Committee Hearing, June 4, 2007

Thank you. Councilman Ramos?

Thank you, Madam Chair. Along those lines, I think there is probably a bigger -- a broader problem, and that is that the people new immigrants, particularly Spanish-speaking people but not exclusive to the Spanish-speaking, that they don't know about these programs, they really don't. And that has been my experience here in City Council that the overwhelming majority of people that come through my office -- close to 7,000 people have come through my office, and they do not know of these programs. And I know we do a decent job advertising and trying to get the public to know about this program. But a new growing community such as the Spanish-speaking community, 122 6/4/07 FINANCE - BILL 070387, RES. 070405 these programs are not known, and I think we need to do more in getting this -- these programs known throughout the City and particularly in those areas that you mention -- east of Broad Street, where there's a vast Hispanic community and other languages. I live in a community where a lot of people from different parts of the Arab world are living, and they need to know about these programs as well. So I think that would be a good thing to work out OHCD, you know, outreach, you know, to your particular community, right?

Yeah, it's with one -- (Indiscernible, parties talking over each other.)

... were to access the program, what does the program offer, and then on the other end, on your point, you know, just to have bilingual personnel, or 123 6/4/07 FINANCE - BILL 070387, RES. 070405 multi-lingual personnel to be able to make these programs available to the people of Philadelphia.

Yes, that would help a lot, but there's also a more nefarious, disgusting problem with that; and that is that those who do now about it and do apply for the grant are put on long waiting lists, and that is one thing that has plagued the program for many years. I think that facing what is going on in Philadelphia in terms of affordable housing, that there is a need to say (using Spanish phrase), stop now. We're going to try to fix this program and finally make it work. And at this point, the small amount of money that is allocated for it, plus there's a need to put more money into it and put more money per grant for these programs. So I hope that we look at this plan as the last year that we run the 124 6/4/07 FINANCE - BILL 070387, RES. 070405 program like this and that we look forward to really instituting a very good Basic System and Weatherization Program for the aging housing stock in this city, one of the oldest cities in this country.

Thank you very much. Are there other questions? (No further questions.)

Liz Robinson, ECA.

Thank you. (Witness comes forward.)

After Liz will be Judy Robinson. Is there anyone else who would like to testify? Thank you very much.

Good afternoon.

Good afternoon.

Thank you, Councilwoman Blackwell and members of the committee. 125 6/4/07 FINANCE - BILL 070387, RES. 070405 I am Liz Robinson, and I'm the Executive Director of the Energy Coordinating Agency, or ECA. ECA provides comprehensive energy services, specifically energy conservation, home repair, bill payment assistance, and education services to more than 25,000 low-income households every year. These services are funded by federal, state and local government, local utilities, corporations, and foundations. ECA's citywide network of neighborhood energy centers create a lifeline of service, connecting thousands of low-income households to public and private assistance, resolving utility disputes, restoring thousands of households who have been shut off, and teaching people how to manage their scarce sources more skillfully to ensure that they keep their water, electricity, and heating service on year-round. 126 6/4/07 FINANCE - BILL 070387, RES. 070405 As energy costs continue to climb, this job gets harder every year. Utility terminations are on the rise, affecting not only low-income families but also moderate-income people. In fact, last year, for the first time across Pennsylvania, there were more terminations among low-moderate-income people than among low-income households. This suggests that our low-income energy-assistance programs are serving to protect low-income households but that those just above the eligibility thresholds have no 17 protection from rising prices. This will only continue as energy costs continue to rise. In Philadelphia, the rate cap on electricity will expire in 2010. Conservative projections are that rates will rise percent. If surrounding 24 states are any guide, the rate hike 25 will be closer to 70 percent. Imagine 127 6/4/07 FINANCE - BILL 070387, RES. 070405 what that will do to our local economy. Philadelphia needs to start investing in its own energy future. Energy conservation is the cheapest and cleanest energy resource. As such, an old city in which virtually every building is leaky, underinsulated, and has old, inefficient heating appliances and lighting, energy conservation is also an abundant resource in Philadelphia. We need to start harvesting this energy conservation resource and start saving the tens of millions of dollars we're currently wasting every year. I thank OHCD for increasing the ECA's contract for the neighborhood energy centers this year. This increased funding will enable us to expand our network and meet even more of the pressing need. A key service that ECA has been providing for many, many years is the Heater Hotline Program. Through Heater 128 6/4/07 FINANCE - BILL 070387, RES. 070405 Hotline, we repair almost 4,000 heating systems every year. We're also able to replace just a handful of systems. Heater Hotline is essentially a lifeline to low-income homeowners throughout the City. ECA has been funded at the same level since 2000. During that time, the number of households served has risen each year from 3,864 in 2002 to 4,923 last year. ECA's also modified this program, introducing some measures to conserve energy in addition to repairing heating systems. Thus, through Heater Hotline, we are helping people lower their energy costs. As you may imagine, in the last four years, labor costs, health insurance, Worker's Comp, gasoline, materials, and many other costs of providing the Heater Hotline Program have steadily climbed. As our budget remains flat, it becomes increasingly 129 6/4/07 FINANCE - BILL 070387, RES. 070405 difficult for us to keep up with rising demands. The other program which desperately needs to be refunded year is the Energy Conservation Workshops. ECA has received a grant for the last two years to do weatherization workshops citywide.

These workshops have reached thousands of people in every neighborhood across the City, teaching them how to install basic weatherization materials in their homes, and then giving them a starter kit of weatherization materials. These workshops have been extremely popular. This year, we're asking OHCD to fund this effort earlier in the year rather than waiting for the holidays to get started. In this way, we can do much better planning and even run a train-the-trainers program through our neighborhood centers to train skilled presenters in many neighborhoods across the City. 130 6/4/07 FINANCE - BILL 070387, RES. 070405 Thank you very much very, very much for the opportunity to testify, and I'd be happy to answer any of your questions.

Thank you very much. Councilwoman Reynolds-Brown?

Thank you. Good afternoon.

Good afternoon.

Did you have an opportunity to hear the testimony of the Utility Emergency Services Fund?

Yes, I did.

Is there any opportunity to complement each other in the work that you do? since it appears, at least on paper, that for sure, you're serving the same population.

Exactly. Yes. Most of the neighborhood energy centers are also UESF intake sites. 131 6/4/07 FINANCE - BILL 070387, RES. 070405

Okay.

We do coordinates very closely. And the energy-services delivery system is actually very well coordinated in Philadelphia.

Okay.

We are trying -- John and I are talking about doing even more at UESF sites around budget counseling, which is really, you know, financial literacy is a greatly needed service.

Can you give me an example of what you mean when you say that Philadelphia needs to start investing in its energy future?

Yes. Thanks for asking. Energy. Conservation is, by far, the cheapest form of energy. So, for 132 6/4/07 FINANCE - BILL 070387, RES. 070405 example, I'll just give you a real-life example. In this room, the lights that are in the ceiling, these are probably incandescent lamps. If you were to change these lamps out to compact fluorescent lamps, you would drop the energy cost for lighting this room by 75 percent. You would receive a payback of less than six months. So this kind of opportunity is abundant in Philadelphia. We are, as you know, a very old city with old buildings with old equipment, old every. Energy technologies right now can cut energy consumption in our existing buildings cost-effectively by more than 40 percent, and that's with a payback of less than five years. As energy costs rise, in comparison, energy conservation gets cheaper and cheaper and cheaper. So the cost of delivered energy conservation in Philadelphia is about 2-and-a-half cents per kilowatt hour in 133 6/4/07 FINANCE - BILL 070387, RES. 070405 comparison to what PECO charges us, which is cents per kilowatt hour, 4 just to give you a sense of the 5 relative cost. 6

7 Sure. So is there any organized 8 strategic way of informing consumers of 9 that? I mean, just that fact alone, 10 how many owners of old buildings in 11 this city know that? 12

That's a 13 huge -- you've hit the nail right on 14 the head. 15 The reality is that most Americans know very little about energy and would love to learn more and are really eager. You know, they're kind of desperate for this information. The federal government, as you know, has been doing nothing on this score for years, and it's really left to the local level. Both PGW and PECO have begun educating customers a bit about energy 134 6/4/07 FINANCE - BILL 070387, RES. 070405 conservation, but, you know, we really need to do a vast amount of education to give people the right tools to help them reduce their consumption. This is the single biggest wealth opportunity waiting to be tapped in the City. It's huge.

Is there a coordinated effort between PGW and PECO?

No, there is not.

And the reason for that would be...?

I honestly don't know. I don't know the reason for that.

Okay. Thank you very much for testimony.

You're welcome.

Councilman Greenlee?

Thank 135 6/4/07 FINANCE - BILL 070387, RES. 070405 you, Madam Chair. Good afternoon, Ms. Robinson.

Good afternoon.

You talk about the low-moderate-income person that's probably above the limits to get direct help. Does your agency still deal with those people as far as advice, you know...

Yes. We provide -- we have a -- well, just to be clear about this, all of the low-income programs use 150 percent of poverty. So services to people below that level are free.

Mm-hmm.

