Aye. The ayes are 17; the nays are zero. A majority of all members having voted in the affirmative, the bill passes. Calendar for today. The time has come for us to consider the Mayor's presentation of his annual budget message. The Philadelphia Home Rule Charter states that the Mayor shall submit to Council no later than 90 days before the end of the fiscal year his Operating Budget message and Proposed Operating Budget ordinance for the ensuing fiscal year. At the same time, the Mayor shall submit to Council the Recommended Capital Program and Capital Budget as received from the City Planning Commission, to the extent approved by the Mayor. I now appoint the following committee to escort the Mayor into the Council Chambers: Councilwoman Tasco, Councilman Clarke, Councilman O'Neill and Councilman Rizzo. (Pause.)
I understand the Mayor will be coming up (Pause.)
Ladies and gentlemen, I am pleased to introduce the Mayor of the City of Philadelphia, Mayor Michael A. Nutter. (Applause.)
Thank you, Madam President, and good morning to everyone. It's an enthusiastic crowd here today. This is what I'm looking forward to. Madam President, Majority Leader Tasco, Majority Whip Clarke, Minority Leader O'Neill, Minority Whip Rizzo, all the members of Philadelphia City Council, there may be some members of the General Assembly here, I want to welcome them and thank them, other elected officials, my fellow guests, folks from around the region and, of course, all of our public servants in the Administration, I want to say thank you and welcome. Thank you for being here this morning for this address. I also want to recognize Mayor John F. Street and thank him for his great service. (Applause.)
I had the opportunity to work with Mayor Street when he was the Council President and then, of course, during his time as Mayor. We worked a great deal together. We did a number of things. I learned a great deal of things from him, and enjoy referring to him, I guess, now either as Mayor Street or Professor Street. He was always in the teaching business from the start. Mayor, good to see you here. He is not here, of course, but I also want to thank my executive partner level, Governor Rendell, former Mayor of the City of Philadelphia. His help and support, the relationship that we've been able to maintain and improve on in Harrisburg has been part of the key to the success of our time here for the last 15 months or so. I also want to thank Philadelphia's great House Appropriations Chair, Representative Dwight Evans, who has also been a great leader in Harrisburg, a wonderful friend to Philadelphia. We always know that he's looking out for our interests. And then, of course, my own State Representative, Kathy Manderino, who is always looking out for me. I want to thank the members of City Council, every member, for your willingness to partner with us in the interest of the citizens of this great city, for your prompt, professional consideration of our first budget last year and the numerous bills that came in last year, the very difficult rebalancing of our budget back in the fall and the efforts that have brought us here to this point and your participation in one of the most exciting and dynamic budget processes over the past couple months. I sincerely look forward to working with each and every one of you in the challenging days ahead. More than 14 months ago, I addressed this great body as we all stood together on Inauguration Day, and I spoke that day and the days since about a sense of renewed hope and optimism in our city. I told you then what kind of leader I would be, that I wanted to lead this city in a new direction, away from the policies and politics of the past. I said it was a time for new ideas and bold action. And after a year and a half of campaigning for change in our city, on that inaugural morning, I said that we must reform a status quo that has held our city back for much too Today, Madam President, I am that same reformer standing right here with you today with the same message, that if we work together, if we share the sacrifices that change demands, we will secure the future of a new Philadelphia that all of us want to see. And some have asked what kind of future will that be, what, Mayor, is your vision for our great city. It's a Philadelphia that's rich in human capital, rich in good-paying jobs for Philadelphians. It's a world-class city where Philadelphians thrive in safe, healthy neighborhoods. They enjoy the wonderful green open space the City has to offer in a diverse, urban environment. It's a city where good schools produce educated and motivated citizens ready to play their appropriate role in the future of a great Philadelphia. It's a city that works. Now, as a student of history, crises have a tendency to shape our views of the past and the future. And I believe our current economic crisis has possibly blurred a clear-eyed vision and examination of our city's great progress. In the last year, despite numerous budget concerns, our city has moved forward. We are not paralyzed by the current economic crisis. No. These times demand that the time for change has come. In my inaugural address, I said we would focus on crime and public safety and gun violence and reducing the homicide rate. )
And we are well on our way to what our near-term goal to a 30 percent reduction in our first three years. I set aggressive, long-range goals to reduce the number of dropouts and increase the graduation rate in our city, as well as the number of people who get a college diploma. And now we have a partnership with the School District, a new program that targets at-risk sixth grade students long before they might think about dropping out. Our high school graduation rate is nearly 60 percent, and we have new reengagement centers that are providing dropouts with a way to drop back in to get their GED or diploma. (Applause.)
