'Cause I realize there are no real renovations; there are only conceptual renovations. (Laughter.)
And so I want to actually refer to the conceptual agreement. My understanding of the conceptual agreement, not as it is being further defined but as it is already defined, says that if this Council does not do a new stadium deal by November 3rd, that we will buy out the practice facility 205 2/10/00 WHOLE - PUB. MEETING - 003, 4, for $23 million and that we will renovate Vets Stadium at the cost of up to $80 million.
The source of that $23 million conceptually will come from PAID. The source of the $80 million conceptually come from the Capital Budget. Whose decision was it that the $23 million would come from PAID and the $80 million would come from the Capital Budget, as opposed to $103 coming from PAID or some other variation of the two? Whose decision was it, whose recommendation was it, and who's authorized to make those types of decisions?
The conceptual agreement was ultimately approved -- the Mayor made the final decision in terms of what --
Well, I would probably say it was a combination. I mean, I can 206 2/10/00 WHOLE - PUB. MEETING - 003, 4, tell you the members of the, quote/unquote, negotiating team included myself, a couple of members of the Law Department, Bill Hankowsky, a couple of members of PIDC, the Eagles, some discussion with the Phillies. We also consulted with public financial management, represents the City's financial advisor in thinking about alternative ways to fund and finance these commitments.
And in the end, in terms of the determining those financing sources, who is authorized to make those types of decisions? Is it only the Mayor?
Is he the only one authorized to make those types of decisions?
Well, Bill 20 Hankowsky's authorized to make decisions on behalf of PIDC. It's a separate legal entity.
Is he authorized to make decisions on behalf of the City of Philadelphia related to the Capital Budget?
The Mayor proposed 207 2/10/00 WHOLE - PUB. MEETING - 003, 4, a Capital Budget; the Capital Budget has to be approved by City Council.
So only the Mayor 5 was authorized to decide that $23 million would come through PAID and $80 million would come from the Capital Budget?
The Mayor was authorized to reach the conceptual agreement. The conceptual agreement contemplates a legislative package that requires City Council approval.
Let me ask another question. In determining that there needed to be a conceptual agreement, it's been said that there needed to be some measure of good faith, some extension of good faith. Is it the position of the Administration that allowing the Eagles to draw down $7 million in grants from the Economic Stimulus Program is not a measure of good faith?
That is a measure of good faith. That agreement had been reached with the prior administration, and there was a grant agreement already in place, an interim grant agreement. So the City had already made the commitment to the $7 million Economic Stimulus 208 2/10/00 WHOLE - PUB. MEETING - 003, 4, Fund.
The $7 million in 4 grants from the Economic Stimulus Program is from 5 the previous administration, so this administration needs to put something on the table to show good faith?
The Mayor still is authorized, though, to decide whether the Eagles can draw down the $7 million in grant or not, is he not?
So it was still a determination that the $7 million in grants in Economic Stimulus Fund was not enough, that something else needed to be put on the table?
You're 209 2/10/00 WHOLE - PUB. MEETING - 003, 4, welcome. Are any other questions from members of the committee? The Chair recognizes Councilman Nutter.
Point of order. Is this going to be the only time? Are we going to have another hearing? Because there's a lot of information we have to get and study, and I'd like to feel certain that we're going to be able to have at least another opportunity to question.
Councilman, we always have the ability to call back any of the departments before we vote on the budget.
Thank you, Madam Chair. Miss Franklin-Suber, I took down a part of one of your statements in response, I think, to Councilman Cohen with regard to the teams had been 210 2/10/00 WHOLE - PUB. MEETING - 003, 4, proceeding down a road for about a year or two but have become frustrated about the lack of a stadium deal, I guess, last year. And then the Eagles, because they're in need of a practice facility and had started decided to then stop and then shop around the surrounding counties for a new location. Was there a legislative package or documents that were ready for introduction and review in Calendar Year 1999 for this City Council to make any decision with regard to new stadium facilities?
The short answer to your question is, no, there was no final legislative package that was ever introduced to City Council. There were documents drafted, there was legislation drafted. And I was not directly involved in the process, but it is my understanding that at least in terms of the Eagles transaction. They had reached, you know, I guess about 95 percent completion. So were there finally documents final documents that had been executed and signed and final legislation actually introduced to City 211 2/10/00 WHOLE - PUB. MEETING - 003, 4, Council? No. But they had neared the end of the negotiating process and were close to finalizing the transaction. That's my understanding.