If you make 151 percent of poverty, you have no free services. There are now a couple of loans, low-interest loans. Citizens Bank has a percent loan, the State has backed an energy loan. And we provide service to anybody regardless 136 6/4/07 FINANCE - BILL 070387, RES. 070405 of income on a fee-for-service basis; we charge people who are not low-income for conservation. But there really are not yet the right tools and the right education out there that, in order to get this market moving, specific tools needs to be created.

What do you mean by that?

The cities across the country that are most successful have a zero-interest loan program. They have robust education, public education efforts, they have low-interest loans for mortgages so that on an energy-efficient building, the interest rate would be lower. They have requirements when a building changes hands that the building be brought up to energy codes. Philadelphia could be doing a great deal more for new construction now that we really have a building boom 137 6/4/07 FINANCE - BILL 070387, RES. 070405 going on in the City. New construction could be required to be much more energy-efficient in order to earn the tax abatement. So there are many, many tools that we could be looking at and creating to spur energy efficiency in the City that will make the City much more competitive over the long term.

That's interesting. Very good.

More to come. Thank you so much.

Right, thank you.

Thank you very much. Miss Judith Robinson? And if there's no one else after this, we will ask Kevin Hanna and Eva Gladstein and others from our housing agency to come forward and respond to some of the issues we raised earlier and to make your testimony. 138 6/4/07 FINANCE - BILL 070387, RES. 070405 (Witness comes forward.)

Good afternoon. Thank you for your patience.

Good afternoon. Please bear with me. I understand we are combining two -- or one resolution 9 and one bill?

Yes.

So bear with me because I planned to testify on both. Good afternoon. My name is Judith Robinson, and I'm here to testify on Bill No. 070387 and also 070405. Wow. It's been a long time. The first time I ever heard about community block development grant funds, it was Citizen John Street oh so many years ago. I was a young mother, not even in -- I wasn't in the real estate business at that time, not just yet, and at home, trying to raise my daughter, hearing John Street and his 139 6/4/07 FINANCE - BILL 070387, RES. 070405 brother, Milton, on WHAT, Mary Mason Show, talking about the community development block grant funds. But I was subscribing to Philadelphia Magazine. And in 1979, I received this magazine in my mailbox, "The Hot New Neighborhoods: Come On Back," and it has a nice ethnic family sitting on the step, and it's talking about various neighborhoods. Come, come back. A whole nice article about the various neighborhoods, had maps, et cetera. I kept subliminally, I guess, remembering that, and I kept it in my archives. It's an interesting story. I want all of this to go in the public record, please, so maybe someone in the future like my granddaughter won't be as confused about just how this planning and housing and all of this kind of comes together. I always knew that federal funding and housing dollars and urban 140 6/4/07 FINANCE - BILL 070387, RES. 070405 renewal takes a long time when you're dealing with government, but this is a very interesting story. I remember blabbing to all of my friends about, wow, they're even talking about coming on back all the way back to North Philly, where we live, y'all, up to Brewerytown, Brewerytown, all the way uptown. So I want all of that to go in, and maybe it will be good reading for someone. That was in June of 1979. In October of 1979, October, there -- another Philadelphia Magazine came in my mail, and it asked the question, Is Philadelphia going black? Okay? I brought that too for you all to research if you choose to. I was wondering, and I probably have been sounding a little angry as I have come down here to testify in years, but fast-forward to the future. I realize those two covers and 141 6/4/07 FINANCE - BILL 070387, RES. 070405 those stories that I read years ago were sticking in my mind, they were bothering me; it was something about them that was bothering me. As I looked at the housing budget and started to pay more attention, I got in the real estate business -- it was like six years after this. I didn't realize that this had anything -- I didn't no consciously that this had anything to do with me getting in the real estate business. But as I did, I went about trying to be a real-estate person trying to sell real estate. And then about 1990-something, '96, '98, I started to remember what Citizen John Street -- at this time, he was my councilman -- was talking about these community development block grant funds, and he and his brother was marching up and down the Gallery steps and carrying on. I kind of thought they had our 142 6/4/07 FINANCE - BILL 070387, RES. 070405 back so to speak, you know? I was thinking that. So I didn't rush downtown to start testifying; I didn't come down here until about the '90s. But before I did, I wrote to my councilman then, John Street, saying to him -- there was a select committee, and those of you that have been around for a long time will remember this -- a Select Committee on Land Management and Reuse. I wrote to my councilman at the time; he was president of City Council. This was 1998 by this time. I'm saying to him, Listen, I found out about these hearings that are being held around the summer of 1998. It was a select committee hearing in September of '98, and if they start tearing down these properties and doing these things that they're talking about at these meetings, the 5th District will have more vacant land than any other area. How come you don't have more of your 143 6/4/07 FINANCE - BILL 070387, RES.

070405 people involved with this Select Committee on Land Management and Reuse? Well, nobody has to tell me as a citizen how to get involved. What did I, I attended the meetings throughout that summer of '98, and I wrote to my councilman at that time. And he wrote he me back a real weak letter, okay? telling me that he's been in contact with me on more than one occasion about the subject of this letter, which is abandoned properties and vacant properties and their use for housing. And he says my staff is working on these problems every day, and if I take a quick drive around North Philadelphia, I would be able to confirm this. I was living in North Philly at the time. But, anyway, I just wanted to put all of that in the record. Fast-forward to the future. John Street, John F. Street, our mayor, 144 6/4/07 FINANCE - BILL 070387, RES. 070405 coming up with the NTI Program. I just want to say this, 'cause what is my point, what is my point in all of this? I remind myself to get to the point. That Mayor John Street's NTI Program with Hope VI, PHA has moved more African-Americans out of the City of Philadelphia over this period of time. In addition, all of the projects in our district that didn't work out -- 16th and Cecil B. Moore, Girard Avenue, here they are digging up, having a groundbreaking about a project that never came to fruition. Girard Avenue, Heritage Village, Super Mall of Shopping. I was sent this by my councilman, saying things were moving forward. Well, I'm just saying this 'cause I don't want to drag you all along too long but, you know, I'm going to read it to you all, and it's not adding up because the community block 145 6/4/07 FINANCE - BILL 070387, RES. 070405 development grants, according to your documents, were supposed to eliminate blight, help economic building of our community. But what I see that it was really doing is following this plan of reducing black people from Philadelphia, because when the projects were torn down, that reduced the number substantially of African-Americans in this town. They all didn't move to the new -- they didn't come back to the new developments. It's only one development, and you can correct me if I'm wrong, and that's Mill Creek that increased the number of units from when they were the developments. My point, my point, my point is that I live in North Philly. I'm a homeowner, I am a business owner. And after 33 years, all I see is like a hodgepodge of development cheaply crafted but very expensive 146 6/4/07 FINANCE - BILL 070387, RES. 070405 developments. Now, I'm not going to be so out of order as to say that nothing has been done that's of value 'cause, sure, you know, there are some things such as the retaining walls, but that's not so much in North Philly as it is in other areas. I think that was a good thing. The Clip Program, I think, is a good thing. I hear CDCs come here to this forum over the years, talking about what they're doing and what they have done. ACDC, for instance, which is our development in North Philly, after 30 years, they no longer exist. And Susquehanna CDC is a new CDC. You can't find out who is on the board, you can't find out any -- very much about them. I think CDCs have not been of value to my community. We have had a lot of developments with pop-up CDCs such as the 3S Project, and it's a lot of just 147 6/4/07 FINANCE - BILL 070387, RES. 070405 mess. It's almost like I really wish the private sector could have done more and not have politicians get in our way over 33 years. I know good and well I have done in one year, created a business on an avenue, Susquehanna Avenue, without any government dollars than I've seen on our commercial corridors in 33 years. This restore, whatever that's supposed to be, a drop in the bucket, I don't really know what it's supposed to do, but I know it's not of value to Susquehanna Avenue.