I said then that ethics would be the cornerstone of our government, and in the year since, we've strengthened the Inspector General's Office, brought on a new Chief Integrity Officer, increased training for employees and are working closely with federal and local prosecutors as partners, not adversaries. Integrity instills confidence in our government for our citizens and the business community. We made investments and taken actions reflecting our vision and values and showing that we are indeed a city that works. Think about some of the things we've done over the past year: Increased funding for Fairmount Park; rolled out weekly single-stream recycling; opened a new 3-1-1 call center; reestablished a Planning Commission as a force for development in this city; taken steps to improve minority and female business participation in our economy; established good relations with the cities and counties around us, as well as the state and federal government; sparked a new sense of volunteerism in our city; and foreclosure prevention program that is a national model. We've been busy and gotten a number of things done in a relatively short period of time. It's also of great value to our city taxpayers that we were able to negotiate fair contracts of a one-year nature with our public employees, and for the first time in a decade, the contracts controlled the spiraling costs of our employee healthcare provisions. There were no changes in the quality of the benefits, but depending on the contract, the costs to the City were either reduced or held steady. Even more significant for future cost containment, all four unions for the first time agreed to sit down with the City in a special committee to explore new ways to provide healthcare benefits at a lower cost. That committee is still at work and we anticipate the results of their work very soon. passing month, the tell-tale signs of economic distress began to grow, and our City Administration committed to a new level of transparency quickly, laid out the information to the public, that there was a growing problem last September, and we provided regular updates. That's what leaders do. On November 6th, after the historic election of Barack Obama as our new President and the no less historic victory of our Philadelphia Phillies in the World Series, I announced an emergency rebalancing plan for our annual budget and Five-Year Plan to close an over $1 billion five-year gap. This huge deficit was caused by declining tax revenues and increased pension payments resulting from severe losses in the financial markets as they continued to spiral downward. Our approach to this explosive fiscal crisis was to preserve our core services, particularly those for our most vulnerable populations. We rejected short-term fixes that would hurt us in the long run. That task was complicated because 58 percent of our spending is non-discretionary, such as payments to the School District, debt service, pension payments or human services. These are commitments that we must keep and not endanger. After an intensive review, we found that more than half of our reductions would come from efficiencies, revenue increases and one-time savings. There was major belt-tightening throughout our entire city government. However -- and I understand this -- that at times the media spotlight may have focused on some of the loudest voices in the public, some making very pointed criticism of our decision to remove seven pieces of equipment, fire stations or reduce use of pools or even I understand those concerns. But on that particular issue, I want to specifically thank Council President Verna, Councilmembers Tasco, Kenney, DiCicco and Greenlee for your support in a very tough situation.
Without diminishing the controversy that surrounded any of those proposals -- and I understand why they were controversial -- my decision to halt for five years the scheduled decreases in wage and business taxes had a much larger budgetary impact. We saved over $230 million in our Five-Year Plan. We also eliminated nearly 2,800 positions from our city government and throughout the government. There were heavy overtime reductions, totalling nearly 18 and a half million dollars a year. In the Police Department, there were 200 police vacancies and millions of dollars in police overtime removed from that department. my own pay. I asked my cabinet and senior staff members to take pay reductions, furlough days. We saved over $400,000 annually. 7 million this year and again next fiscal year. It was a difficult time, but through it all, we remained true to our vision for this great city. We were able to avoid layoffs of police and fire. There were no reductions in emergency medical services. We kept our recreation centers open. Weekly trash collection and single-stream recycling were all preserved. In the following weeks, I did not just take it easy and say, Painful job done. We didn't just hang out and try to ride it out through the holidays. We didn't go behind closed doors to put together our FY10 budget. No. Instead, we monitored with growing concern our declining revenue projections, and I Town Hall meetings throughout the City of Philadelphia where thousands of Philadelphians voiced their concerns, sometimes pretty loudly, to express their displeasure about one cut or another. Leaders also listen. )
I'll take that. And now it's certainly true that many complained that their voices were being heard after the fact, after we had already made the tough choices and decisions, and some wondered to me directly, What's the purpose of these meetings? You've already made these choices. I understand that as well, but there's another side to this process. The Town Hall meetings were not just created to talk about the past actions. No. They were the start of the current budget process last year. I was already most extensive and engaged public outreach and information activity and a budget process for the City of Philadelphia that had ever taken place in our city's history. We were already working on what I referred to as the "People's Budget." The input from concerned citizens at Town Hall meetings, comments about preserving core services, about a willingness to consider paying a little more for the desperately needed services that we offer, about keeping our city safe, about aggressively collecting taxes that are owed to us, about slashing the size of our city fleet, all of these ideas would come back as we talked about the FY10 budget in a continued public outreach campaign. Well, let me tell you, at those Town Hall meetings, I heard you loud and clear, and your comments -(Applause.)