Well, why is it that the teams -- I recall some late meetings in December, and I know the Council President had a few visits from people. Why were the teams insisting that City Council take up the issue of new stadiums as late as December 2, 1999 if there were no legislative package ready for introduction, review, and a public hearing?
Councilman Nutter, I was not involved at that point, but Bill 15 Hankowsky was. So maybe he can answer your question.
Councilman Nutter, I just want to make sure I got the question right before I respond to it. Your question is, why were the teams pressing for introduction as late as December if the package wasn't done?
Is that -- do I 212 2/10/00 WHOLE - PUB. MEETING - 003, 4, correctly understand the question?
Okay. The -- and you're right that there were various efforts in, I guess, the beginning sort of mid-November through Erial December. In fact, up until, I guess, whatever it was the last mechanical time you could have introduced --
People were asking that we give consideration to legislation as late as December 2nd.
Although legislation never came, to the best of my knowledge. The President can --
No, it never came. 213 2/10/00 WHOLE - PUB. MEETING - 003, 4, 2
There was insistence that this Council take up that particular issue. There is a public impression left that has never been addressed that somehow, this City Council was potentially negligent in its duty and responsibility to address this particular issue. Now, I would like for you, Mr. Hankowsky, to clear the record tonight as to whether or not there was a piece of legislation with a blue back ready for introduction that this Council could have taken up at that time.
No, there wasn't a package. That's the simplest answer. And maybe to amplify it --
So why was there this pressing need by the various teams that we do something?
I understand. 214 2/10/00 WHOLE - PUB. MEETING - 003, 4, 2
As Stephanie said, we were probably about 95 percent there, in a document production, create-the-package sense. There, as you know, were some very valid and serious concerns raised at least on one plane by residents about issues of traffic and circulation and how things were going to get done, issues like scheduling, because that scenario would have -- I'm not saying that in any way, as you know, Mayor Street has been very clear that he has not agreed on any site selection scenario and wants to look at that very closely. But, again, from a historical perspective, that scenario the November-December scenario, assumed the development of two stadiums in South Philadelphia, so there would have been four facilities. And so there were issues related, for example, to event scheduling. We have enough trouble today with three facilities in event scheduling issues. Now all of a sudden, it's -- and since I was attempting to draft event scheduling rules, the adding of another facility was not arithmetical, it was geometric in its complexity. 215 2/10/00 WHOLE - PUB. MEETING - 003, 4, 2
And so there was an 4 effect, if I could characterize this, I guess a 5 parallel effort. On the one hand, there were a group people working on documents and issues and trying to resolve them and put them into place. And parallel to that was the request by the teams that if we can get all of this done, will you take it, will you introduce it? So you were -- and at the point when it became clear that that was not going to happen, we simply, to be candid, stopped. So we didn't go to closure because it wasn't clear that the product would be a product that a new mayor or a new -- to some extent, a new Council, would want to entertain, that there was no benefit.
The community concerns were not the only thing. 216 2/10/00 WHOLE - PUB. MEETING - 003, 4, 2
I was using that as example of an issue that we were still working through.
But there were other parts of that package that were not ready to be introduced.
Right, right. I mean, I was -- without getting into -- I guess just occasionally history's important. But, I mean, you know, there was an issue with regard to certain real estate properties. I was at a point where there was a, you know, I was scheduled to -- you know, I had an agreement that I was going to proffer to a property owner about, you know, proceeding on a property. When it became clear we weren't going to introduce, I simply cancelled the meeting, so we didn't go that next step. So we -- it wasn't as if whatever was the judgment of the dialogue between the Administration and Council was the only issue. We didn't finish a package that was ready to go, 217 2/10/00 WHOLE - PUB. MEETING - 003, 4, which I think is --
The long and the 4 short of it and to fast-forward to December 2nd or 5 December 3rd, when the stories then evolved that would leave one with the impression that Council refuses to take up stadium issue, the reality is that there was never anything ready for Council to take up in the first place because the parties had not reached full agreement, you still had documents, you had outstanding real-estate issues, you had not addressed the concerns of the community. And so, therefore, it was not a failure to act by this body.
I'm just asking you to clear the record. It's not a failure to act -- (Unintelligible, parties talking over each other.)
I understand. It 218 2/10/00 WHOLE - PUB. MEETING - 003, 4, was a lack of completion by the direct parties who had nothing to bring here for us to look at in the first place; isn't that correct?