If we could just get something like an anti-litter campaign or just some help with reduction of litter, that would be a lot for me. I just -- I'm trying to -- bear with me -- combine both of these testimonies in and making sure that I don't leave out things that I really think are important, because I don't want to come down here and just say 148 6/4/07 FINANCE - BILL 070387, RES. 070405 that I'm perturbed about over 33 years of much of nothing, you know. I want to be of value because I do have years of real estate 6 experience, and I should be able to add 7 something to this hearing. 8 So in that regard, let me just 9 please try to go over my notes so I can 10 maybe add something to this hearing. 11 RDA, let me start there, 12 because that's the implementation 13 agency. They have more land, more 14 properties in their inventory. They 15 need a property disposition program 16 such as HUD where they get rid of their 17 properties in their inventory. 18 It's no good reason why they 19 should be allowed to mar communities 20 with vacant properties in their inventory that when you write to request them, they tell you that there's a development planned. However, years later, the properties are there sitting vacant, such as 2603 149 6/4/07 FINANCE - BILL 070387, RES. 070405 North 33rd Street. Years ago, I had a tour. I showed Councilman Goode and others that were on the tour this property on 33rd Street. It's still there rotting, but when you request any information about it from RDA, they'll tell that you there's some project going on. There are many properties like that, vacant and rotting while they sit there. I don't know how we can say that housing agencies are being redeveloped or reorganized without PHA being a part of some kind of organization. It's no way that PHA should be allowed, after 30 years of funding, to have properties that are sitting vacant while they have a long list of people that are in need of housing. And I'm going to jump a little bit. RDA, still from what I can see, are not giving fair market value to folks that are having their property 150 6/4/07 FINANCE - BILL 070387, RES. 070405 taken through eminent domain. They seem to have a problem with their appraisals, and I think this is really something I'm going to work with the next mayor to see if we can work on. When they get an appraisal and they're taking someone's home through eminent domain, it's very low, below fair market value. However, when people have requested land, they are given appraisals that are extremely high. There is something wrong with that. And I have challenged the board at RDA to look into this, and I would respectfully request that you all, as Councilmembers, find out what's going on there because at least if a person's property is going to be taken from them through condemnation and eminent domain, at least they should get fair market value. The rate of real estate, as we all know, has really tremendously 151 6/4/07 FINANCE - BILL 070387, RES. 070405 increased. Let everybody partake of the bounty. Let's not be disrespectful of mostly African-American people as you take their properties and not give them fair market value. Let everybody be awe part of what's going on here. Let me get to some of the things that I think are of value in this plan. I don't know why these folks over here are holding on to these plans like, you know, they're gold or something. We, the taxpayers, should be seeing this information. I don't know how we could have an intelligence discussion without seeing this, but I'm a speed-reader, so I was able to go through this and see something's are of value. In the past, I have requested that there be money for tangled titles. That's the reason why we have so much abandonment now. A lot of people, for whatever 152 6/4/07 FINANCE - BILL 070387, RES. 070405 reason, especially in the African-American community, do not have wills.

They need to be encouraged to have wills so that they will know when they're not able to, for whatever reason, or if they're deceased, if they're not able to take care of their properties, they need to designate someone that will. So that's a good thing. A small amount, $50,000. I guess that will be sucked up like the last money was. As a real estate broker, this is something that I encourage all the time. I'm not looking for any money, government money, but the last time some little bit of money was available, a bunch of lawyers sucked it up, and they had somebody all the way in Glenside counseling people in Philadelphia about whether they should get a will or not. That was really just crazy for me. 153 6/4/07 FINANCE - BILL 070387, RES. 070405 Even the lawyers at that forum that they had, the one little one that I attended, agreed with me sneakily, privately, that real estate brokers' ears were closer to the ground, and they were the ones that really should be very much involved with assisting folks in creating wills, or assisting in making sure that their properties are a part of some process a succession. I'm not looking for any funding for that; I want to be clear on that, please. I would not take any more for that, 'cause it's something that so much needs to be done. But community planning. I really wish that communities' plans and community planning would be more a part of this process 'cause if true community planning was a part of this process, I don't think so much money would be squandered. I am not trying to disrespect 154 6/4/07 FINANCE - BILL 070387, RES. 070405 Councilpeople, but they need guidance. I don't think any of you all, as Councilpeople, are experts in real estate. And I am, so I'll be willing to volunteer my time just to make sure that when we have developments in communities, that they truly are of value. In addition -- and I will be summing up shortly, but I want to make sure I get this all in 'cause maybe somebody might just hear some of this. You know, I'm not one to take credit, as long as it gets done, so maybe I'll see some of my other ideas in some of these plans. But in addition, I'm really concerned -- and I will be talking to my councilman about this -- that Stanley Street, the block that I grew up on, is down here for demolition of 51 properties. We asked the councilman to take substantial number of properties off of the list, and that's 155 6/4/07 FINANCE - BILL 070387, RES. 070405 money for somebody else to knock down something else because we do not want 51 properties on a 69-house block demolished. You might as well take the whole block, and I'm just not feeling that, if I could use the vernacular. In addition, I see where scattered sites -- PHA scattered sites would be modernized, 244. That would be a good thing. But I just don't understand how PHA, with their own source of financing from HUD, can be sucking up dollars. Their dollars should be better managed. I know that's not a part of this process, but it should be. And the fact that it's in this book tells me that it's somewhat a part of the process. It's no way that people should be sitting around, waiting for PHA housing. How much modernization could they need? People are not looking for the most modern, cute property in the 156 6/4/07 FINANCE - BILL 070387, RES. 070405 whole city; they just want a clean, safe, healthy property, like no 4 lead-based paint and all of that. So if PHA has been getting millions of dollars in the name maintaining these properties over the years, how much could they need, you know? Anyway, one thing I'm really concerned about that I saw at RDA -- and I do go to their board meetings and have been for the past three years, most times I've attended -- side yards that are being used as tot lots gardens, et cetera, have really started to increase in price.

Now, I understand the value of land has increased, but when a house in the same neighborhood would go for less than what the land would cost if it was condemned, something is wrong. And I'll give you an example. The 1200 block of West Cambria, a side yard a person was buying, an average 157 6/4/07 FINANCE - BILL 070387, RES. 070405 size house, 18,000. But a house that's being condemned for the 52nd and Jefferson development, they only want to give the person 17,000. Something's wrong with that. Something is definitely wrong with that. So I really would respectfully request that you all look into that. I'm glad to know that money will be budgeted for historic property repair. Diamond Street, in the former Councilman John Street's district, I remember him being so happy about Diamond Street being the first historic street district, but over the years, they have done nothing much to help the folks on Diamond Street maintain those historic properties, and many of them have been torn down. So it's good to know that there's some money there. I'll tell my friends right away. Well, I really appreciate your attention. Thank you very much. I think that's about it. 158 6/4/07 FINANCE - BILL 070387, RES. 070405 But I really would respectfully request that all of these documents -- I got two sets, one for the NTI hearing and one for the community block development grant funds, 'cause I want you all to read this. So I would like to have this put in the record, please.

Thank you very much. Are there any questions? (No questions.)

Thank you very much.

Thank you.

Thank you. We'll now ask Kevin Hanna, Eva Gladstein, and whomever. I'm sorry. Someone just came in from People's Emergency Center. This is the last individual that we have before you to testify, and then we will have the Administration testify. 159 6/4/07 FINANCE - BILL 070387, RES. 070405 (Witness comes forward.)

Thank you very much.

Good afternoon. My name is Stephanie Wall, and I represent People's Energy Center Community Development Corporation. Thank you for offering me the opportunity to testify today and to discuss the importance of supporting the ongoing funding for affordable housing and neighborhood economic development. On behalf of PEC CDC, I'd like to make the following recommendations for Year 33. First, we thank the City for continuing to set aside community development block grant funding for homeless and special-needs housing to better serve homeless individuals and families and people with physical disabilities. The set-aside ensures new housing units for the homeless, 160 6/4/07 FINANCE - BILL 070387, RES. 070405 increase of the development capacity of special-needs providers, and increases the federal dollars for special-needs projects in Philadelphia. It serves as a match to available federal and state dollars that can add to development operating costs. Additionally, the set-asides enable the City to fund critical permanent supportive housing without draining resources from other components of the homeless continuum of care. Second, we appreciate the City has maintained their commitment to both homeownership and affordable rental housing at levels relatively close to last year's allocation. Third, thriving commercial corridors are critical to the overall health of Philadelphia neighborhoods. We applaud the City's commitment to the neighborhood economic development with the $65 million in City bond proceeds 161 6/4/07 FINANCE - BILL 070387, RES. 070405 for commercial corridor revitalization and their continued partnership with the Commonwealth through the Main Street and Elm Street programs. And finally, acquisition is essential to the revitalization in the neighborhood commercials corridors and in the surrounding residential communities. We thank the City for allocating funds to both commercial and residential property acquisition, which will allow critical affordable housing and economic development activities to move forward. We greatly appreciate the past support that City Council, the OHCD, the RDA and the Commerce Department, and other City agencies have provided to PEC CDC and the local CDC community. We believe that we have consistently provided an important return on this public investment. Thank you again for the opportunity to provide these comments. 162 6/4/07 FINANCE - BILL 070387, RES. 070405

Thank you very much. Are there any questions? (No questions.)

Thank you very much. PEC does a great job. All right. We're now prepared for the Administration, and thank you for your patience. (Witnesses come forward.)

Please introduce yourself for our record and begin your testimony.

