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Committee Hearing, March 30, 2004 (part 1)

Minutes from Philadelphia City Council Committee Hearings, Mar 30, 2004

People mentioned

Names our system found in this transcript. Automatically extracted, so it can include anyone named in the record, not only officials or parties.

Mr. Fina

The tenant has a lease that runs through 2008, and ACE is not forcing that tenant to relocate from the premises at all.

Councilman Cohen

No, but how do their executives take it? They haven't done nearly as well as the new people, who have not contributed to the rental at all for the building. And yet the new tenant comes in at a successful rate. The new tenant probably disturbs the work of the old tenant. It's awful hard to have such a large movement in a building without disturbing the current work force. But how do you protect the present tenant's rights? Have you discussed this? Does the present tenant feel that their role is going to be better off with this new tenant coming in?

Mr. Fina

We have reached out to the new tenant, Councilman. And the tenant has a lease that cannot -- and was not being disturbed.

Councilman Cohen

Do you mean they 137 Whole - 3/30/04 - Bill 040157 don't have any power; therefore, we don't even have to worry about them?

Mr. Fina

They have -- They have under law a lease. You're an attorney. You know that you have rights under that document.

Councilman Cohen

Well, they may have a lot to complain about, that when the building became emptier and you no longer had tenants like the current ones in, who were loyal and are not trying to break a lease -- I think that's true -- and they're in for a longer term, then the City kicks them and doesn't show any interest in them. But new tenants coming in get benefits. I'd be very disturbed if I were a tenant in that --

Mr. Fina

ACE is not a tenant. ACE is a landlord. They're purchasing the building, spending $74 million to acquire and improve the property. They are not disturbing the lease -- They are not disturbing the lease of the current tenant.

Councilman Cohen

How long does 138 Whole - 3/30/04 - Bill 040157 that least last?

Councilman Cohen

As politicians know, these years move along quickly. 2007 is our next election. It's almost... It seems around the corner. Well, I certainly hope that the City begins thinking of these things, because I think you're being whipsawed into a terrible position. New Jersey and Pennsylvania ought to be working together, as Delaware and any states around here, because I think we need a governmental combination to resist these efforts by business to do what it's doing. Now, how do you work with the tenants that are in the building? How do you explain this to them? You say to them, we were lucky; we signed you up for many years, so you don't have any rights now until 2008?

Mr. Fina

Councilman, they have all the rights of any private corporation that signs a lease with an independent landlord. 139 Whole - 3/30/04 - Bill 040157 We will work with this tenant. We've reached out to this tenant. And when their lease expires, we'll be happy to work with them to retain them.

Councilman Cohen

And you're going to have to pay heavily then, too, probably, because you're showing them how to compel the City to share part of the costs. Just play tough, develop a theory, maybe even call New Jersey and say, come over and invite us, because we've got to lower the costs of our rental costs or don't apply for PIDC help.

Mr. Fina

I believe there's been 66 leases renewed in Center City. And ACE is the first company that we are providing a TIF for because they're the first company making an acquisition of the property and making a capital investment of $74 million.

Councilman Cohen

Well, tell me: How is the School District going to fare?

Mr. Fina

We are not TIFing the Use and Occupancy tax, which is the tax that 100 percent of that goes to the School 140 Whole - 3/30/04 - Bill 040157 District.

Councilman Cohen

Right. How about the --

Mr. Fina

So we are not using that to pay for the TIF note.

Councilman Cohen

Are you using the 55 percent of the real estate tax?

Councilman Cohen

Goes to the School District?

Councilman Cohen

Why didn't you tell me that? Why didn't you say, we're now limiting ourselves. Instead of telling me that there's one tax we're taking off, what City taxes -- school taxes are you not taking off?

Mr. Fina

I gave that information in my testimony earlier, but I'll be happy to repeat it.

Councilman Cohen

Yes. Please repeat it. There's no rule in Council that says that once a witness has given testimony, that he's covered the area and 141 Whole - 3/30/04 - Bill 040157 no further questions are going to be permitted. You know, if these questions are uncomfortable, I understand, because I think Philadelphia is digging its own grave.