Okay. Now, let's talk about -- there's been much discussion -- the word so far for the FY 2001 Budget has been the much-discussed term "deferral." And today we heard that there was an agreement between the City and the teams to agreed-upon deferred capital items to be done at Vets Stadium because everyone at some point in time in the last year or so wanted to focus on new stadiums rather than improvement at Vets Stadium. I believe that was, again, in the testimony of Miss Franklin-Suber; is that correct?
That is correct. 219 2/10/00 WHOLE - PUB. MEETING - 003, 4, 2
I testified that 5 that was my understanding. I was not involved --
-- in those discussions or in the new-stadium negotiations.
I mean, again, I'm not -- I'm trying to be responsive but I'm not sure I'm exactly in tune to the question. I mean, the teams obviously were pursuing new venues.
You know, and I'm not an expert in every issue at the Vets Stadium but, you know, there's issues about, you know, the 220 2/10/00 WHOLE - PUB. MEETING - 003, 4, zippers on the tarp and things that come up.
You mean the new 4 tarp? I'm sorry, you're not talking about the 5 Astroturf, you're talking about the --
So the new issues come up and -- and the teams simply weren't pursuing any long-term permanent solution that might have a life cycle of 2010 because they assumed that they might not ever be there through 2010.
Well, what were some of these items that we didn't do at Vets Stadium? What were some of these deferred items that someone might have been talking about in '98 or '99 or into 2000 that they just said, Well, we don't need to talk about that because we really 221 2/10/00 WHOLE - PUB. MEETING - 003, 4, want to talk about new stadiums. What things didn't we do?
Well, again, I don't 5 think it's a question -- because I don't -- again, I don't want to -- 'cause I'm -- I'm not an expert, to be candid -- to characterize whether we're, you know -- and where we are today. I think the more question was, if you're a tenant at the Vet and you're assuming you're there at least through the end of your lease, do you raise the issue of, Okay, let's begin to think about programming the next cycle of waterproofing or programming the next cycle, you know, is the -- you know, Greg I think earlier testified that the fields last five to nine years. So do you now say, Okay, well, we're kind of in that -- we're kind of getting to that zone, so should we begin to think about a Capital Budget that says we're going to be putting it back? You might live with it an extra year if you thought the new one was going to open in a year.
If you thought it's never going to open, you say, Well, we better get 222 2/10/00 WHOLE - PUB. MEETING - 003, 4, one in there 'cause we're going to need it for the seven years left.
So what's wrong with the place now? (Unintelligible, parties talking over each other.)
'Cause we don't think we're ever going there and we think we have new venues.
But now, 223 2/10/00 WHOLE - PUB. MEETING - 003, 4, apparently, they've become the subject of complaint, that something's wrong with the place or that we've somehow been negligent to the place, when the earlier testimony that this was by agreement between the teams and the City that they wouldn't pursue certain things or expect certain things either because they were anticipating getting a new stadium or something else. Now as a part of this discussion, you want a practice facility -- which is their right to want to have a practice facility, but if somehow we don't do a new stadium, we have to pay for it and take care of a whole host of items which they now claim are detrimental to their situation -- when they, in fact, apparently, according to the testimony, agreed to the deferral of some of these items. I mean, you can't have it both ways.
Let me just make one statement, and it may be not adequate or responsive or complete. I'm not sure I would necessarily categorize the team's position at the moment as "You haven't done these things and we're mad 224 2/10/00 WHOLE - PUB. MEETING - 003, 4, about it and do 'em." I think that the way people have looked at this is that if new stadiums can be figured out and receive the necessary legislative and other approvals in Calendar 2000, then we're probably in a mode of Okay, let's just make sure there's no hazardous condition at the Vet, you know, the railings are safe and everything, because we're going to get out of it. So don't make any significant investment. If that doesn't happen, the simple development cycle of stadiums, it takes about a year to design 'em and about two years to build 'em, and as we all know, it takes a long time to figure out how to get the transactions put together. If that doesn't happen in 2000, you begin to say, Well, wait a minute, how much term is left on the lease? We may end up living out our life at the Vet. And so if we live out our life at the Vet under the current lease, what would that world need to look like for the Vet to be an acceptable -- as best it could be, given what it is? I mean, you know, there are certain things you can do with it and certain things you 225 2/10/00 WHOLE - PUB. MEETING - 003, 4, 2 can't. I mean, the column are where the columns 3 are. 4
Right. Is that 5 where the $150 million kind of list comes from?