And your sense of urgency and helped us as we began this new public engagement budget process. On January 15th of this year, just two months after closing our first billion-dollar deficit in our Five-Year Plan, I announced that we had been hit by an economic hurricane and that a second billion-dollar gap had opened up for our next Five-Year Plan. Again, the driving forces of that deficit: Declining revenues and huge losses in our pension fund, requiring millions of additional General Fund dollars from taxpayers to support our pension fund, the safety net for our retirees and current workers. I should note that our budget hole has actually grown since that mid-January announcement by an additional $333 million to almost 1.4 billion, owing to further losses in business and real estate transfer taxes. Beyond the enormity of our and my promise that every service, every program, every tax and every fee would be on the table for discussion, three points are worth recalling about that particular day. First, I called on our four union leaders and our city workers to be prepared to share in the pain and sacrifice that would come. I said that it was time for change and change would have to happen. Second, I outlined the People's Budget process - a series of PhillyStat meetings, budget workshops and an unparalleled engagement with the public at the earliest stages ever of the budget development. And over the following weeks, I would meet with Philadelphians in barber shops and beauty salons, in churches and community centers, on the streets and in private homes. And just before I came into these great Council Chambers, I met with many people who had me at their home or out in a session, and thank the members of the public who engaged us and allowed us to sit literally at a dining room table or in their basement to talk about the real issue and real concerns that real people have. I'd like to thank them for their participation. (Applause.)
And the third thing about that day is, I named a Private Sector Outreach Board composed of distinguished private sector leaders who were tasked with advising me and the Administration on ways to make our government more efficient, to drive down our costs and to increase the quality of the services that we provide to Philadelphians. And along with a number of tremendous ideas from our own public employees, this public input over the following weeks was enormous and wide-ranging. Philadelphians do want our its belt. They want more value from our tax dollars. They want every dollar that's owed to the City to be collected, and they wanted us to preserve key services, particularly those aimed at vulnerable populations. And lately there's been no greater symbol of reining in costs than the clamping down on the use of city vehicles. At a meeting in Southwest Philadelphia, Woody Beale, a community activist working to reduce violence in our city, told me, Mayor, we have got to take away some of these city cars that our employees are driving. They may just have to catch the bus like the rest of us and get out here and help us save money. (Applause.)
Well, Woody, I heard you and the hundreds of Philadelphians who pointed to this particular issue. Since January of 2008 when I arrived, we've cut almost in half the number of employees with take-home vehicles. (Applause.)
That's $2.1 million in savings in our Five-Year Plan. And so far, we've removed 243 cars, trucks and vans from our fleet of about 5,900 vehicles, for a savings of $1.5 million. The auction value of these vehicles alone is about $280,000 in revenue for the City. And our goal by July 1st of this year is to take another 500 vehicles out of service. (Applause.)
Walt Wesolowski, a retiree in Juniata, was as blunt as anyone when he said, Mayor, you have got to go after these tax deadbeats. It's unfair to the rest of us who are paying our taxes and our fair share. (Applause.)
Well, Walt, we're doing that. Last November, we list of our top tax deadbeats in Philadelphia, and that tactic has achieved some results. So far, we've collected two and a half million dollars in back taxes, but we're just getting started. The City Solicitor's Office, in partnership with the Sheriff's Office, are fully mobilized. Ladies and gentlemen, we are not playing about folks paying their taxes. (Applause.)