Mr. Fina

They're not uncomfortable at all, Councilman. As currently occupied, the project site will continue to generate taxes of approximately $1.8 million per year initially, and $46.9 million over years 14 from within the District. That's the TIF 15 District. Of this amount, $36.5 million 16 will go to the City, $10.4 million to the 17 School District. If the project -- 18

Councilman Cohen

What goes to the 19 School District? 20

Mr. Fina

$10.4 million.

Councilman Cohen

And how much goes to the City?

Councilman Cohen

Real estate tax?

Mr. Fina

No. I... 142 Whole - 3/30/04 - Bill 040157

Councilman Cohen

No; we were talking about real estate tax. I want to know how much goes to the City from the City's real estate tax, and how much goes to the School District.

Mr. Fina

Presently the base value is $465,000 annually. That's what the property pays now, and that will continue to pay that. And that goes --

Councilman Cohen

Goes to the City?

Mr. Fina

That's the property tax. Half of that goes to the City, approximately; half of that goes to the school --

Councilman Cohen

55 percent of it goes to the School District.

Mr. Fina

58 percent goes to the School District.

Councilman Cohen

58 now?

Councilman Cohen

And then only 42 to the City.

Mr. Fina

That's correct.

Councilman Cohen

So the School 143 Whole - 3/30/04 - Bill 040157 District is going to continue that part of its tax.

Mr. Fina

Yes. And $137,000 and change is in Use and Occupancy tax. All $137,000 will continue as the base Use and Occupancy tax to flow to the School District.

Councilman Cohen

And what continues to flow into the City that will be comparable to what flows into the School District?

Mr. Fina

The City gets approximately $407,000 a year. I'm sorry. The City gets approximately $1.4 million a year, and the School District gets approximately $407,000 a year.

Councilman Cohen

But that's made up of all different kinds of taxes.

Councilman Cohen

And the company doesn't pay those taxes.

Mr. Fina

Well, they do.

Councilman Cohen

Oh, there's is company. They're not the Wage Tax from 144 Whole - 3/30/04 - Bill 040157 employees?

Mr. Fina

Yeah. They pay Wage Taxes. We don't use Wage Taxes to pay for the TIF note. That's an ineligible tax. That goes all to the City.

Councilman Cohen

The City gets that money.

Mr. Fina

Yes. The School District will receive, if City Council approves this TIF, over the 12 years, $17.5 million. 13

Councilman Cohen

What would the 14 City get if this was not a TIF? 15

Mr. Fina

What would the City get? 16

Councilman Cohen

Covering that 17 figure, instead of the School District 18 getting $17.5 million over 20 years, what 19 would the School District get if there were 20 no TIF?

Mr. Fina

Probably about $24 million.

Councilman Cohen

I think it's bad policy for the City to have to go and borrow. We borrowed... Was it $300 145 Whole - 3/30/04 - Bill 040157 million for the School System? To enable it to be sure it's going to continue to operate, and then to cut any income to the School District. The whole thing is maddening to me, and that's the reason I raise these questions. All right. Thank you, Madam President. That's all I'm going to raise now.

Mr. Fina

Thank you, Councilman.

Councilman Goode

Point of order.

Council President Verna

Yes.

Councilman Goode

Madam President, I have to leave the Chambers. In my absence, I'd like to have my vote recorded.

Council President Verna

Please. I think I know where you're going, but...

Councilman Goode

No. 21

Council President Verna

Okay. Councilwoman Tasco and Clarke, you don't have any questions of our witnesses?

Councilman Kelly

Madam President.

Council President Verna

Yes. 146 Whole - 3/30/04 - Bill 040157 Councilman Kelly.