It's been said on the record here that one of the teams believes that there might be in the neighborhood of $150 million worth of repairs that need to be made to Veterans Stadium. Is that as you look out over the next ten years?
Yeah, because if you're looking out both in a life cycle sense, so again, not -- and I use -- "deferred" has become a word with much meaning over the course of today.
But, in other words, where you would say, Let's postpone something because we're going somewhere else.
And so, you know, That boiler will last another year, let's not get a new boiler. But if we're staying here, the boiler's not going to last ten more years so we better 226 2/10/00 WHOLE - PUB. MEETING - 003, 4, schedule fixing it. So there's a set of activities that are of that ilk.
And then you might also say, Well, since we're here, is there's any way to improve the economics of being here by spending some other money to, I don't know, have a new scoreboard that you could sell better advertising 'cause it can do, you know, neat things in 3-D off the Internet or something.
So you think -- I'll use the terminology "enhancements," not just maintenance of the current plan because, well, maybe there's ways we can -- 'cause we're going to have to live here and see if we can create the best economic world out of it.
Right. Let me understand this and we can move on. I mean, who decides what things are needed at Veterans Stadium? Do we decide, do the teams decide, is there a joint decision-making process? What's the 227 2/10/00 WHOLE - PUB. MEETING - 003, 4, nature of our obligation to figure out the condition of our facility to meet up to the test of the lease?
Generally speaking or under the conceptual agreement?
No, I want to talk about the signed agreement, not a conceptual one.
I want to talk about the signed agreement, Article 9, "Maintenance, Repair and Replacements." The signed agreement, not the conceptual one. Who decides what needs to be done at that place?
Councilman, it's a collaborative process. I mean, we use the information that we generate internally from our staff and from our experience and we also listen to the wishes and the needs of the tenants and what they think they need and conditions that they might be aware of that perhaps we're not aware of. So we put that data together and we try to reach a consensus. And then we go into the -- 228 2/10/00 WHOLE - PUB. MEETING - 003, 4, we, the Recreation -- Veterans Stadium is part of Recreation -- puts together, you know, our wish list, if you will. And then that gets put into to the processes, as Miss Kaplan explained, where all of the department come to them, and then they look at those lists and formulate a recommended budget.
Well, your wish list last year anticipated that you would only get a million dollars this year, right?
Right. And that was within the context of what Mr. Hankowsky talked about, where everybody was in a mode where we were thinking new stadiums.
Well, what are the specific areas, elements, items, or components of Veterans Stadium by way of the lease that we are responsible for as a landlord? I've read about the seats, I've read about the playing field, I've read about snow removal, I've read about housekeeping issues, the responsibilities of the landlord the responsibilities of the tenant.
With the exception of what's called "the exclusive use areas," I mean, 229 2/10/00 WHOLE - PUB. MEETING - 003, 4, the City of Philadelphia is responsible for the structure there, the super structure, and the major systems. Things that may be indigenous to them playing their games would fall under the category that they be responsible for.
Educationally or -- I have an MBA from Temple. I came out of Temple and started in City government, worked in the Managing Director's Office under a very astute list of managing directors. In 1984, I went down to the stadium as Assistant Stadium Manager and I became Stadium Director in 1992.
In your professional capacity and as the manager of Veterans Stadium, what's your evaluation of the condition of the stadium?
I think the condition of the stadium is good -- for a stadium that's 30 years old and has experienced the use and the wear 230 2/10/00 WHOLE - PUB. MEETING - 003, 4, and tear that it has over the life of its existence. I think it's a good stadium.
As well as the 5 capital improvements that we've made.
I understand that. And there are many things in this government that are perfect. Do you spend much time in City Hall?
Mr. Hankowsky, please explain that that's not the kind of question that he's really required to answer. (Laughter.)
Ms. Franklin-Suber, this may be last question for the night, which I'm sure will make a lot of people happy. In the conceptual agreement, what happens if the City reaches agreement with the Phillies for a new stadium but does not reach an agreement with the Eagles by November 3rd? Do the Phillies get a new stadium and he Eagles get to stay at the Vet with the $80 million improvements?
Yes, and we would 231 2/10/00 WHOLE - PUB. MEETING - 003, 4, buy back the practice facility.