And as that tax deadbeat lawyer who approached me on the sidewalk on South Broad Street last week learned very clearly, my message is pretty simple: If you owe, pay what you owe. (Applause.)
Philadelphians in large numbers also told me that the City needs to make sure that we preserve vital services to our most vulnerable populations, from children to the elderly. (Applause.)
Marsha Wall, a retired nurse in Southwest Philadelphia, told me that City health centers are a key part of the City's social safety net. She said -(Applause.)
She said, For people without insurance, it's all they have. Please don't close them. Well, Marsha, that brings us to today. I want Philadelphians to know that their voices and their ideas were heard and received, and we understand. (Audience member yelling, "Thank you.")
You're welcome. My proposed FY10 budget and the Five-Year Plan is the People's Budget. We heard you loud and clear, and I'm proposing a budget that maintains a high quality of service to Philadelphians. We away from the gains that we've made in public safety. So, therefore, I will not lay off one police officer or one firefighter in this city. (Applause.)
Nor will any fire stations close or any equipment be removed. (Applause.)
I heard you loud and clear. I understand the linkage between safety and education, and so no recreation centers or libraries will close. (Applause.)
And we will have four times as many swimming pools open this summer than I announced back in November. (Applause.)
Through the help of many people in the private sector and additional commitment from our City government, I made the decision to open pools because I wanted to invest in our young people. And so -and, Mrs. Wall, no health centers will close either. (Applause.)
And so we have heard you, and we are keeping the faith. This is our proposed framework. But you know, as they say, nothing in life is free. To provide the level of service that Philadelphians want will cost us a little more than we currently have. So in order to keep more than 6,600 FOP police officers on the street, to have a full complement of Local 22 Firefighters, to keep our health centers open, to have our recreation centers and our libraries open, staffed with District Council 33 and District Council 47 workers, we must do two very painful things. First, sharply cut our costs once again. We face really tough choices. easy way out. I will not sugarcoat this. Now, more than ever, leadership demands an honest accounting of our situation and a responsible solution. There is no magic that can transform our situation into something other than what it is - a time for shared sacrifice dedicated to a vision of a brighter future for this city. This is the time for all of us to either stand up and be counted or sit down and be quiet. (Applause.)
As we did in November, our first task is to look for efficiencies, new revenue opportunities in the departments and spending reductions. It was not easy, considering that we had to take so much out of our Five-Year Plan last November. But we put the sharp pencil to our budget and we found a total of $60 million worth of proposed efficiencies, reductions and new revenue. That's more $300 million over the course of our Five-Year Plan. Half of the changes are reductions, including a reduction of about 250 positions in our city government. Staff reductions citywide will save us $11 million per year and more than $50 million over our Five-Year Plan, and it will raise to more than 3,000 the number of positions eliminated from this city government since last November. On top of the 18 and a half million dollars in overtime we removed last November, this budget assumes an additional $2 million in annual overtime reductions. Added up, it's more than $100 million over the Five-Year Plan. Fees in some areas will increase. Higher EMS fees will provide $5 million more a year, and fees for commercial, commercial trash collection will generate $7 million annually. Also on an annual basis, waste net us an additional $2 million, citywide fleet reduction one and a half million, and energy efficiencies in FY10 will save us a million and a half dollars, and that number will jump to $3 million in the two following years. But with all of these proposed changes, it was clear that we would not be able to cut our way out of a second billion-dollar Five-Year Plan deficit. And that leads to the second very painful choice. New revenue is an absolute necessity. Now, as an elected official and a candidate who for a decade championed the cause of tax cutting and its central role in the City's strategy to be a more desirable place to do business and reside and raise our families, I am certainly well aware of the irony of our proposal today. But this is not the time for philosophical debates. This is the time make tough decisions. And that's what I'm going to do. I'm going to lead and I'm going to make tough decisions. Unlike some politicians, I'm not worried about the next election. I'm worried about the next generation. (Applause.)
