also gone outside to get doctors.
Thank you. The Chair recognizes Councilwoman Brown. 2642 Operating Budget - 4/6/05
On your testimony you discuss work force diversity statistics for women and minorities. And it indicates that there was a marked improvement from 1975, but this is the only year that you offer a comparison. Do you have any more current data on the City's work force, with regards to racial and gender diversity?
Well, the number we gave you was 2004 compared to 1975. We have every year, and I would be glad to send you our diversity report, if you were interested.
Absolutely. And you will notice that it is incremental, but it is --
And is that improvement also reflected? Because I don't have it now. I only have my questions. Also, in the management in areas where women and people of color have positions of responsibility --
Yes. The report has that as well. It has the category of jobs, as well as the category of men, women and racial breakdown.
Very well. I'd appreciate it if you'd pass that on to the Chair.
You're welcome. The Chair recognizes Councilman 2644 Operating Budget - 4/6/05 Rizzo.
Thank you, Madam Chair. Good afternoon. I just want to make sure I understand. The total number of every category of waiver: Doctors, lawyers, whatever is total 61.
Right. But that's not the total number of employees. That's the job titles. So, we could have five people in one of those categories.
Then give us a number. How many employees does this City employ that are as a result of a waiver that live outside the City?
Sorry. I misspoke. There's 61 people who currently have waivers.
Do I say strike that from the record? So we only have 61 employees.
That live outside 2645 Operating Budget - 4/6/05 the City.
And the spreadsheet is being circulated now, Councilman.
What's the longest a person has had a waiver? How many years has a person had a waiver that works for the City of Philadelphia?
There's a few people in the First Judicial District who go back to the '70s.
Well, we don't hire in the First Judicial District. I want to make that clear. That's done by the courts.
Why would someone from the library... I mean, that's not --
Well, the reason is -- Well, do you want me to -- I'm sorry -- address the courts?
Okay. Court employees who were non-residents in 1973, when the residency requirement was imposed on the courts, were granted -- they were grandfathered. That's why there are court employees that go back that long, who they were non-residents then, and they were grandfathered in.
Not the First Judicial. I mean, if you look at the Health Department or you look at Aviation or District Attorney, most of those waivers are 2647 Operating Budget - 4/6/05 fairly recent, and most of them are exempt. No, I shouldn't say that. It's a combination.
Free Library. What in the world are we doing with people -- giving people exemptions that work for the library?
These are people who we've recruited. They're probably -- They're -- Some of them are trainees and may have a certain amount of time to move into the City. They will move into the City. They get -- In Civil Service they have one year to move in. And if you look at their appointment dates, they have a date they have to establish residency. That's sort of in the middle of the column. So the four people in the library have to move in by October '05 and one by March of '06. That means that we recruited them possibly from colleges. They weren't Philadelphia residents, but they must become Philadelphia residents. And that's a date they have to become, by that date. 2648 Operating Budget - 4/6/05
So the date to establish residence, almost everyone on here -- Let's say the Aviation unit.
4/26 of 2005. Those people need to have residency in the City of Philadelphia. Who manages this? Is the operating department responsible to make sure that happens?
Because this is really... Sometimes I think... I mean, I can understand the scenario with the doctors. But I mean, you think we would really try a little bit harder to get some physicians that live in Philadelphia to work for the Health Department. I don't know -- Maybe this is just an easy way out. Maybe we don't work hard enough at really doing this, and we accept 2649 Operating Budget - 4/6/05 the fact that we'll just take whoever's available no matter where they live.
Well, we do a lot of recruiting. We advertise. You know, we try very hard to get Philadelphia residents first.
Lynda, I don't -- I never give you a difficult time. But I've been around this government a long time, and I've never heard a recruiting pitch for doctors. And I have a lot of friends that are doctors tell me, because I've talked about this. They said, nobody's ever asked them if they wanted to work part-time for the Health Department. And they're in all different disciplines, internal medicine, you name it.