What a difference a year makes, right? " Good afternoon. My name is Kevin Hanna. I serve as Secretary of the Office of Housing for the City of Philadelphia. I'm here today to testify on 163 6/4/07 FINANCE - BILL 070387, RES. 070405 behalf of the Administration on Bill 3 No. 070387, which permits the City to apply for the Federal Community Development Block Grant Home Investment Partnership Funds, Emergency Shelter Grant, and Housing Opportunities for Persons, otherwise known as HOPWA, and for State funds from the Department of Community and Economic Development. S. Department of Housing and Urban Development, and which details our proposal for spending these and other related funds for affordable housing and other activities. By no later than August 16, 2007, the City is required to submit to HUD the consolidated plan which combines the formerly separate CDBG final plan and statement, the Home Program Description Emergency Shelter Grant Application, the HOPWA 164 6/4/07 FINANCE - BILL 070387, RES. 070405 application, and the Comprehensive Housing Affordability Strategy. With me are Debra McCullough, First Deputy of Housing and Community Development. Tony MacIntosh is seated to my left, your right, as is Michael Koonce. Tony is Executive Vice President of PHDC, Mike is the Executive Director of RDA. With me also is Eva Gladstein, the Director of the Neighborhood Transformation Initiative, who can answer whatever questions you might have related to NTI and its budgeted items within the CDBG plan. The Year 33 Consolidated Plan for the fiscal year that begins July 1, 2007, details our plan for spending monies from a variety of federal, state, and local sources. The proposed budget cares forward existing programs and commitments to reinforce NTI activities. As far as resources go, the 165 6/4/07 FINANCE - BILL 070387, RES. 582 million; that's an increase of $30,539,000 over the prior period over the prior year. Most of the increase can be attributed to City bond proceeds used to -- or used for community economic development and from NTI bond proceeds. New entitlement funding from HUD is virtually the same as in the Year 32. Resources also include the Community Development Block Grant, still the largest single source of funding for affordable housing that is outside of the subsidies that PHA receives directly from HUD. 643 million in new entitlement funding; that's a reduction of only $75,000 from Year 32. 3 million cut in CDBG funds versus 166 6/4/07 FINANCE - BILL 070387, RES. 070405 75,000 for this year. Other CDBG-related resources include program income such as the proceeds from the sale of land and other prior years' reprogram funds, which are funds which can be liquidated from prior years' budgeted activities. 2 million increase from Fiscal Year 2007. Other federal resources received reflect minor changes from prior years' levels. 879 million; that's a $115,000 increase from the prior year. HOPWA funds awarded are $7 million; that's a $333,000 decrease from the prior year. 3 million in the upcoming 167 6/4/07 FINANCE - BILL 070387, RES. 070405 years. 758 million in NTI funds made available through that program. 5 million in City-issued bond funding, $20 million in Section 108 loan requests for economic stimulus activities, $11 million in other City funding, and $4 million in RDA bond proceeds. The proposed Year 33 Consolidated Plan builds upon initiatives and programs from prior years consistent with the Neighborhood Transformation Initiative's housing development strategies. Year 33 is the sixth year of implementation of the NTI Program. The proposed plan seeks to keep as much 168 6/4/07 FINANCE - BILL 070387, RES. 070405 money in programs and projects as possible. That's a very important line; in fact, it bears repeating: The proposed plan seeks to keep as much money in programs and projects as possible.

More specifically, the proposed plan either maintains or slightly increases funding aimed at subsidizing the development of new affordable housing. The reorganization of the three housing agencies -- OHCD, RDA, and PHDC -- is substantially complete. The Administration's proposal to strategically organize the three core housing agencies has resulted in the consolidation of redundant functions and activities. It streamlined certain processes and reduced the cost for delivering housing services, assuming no additional reductions in projected funding resources and assuming no 169 6/4/07 FINANCE - BILL 070387, RES. 070405 significant unforeseen expenditures. We do not anticipate additional staff reductions in the upcoming fiscal year, nor do we anticipate decreases in housing program funding levels. In order to meet our deadline, I would respectfully request that the committee vote Bill 070387 out with a favorable recommendation and with a request to suspend the rules to allow for first reading at the next Council reading on Thursday. Thank you for this opportunity to present this written and verbal testimony, and I have my colleagues standing ready to answer any questions that you might have.

Thank you. We will ask Miss Gladstein to give her testimony, and then we'll open the floor for questions.

Good afternoon. My name is Eva Gladstein. 170 6/4/07 FINANCE - BILL 070387, RES. 070405 I'm Director of Neighborhood Transformation. And thank you, Madam President and other members of the committee, for allowing me the opportunity to testify today in support of Bill No. 070405. I'm going to truncate my written testimony -- I assume that you all have copies of it -- just for the sake of time. In April of 2007, Mayor Street unveiled the Neighborhood Transformation Initiative in response to the challenges of blight, abandonment, and deterioration and the quality of life of residents that resulted from decades of disinvestment in Philadelphia neighborhoods. The NTI strategy was created to rebuild and preserve Philadelphia's neighborhoods as thriving communities with clean and secure streets, recreation and cultural outlets, and quality housing. 171 6/4/07 FINANCE - BILL 070387, RES. 070405 From the beginning of NTI through Fiscal Year '06, its work was organized into strategies that included facilitating and supporting community- based planning; eliminating blight to improve streetscapes, to abate debris-filled lots and remove abandoned cars, litter, and graffiti; improving the City's ability to assemble land for development; encouraging neighborhood preservation; stimulating investment in Philadelphia neighborhoods; and leveraging resources to the fullest extent possible, investing them in neighborhoods strategically. Like any long-term comprehensive strategy, NTI was also designed to be resilient and adapt to changing conditions. Its rich and successful implementation has increased expectations in neighborhoods, in commerce, and among City departments. Effective in Fiscal Year '07, NTI revised its framework to build upon 172 6/4/07 FINANCE - BILL 070387, RES. 070405 earlier achievements and lessons learned. The new framework includes supporting sustainable community development to ensure that Philadelphia's neighbor are economically diverse, culturally rich, and desirable places to live, work, learn, shop, and play; and continuing to help the City work smarter by improving its business practices. " I'll now go through some highlights for Fiscal Year '08, which is on the bottom of of my written testimony. Beginning in Fiscal Year '08, an additional $10,641,000 will be made available as a result of interest earned on NTI bound proceeds. 9 million was earned on 173 6/4/07 FINANCE - BILL 070387, RES. 070405 taxable bond proceeds. 64 million is being allocated to uses consistent with the original bond issue. For example, interest earned on tax-exempt governmental-purpose bond proceeds must be allocated to uses that meet that criteria for the original tax exemption governmental bond issue. Therefore, effective Fiscal Year '08, the NTI Bond Program funding totals $306,875,415, of which $67,537,774 will be spent during this program year. It is anticipated that Fiscal Year '08 will be the final year of NTI bond spending. The proposed program statement creates flexibility among certain NTI funding line items and allocates the interest earned in most part to housing- preservation activities. And I've highlighted these changes. NTI bond proceeds allocated to residential demolition, vacant property stabilization, and large vacant 174 6/4/07 FINANCE - BILL 070387, RES. 070405 property demolition will become fungible and be available for activities approved for the expenditure of tax-exempt bond proceeds. These include public-safety demolition; grants for physical improvements to public infrastructure such as streetscape and gateway improvements. We've made this modification because a number of District Council persons have found that there's less demolition needing to be accomplished in their districts and want to be able to use the resources towards other physical infrastructure improvement.

We've also made fungible the grant funds that were allocated for the Preservation Development Initiative and the Historic Property Repair Program so that any remaining resources from the initiative can be used to help low-income homeowners in historic make necessary and historically appropriate repairs. 175 6/4/07 FINANCE - BILL 070387, RES. 176418 of the interest earned on taxable bond proceeds will be added to the Land Acquisition Budget for acquisition zones and large-scale development projects. The preponderance of the interest earned on tax-exempt bond proceeds will be allocated to a range of housing preservation activities, including the Basic Systems Repair Program, the Home Rehabilitation Program, and the Adaptive Modification Program. The Vacancy Prevention Program, which was referenced two speakers ago, will be newly funded with NTI resources of $50,000, and there will be additional CDBG resources attached to that as well that, and will help elderly homeowners and others plan for the maintenance and disposition of their homes. The largest investment, planned investment, almost 176 6/4/07 FINANCE - BILL 070387, RES. 8 million, is proposed for the City's equitable development strategy. First funded in Fiscal Year '06, this strategy addresses neighborhood change resulting from housing commercial revitalization activities. The strategy will continue to develop financial tools, housing counseling, and education programs to enable long-term residents to participate and benefit from stronger housing markets and other improved neighborhood economies. These activities will complement the work of Inclusionary Housing Working Group recently formed by the mayor and to be cochaired by Councilman Clarke and Secretary Hanna. The program statement also discusses additional City resources and initiatives, which I'll just name and not read through my testimony, including: Restore Philadelphia Corridors, Green Plan Philadelphia, the 177 6/4/07 FINANCE - BILL 070387, RES. 070405 New River City initiative, as well as Project Management Best Practices that are working with various operating departments to migrate those practices back into those departments as well as best practices for economic opportunity and participation and employment. On , I list some of our accomplishments, which I will not read for you. And before I conclude, I do want to note that in the copy of the proposed program statement, there's a stapled sheet, I believe, in the inside front cover, because as we reviewed the document for today's hearings, we noticed several typographical errors that we wanted to correct. I'm not going to read that into the record unless I need to do that, and somebody will advise me, but I do want to make a note of that in my testimony. In conclusion, Madam 178 6/4/07 FINANCE - BILL 070387, RES. 070405 Chairwoman and members of the committee, I would like to take this opportunity to thank you and to acknowledge your contributions to the success of NTI. Without your support, your work with us, any significant achievements would not have been possible. I respectfully request that the committee vote out Bill No. 070405 with a favorable recommendation. Thank you. Miss McCullough, you okay? Thank you very much. I'll ask just maybe two or three questions myself and then turn it over to my colleagues, who have many questions. Mine is about housing reorganization; many people have waited a long time to deal with this issue, and it has been a problem in prior years.

Councilwoman, can 179 6/4/07 FINANCE - BILL 070387, RES. 070405 I make a couple of comments first of all?