Now, in taking into consideration just what would we do and which taxes will we look at, I had a number of concerns and criteria. I said that we could not take a near-term action that would cause us long-term pain and difficulty and damage our economy. I said that whatever we were going to do, it must be of a short duration, designed specifically and solely to get us past this temporary economic crisis, and that the pain must be shared fairly and broadly. Study after study has shown us that over the last 50 years, wage and business tax increases have exacted a terrible price on the City's economy, population, business and investment outside of our city. Conversely, if you listen to experts -- and I'll quote one -- Robert Inman, a Wharton finance scholar and a noted expert on the City's tax system and economy, the rate of economic decline would have been even much steeper in recent years but for the annual reductions in wage taxes started in the mid '90s by then-Mayor Rendell. Professor Inman has estimated that those wage tax cuts actually added 23,000 jobs to the City's economy. (Applause.) (Audience member yelling, "Good news.")
You're right. Raising the wage tax to fix our current deficit would be the poster child for taking a short-term step with devastating long-term impact. It sends the absolute wrong message. It is the wrong thing to do, and I won't do that. (Applause.)
In addition to just being a bad idea, it would also involve us in a potentially damaging fight in Harrisburg, where legislators have told me time and time again that they would view any action by the City to raise the wage tax as an action of a broken promise, coming after the General Assembly and Governor Rendell provided gaming revenue as a way for us to reduce our wage tax. Instead, I have chosen to ask the General Assembly to give us the authority to levy an additional one percent on our sales tax. This surcharge, this penny with a purpose, would last for only three years and would generate an estimated $340 million for its temporary existence. I'm also asking City Council to raise the city portion of the real estate tax for 2010 by 16 mills over the current rate and by 12 mills -- for 2010 and by 12 mills over the current rate for 2011. This temporary, temporary two-year -(Audience booing.)
-- two-year change will provide the City with an estimated $272 million. Though the millage rate has not been raised since 1990, I understand that homeowners have seen their assessments rise. I am sensitive, very sensitive, to those concerns, and I'm also worried about the impact of these proposals on low-income workers and senior citizens. And I would suggest that all of us take further steps, whatever legal steps we have, to protect those vulnerable populations. I also understand that the assessments in some cases are not necessarily up to date, meaning that some people are paying more than they should and some people are not paying enough. (Applause.)
This must and fully expect a new system of setting assessments with fairness and transparency will be in place for the 2011 tax year. Finally, as City Controller Alan Butkovitz and I recently announced, I will also seek General Assembly approval for a technical change in our pension fund's operating rules that will save the City over $332 million over our Five-Year Plan. Taken together, these changes put us close to a balanced Five-Year Plan, but not completely. Core services have been preserved while the pain of supporting this spending plan has been spread across our business, consumer and homeowner communities. Already businesses and wage earners have had to forego tax reductions that had already been approved by City Council for a number of years, but any additional effort to stabilize our city budget must also involve our own public employees, who are also taxpayers. On Inauguration Day, I said we needed to protect the City's fiscal health, stabilize the City's pension fund and come to grips with double-digit healthcare expenses. I also said we needed new contracts for our public employees, contracts that were fair to the employees and fair to the public, who must pay for them. Fourteen months later, I can tell you with certainty that reform is never an easy process. You never get there without experiencing pain and enduring hard work. I say that with the deepest respect for all of our city's public servants and their elected leadership. And so today I am calling on Pete Matthews, President of District Council 33, Brian McBride, President of the Local 22 Firefighters, John McNesby, President of Lodge 5 of the FOP, and Scott, our President of District Council 47, with a message: It's time for leaders to lead, not follow the screaming masses. Work with me. Work with us. Work with us on behalf of your members and the one and a half million residents of our great city who pay their taxes and pay our salaries. We work for them, not the other way around. I'm asking for a new level of cooperation that will benefit all of us. We need to be open to new ideas. For example, I've met with the union leaders and asked them to encourage their members to take voluntary furlough days. This is an idea -(Audience yelling, "No.")
This is an idea that actually came to us from many of our own public employees who participated in our open budget process. Now, because of contractual requirements, furloughs are not something that the City can impose on our unionized employees, but it is a way to help further forestall additional layoffs. If every city and court employee who is not already taking a furlough day voluntarily took one furlough day, it would save the taxpayers more than $4.1 million per year. (Audience member yelling, "Why don't you take 365 of them this year.")