Councilman Kelly

Madam President. I would just like to say... in just in regard to Councilman's Cohen's statement, I think by doing nothing -- By not doing everything we can to bring businesses into Philadelphia and to keep the ones that we have, by doing nothing, I think it's going to dry up the City. I think in this particular case, I think PIDC is to be commended. They did a good job. I think they did a great job in making this -- making this TIF presentable today. I also want to congratulate and commend the people from not only PIDC, but the Chamber of Commerce, and of course the president and the corporate officers from the company that's involved in this thing. I just want to put in my recommendations, that this is going to be a very, very difficult year. And this is the first TIF that I'm here hearing today in this presentation. 147 Whole - 3/30/04 - Bill 040157 And I just wanted to say that -- again, that you did a commendable job. And I want to thank you, and I want to thank the Chamber of Commerce, and I want to thank all the people from ACE, not only, I think, for staying in the City, and I think they're going to expand. And I want to do everything I can to help you do that. Again, thank you very much. And thank you, Madam President.

Council President Verna

You're welcome.

Mr. Fina

Thank you, Councilman.

Council President Verna

Mr. Fina, I know you're going to be disappointed. You're going to have to stay in the Chamber until we're finished.

Mr. Fina

Be my pleasure.

Council President Verna

Thank you. Mr. Roundtree. The Chair recognizes Councilwoman Tasco.

Councilwoman Tasco

Thank you very 148 Whole - 3/30/04 - Bill 040157 much. Glad you were able to come, Mr. Roundtree. As a result of the hearings that we had last spring, relative to the minority participation on the projects that we support and which left a number of us with some disappointment, and the number of minorities and women who finally end up in the unions, I want to -- I want to talk to you about that and find out where we are. We have talked to the people at ACE, and it seems to me that their commitment is to be inclusive. It's certainly outlined in their letter. Talk about what they will do as the developer to have a good faith effort to maximize employment for minorities and women. When we talked last year during the course of some of our hearings, we had a chart that showed the number of training programs in the City of Philadelphia, as well as the number of graduates, and then 149 Whole - 3/30/04 - Bill 040157 the number of workers who were able to access union membership. And it was quite disappointing, in terms of the results. Have we done better? And what do you see your role in improving the lot of women and minorities who live in this City who have not been able to access permanent employment through the union process?

Mr. Roundtree

Good afternoon. My name is Dan Roundtree, and I'm the Director of the Minority Business Enterprise Council. And your first part of your statement was absolutely correct. It is going to be achievable by the support and by the energy that's driven by ACE -- and -- as a developer, and PAID and PIDC as co-developers or co-sponsors of the initiative that we reviewed. Because a lot will come down to them making decisions as to whether or not firms are in compliance with the goals and ranges that they set forth in this plan. 150 Whole - 3/30/04 - Bill 040157 I think this plan is a very achievable one. It has some aggressive tendencies to it, but -- but they all are achievable. And we do have the kind of construction marketplace that will sustain these levels of participation. And it has come to my -- It's my opinion that, based on the projects that I reviewed over the last several months and years, that these goals are attainable.

Councilwoman Tasco

When you talk about the skill trades in your work hours, is this 40 percent work hours or is it 40 percent participation? How are you calculating?

Mr. Roundtree

I'm counting it by hours, by percentage of hours. And the 40 percent is based on Philadelphia residents and by trade. And the percent for 22 minority and 10 percent for females are 23 based on trade. The 10 percent itself for 24 female skilled trade workers is a very 25 aggressive one, but I think it's attainable 151 Whole - 3/30/04 - Bill 040157 because this is a renovation project versus the new construction.

Councilwoman Tasco

Well, when you talk about the trades, are you talking about all trades or will all the minorities come out of the laborer's district?

Mr. Roundtree

We are talking by trade of all the trades. Because I don't think, with the exception of the demolition, and I don't have a thorough outline of their construction plan. But with the exception of demolition, I don't think there's going to be a large concentration of laborers. What I think you're going to have, even on a project of this size, is a small concentrated work force for rehabilitation or renovation versus new construction. There's a difference. Most -- Although the dollar values of the contract may be comparative to a new construction, it is renovation. And so, therefore, your work force will be a smaller, more concentrated one. 152 Whole - 3/30/04 - Bill 040157

Councilwoman Tasco

What are the concentrated skills?

