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Monday, August 31, 2009

City Carefully Watching Cash Flow

As the city anxiously awaits a Sept. 8 vote on legislation that would provide budget relief, Finance Director Rob Dubow says he is carefully watching the city's bank balance.

"As you know, our cash flow situation is pretty tight," Dubow said today. Last month, the city started withholding most vendor payments in an effort to preserve cash. Only payroll, benefits, debt service and payments deemed emergencies are being made at the moment.

Dubow said that because they are withholding cash, the city should be able to last several months. But he stressed that they hope state relief will happen soon.

Next week, the state House of Representatives will vote on House Bill 1828, which would allow the city to temporarily raise the sales tax and defer some pension payments. Those items -- worth $700 million over five years -- are key to balancing the city budget. If the state doesn’t approve the city's budget requests, the mayor will have to implement a dire budget that would prompt layoffs of 3,000 city workers.

But in addition to the hold-up on HB 1828, the city has been strained on two other financial fronts, Dubow said. The unresolved state budget is holding up reimbursements that the city counts on for social services provided. And because the city budget is in flux, officials have been unable to do some standard short-term borrowing to cover bills.

If HB1828 passes, the city should be able to borrow money, Dubow said. But state reimbursments won't happen until the state budget is resolved, which means the city's finances will still be under some pressure.
Posted by Catherine Lucey @ 11:20 AM  Permalink | 3 comments
Comments   
  • 0 like this / 0 don't   •   Posted 12:21 PM, 08/31/2009
    Wow, knuckleheads, collect overdue property taxes by sending the empty houses to sheriff sales. There are tons in my neighborhood where people walk around every weekend looking for a good deal on a house within walking distance to CC. 19146 -- almost 30% of the property here is delinquent, hugely delinquent, and all of it should face the auctioneer's hammer. Sell it. IT'S EMPTY. Joan K. is just trying to squeeze a few more cheap votes from this broken system. Raising sales taxes in a recession to higher than the surrounding regions without first collecting the half a billion in overdue PROPERTY taxes is absolute policy folly. What county does this? What school district forfeits so much money to have such bad schools so as to not collect property taxes? Dem writers who pull punches on this issue and self-censor on property tax collection in the city are in the wrong. The dems here are morally wrong, policy wrong, and ethically wrong in not collecting property taxes blindly without prejudice or political interference. End machine property tax interference. You want to let the close libraries instead of collect property taxes impartially?
    — CleanupPhilly
  • 0 like this / 0 don't   •   Posted 12:31 PM, 08/31/2009
    The city has to make cuts and collections. There is $435 million in overdue property taxes owed for YEARS, there is $1 billion in forfeit bail and the city has to be compelled to address this first or yeah, they'll close libraries and cut services to kids. Kids don't vote. This has to come first before a sales tax hike. Just say NO. Go to http://www.stoppataxhike.com/ and click on the comments section, say you've signed the petition, now closed, and your message goes to your House rep in PA.
    — CleanupPhilly
  • 0 like this / 0 don't   •   Posted 1:25 PM, 08/31/2009
    There's no WAY the House can vote on this legislation before the city has to implement Plan C. Let's cover Plan C -- it was submitted to PICA, yet there has been nothing on the contents all weekend or today.
    — CleanupPhilly


3 comments
About The Philly Clout Team
PhillyClout
Chris Brennan, a native Philadelphian and graduate of Temple University, joined the Daily News in 1999. He has written about SEPTA, the Philadelphia School District, the legalization of casino gambling, state government, the mayor, the governor, City Council and political campaigns.
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David Gambacorta spent a small eternity writing about cops, drug dealers and serial killers. Now he’s writing about power and politics ­– which sometimes reminds him of the old crime beat. He joined the Daily News in 2005. And yes, he knows you’re not quite sure how to pronounce his last name. E-mail tips to gambacd@phillynews.com
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Catherine Lucey joined the Daily News in 2002 and has written about murderous drug gangs, political protesters and Harry Potter. After covering the 2007 mayoral election, she moved over to the City Hall bureau where she has been reporting on the Nutter administration.
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Jan Ransom, a native New Yorker, joined the Daily News in 2010 after graduating from Howard University. She has since written about the difficulty of filing police complaints, tax deadbeats and life after violent home invasions. She joined the Daily News City Hall Bureau in 2011 and has plunged headfirst into reporting on administration budget battles and City Council shenanigans.
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Catherine Lucey
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Chris Brennan
brennac@phillynews.com

Jan Ransom
Ransomj@phillynews.com
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