Because I got a lot of work to do. As we all know, among the key drivers of the City's budget crisis are pension and healthcare costs. We must also acknowledge that today's system is the sum of decisions that date back almost 35 years, but we now have an opportunity to chart a new course for fiscal health over the next 20 to 30 years. Rising benefit costs have forced the City to shift ever more valuable tax dollars away from the services that citizens rely upon. In 2000, the City spent $220 million on pensions and $170 million on healthcare costs. Those costs represented 14 percent of our city budget. In 2008, we spent $430 million on pension costs and $420 million on healthcare, almost 22 percent of our entire city budget. By FY13, the City expects to spend more than 25 percent of our entire budget on just those two items unless significant changes are made. I am proud that we pay our hard-working city employees for a good day's work. They deserve our respect for taking on the hardships of working in the public sector, but they must also understand that our city treasury is not an endless source of money. To ensure the City's fiscal health, I am asking our public employees to contribute more of their salaries toward their pensions and healthcare, amounts more in line with national averages. about impacting the quality of our city healthcare benefits. Just as we were able to lower the cost this year while preserving the quality of benefits, so too must we continue to drive down those costs over the next five years. It's what Philadelphians expect and it's what they deserve. As I've noted several times today, our pension fund has been rocked by the turmoil in the financial markets. It has lost millions of dollars, which must be made up by city taxpayers. 4 billion. The Fund's condition is of such concern that we will soon submit an application to the Pennsylvania Employee Retirement Commission asking that the Philadelphia pension fund be declared distressed, the highest level of distress as defined by state law. Under the term of the law, we will be required, we will be required to make significant changes to the pension fund to reduce our employee costs. And following receipt and acknowledgment of our application to the Pennsylvania Employee Retirement Commission, I will send legislation to City Council to implement a new pension plan for certain existing exempt employees and all public employees hired after July 1, 2009. This new plan will provide a guaranteed level of benefits, although lower than the current plan, to employees who work for the City for a certain number of years and allow those who want higher benefits to contribute more of their own money and receive a city matching contribution for part of it. It will offer employees a way to take their retirement benefits with decide for some reason to leave city employment. It's known as portability. This new plan will be less expensive for the City in the long term, while providing employees a measure of retirement security. We are also asking our unions to agree that current employees who are vested in pension plans pay more of the cost to keep their existing pension benefits. And while the savings in the Five-Year Plan from these proposed pension changes are estimated to be somewhat modest, over the next 20 years, we're expecting to generate over $600 million in savings. For now, I've included $25 million in benefits and work rule changes in our proposed budget, or an estimated $125 million in savings for our Five-Year Plan. It is a minimum level of savings that we must have in order to afford we're proposing to do. Without these savings, unfortunately I have to tell you, layoffs will surely follow. There is no question about it.
This budget and plan also does not include any money for salary increases. If raises are to be found, those dollars must come from other efficiencies that labor and management implement in the course of the contract negotiations. As you can see, there are many working parts to this proposed budget. It requires support from our taxpayers, cooperation from our employees, approvals from the General Assembly, the Governor and, of course, this City Council. One area I have not yet addressed is the independently elected officials and their operations. In the last three months, in the course of our extensive budget outreach process, Philadelphians have urged me on many occasions to do things by executive that, quite honestly, I just don't have the power to do. And while it's true that our 1951 Charter is often described as creating a "strong mayor" form of government, everyone doesn't work for me. There are about 23,000 city employees supported by the General Fund, but more than 3,250 are not under the executive branch control. On a host of spending issues, whether it's City Council, the Sheriff, First Judicial District, the Register of Wills, the District Attorney and the City Controller, all have significant authority over their own budgets. Today, I'm asking all of our elected officials to look carefully at some of the things we've been doing in the Administration, and I want to commend you for many of the things that you've already done. I reduced my own budget in the Mayor's Office by 22 percent compared to budget. )
-- to our City Council a bill that prohibits future elected officials to joining that program after this year. (Applause.)
I'm also calling on all elected officials to do more. And you've done a great deal, but I'm asking you to do more on behalf of the citizens of Philadelphia and our city employees. Whether, as many of you have already done, making across-the-board cuts, salary reductions, either for yourselves or possibly staff, voluntary furloughs, returning city cars or simply reducing the use, do something to help. We need the savings, substantial savings, and we need them right now. (Applause.)
I cannot be more serious about this, and I also know and I know you know that the citizens of this city are watching what we do. (Applause.)