Mr. Roundtree

The same. I believe there would be -- Everything with the exception of the structural steel and concrete. I think you'll still have electricians, plumbers, heating and air conditioning, because I heard you asked -- someone asked the questions about the energy activity. So that will definitely keep in consideration the pipefitters, the sheet metal workers. And if it comes to my mind, if I missed anyone, I think those are the critical trades. And carpenters. There should be a large concentration of carpenters. And possibly... Again, I haven't seen the building, but you should have some... a finishing trade with painting and plastering. Those, I think, will be -- make up the bulk of the trade. I don't think you'll have a large 153 Whole - 3/30/04 - Bill 040157 concentration of masons or bricklayers or structural iron workers or anything of that nature. I think most of this is going to be renovations.

Councilwoman Tasco

Mr. Fina talked about an oversight committee, because in their letter they lay out all of the areas they're committed to. And INA ACE being the developer of it, has agreed to abide by the goals set forth by the contract. Who will be the oversight committee, and how is that oversight committee selected?

Mr. Roundtree

The oversight committee? I think they made a recommendation, and having someone from the Office of the President, somebody from another member of Council, somebody representing PIDC, somebody's representing MBEC, someone representing the actual trade council. And I believe there... Oh, the Afro-American Chamber, the Latino Chamber, and I believe someone else -- Oh, the 154 Whole - 3/30/04 - Bill 040157 construction... But they're ex-officio members, the construction manager, the architect, and they also are committed to hiring outside consulting firm to do the actual reporting mechanism.

Councilwoman Tasco

So, how do all these people -- So many people. How do you manage all of that?

Mr. Roundtree

There's going to be a chairperson, which I don't know how they're going to select the chairperson. But there should be a chairperson. And that person will become the spokesperson for the organization. There will be monthly meetings.

Councilwoman Tasco

They have about 15 to 20 people overseeing this project?

Mr. Roundtree

It should be. It should be. And it should be a few that stakeholders. Everyone in this, and everyone that's involved should be considered a stakeholder and should be able to facilitate some change, if need be. Because one of the major problems that you 155 Whole - 3/30/04 - Bill 040157 have is that the subcommittee or the oversight committee will only meet once a month. So they must empower someone or some group of people to deal with any occurrence that may come up within the -- between the meetings. And so, that's where your chairperson is going to...

Councilwoman Tasco

I understand that the Progress Plaza project is the first TIF where you incorporate this oversight committee under economic plan or has this worked in other TIFs?

Mr. Roundtree

See, this is the first one since the April, that I am aware of, that I have been contacted to provide any -- any participation or review of, since -- since the inception of the Ordinance 030125 and the new executive order 00103. So, we took a very cautious approach as to how this is going to be done. I was not contacted by OIC -- about the OIC TIF.

Councilwoman Tasco

Mm-hmm. 156 Whole - 3/30/04 - Bill 040157

Mr. Roundtree

So this will be my first endeavor at trying to make this approach work.

Councilwoman Tasco

Okay. So, you will be the monitor for this? Are you saying that there will be --

Mr. Roundtree

We will be responsible for monitoring on behalf of the City. But ACE has agreed to hire an outside monitoring group to provide a day-to-day activity of going to the work sites, and those kind of things. But we will review the information that is provided through them.

Councilwoman Tasco

Do you know who that consultant is?

Mr. Roundtree

No. We recommended that they leave that open so that they can actually solicit proposals from a group of people, so they can get a very competitive scenario and inject some energy into what it is they're trying to do. This is going to be -- Because it's such a tight construction schedule, that is 157 Whole - 3/30/04 - Bill 040157 going to be the most -- the biggest challenge because they do have a very aggressive construction schedule of 5 months. And so, you won't have a lot of 6 time to make mistakes, be it structural or 7 philosophical, when it comes to 8 facilitating the economic opportunity plan. 9

Councilwoman Tasco

Okay. Thank 10 you, Madam President. 11

Council President Verna

Thank you. 12 The Chair recognizes Councilman 13 Kenney. 14

Councilman Kenney

Thank you, Madam 15 President. 16 I have to leave the Chamber for a 17 few moments. I'd like to leave my vote as voting yes, if I am not here when the vote is taken. I'd also like to thank ACE INA for sitting through this. I know it's not an easy process. And perhaps it should be easier to stay here in the City. And we appreciate your patience. Thanks.

