At any rate, at any rate, one of the problems from our point of view is that this is the opportunity for us -- and when I say "us," I'm talking about the independent newsstand operators. Remember, it's not a monolithic organization; it's the last of the small independent people. And this is our opportunity to have somebody else provide for a stand that is beautiful for the City and possible for us to live in and work in, with heat and electricity and so forth. And we know that Eller's going to make a profit. We hope they make a tremendous profit because we'd like to see this spread throughout the City. Obviously, we've been over this with them and we've tried to do our own proformas. Obviously, they can obtain more profit from an ad 73 4/11/00 STREETS/SERVICES - BILL 166 in Center City than perhaps in some outlying district, but we don't want anybody excluded from this, Councilman.
And so -- well, obviously, I know that you have the absolute right to go into that. We have impressed them as hard as you are because in addition to maintaining, repairing and, most important, initially providing the stand, they are also going to be paying a commission, which will be paid to our individual members. So we're as much interested in those numbers as you are but I don't know that, in all fairness to Eller or to Add Shell, that they can even begin to guess at what maintenance will be. The only thing we could look to is what the Center City District is.
And you know and you have been a supporter of cleanliness in your own district, I know it well. And you know what it is to maintain, and that's the problem. I'm not trying to save him; I'm just trying to have you understand. 74 4/11/00 STREETS/SERVICES - BILL 166
I don't think he's being disingenuous because I don't think he knows what it's going to cost yet, and I don't want you to scare him off.
No, no, no. You know, I'm a kinder, gentler councilman at this point, but I do like to talk about money -- not that I have any but, you know, it kind of becomes the bottom line. Let's figure out the maintenance cost for a second. There's $600 a month in ad revenue. Are there any other financial components to this? Is there something that kind of flows between Eller and the individual newsstand operator?
Yes. There's a percentage share in the revenue, that's correct.
Whatever revenue the signs generate, the Newsstand Association would get a percentage of that, before expenses.
Well, does Eller 75 4/11/00 STREETS/SERVICES - BILL 166 participate in any of the other revenues generated witness the newsstand itself.
Okay. Well, let me -- we were all the beneficiaries of little dual solar calculators from PECO Energy. They might be an advertiser on the thing there. But at 600 a month, that came to $7200 a year in revenue for the stand. That's just 600 times 12.
Does that sound right? I mean, that's what the calculator says.
Well, just so you know, you can't use the number 600, but you're assuming that we're sold 100 percent of the time. Our typical number around the City of Philadelphia and in the surrounding suburbs is somewhere around 70 to 75 percent sales, plus you're not including -- we pay an ad agency a commission of 15 or 16-2/3s, depending on who's buying the ad. That comes off 76 4/11/00 STREETS/SERVICES - BILL 166 the top.
I understand. I'm just going based on what you shared with me.
Our sales (unintelligible) gets 5 to 10 percent for selling it on our end. There's a million costs that --
Wait a minute. Everybody has got to eat that, I understand that.
But based on the figures you gave me of 350 to 400 a month for the big one --
-- 600 a month, 7200 a year. And you're paying $20,000 for the facility.
I understand that, but you're going to have that anyway 'cause many of the stands have electricity already. 77 4/11/00 STREETS/SERVICES - BILL 166
It's more, right. Basically, you have about a three-year payback on the newsstand, if you're fully rigged up for the year.
If we're 100 percent sold and you don't count any of our expenses, yes, it's a three-year payback.
I mean, 7200 times 3 years is $21,600. Those are the numbers.
If you have 50 stands at those rates, you're talking about $360,000 a year in ad revenue, 2 people, maybe you have 30 to do the maintenance operation, so you're talking about another 60 or 90, plus all the things that you laid out.
Right. Plus we have to 78 4/11/00 STREETS/SERVICES - BILL 166 take off the share that the Newsstand Association gets.
Okay, all right. But, I mean, these -- the numbers are not outrageous. I mean, they're not that far out of the ballpark as to be absurd?
No, but you're not taking into consideration a lot of different things. You're assuming it's sold all the time, you're not including any of our costs.
Again, not to be in an argument with you. I can only take what you give me. I've asked you for a number of things, and you said, Well, we have a proforma, but that's at another company, and I don't have that, so I'm limited in my ability to get to where I'd like to be based on the information I get. I'm willing to factor anything into this equation based on what you're willing to share with us.
Well, you can use a 75 sold ratio and you can take percent off for sales 23 commission, and then I'm not at liberty to tell 24 you what commission I'm paying to the Newsstand 25 Association. 79 4/11/00 STREETS/SERVICES - BILL 166
I can tell you that it's substantial. So you're three-year payback is nowhere even close.