Absolutely.

Just to respond to the testimony presented earlier -- it seems like a long time ago -- by Miss Pankey. I agree with Miss Pankey that if we, the Office of Housing -- and when I say "the Office of Housing," I'm speaking there of OHCD, RDA, and PHDC. If we, the Office of Housing, have to suffer through any more federal cuts consistent with what we've seen, this next year notwithstanding, it is going to be very -- in fact, it's going to be more painful going forward than it has been up until now. Because she's right, we've cut from an administrative -- from a personnel standpoint, we've pretty much cut to the bone. Any additional federal cuts will mean that we're going 180 6/4/07 FINANCE - BILL 070387, RES. 070405 to have to start cutting programs, and that's one thing we've tried to avoid. I will agree with Miss Pankey also when she says that -- when she throws out the idea that the General Fund may need to be tapped going forward. I disagree as far as this current fiscal year is concerned; I think we'll be okay, and I can talk about some of the program income assumptions we've made. So I think short-term, we should be okay; but long-term, I absolutely support her view, the union's view, that we need to look at the General Fund as an additional source of funds for housing. We are -- we, meaning Miss McCullough and I and the other folks on the Housing Trust Fund Advisory Board, as you all know, are looking for additional alternative sources for revenue for that particular housing source. And I think long-term -- maybe 181 6/4/07 FINANCE - BILL 070387, RES. 070405 even intermediate term -- we'll be successful with that. Short-term, maybe not so successful; we may not be able to find as much subsidy for the Housing Trust Fund short-term as we will long-term. But I say all of that to say this, that we are in desperate need of additional funding. We can't -- not anymore anyway -- depend substantially upon CDBG. We do have to look at other sources for funding; otherwise, the level of services, the quality of the provision of those services are going to suffer dramatically. From a reorganization standpoint, as I said in my testimony, the reorganization is substantially complete. In this current fiscal year, the one that will end at the end of this month, we will not see a whole lot in the way of savings, nor will we see a whole lot in the way of more 182 6/4/07 FINANCE - BILL 070387, RES. 070405 efficiency. It's not unlike what you see when a road is being repaired. During the time that the road is being repaired, traffic sometimes actually gets worse sometimes. But it's the expectation -- as with road repair, it's our expectation that with this upcoming fiscal year, we will, in fact, see more efficiency; we will, in fact, see a smoother provision of certain housing services. I'm not here to make excuses, but I will tell you that implementation of the reorganization in this fiscal year was more difficult than we thought it would be -- for whatever reasons. The fact is, we are in now, I guess, already June, just about to embark on a new fiscal year. I do, however, fully expect that in this upcoming fiscal year, we'll see a better operated Office of Housing than we saw in this current -- 183 6/4/07 FINANCE - BILL 070387, RES. 070405 the one now, just about to pass, fiscal year.

How do you reconcile, for example, just on a -- we took a cursory look at some of the information we asked and received from you, and that prior to housing reorganization, seven employees had salaries in excessive of $100,000. In posts, there were employees who had 12 incomes in excess of 100,000, and five of those who were making more than 90,000 got increases, but seven more people, who were making significantly less, got cuts, cuts like 6,000, 10,000 a year, 14,000, 15,000, 25,000 dollars a year. So how do you reconcile housing reorganization when those who were making the higher rates almost doubled; and at the same time, the same number of people who had lower salaries doubled as well. How do you reconcile those kinds of numbers? 184 6/4/07 FINANCE - BILL 070387, RES. 070405

I can't comment specifically on that because this is the first time I'm hearing about that, and I have not seen --

It's in your figures, Mr. Hanna.

Well, I have not seen the specific individuals. I can give you one, at least one, anecdotal example. There was one individual who was making, I don't know, roughly $90,000 a year, and he's probably one of folks of whom you're speaking. That individual had not had a raise since the mid- to late-'90s. During the reorganization time, it was determined that that person had not had a raise in upwards of ten years, and it was time. Now the timing may have been ill-conceived, or accidental more than anything else, but the two weren't timed to go with one another -- reorganize so that we can give people 185 6/4/07 FINANCE - BILL 070387, RES. 070405 who make whatever baseline number you use there, people who make a lot to make a whole lot more. Several adjustments were made on that same basis. Folks who hadn't seen -- I'm talking folks who are not represented by the union, who hadn't seen raises in seven to ten years, those folks, their salaries -- and I'm not going to embarrass anybody by calling out names, but people like that did have salary adjustments. Again, this is without seeing the specific names that you're talking about, and I'd ask that you not call out specific names here.

Well, I realize that I contacted you on certain individuals and asked you to relook at their cases, whenever I learned about them, and you did that. But other people --

One other point still to your question. 186 6/4/07 FINANCE - BILL 070387, RES. 070405 When folks came over from the Redevelopment Authority and PHDC into the Office of Housing and Community Development, an agreement needed to be made between the union and management which would have governed the basis on which those folks came. In other words, without -- and I'm trying to be as circumspect as possible -- without the benefit of what we call "a transition agreement." Without the benefit of a transition agreement, those people who were hired from RDA or PHDC had to be brought in at lower levels of compensation. If the transition agreement had been negotiated -- and, believe me, an awful lot of effort went into negotiating. If that transaction agreement had been negotiated, folks who came up RDA and PHDC, for the most part, would have maintained their same level of salary and other benefits. 187 6/4/07 FINANCE - BILL 070387, RES. 070405 Without that transition agreement -- and such a transition agreement was negotiated in each of the previous reorganizations to which Miss Pankey referred. Without that transition agreement, to a large extent, our hands were tied in terms of being able to bring folks over at the salary they had at PH or RDA.

Oh, I wish I had specific figures, but in seven cases, it was lowered -- 15,000, 14,000, 12,000, 16,000, 6,000, 10,000, and 25,000 per year are salaries that folks were lowered by. That's -- that's really -- that's major. As I said, I know in some cases where I learned about it, people came to me, I called you, and you reviewed them, but I don't know how anybody lives at times 25,000 less a year -- even 6 at the bottom end. While we're talking about housing reorganization, on another 188 6/4/07 FINANCE - BILL 070387, RES. 070405 level, many of my colleagues and I have experienced a slowdown in acquisition of properties, notwithstanding dollars. Many properties that were even approved in '03 have not as yet been acquired, and others seem to be delayed. Where are you on the issue of improving this process? And, you know, because the agencies work as hard as they can. They do all that they can. We've been worried about them, and it's been a blessing we've gotten to go this far because, again, I still haven't met anybody who thinks housing reorganization has made life better. But can you cite a few examples of how program efficiency has improved and your criteria or how you even expect it to?

The real estate disposition process, again, to which you just referred, over the past nine months, you're right, has gotten worse. A lot of that has had to do 189 6/4/07 FINANCE - BILL 070387, RES. 070405 specifically with the reorganization, the fact that we were moving the Real Estate Department from PHDC and RDA up to OHCD. As you well know, late last year, there were some issues with that. We ended up actually having to lay some of those -- most of those folks off for several weeks. And, obviously, with no 11 staff, there will be -- there was to be no disposition. That had an awful lot to do with what you're talking about. Those folks have now been hired, they're at the Office of Housing and Community Development. My expectation is that now that they are there, the kinds of issues that we dealt with in October, November, and December, we hopefully won't have to deal with going forward. You asked about efficiencies going forward. As a direct result of consolidating certain redundant functions, we have fewer employees; 190 6/4/07 FINANCE - BILL 070387, RES. 070405 that's a fact of life. We have fewer employees now than we did this time last year. This time last year, remember too, as I said, we were looking at a $5.9 million decrease in our funding level. With fewer employees, we've been able to actually get out of a couple of the leases. We'll get out of a lease, part of the lease that we have in our building. That's going to save us some money. As a result of the reorganization, as well, we have been able to be more efficient in our usage of vehicles. We'll operate with roughly 16 fewer vehicles this coming year than we did in the previous year. As a result of the reorganization, we'll also do a better job of managing and ordering equipment and supplies used by the Office of Housing offices of housing. Again, my expectation is that 191 6/4/07 FINANCE - BILL 070387, RES. 070405 in this upcoming year, we'll see -- I know we'll save money. In fact, if you'll look at our plan, the total administration costs actually go down by about $2 million. I know we'll save money. Our expectation is that with, again, for the most part, the most difficult aspects of parts of reorganizing behind us, it's my hope, it's my expectation that the provision of services, like disposition, will get better in the upcoming months than they have been in previous months.

Councilman Greenlee?

Thank you, Madam Chair. I had a couple questions on some of the testimony. But just, Mr. Hanna, just quickly so I'm clear, can you explain in answer to one of Councilwoman Blackwell's questions on the salary decreases of some people, 192 6/4/07 FINANCE - BILL 070387, RES. 070405 you said your hands were tied because there wasn't a transitional agreement. Can you explain that a little bit for me, please?

In previous organizations and in this reorganization, folks were moved from RDA and PHDC. I wasn't here for previous reorganizations.

Excuse me a moment, Mr. Hanna. We have to interrupt a moment. Councilman O'Neill?