Council President Verna

I believe 158 Whole - 3/30/04 - Bill 040157 an amendment may be offered. How are you voting?

Councilman Kenney

I would be voting aye on the amendments also. Thank you.

Council President Verna

Thank you. Mr. Roundtree, on this oversight committee, you indicated that there would be a representative from the City Council President's Office.

Council President Verna

And also a Council member?

Mr. Roundtree

Or someone else from Council.

Council President Verna

Okay. Can you send me a letter on that, please?

Mr. Roundtree

Yes. It's included in their -- It's included in their economic opportunity plan, because they did go through and identify as many potential stakeholders as they could.

Council President Verna

Okay. Thank you. 159 Whole - 3/30/04 - Bill 040157 The Chair recognizes Councilman Clarke.

Councilman Clarke

Thank you. Thank you, Madam President. Good afternoon.

Mr. Roundtree

Good afternoon, Councilman.

Councilman Clarke

I have one quick question for ACE. In prior testimony they had indicated that they had a plan for college recruitment or were developing a plan for college recruitment to some way help us stop the brain drain. And I would like to know, do you have a similar plan for minority recruitment? If I hear your numbers -- and correct me if I'm wrong -- that percent 19 of your entire work force is minority, and 20 only 16 of the 152 of the executives in your work force are minority. And that's not reflective not only of the City of Philadelphia but of the region. So I would like to know if you have an aggressive strategy and plan in place to 160 Whole - 3/30/04 - Bill 040157 increase the level of minority participation in your, you know, everyday work force.

Council President Verna

Please identify yourself.

Mr. Gales

Thank you. Kaywin Gales, Executive Vice President, Human Resources. As I stated earlier, we are very committed to diversity. We had talked about the fact that we are establishing a relationship with Howard University in Washington, D.C. to increase our diversity representation. Howard University has a very good risk management program. Additionally, last year, in the hires for Philadelphia, we hired over 200 people of which percent of those were 20 minorities. 21 And all the search agencies that we 22 use, we specify diversity goals within 23 those contracts, as well as all the 24 recruiting agencies that we use we also 25 specify diversity goals within those 161 Whole - 3/30/04 - Bill 040157 contracts.

Councilman Clarke

And you still only have percent minority work force 5 and 16 out of 152 in the executive level. 6

Mr. Gales

Correct. But we are 7 seeing a trend upward in our recruitment 8 efforts for minorities. 9 We have various outreach programs. 10 As I stated earlier, we are beginning to 11 work with the Urban League, to reach out 12 and to do work there as well, to attract 13 minorities to our organization as well. 14

Councilman Clarke

So you're going 15 to adjust your strategy because the 16 existing strategy is apparently not 17 working, as well as at least this member 18 would like to see. 19

Mr. Gales

I don't know if I would 20 say we would adjust our strategy. I think we have to stay the course, in terms of our recruitment for the various jobs within our organization. We are doing, I think and believe, the right --

Councilman Clarke

When you say 162 Whole - 3/30/04 - Bill 040157 stay the course, what do you mean? You think this is an acceptable level?

Mr. Gales

I wouldn't say this is an acceptable level. I think we have to continue to work with those agencies, the urban leagues, and the various outlet programs that we have in place, the various colleges and universities, to increase our representation of our hires within our organization.

Councilman Clarke

Well, if you're working with those agencies, and you have numbers that, frankly speaking, are somewhat abysmal; and you're saying that you're not going to alter that approach or enhance that approach, then I'm a little concerned, first, that you're not acknowledging that the numbers -- It appears that you're not acknowledging that the numbers are not what it should be; but second, that you sound like you're not even willing to entertain a change in your approach to increasing those numbers.

Mr. Gales

Well, we are very 163 Whole - 3/30/04 - Bill 040157 aggressive in our recruitment strategies with all the agencies that we're working with and the universities. We have implemented the appropriate training within our organization for our managers, from a college recruiting standpoint, as well as for our diversity hire standpoint for individuals who understand our commitment to diversity, increasing diversity hires within the organization.