Okay, all right. Now, with this particular bill, would this allow anyone who presently has a newsstand to have this new type of newsstand?
Yes, but let me qualify that by saying that we have promised the Newsstand Association that we would do all the Newsstand Association members first, and we would actively try and recruit other members -- non-members to be members of the association to --
I mean, my contract is between the Newsstand Association, so --
Oh, okay, all right. So you have a contract with them. 80 4/11/00 STREETS/SERVICES - BILL 166
Yeah. You know, we promised them that we would try to do theirs first. Most of their members are Center City. And we would try and recruit along with John Rocco in going out and saying, Would you join? You join get a free newsstand, you get a share in the revenue, it doesn't cost you a thing, and the outside is maintain. We pretty much feel that just about everybody would like to join that. The membership fee is not that expensive, I don't believe, to join.
Councilman, for $150 a year, you too can have the Taurus. (Laughter.)
And, incidently, Dave is quite right, we do have a contract with them because, as you know, along with the cooperation that was mentioned from the City from Councilman DiCicco's office, from City Council, Streets 81 4/11/00 STREETS/SERVICES - BILL 166 Department, L&I, and so forth, the Art Commission, it really has been the newsstand operators that have really spearheaded this with that. And so, obviously, we're the ones who enter into the first contract. We're not going to ever exclude anybody else, and no one has to join anything. And I just think, as I say, for $150, you too can have the brand new Taurus.
Let me ask one last question. The Chairman has been most accommodating with me and I appreciate that. What is the light issue, the illumination issue? Is that just a further enhancement of the advertisement and the concern that people can't see whatever is being advertised at night? I mean, why do these have to be lit up?
Why do the signs have to be lit up or why does there have to be electricity to the newsstand?.
No, I know why there's electricity to the newsstand, but why do the signs have to be lit up?
Well, I mean, all signs 82 4/11/00 STREETS/SERVICES - BILL 166 like that it's just part of selling it to national clients.
We have light in bus shelters because wept people to stand there.
By putting it in new newsstands, if the city goes dark by 5 o'clock -- not in the summertime -- you need backlit light. It's pretty much standard in the industry that these type of signs are going to be illuminated. I mean, we would obviously have to charge less.
It's standard in the industry that 11 or 12 o'clock at night is when it's shut off. And you could look at it as a secure area. They're not that bright, but it does illuminate the area right around the newsstand and keeps it more secure from a lot of break-ins, and it not going to blind anybody and it's just going to illuminate the area, it will probably make it a safer and more secure area. 83 4/11/00 STREETS/SERVICES - BILL 166
Again, I hate to interrupt, Councilman Nutter, but I want you to know that at one point, long before we talked about the new newsstands, representatives of the Police Department came to our meetings and asked if we could put lights around the various newsstands and keep them on all night as a help to them. So lighting's not a new concept for us, and we're willing to cooperate. As Dave said, normally, you could put them on a timer and they would go off at 11, 12 o'clock.
Are there any newsstands on Walnut Street or soon-to-be-remade Chestnut Street? (Individuals at witness table confer among themselves off the record.)
Yeah. Well, I'm thinking of the immediate vicinity of Walnut that I'm most familiar with. Most of them are on the cross streets at the intersection with Walnut, such as 84 4/11/00 STREETS/SERVICES - BILL 166 18th and Walnut.
Walnut Street is one of the brightest streets in the City of Philadelphia. I mean, it has a foot candle reading of 4 to 5, as compared to most City streets, which is a quarter to a half. I mean, what's the additional light that you're providing that our new pedestrian light out there aren't providing? I mean, I'm just kind of intrigued at the notion that -- I mean, if people want to have new newsstands and get away from the wooden ones and have aluminum and steel and, you know, titanium might be next, I mean, that would be very interesting. I mean, they'll withstand, you know, fallout or something. But, I mean, I thought it was the Street Department's responsibility to make sure that our streets are well lit and not necessarily have that burden or responsibility on newsstands and advertising companies.
Yeah. I mean, obviously, you know, we're not backlighting signs just for safety and security reasons. It's an added benefit that comes out of it. 85 4/11/00 STREETS/SERVICES - BILL 166
And in certain areas, it will definitely help because a lot of them are very dark. On Walnut Street, it may be very light at night. However, we can't sell half of them lit and half of them not lit. You know, everything in advertising is sold in a package and it will be -- they all -- and that's why I'm asking for a standardized size, because we're going to tie it into the rest of the City and the suburbs with the advertising and it will make it easier to sell so that we can get closer to our 75 or 80 percent sales rates.