I understand. I 4 thought that there were provisions in both teams' 5 leases -- I've only heard about this, I've not seen the specific citation -- that whatever one team had by way of accommodations, the other team had to have.
The concept is parity, and that's also why in terms of the improvements to Vets Stadium, there would be an amendment to the Phillies' lease, an amendment to the Eagles' lease, and each of the team would consent so that each of them would understand that if we proceeded with one new stadium and not the other, that there would be one team at Vets Stadium. And from our standpoint, parity doesn't mean new stadium, new stadium. They would have consented to the arrangement, and from our standpoint, it would constitute parity.
So your statement is that the City would take the position that there is parity between a 30-year-old Veterans Stadium, which, up to that time has had 232 2/10/00 WHOLE - PUB. MEETING - 003, 4, $85 million in capital improvements, plus potentially another 80, and that that would be comparable or have parity with an upwards of $400 million brand-new stadium?
The concept in the lease is that you can't -- generally speaking, you can't do something to the detriment of the other party. It doesn't mean that they have to have the exact same thing. And if you look at -- they both started with a 1966 lease. Both leases were subsequently amended. They are not identical today in terms of the way that they occupy Veterans Stadium. So our position will be that in terms of our obligations to both teams under the leases, that we would have satisfied that. The concept is generally referred to as "parity," but it doesn't mean that you have to treat them equally; it means that you can't hurt one. So if one of them gets a new stadium, one of them has to have a place to stay and vice versa. They both take the same risk.
Okay. Could you -- not for this evening, but could you detail for us 233 2/10/00 WHOLE - PUB. MEETING - 003, 4, under the lease terms for both teams what are the circumstances under which they can leave?
I am not in a 5 position to do that this evening. I don't have the lease documents in front of me.
I ask that you not do it this evening. I ask that you forward to the Chair --
-- after looking through the lease documents, tell us by way of article and section what would allow and what are the circumstances under which a team could leave.
Lastly, in one part of the lease, there is a section called "Practice Facilities." It says no later than August 1, 1985, the Landlord shall provide at its sole cost and expense at least one natural-turf football field suitable for training and practice of a professional football team at a site that's convenient and that's practicable to the stadium. It's my understanding that that particular section may have been amended over some 234 2/10/00 WHOLE - PUB. MEETING - 003, 4, time, and I guess we now have at least one open field and then we have the bubble. And what else do we have down there in terms of practice facilities?
Okay. And so are we in compliance on that particular issue with our lease?
But I guess according to the lease terms, there's no 14 obligation that even if provide such practice facilities, that they have to use them?
Which is why we were subject to the threat of "We'll build it somewhere outside of the City," and then we'd be left with these open fields down there?
Okay, all right. Thank you very much. 235 2/10/00 WHOLE - PUB. MEETING - 003, 4, 2
Thank you. The Chair recognizes Councilwoman Tasco.
This has to do with the Managing Director's Office. On of the Capital Program, there are several capital items that have to do with Public Property, Streets, as well as the Fire Department. Why are they listed under the Managing Director's Office?
The Municipal Energy Office that is actually going to carry out these projects -- the green lights, lighting upgrades and the energy building upgrades on the next -- is located within the Managing Director's Office, but they carry out the energy projects for 236 2/10/00 WHOLE - PUB. MEETING - 003, 4, a whole variety of departments 'cause they are the energy expert in the City.
The lighting upgrade at City Hall, item number 1, under 76, on --
-- that's energy lighting or has something to do with conservation?
That is to upgrade the lighting while at the same time reducing energy consumption. You know, it's a modern fixture that provides the output and reduces energy consumption.
It's inside lighting, it's interior lighting. The Streets Department wouldn't --
Interior lighting. 237 2/10/00 WHOLE - PUB. MEETING - 003, 4, 2
Well, the decision was 5 made, I guess, fairly early in the Rendell Administration that it would be advantageous to have a Municipal Energy Office that would -- I think the way they actually started out was by doing energy audits on the largest City facilities, you know, starting with the largest facilities where they thought the payback in terms of cost savings through more efficient use of energy would be the greatest. And then gradually, they worked their way to smaller City buildings. And we've gradually, over the last eight years and are now continuing into the future, have been making various kinds of energy improvements either in lighting or in the power systems, the fuel systems, a whole variety of things to reduce energy consumption.
Does this take care of -- does this dollar amount take care of the actual work?
Or is this -- 238 2/10/00 WHOLE - PUB. MEETING - 003, 4, 2