Councilman Clarke

You're just saying you're aggressive. But you're not achieving the goal. I'm assuming the goal -- You have got to have more than 16 out of 152 executives. I'm assuming that that's not an acceptable number for you.

Mr. Gales

It's actually 16 of 117.

Councilman Clarke

It's still not representative of the region.

Mr. Gales

It's not representative of the region, but it is --

Councilman Clarke

It is representative of the industry? 164 Whole - 3/30/04 - Bill 040157

Mr. Gales

It's trending in the right direction. It's a very difficult industry in which we are operating in. As we said, we do make sure that we increase our diversity representation in every single hiring classification that we have. We stress that to our management team. We stress that to our recruiting agencies. We stress that with the colleges and universities that we are working with. We have identified what we believe the right universities: Temple University, Drexel, Howard University, to help us increase our minority representation.

Councilman Clarke

All right. You're not going to change your answer. That's quite clear. And I'm going to tell you, I'm not very happy with your answer. And during the process of this oversight committee, I would hope that the oversight committee deals not only with the construction trades, but long-term opportunities, to help you adjust your thinking on this matter. 165 Whole - 3/30/04 - Bill 040157

Mr. Gales

We'll certainly welcome the input. Thank you.

Councilman Clarke

All right. Mr. Roundtree, on these numbers that we received on the construction management and the construction, there's a difference, a relatively small difference, in the minority numbers in the construction management and the participation of the construction entities you have on the MBE. You have and 30 on the 13 construction management, and you have 30 14 and 35 on construction. Is there a reason 15 why there's a difference? Is it more 16 difficult? 17

Mr. Roundtree

Yes, because in your 18 construction management, you're only going 19 to have one company providing that service. 20 But in the actual construction where we 21 will proceed, the bricks and mortar, you're 22 going to have more than one company, so you 23 have more of an opportunity for 24 participation. 25

Councilman Clarke

So it's a matter 166 Whole - 3/30/04 - Bill 040157 of the numbers that gives you a better opportunity.

Councilman Clarke

On this oversight committee, I had the occasion to sit on the two larger oversight committees on the stadiums, where we had an opportunity to handle substantially an amount more of individuals working on the projects. It was clear, a consensus to most, that we made some mistakes early on in the process, particularly as it related to some of the apprentices and dealing with the ratios. And as a result of that, we didn't do -- we weren't able to infuse new people onto the process; therefore, not allowing us to include an additional minority work force on the process. Prior to the implementation of this particular oversight committee, when you look at some of the things that we did, in retrospect, on the stadium oversight 167 Whole - 3/30/04 - Bill 040157 committee, that can be corrected before we start this process so we don't duplicate that.

Mr. Roundtree

Because of your question, I think one of the things that needs to be reviewed is to establish a goal for apprentice. But let me be clear about one thing. Because of the size of the this project, you're not going to have the volume of apprentice that you would normally have on a new construction activity. But I still think that the -- that we should recommend that they have at least a range or a goal for apprentice, because people won't -- won't learn this trade or won't learn this activity unless they're involved in it. So, you know, one of the suggestions would probably be to have some level of goal for apprentice.

Councilman Clarke

Frankly speaking, I'm surprised to hear that it's going to be an oversight committee on a 168 Whole - 3/30/04 - Bill 040157 project of this size.

Mr. Roundtree

Yeah.

Councilman Clarke

Although it's a big dollar amount, it's not a lot of employees. So I'm happy to hear that we have that. And hopefully we will do that as we proceed along TIFs.

Mr. Roundtree

The other interesting part, and I think that the thing that will make this a more successful activity, is if they get the oversight committee involved much earlier. Right now they're doing a lot of the planning. The oversight committee could be used to help them shape some of the bid packages. Because once it starts, it will have -- As you know, in construction it's a snowball effect, and nobody will be able to stop this train.

Councilman Clarke

Right.

Mr. Roundtree

And so, the more impact you have and the earlier you have the impact, the better the -- the more 169 Whole - 3/30/04 - Bill 040157 successful you'll be.

Councilman Clarke

Do we know who the general contractor will be?

Mr. Roundtree

No. I don't believe they've selected one yet.