The good news is, you'll have at least one vote, I hope more. I just want to -- I have to run up to my district, and I just wanted to not have anybody rush 'cause I know a lot of people want to be here until 6 and 7 o'clock, but I do have to go, and I want to have my vote recorded as aye on all bills today, and if there's on those as well, but I don't 193 6/4/07 FINANCE - BILL 070387, RES. 070405 believer there are at this point.

Thank you, Councilman.

Thank you, Madam Chair.

Thank you.

I wasn't here for previous reorganizations, so I can't speak specifically as to they were, but in this reorganization, as I said, it contemplated moving folks from RDA and PHDC to the Office of Housing and Community Development. Without a transition agreement, without some document which instructed, which directed the basis on which folks could come from those organizations, without that, OHCD would have to look at those hires as new hires. With that transaction agreement that transition agreement would have determined the basis on 194 6/4/07 FINANCE - BILL 070387, RES. 070405 which people brought over their vacation time, their sick leave, their salary. The proposal was, in fact, to have -- to allow folks to come over and maintain the salaries that they had at RDA and PHDC. Without that transition agreement, we couldn't agree to do that. And so those folks were brought on as new hires.

And you say they had to be brought on as new hires without that agreement? I mean, there was no other way to do that?

Well, certainly there could have been other ways to look at it, but that agreement would have instructed how, in fact, folks were brought on.

Okay. I'm not sure I totally understand that, but let me just ask, if I could a, couple of other questions on -- regarding some testimony that was here 195 6/4/07 FINANCE - BILL 070387, RES. 070405 earlier, particularly Mr. Gonzales's testimony on the language difficulties.

Okay.

First, informing people of programs and then dealing with the clients or the constituents once they're in the program, have you looked at that at all? I know he said he would have some discussion with you, but have you looked at that at all? have you seen in a program? do you have any plans, that kind of thing?

Mr. Gonzales brought very compelling testimony. We certainly are aware of the language challenges that we face not just in that part of Philadelphia but, you know, those parts where there's a preponderance of Asian citizens.

Right, right.

One correction I 196 6/4/07 FINANCE - BILL 070387, RES. 070405 do feel compelled to make. Mr. Gonzales made a remark relative to the Basic Systems Repair System, how it seemed like Latin or Spanish-speaking individual citizens were put onto a long list. Everybody who comes onto the Basic Systems Repair Program gets put onto the same list. We don't maintain different lists, so we certainly are not discriminating against him or folks of Latin --

Right. I guess I was more interested in what he said as far as dealing with people coming out and doing the inspections and whatever, how they may be not understanding; the language there seem to be a big concern. MS. McCULLOUGH: My name is Debra McCullough from the Office of Housing and Community Development. The BSRP Program is carried out through PHDC, and then maybe 197 6/4/07 FINANCE - BILL 070387, RES. 070405 there's someone here from PHDC who could speak to it more directly than I can, but we have worked with PHDC to try to ensure that the folks do have that -- interpreters there to help them through those complicated processes. Mr. Gonzales is right: Contracts are very complicated, and certainly some of our contractors, we don't expect them to be able to speak Spanish, the folks that who are coming in to do the work on the houses. But we have Spanish-speaking and bilingual employees at PHDC to assist clients who need that kind of help, and we would want to work with Mr. Gonzales and other housing- counseling to ensure that that language barrier is overcome, and we've been working with him and others to try to do that, and so we would welcome his assistance to continue to try to do that.

How 198 6/4/07 FINANCE - BILL 070387, RES. 070405 about the other part that was mentioned as far as -- I think it was actually Councilman Ramos that mentioned this, as far as people actually even knowing about the program, as far as outreach to both -- as Mr. Hanna said, to both Latino communities, Asian, whatever. MS. McCULLOUGH: Right. I would say that we do as much outreach as we can. We have, you know, a whole series of housing counseling agencies, we have neighborhood advisory committees throughout the City whose job it is -- is to advertise our programs. Certainly, can we do a better job? I think one can always do a better job of outreach. That particular issue that Councilman Ramos raised was not one that was brought to my attention before, that people don't even know about the programs. The concern that Mr. Gonzales 199 6/4/07 FINANCE - BILL 070387, RES. 070405 raised that sometimes people are confused about the programs or there's a misunderstanding in interpretation, that problem I have heard, and we've been working with the housing counseling agencies and others to try to overcome that. The issue of people not having even heard of it, I'm not aware that that part of it is a problem. One of the problems that we do have right now, as you well know, is that our needs so far exceed our resources that it may be that people have heard about it and they've heard, Oh, there's a long waiting list, I don't even want to apply, or something like that. That may be a part of the issue. But certainly through our (indiscernible) and other organizations, we try to get the word out there about the programs we have -- ads in water bills, you may have seen 200 6/4/07 FINANCE - BILL 070387, RES. 070405 the water bill stuffers that advertise our programs, and those are both in Spanish and English, so we certainly try to get the word out.

Again, I had not heard that either, but I was just going by what the Councilman said, that that may be a problem. On the Basic System Repair and Weatherization, has the list elongated any more? Have you been able to cut into it a little bit? Is it hard to say?

Well, actually, it's heartening and at the same time, it's disheartening, because I've been here now -- this is my fifth budget hearing. Each year, we've increased the amount going into BSRP. There's a paper decrease on this, but we can explain why that is. But each year that I've been here, we've but more money into the Basic Systems Repair Program. That's 201 6/4/07 FINANCE - BILL 070387, RES. 070405 the heartening part. The disheartening part is no, the list doesn't seem to get any shorter. The more money we pump into it, it seems like the higher the demand continues to be.

Yeah, I guess that's not surprising, particularly with what Liz Robertson said about how even more people that are probably not eligible for a program may need assistance like that. Just the last question, if I could, to Ms. Gladstein. The Restored Philadelphia Corridors, as you mentioned in your written testimony, I don't expect you to go into the whole thing here, but could you give an example of like an area or a corridor that's been particularly helped through your program?

Actually, we've been mostly doing planning through Restore Philadelphia Corridors, 202 6/4/07 FINANCE - BILL 070387, RES. 070405 and we've looked at a number of the transit-oriented corridors in the City, and I've been working with District Councilpeople planned investment. So some of those corridors include Girard Avenue, Lancaster Avenue, Baltimore Avenue, Ridge Avenue, corridors like that, where we would be making investments either in furthering planning that community-based organizations have been doing on those corridors or actual investments into capital improvements and investment into the businesses on those corridors.

And I guess you're just using that as an example. That's an ongoing thing, 'cause obviously, those corridors are getting there, some of them anyway.

Right. I mean, this was newly funded or authorized by City Council. The funding became available in December, so actually, some members of my staff 203 6/4/07 FINANCE - BILL 070387, RES. 070405 will be here on Wednesday, looking for second-year funding on it, but we've identified investments for a significant amount of it, but the money is not yet on the street; we're still in the process of hiring folks.

Okay. So it's still kind of new, okay.

Exactly.

Okay. Thank you. Thank you, Madam Chair.

Thank you. Councilwoman Reynolds-Brown?

Thank you. Let me follow-up with Eva Gladstein. Councilwoman Jannie Blackwell and I sit on a committee with Stephanie Nadoff and her team of professionals that are making decisions around the bond issuance for the corridors and the arts institutions. 204 6/4/07 FINANCE - BILL 070387, RES. 070405 What is your interface with the Commerce Department on that project?

Our interface is really that the Commerce Department and the NTI staff are working together around the $150 million overall Cultural and Commercial Corridor Bond Issue. However, the Commerce Department is managing the cultural component, and the NTI staff is managing the commercial component. So we have, for example, tried to work on systems that are compatible with each other. To the extent that there are projects that might be eligible from either or both sources, we'll to try to discuss it to make sure that we both have the right information to make a good funding decision. But in essence, they are managing the cultural, and we're managing the commercial corridor component. 205 6/4/07 FINANCE - BILL 070387, RES. 070405

You should know that Councilwoman Jannie Blackwell and I have sent a letter to Miss Nadoff indicating our interests in making sure that the process is fair, transparent, and open to everybody.

If I may interrupt, we concur.

Okay. And the way it has been currently described to us, we believe, does not fit open, fair, transparent and a level playing field for everybody. On the issue of the bilingual challenges, are any of the brochures published by any of the housing agencies in different languages?

They're all.

All.

Very good, excellent. Any publications in Latino 206 6/4/07 FINANCE - BILL 070387, RES. 070405 newspapers and/or the radio?

Yes.

Okay. That takes care of that. Both of you witnessed the testimony of both the Energy Coordinating Agency and the Utility Emergency Services Fund. Knowing the world that they try to serve, what opportunities have you had in the past where you were able to -- where dollars appear for whatever reasons that happen within the work of the housing agencies and you're able to -- available dollars become available mid-year and you decide -- or can you make a decision to then go back to those agencies that provide the kind of testimony that we witnessed here today?