As we move forward, we're thinking about efficiency and reducing costs every day, not only by learning to work smarter and faster, but also by completely rethinking and reforming our government structure. Philadelphia is a wonderfully old city, but it also has a dated government structure. And as I noted last year, the row offices in many instances are a significant component of our city budget costs. In the 21st century and at this time, it is prudent and fiscally responsible to carefully study the future of these row offices and the millions of taxpayers' dollars spent each year. Many of the functions carried out by the City Commissioners or the Sheriff, the Clerk of Quarter Sessions, the Register of Wills, the Board of Revision of Taxes, of course, are vital to this city. The question is whether or not we can provide these services more efficiently and at less cost if these elected offices and these associated costs are removed and the core functions are redistributed to other city departments. It is a question that needs more study, but it needs to be addressed with a careful analysis, and I am certainly committed to exploring the various options for how we may either reduce, consolidate or eliminate any of those offices. Similarly, the City of Philadelphia has hundreds of buildings, including many very old, deteriorating facilities that are way beyond their useful life. Last week, Councilman Jim resolution that could lead to an independent non-partisan commission to inventory and evaluate city assets and then make non-binding recommendations to this Council and to the Administration for potential closure. This is a concept modeled after the military's base closure process. As a city, we must confront the issue of how our current portfolio of facilities matches our needs and resources in the years to come. It may be that there are exciting opportunities to consolidate city services in selected buildings. I believe this proposal could be the appropriate venue for a rational and deliberative consideration of our future facility needs, and I ask Council to consider this issue as soon as practical. Meanwhile, the reform teams put in place by Managing Director Camille Barnett are looking at a variety of issues, from increasing police efficiency with better use of technology, consolidating administrative functions and studying the sale or long-term lease of city assets. The Managing Director is also using the PhillyStat process to hold departmental managers accountable for constant improvement of services that are most important to the public. Philadelphians, of course, can see the progress of that activity by literally streaming it on the web or watching on the cable access channel No. 64. This morning I've talked a great deal about our fiscal crisis and our difficult choices. I believe a good leader listens, consults, carefully considers alternatives, and then leaders must lead. And that's my job as the leader of this city. One attribute of leadership is the will to make tough, painful choices now for the sake of a better future. a valley of despair and knowing you can walk through tough times because you have a vision of a prosperous future on the other side. We are in that moment right now in our great city. We can no longer operate this large government as it has in the past. We've got to change or we'll be left behind as a once great city. People and businesses will give up on us. Well, I'm not going to let that happen, and I'm sure you won't either, because we're going to come out of this recession together. I don't know when, but we must use the time available to prepare for the next round of growth. What will Philadelphia look like three years after these proposed temporary taxes expire?
Well, I see a smaller, leaner, more agile, more productive, lower cost government. I see increased productivity. I see jobs, jobs for all I see educational and medical institutions expanding their operations and working in concert with the City on its educational and employment goals. And with the completion of the Pennsylvania Convention Center expansion, I see our hospitality industry taking off, with more hotels and conventions and tourists who will take in our incredible array of cultural and historical venues, including the Barnes, the National Museum of Jewish-American History, the President's House, our world-class restaurants and our two casinos. )
-- let me thank Councilman Frank DiCicco for his steadfast leadership on this tough issue, and I've enjoyed working in concert with Councilman Clarke as well. We'll be the leader in sustainability, spurred on by a new Code, a strong Planning Commission, a powerful plan for sustainability and a creative parks and recreation program that fosters both recreation and our great Fairmount Park. (Audience member yelling, "What about the trash?")
We'll be known as a leader -- we're going to pick it up every week for free. (Applause.)