Councilman Clarke

Okay. Good. That's good. All right. Thank you, Madam President.

Council President Verna

The Chair recognizes Councilwoman Brown.

Councilwoman Brown

Thank you, Madam President. Let me continue with the questioning regarding the oversight committee, and then I'll come back to the recruitment issue. You indicated in your testimony that you identified the members, and you indicated that a chairperson will be elected or selected, and then you used the word spokesperson. Who ultimately is going to be accountable for ensuring that these goals are achieved?

Mr. Roundtree

The developer. 170 Whole - 3/30/04 - Bill 040157

Councilwoman Brown

The developer.

Mr. Roundtree

The developer.

Councilwoman Brown

Okay. And because this is the first opportunity for a TIF to have MBE WBE goals in it, it's also a test case, correct?

Mr. Roundtree

Yes. From the Minority Business Enterprise standpoint. I understood there was earlier testimony that there was a TIF for Progress Plaza, but we weren't involved in that one.

Councilwoman Brown

Okay. All right, then. If I could please ask the ACE representative to come again, I have some questions regarding recruitment strategy, please. And if I could ask Mr. Fina to please come forward again for a question around... procedurally, the standard operating procedures at PIDC, when it comes to companies who come before PIDC with an interest in TIFs. As a matter of practice, has it been 171 Whole - 3/30/04 - Bill 040157 your practice to arm corporations like ACE to help them understand that now City Council is paying attention to MBE WBE activity, so that they're not surprised when they come to testify?

Mr. Gales

We do, Councilwoman. We -- We -- And this is not new. We've been doing economic opportunity plans for some time. What you have done, what City Council has done, is made a requirement that it becomes part of the project plan, which we do now, with... Progress Plaza was the first, and this is the second. And with the Mayor's executive order, MBEC has monitoring responsibility. So, they step forward and do the monitoring.

Councilwoman Brown

Okay. So then I'm hearing two different answers then. MBEC will ultimately be responsible for the achievement of the goals of the oversight committee?

Mr. Gales

No. They will monitor. 172 Whole - 3/30/04 - Bill 040157

Councilwoman Brown

They will monitor.

Mr. Gales

They are independently monitoring.

Councilwoman Brown

You told me that the develop would be ultimately responsible. Okay. All right. Thank you. Having worked in higher education, I need to know: Did this project spark a recruitment strategy or did ACE have a recruitment strategy in place all along around the recruitment of women and people of color for the company?

Mr. Gales

ACE has had a recruitment strategy in place all along for the recruitment of people of color and women.

Councilwoman Brown

Okay. Of the 16, how many are professional positions?

Mr. Gales

All 16 in that classification were minority.

Councilwoman Brown

Of the 16 that are minority, how many are professionals and how many are non-professionals? 173 Whole - 3/30/04 - Bill 040157

Mr. Gales

All are professional in the executive group.

Councilwoman Brown

Okay, then. 5 You said that -- You mentioned the Urban 6 League, and you mentioned Howard, and then 7 you said that there's a list of agencies 8 and colleges that you are working with. 9 Could you provide that between now and the 10 final vote? Provide that to the Chair, 11 please between now and the final vote? 12

Mr. Gales

Yes, we can. 13

Councilwoman Brown

Okay. And 14 finally, you said you will -- Because the 15 former practices didn't give you the yield 16 you desire, because we have 16 -- Let me ask you this: Of the 16, how many live in the City?

Mr. Gales

Well, let me just... For a point of clarification, it's 16 in the executive group. The total minorities in the classification is 221.

Councilwoman Brown

Okay. That was not clear to me. Okay. All right. Do you understand the relationship 174 Whole - 3/30/04 - Bill 040157 we're trying to draw between residents who live in the City, people of color who live in the City who pay taxes, and corporations who come to the City of Philadelphia looking for opportunities and tax incentive opportunities to stay? Do you understand the connect?

Councilwoman Brown

Okay. So, you've amended -- or your strategy, the recruitment strategy, what are you doing differently that moves you to a stronger position of increasing the numbers of people of color?