Let me comment first of all upon their testimony. Again, it was very compelling testimony. Those folks do outstanding 207 6/4/07 FINANCE - BILL 070387, RES. 070405 work. The folks they serve need the services that are provided to them. And if we had more money, we'd give them more money. I think testimony was provided that the one agency has had $525,000 budget for the last umpteen years or so. That in and of itself is actually something to be proud of because given the cuts that we have had over the past five years that I've been here, everybody, I thought, had been cut, with the exception, obviously, of that R525,000. Now, this year, again, things were relatively flat so they didn't see an increase but, again, the fact that over the past several years, they have been flat is really a testament to the good work that they have done as opposed to anything else. We had earlier discussions as to how we might be able to step up to 208 6/4/07 FINANCE - BILL 070387, RES. 070405 their requests. One way would, in fact, be to review their requests. As the days got shorter, as the weather got colder, they're not going to need that money until, you know, November or December or certainly January or February. If our program income projections prove to be conservative, then it may be possible to pull some additional funds from those additional collections and dedicate it here. If we don't do that, if it is Council's desire that we somehow, quote/unquote, find money to dedicate to them, that's going to entail pulling it from someplace else. Now, what someplace else is is up for debate, but this budget is pretty tight. If we decide to do that -- and, again, I'm not at this point lobbying for other against it, so to speak, but if we choose to do that, just know that we're going to have to 209 6/4/07 FINANCE - BILL 070387, RES. 070405 pull that, whether it's 300 or some factor thereof, from some other line item.

Okay. Does the federal government offer any incentives, provisions, conditions whereby those agencies receiving higher housing dollars, you're required to adhere to the new leads standards, for example? Do you impose those types of requirements for new construction currently within the Administration? MS. McCULLOUGH: We are using Energy Sta certification -- Energy Star requirements for all of our rehab and new construction.

Okay. MS. McCULLOUGH: And we were encouraging, encouraging, the even more restrictive -- if that's right word -- better leads qualification requirements, and that's the direction 210 6/4/07 FINANCE - BILL 070387, RES. 070405 that we're moving in. We're not there yet, but we are requiring Energy Star requirements now for all of offer work.

Okay. All right then.

If I could add something.

Please.

In the Mayor's executive order that he issued during Earth Week, he did ask, I believe, the Planning Commission to review the adaption around leads development, so it's something that he's asked the City Administration to study.

Okay. That's important to know. Finally, you're right, the difference a year does make when it comes to the huge challenge that all of the housing agencies were confronted with, given the backdrop of the federal government. 211 6/4/07 FINANCE - BILL 070387, RES. 070405 So now, with the benefit of hindsight and knowing that hindsight is 20/20 what lessons have been learned around the housing reorg, period?

That's a good question. We would have approached -- we would have approached our communications with the union differently. (Applause.)

We could have done a better job of communicating, and they could have done a better job of communicating with us. We would have approached that differently; that's probably the most important, the biggest lesson learned, the best lesson learned probably.

Because if we look to what's happening in D.C. and what lies ahead, given fewer dollars coming to municipalities, Philadelphia and other cities may be confronted with that type of must-do 212 6/4/07 FINANCE - BILL 070387, RES. 070405 governmental assignment again. And so it's just important that we not repeat --

Well taken.

-- what did or did not work. Thank you for your testimony.

Thank you, Councilwoman. Councilwoman Campbell, thank you for your patience all day.

Madam Chair, some questions that I would like to ask Miss Gladstein.

Certainly.

Good afternoon, Miss Gladstein.

Good afternoon.

I would appreciate your prompt response to my request for some details regarding NTI funds that are available 213 6/4/07 FINANCE - BILL 070387, RES. 070405 for use in the 4th Council District. I have a number of questions regarding the information provided that I would like you to respond to now and confirm your response in writing. In the document titled "Neighborhood Transformation Initiative Demolition and Encapsulation Summary," it shows the retaining wall repair escrow account in the amount of $100,000. On what basis was this escrow account established? number one.

Well, thank you for the opportunity to respond and to confirm later since I'm not sure I can give you full detail on all of these points. There was a retaining wall in the 4th District that -- for which an RFP had been issued by the Streets Department in the last year. There was a technical error with that RFP that was issued by the Streets Department, and it was reissued. 214 6/4/07 FINANCE - BILL 070387, RES. 070405 However, the first set of bids that came in identified that there would be a need for additional funding beyond the amount available in the retaining wall line item. The previous holder of the position of the 4th District Councilmember had signed off on an escrow, if you will, an allowance to enable that retaining wall to be completed. And this is one that I would like to definitely be able to confirm in writing to you later.

On what basis will these funds be released from escrow to be used to support activity of the 4th Council District, though? I assume that you are talking about Stewart Street.

Yes.

And the 5700 block of Stewart Street.

And what I do have to do is confirm with the Streets 215 6/4/07 FINANCE - BILL 070387, RES. 070405 Department the status of their rebidding of that retaining wall. In these cases, we do require the signature of the Councilperson for the use of the funds.

In the same document, it shows $539,388 total available dollars. Can I assume that this amount and more, if the escrow for retaining walls is released, is available to be reprogrammed for other activities in the 4th Council District?

I'm going to ask Tumar Alexander from the Managing Director's Office to assist me with the response.

Okay.

Your question is about the $539,000 that's available for demolition and vacant property stabilization? I'm sorry, if you could just --

If there's anything left over, will it be 216 6/4/07 FINANCE - BILL 070387, RES. 070405 reprogrammed for other activities in the 4th Council District?

Right. If it's -- if there is funding left over, yes, that would be available for other activities of a similar nature in the 4th Council District.

Okay. In the document entitled "Accomplishments of the 4th Council District," the line-item settlement grant shows a citywide budget of $3,100,000, and the 4th Council District's expenditures of $212,000. The 4th District expenditures itself of 212,000 represents only 6.85 percent of the citywide budget; why such a small percentage in the 4th Council District, and what actions can be taken to increase the use of funds in the 4th Council District?

This is for the Basic Systems Repair Program, which is a citywide program. And the way it 217 6/4/07 FINANCE - BILL 070387, RES. 070405 works is that there's individuals through housing-counseling agencies, (indiscernible) or other community- based organizations become aware of the program, apply to PHDC for the program. They have to be income-eligible and meet other criteria. So the distribution is not necessarily consistent throughout Council Districts. I believe you heard testimony earlier today from the -- eastern North Philadelphia that they also felt that their community was underserved. I think there are two ways to deal with this. One, obviously, is to try to maintain as much funding as possible in that line item, but the second is to be able to ask community-based organizations and other groups in the 4th District to be aware of the program, and I'm sure the Office of Housing and PHDC would make information available so that they 218 6/4/07 FINANCE - BILL 070387, RES. 070405 could make referrals into that program. There are several housing- counseling programs that do work in the community, and they should be well aware of the program and be able to make referrals.

I think there are copies of that, but I just wanted to know why only 6.85 percent.

If I may, I think it's hard to know what the correct percentage should be in every community because not very household will be eligible for it, again, because it's based upon ownership status and income as well as the kinds of needs of the property. And I don't know that it's -- something that I think we would have to do is to look to see who the eligible households would be in any particular community; I'm not sure it's information that we have available. 219 6/4/07 FINANCE - BILL 070387, RES. 070405

In the lower part of the 4th Council District, it's comprised mainly of senior citizens, low-income and fixed incomes. That's the lower part of the district. Let me go on to this one: You have here in the same document, your line item Basic Systems Repair Program shows a citywide budget that's $26,475,000, with expenditures in the 4th Council District of only $562,026. The 4th District expenditures of $562,026 which represents only 2.12 percent of the citywide budget; why such a small percentage in the 4th Councilmatic District? I mean, you know, this is getting redundant, it really is.

Well, I think you're looking at number of grants and then the dollar amounts of grants, and the dollar amounts of the grants would again relate to what the particular needs of the household would be, 220 6/4/07 FINANCE - BILL 070387, RES. 070405 because while there's a maximum grant, not every household receives a maximum grant; it depends upon what basic systems need repair.

I still don't think you understood what I said. I said the 4th Councilmatic District in the lower end is comprised, the majority of senior citizens on low incomes and fixed incomes; it's a very poor area who are greatly in need of help for basic repairs. And I just -- it's inconceivable to me that that small percentage is there and with the need of the people that I know, I've lived there all my life, so I know what their needs are. Also in the same document, the line item Adoptive Modification Program shows a citywide budget of $9,300,000 with no expenditures in the 4th Council District. Why are there no 25 expenditures in the 4th Council 221 6/4/07 FINANCE - BILL 070387, RES. 070405 District? What actions are you prepared to make sure that these funds are made available to the residents of the 4th Council District who desperately need their homes adapted to meet their disability?

We would need to work with you and with the housing agencies that operate these programs to make sure that we can increase the number of applications coming from the 4th District into those agencies for these programs.

Evidently, according to this information, there were none because no 18 one received anything. And that's deplorable because there are a lot of people that are disabled in that district that need help, and they're poor and they can't get it theirselves.

My information will be corrected by -- and I apologize for this -- Tony Macintosh, the 222 6/4/07 FINANCE - BILL 070387, RES. 070405 Executive Director of PHDC, who operates the program.