We'll be known as a leader in the application of green roof technology, and our green collar workforce will be growing by leaps and bounds, thanks in part to President Barack Obama's Administration and the recovery program that enables us to dramatically expand our weatherization and energy reduction programs. Our wage and business tax cut schedules will be reinstituted sooner than we planned, and as construction cranes pop up all over the City, the noticeably more diverse, thanks to the work of the Advisory Commission on Construction Industry Diversity and the cooperation of unions and employers. More Philadelphia students will graduate from high school and college and choose to stay here to fill the needs of our city's many employers, and more adults will return to get their college degrees, which in turn will enhance their opportunities to move up in the new economy. My friends and colleagues, there is nothing that can stop us from reaching our destiny. We're taking steps now to make our future success inevitable. We've got one eye on the current situation, but one eye always focused on the future and the better days to come. This is the time for all of us to turn toward each other in partnership, not away from each other to score is the time when we show ourselves, the region, the Commonwealth and the nation who we are and what we're about, that we're a great city in America. We're a city of neighborhoods. We're a world city where people from all over the planet come right to Philadelphia. We are a world-class city. This People's Budget is the product of your hard work. You spoke. We listened. And now I present your budget to you. You said you cared very passionately about libraries and recreation centers. Well, make sure you follow through on that and volunteer at one of our great facilities. You talked about the need for good after-school programs as a part of a safe, nurturing city. We need more adults to help run those programs and parents to make sure their children are said you want your children to get a better education. I call on you now to make sure that your children go to school every day, completing their assignments and not getting in trouble. You want to grow your business in our city. Well, please consider taking advantage of our new Office of Neighborhood and Business Services at our Commerce Department. Nothing, nothing, nothing that has happened over the past six months can stop us from achieving our goals. We have the future before us, full of promise and new ideas and a renewed sense of hope. Now is the time for big dreams, for bold action, for huge political courage and the will to change, change we can believe in. Working together, solving our problems together, achieving great things together, that's the new Philadelphia, Thank you. God bless you, and God bless Philadelphia. (Applause.) (Audience members yelling, "Don't tax the poor.")
We're still in session. Are there speeches on the part of the minority? We're still in session. At this time, the Chair recognizes Councilman O'Neill.
Madam President, in deference to our Mayor, I'm going to stand and be heard rather than sit and be quiet. Let me just point out what I think one could argue --
Councilman, just a moment, please. Those who are leaving, please do so quietly. Councilman.
Let me point out that at least in this member's opinion, there is a strong argument that this might be a new day, but this is an old way. Two, that this might be talked about as the people's budget. This could be argued very strongly that it's the government's budget. And let me just say that when we're looking at these kinds of tax increases on our poorest populations, that we are being asked to raise a lot more revenues for a very similar structural deficit that we had at the end of Mayor Goode's administration, and at that time, neither Council nor the Mayor would impose these kinds of burdens on our public, and we did something that was unheard of, to have our own one percent increase above the rest of the state, so that we could borrow money with the state's backing and figure out how we could restructure our expense side, which And that happened at the beginning of Mayor Rendell's administration. And this may be time, instead of having Plan B where real estate taxes are doubled or tripled, to have a Plan B that is PICA 2, using that same one percent sales tax concept to go from instead of 6 to 7, as we did the last time, to go from 7 to 8. Because I can tell you, the people I represent, the people I talked to around the City will accept that based on a restructuring of government and not just moving around the little pods. Then they would -- the kind of drastic increases in their taxes, which they can't afford, in the real estate area -- some people seem to just think that's the area to go after. Well, I can tell you, we were very smart when we did not do that or the wage tax back then, and I think it would be very smart now to consider that other concept. The Mayor is very well-intentioned, but the Mayor also has another branch of government that's allowed to have its own ideas. And I just want to stand to be heard on what I hope we can at least have a good discussion about in this body. Thank you.
Thank you very much. Are there any other speeches on the part of the minority? (No response.)
Are there speeches on the part of the majority? The Chair recognizes Councilman Green.
Thank you, Madam President. I will stand in support of my colleague, Councilman O'Neill. It is time for true collaboration with the Administration, which means respect for each other's points of view, and I look forward to an open dialogue where our substantive policy discussions rather than treated as meaningless rhetoric. Thank you, Madam President.
Thank you. Does anyone else want to be recognized? (No response.)
Seeing no one, the Chair recognizes Councilman Clarke for a motion to adjourn.
Thank you, Madam President. I move that Council stand adjourned until Thursday, March 26, 2009, 10:00 a.m. (Duly seconded.)
It has been moved and seconded that Council stand adjourned until Thursday, March the 26th at 10:00 a.m. All in favor will say aye. (Aye.)
The ayes have it and the motion carries. Thank you. (Stated Meeting and Budget Address adjourned 11:45 a.m.) CERTIFICATE I HEREBY CERTIFY that the proceedings, evidence and objections are contained fully and accurately in the stenographic notes taken by me upon the foregoing matter on March 19, 2009, and that this is a true and correct transcript of same. ______________________________ MICHELE L. MURPHY RPR-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.)