Mr. Gales

We are aggressively working with our universities, as well as our line management, to identify candidates of color, both women and people of color.

Councilwoman Brown

And so that's what you're doing differently.

Mr. Gales

We have been doing that continually since we've been in the City of Philadelphia. There's always been the strategy of ACE, is to aggressively recruit 175 Whole - 3/30/04 - Bill 040157 minorities and females to positions within the organization.

Councilwoman Brown

Okay. And my question was: What are you doing differently? When you say aggressively to better attain these goals, what are you doing differently?

Mr. Gales

ACE acquired INA in 1999. And as soon as ACE came to the City, this is the strategy that we've put in place. We have over the last five years been continuously moving in the right direction, in terms of our recruitment efforts for minorities and people of color.

Councilwoman Brown

Okay, then. I'll look forward to the list that you spoke about, the universities, and non-profits that can aid you in your recruitment strategies, between now and the final vote.

Mr. Gales

Thank you.

Councilwoman Brown

Thank you very much. 176 Whole - 3/30/04 - Bill 040157 Thank you, Madam Chair.

Councilwoman Blackwell

Thank you, Councilwoman. Councilwoman Tasco.

Councilwoman Tasco

Tell the gentleman don't leave. I think it would be very helpful if you just would agree that you would expand your recruitment opportunities to other colleges and universities where there are African Americans, and particularly Bennett College.

Councilwoman Blackwell

Bennett College. (Laughter.)

Councilwoman Tasco

And some of the other historically black universities and colleges, and the United Negro College Fund schools, because there are a lot of them in various parts of the country, but whose students want -- and we're inclined to recruit young people here to Philadelphia. So if they never see a recruiter from INA, and you can take -- There's a 177 Whole - 3/30/04 - Bill 040157 college tour leaving Saturday, so you can take a college tour with one of your recruiters and go to these various institutions. And you may find some very bright young people who are coming out of college who want to live in Philadelphia. Your recruitment helps them bring them to Philadelphia, gives you a quality employee. So all you have to do is say, we will expand our opportunities.

Mr. Gales

We will expand our opportunities.

Councilwoman Tasco

Thank you very much. Mr. Roundtree, I was looking at this Executive Order 40-403, and it says that it expires in 180 days. Is it still effective?

Mr. Roundtree

Yes. It still will be. We submitted a new version to the Administration for them to consider. That's what we have been working under. Until they do that -- Until they do so, 178 Whole - 3/30/04 - Bill 040157 it's still in effect. And they've changed the number. It's really 0103. It was their first Executive Order of '03 that was committed. Unfortunately, when that was printed, it was April, so they put the month of the year versus the actual Executive Order that was issued for that year. So to have --

Councilwoman Tasco

So someone can hold you technically to this order that says it expires -- is effective for 180 days.

Mr. Roundtree

Exactly.

Councilwoman Tasco

But they can.

Mr. Roundtree

They can and they have. And they have.

Councilwoman Tasco

All right. So you're going to get a new one?

Councilwoman Tasco

The other question is, so -- And you'll let us see the new Executive Order?

Mr. Roundtree

Yes. Yes. 179 Whole - 3/30/04 - Bill 040157

Councilwoman Tasco

Okay. I think that's it. I'm done. Thank you. That was it. I'm done. Thank you.

Councilwoman Blackwell

You're welcome. Let me note that when my colleague was talking about Bennett College, I thought of Dr. Leonard Johnson, and how we have more young people from Philadelphia than any other City who go to Florida A & M.

Councilwoman Blackwell

Of course, I'm a Cheyney undergrad, graduate myself.

Councilman Rizzo

Point of information.

Councilwoman Blackwell

Point of information. Yes, Councilman.

Councilman Rizzo

I was just thinking. Of the 16 professionals that work at your corporation, the minorities, have they thought of reaching out to their colleges and let them know of opportunities? Have you kind of started it? That's a very basic place to start. 180 Whole - 3/30/04 - Bill 040157

Mr. Gales

For the record, it's not professionals. It was 16 executives in 4 the executive classification. There's over 5 221 minorities who work for ACE, but -- 6

Councilman Rizzo

Professionals. 7