My name is Anthony MacIntosh. I'm the Executive Vice President of Philadelphia Housing Development Corporation. With respect to the 4th Councilmatic district and specifically the Adaptive Modification Program, we're showing expenditures in the last nine months in excess of about $320,000. And then in the previous years, which would actually only reflect six months because, remember, PHDC only assumes responsibility for the program in January of '06. During that same period, there were 10 modifications and there were a total of 3 properties that were treated during that time period. What should be noted with respect to the Adaptive Modification Program as well as the Basic Systems Repair Program is, those programs are 223 6/4/07 FINANCE - BILL 070387, RES. 070405 demand-driven. It's a first-come- first-served basis, and we try to serve all of the clients that are, in fact, eligible for services. And in certain neighborhoods, the need appears to be greater than others, but we do have information available to reflect actual expenditures related to the community development dollars as well as the NTI dollars.

This information I have we received from your department last week, and we were told that it was current.

Well, I'm not sure where the information came from.

We will review it again with PHDC. Again, we are collecting information from a variety of departments, and so it may have been our error; and if so, I apologize.

I would appreciate that very much in 224 6/4/07 FINANCE - BILL 070387, RES. 070405 writing. Thank you.

The Chair is requesting that the information be forwarded here as well so that the Councilwoman receives all of the information she required for her district. Thank you, Councilwoman.

Thank you.

Councilman Greenlee?

Yeah. Mr. Hanna, just at the risk of belaboring the point, but just so I understand, and I know that it was what -- or it was what it was, so I know it's not going to change. But on that salary question okay, you responded both to Councilwoman Blackwell and I that the -- about your hands being tied, and I don't mean to be sarcastic, but 225 6/4/07 FINANCE - BILL 070387, RES. 070405 you're the Secretary of Housing who is tying your hands? I mean, why couldn't you have just brought those people in at that level and maybe taken away a lot of the problem?

The union contract is pretty specific, but the union contract outlines the basis on which these kinds of transactions can take place. Without -- the contract spells out that those kinds of things have to be negotiated that I can't unilaterally make those kinds of decisions. That's what bound my hands.

So the union would have opposed that?

No. Remember, I said we were negotiating. Negotiations were between us and the unions. Without a negotiated transition agreement, we had to do what we did. And, again, I can't go into any of the detail as to the level of 226 6/4/07 FINANCE - BILL 070387, RES. 070405 negotiations and the hours and weekend nights that were spent trying to negotiate that, but an awful lot of effort went into it from both sides.

Okay. Thank you. Thank you, Mr. Hanna.

Are there any further questions for the witnesses? (No further questions.)

Any further questions? Thank you very much. If there are no further questions and no one else who wants to testify, we will conclude this part of our hearing and enter into our stated meeting. * * * 227 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING

For my colleagues, we'll go by the calendar. And as you note, the first two bills were the Biosolids bills, 060108 and 060109. Next is the bill for City depositories, and the Chair recognizes Councilman DiCicco for a motion with regard to Bill No. 070230.

Thank you, Madam Chair. I move that Bill No. 070230 be reported out of this committee with a favorable recommendation and a further recommendation that the rules of Council be suspended. (Motion seconded.)

It has been moved and seconded that Bill 21 No. 070230 be reported out of committee with a favorable recommendation and furthermore that the rules of Council be suspended in order to permit first reading at our next session of Council. 228 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING All those in favor will say aye. Opposed? The ayes have it and so the bill passes. The Chair recognizes Councilman Greenlee with regard to a motion to Bill No. 070260.

Thank you, Madam Chair. I move that Bill No. 070260 be reported out of this committee with a favorable recommendation and that the rules of Council be suspended so as to allow for first reading at the next session of Council. (Motion seconded.)

It has been moved and seconded that Bill 21 No. 070260 be reported out of committee with a favorable recommendation and furthermore that the rules of Council be suspended in order to permit first reading at our next session of Council. 229 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING All those in favor will say aye. Opposed? The ayes have it, and so the bill passes. The Chair recognizes Councilman Reynolds-Brown with regard to a motion to Bill No. 070151.

Okay, Madam President. I move that Bill No. 070151 be reported out of committee with a favorable recommendation and further move that the rules of Council be suspended so as to permit first reading. (Motion seconded.)

All in favor, say aye. Opposed? The ayes have it; and, therefore, Bill No. 070151 will be reported out of committee with a favorable recommendation and also a recommendation for a suspension of the 230 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING rules so as to permit first reading at our next session of Council. The Chair now recognizes Councilman DiCicco for an amendment to Bill No. 070049.

Thank you, Madam Chair. I move that the amendment that was circulated earlier in reference to Bill No. 070049 bed approved. (Motion seconded.)

It has been moved and seconded that the amendment to Bill No. 070049 be adopted. All those in favor will say aye. Opposed? The ayes have it and so the amendment is adopted. The Chair now recognizes Councilman DiCicco for a motion with regard to the amended bill.

Thank 231 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING you, Madam Chair. I move that Bill No. 070049, as amended, be reported out of this committee with a favorable recommendation and that the rules of Council be suspended. (Motion seconded.)

It has been moved and seconded that Bill 11 No. 070049, as amended, be reported out of committee with a favorable recommendation and also a recommendation for a suspension of the rules so as to permit first reading at our next session of Council. I think we voted, didn't we? All those in favor will say aye. Those opposed? The ayes have it, and so the bill passes. The Chair recognizes Councilwoman Brown with regard to Bill 25 No. 070125. 232 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING

I move that Bill No. 070125 be reported out of committee with a favorable recommendation and further move that the rules of Council be suspended. (Motion seconded.)

It has been moved and seconded that Bill 10 No. 070125 be reported out of committee with a favorable recommendation and also a recommendation that the rules of Council be suspended in order to permit first reading at our next session of Council. All those in favor will say aye. Opposed? The ayes have it, and so the bill passes. The Chair recognizes Councilman Goode with regard to Bill 23 No. 070170.

Thank you, Madam Chair. 233 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING I move that Bill No. 070170 be reported out of committee out with a favorable recommendation and that the rules of Council be suspended so as to permit first reading at our next session. (Motion seconded.)

It has been moved and seconded that Bill 11 No. 070170 be reported out of committee with a favorable recommendation and, furthermore, that the rules of Council be suspended in order to permit first reading at our next session of Council. All those in favor will say aye. Opposed? The ayes have it, and the bill 20 passes. The Chair recognizes Councilman Greenlee with regard to Bill 23 No. 070262.

Thank you, Madam Chair. 234 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING I move that Bill No. 070262 be reported out of this committee with a favorable recommendation and that the rules of Council be suspended to allow for first reading at the next session of Council. (Motion seconded.)

It's been moved and seconded that Bill No. 11 070262 be reported out of committee with a favorable recommendation and also that the rules of Council be suspended in order to permit first reading at our next session of Council. All those in favor will say aye. Opposed? The ayes have it, and the bill 20 passes. The Chair recognizes Blondell Reynolds-Brown with regard to Bill No. 23 070368.

Madam Chair, I move that Bill No. 235 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING 070368 be reported out of committee with a favorable recommendation and further move that the rules of Council be suspended so as to permit first reading. (Motion seconded.)

It has been moved and seconded that Bill 10 No. 070368 be reported out of committee with a favorable recommendation and furthermore that the rules of Council be suspended in order to permit consideration at our next session of Council. All those in favor will say aye. Opposed? The ayes have it, and the bill 20 passes. The Chair recognizes Councilman Goode with regard to Bill 23 No. 070387.

Thank you, Madam Chair. 236 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING I move that Bill No. 070387 be reported out of committee with a favorable recommendation and that the rules of Council be suspended so as to permit first reading at our next Council session. (Motion seconded.)

It's been moved and seconded that Bill No. 11 070387 be reported out of committee with a favorable recommendation and, furthermore, that the rules of Council be suspended in order to permit first consideration at our next session of Council. All in favor, say aye. Opposed? The ayes have it, and the bill 20 passes. The Chair recognizes Councilman DiCicco with regard to Bill 23 No. 070388.

Thank you, Madam Chair. 237 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING I move that Bill No. 070388 be reported out this committee with a favorable recommendation and a further recommendation that the rules of Council be suspended. (Motion seconded.)

It has been moved and seconded that Bill 10 No. 070388 be reported out of committee with a favorable recommendation and, furthermore, that the rules of Council be suspended in order to permit first consideration at our next session of Council. All in favor, say aye. Opposed? The ayes have it and the bill 19 passes. The Chair recognizes Councilman Greenlee with regard to a motion for Bill No. 070393.

Thank you, Madam Chair. I move that Bill No. 070393 be 238 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING reported out of this committee with a favorable recommendation and that the rules of Council be suspended to allow for first reading at our next session of Council. (Motion seconded.)

It has been moved and seconded that Bill 10 No. 070393 be reported out of committee with a favorable recommendation and, furthermore, that the rules of Council be suspended in order to permit first consideration at our next session of Council. All those in favor will say aye. Opposed? The ayes have it, and the bill 20 passes. The Chair recognizes Reynolds-Brown with regard to a motion on Bill No. 070401.

Madam Chair, I move that Bill No. 239 6/4/07 FINANCE COMMITTEE - PUBLIC MEETING 070401 be reported out of committee with a favorable recommendation and further move that the rules of Council be suspended so as to permit first reading. (Motion seconded.)