Wednesday, August 27, 2014
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Butkovitz Calls Financial Plan Reasonable, With Caveats

In an opinion released Friday, Controller Alan Butkovitz called the city’s five-year financial plan “reasonable,” but cautioned about several assumptions made by the Nutter administration.

Butkovitz Calls Financial Plan Reasonable, With Caveats

In an opinion released Friday, Controller Alan Butkovitz called the city’s five-year financial plan “reasonable,” but cautioned about several assumptions made by the Nutter administration.

The plan will be up for approval later this summer by the city’s financial overseer, the Pennsylvania Intergovernmental Cooperation Authority (PICA).

Butkovitz particularly focused on the city’s assumptions for property tax collections, saying that estimating tax appeal losses following a recent citywide reassessment could be difficult, as well as predicting the success of promised improvements in tax collection methods.

Butkovitz also noted the plan does not include more than $90 million to fund last year’s contract arbitration award to firefighters. The city is appealing the award, which would have covered the years 2010-13, while negotiating a new four-year agreement.

Last year, Butkovitz called on PICA to reject the plan because it failed to show money for the firefighters’ award. Members of PICA raised concerns as well, but approved the plan after Finance Director Rob Dubow attached an addendum showing what he thought the city would have to cut to pay for the award.

In more than two decades as financial overseer, PICA has never rejected a plan – doing so would trigger a process that could lead to the city losing hundreds of millions in state funding.

Last year’s plan passed by a 4-1 vote, with PICA member Sam Hopkins voting against. PICA Chairman Sam Katz warned that he would vote against this year’s plan if the city didn’t reach contract agreements with the municipal unions, including AFSCME District Councils 33 and 47.

The sides have not come to an agreement – in fact, Nutter is seeking court permission to impose a contract on DC 33. The plan does include $57 million to fund contracts for DC 33 and 47, Butkovitz said, but those figures merely reflect the cost of the city’s last offer to each union.

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