You really want to take me back to that 4-by-6. You really like that 4-by-6, don't you?
And it will also help -- all the cultural places, they already have 4-by-6 copy right now that they're using in the bus shelters. It's very expensive, that stuff, and if anybody has ever bought it, they realize it. They 86 4/11/00 STREETS/SERVICES - BILL 166 can take it right now and we've offered it -- at the Art Commission, we've offered it and we can make the same offer and we can put it in the legislation. And anytime we have unsold space, we'll put them up free of charge as long as they supply the advertising.
All right. Let me just lastly say that -- I mean, my limited observations of the advertising industry is that at the end of the day, people will make, cut, shape, whatever it is they need to make, cut, shape to fit in wherever it needs to be fit in, because that's where the money is. I mean, that thing that's wrapped around that building down there near the Ben Franklin Bridge, I don't think that's a standard size -- is that a standard-size building rack?
Okay. So someone made that to go with that particular building, right?
That's correct, but that's a larger-scale type thing. When you're talking smaller signs, you know, an advertiser like 87 4/11/00 STREETS/SERVICES - BILL 166 McDonald's will come in and buy 100 signs at one time. They're not going to buy 3 to their 10-by-20, 3 to their, you know 10 inches by this. They all have to be the same because it's all done at an ad agency and it's all produced the same size. And, you know, every time you change the size of an ad, not only do you just have to -- you don't just reprint it. The design people have to redesign it to fit on that size.
It's just much easier to have a standard size. It will help us sell the signs that are outside of the Center City area, it will help us tie in all the stuff in North and Northeast Philadelphia and South Philly, and it will make it that an easier sell if it's all the same.
Thank you. I need to make an announcement. There is another hearing that was supposed to begin at 10 o'clock this morning. And while this, I think, is very important and I've been working on this for the better part of a year, I guess, with a 88 4/11/00 STREETS/SERVICES - BILL 166 team of people from all different agencies, for the hearing that is coming up, there are a number of people who are CEOs from these major companies which are really important to the economic benefit to the City of Philadelphia. And because of the last-minute introduction of amendments that were distributed late last evening, which I have not even had the opportunity to see, I'm probably going to go back on what I said originally. I didn't want to delay this, but I think at this point, there's no other way to do this in a proper way and to have full participation in the discussion but to allow people to take some time and look into those amendments. And because of the hearing that's following us, I'm going to recess the hearing on this bill, 000166, until April 26th at 3 o'clock p.m. We will vote out the other two bills momentarily. And, again, I apologize to those of you, Paul and Kathy and other folks who were here, and I appreciate the fact that you came today, but we are really running out of time. And, again, I think for all of us to us got back and digest some 89 4/11/00 STREETS/SERVICES - BILL 166 of these things over the next two weeks might be beneficial to all of us and will help Council and other members of Council who are not a part of this committee who may be affected -- in particular Councilmember Nutter and other District Councilpeople -- to look at this and cumulatively come back with some suggestions, amendments, reamendments, whatever it is, to get this thing to work. So I want to thank you all for coming. I want to again apologize. We're going to recess the hearing on this bill. This concludes the public hearing on bills on the Committee of Streets and Services. - - -
We will now move into the public meeting on the Committee of Streets and Services. The Chair recognizes Councilmember Clarke for a motion on Bill No. 000139.
Thank you, Mr. Chairman. I move for motion on Bill No. 000139 with a suspension of the rules. (Duly seconded.) 90 4/11/00 - STREETS/SERVICES - PUBLIC MEETING
It's been properly moved and seconded that Bill No. 000139 be reported out of this committee with a favorable recommendation and a further recommendation that the rules of Council be suspended. All those in favor will signify by saying aye. Those opposed? The bill is approved. The Chair recognizes Councilmember Clarke for a motion on Bill No. 000145.
Thank you, Mr. Chairman. A motion on Bill No. 000145, with a suspension of the rules. (Duly seconded.)
It's been properly moved and seconded that Bill No. 000145 be reported out of committee with a favorable recommendation and that the rules of Council be suspended. All those in favor of the bill, signify by saying aye. Those opposed? The bill is approved. 91 4/11/00 - STREETS/SERVICES - PUBLIC MEETING Thank you for your patience. This concludes the public meeting on the Committee of Streets and Services. (Adjourned at 11:13 a.m.) - - - 92 C E R T I F I C A T E I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia of Tuesday, April 11, 2000, were reported fully and accurately by me, and that this is a correct transcript of same. RE: COUNCIL COMMITTEE ON STREETS AND SERVICES BILL NO.'S 000139, 000145, 000166 __________________________________, JOSEPHINE CARDILLO, Registered Professional Reporter