Wednesday, November 25, 2015

Harrisburg may help city close budget gap, but not yet

Under mounting public pressure, State Senate Majority Leader Dominic Pileggi predicted today that a pair of budget-rescuing measures sought by Mayor Nutter would be approved, but he warned that there would not be a vote for at least several weeks.

Harrisburg may help city close budget gap, but not yet


Under mounting public pressure, State Senate Majority Leader Dominic Pileggi predicted today that a pair of budget-rescuing measures sought by Mayor Nutter would be approved, but he warned that there would not be a vote for at least several weeks.

If Pileggi is right, and Harrisburg approves the penny-per-dollar city sales tax hike and pension restructuring that Philadelphia has asked for, the city would avoid the mass layoffs and most of the crippling service reductions — such as closures of most libraries and all recreation centers — that Nutter has warned will be necessary if the legislation fails.

City officials responded warily to Pileggi’s remarks, noting that each day that the State Senate does not act digs the city into a deeper fiscal hole. For each month that passes, the city misses out on $10 million in lost sales tax collections.

“Time really isn’t on our side. We need to get something done quickly. We’re already in mid-August and we still don’t have closure on our budget,” said Philadelphia Finance Director Rob Dubow.

Still, Pileggi’s prediction that the measures would ultimately pass was the strongest sign yet that the city will eventually get what it wants. The House has already approved the bill, and Gov. Rendell strongly supports it as well.

Pileggi’s office released a timetable for consideration of the bill this evening, including a Wednesday hearing on the pension portion of the legislation, and another session the following week to consider the sales tax request. The release said a final vote on the bill could be taken as early as August 26.

“I think that once the questions are answered and once suggestion to improve it are vetted that the majority of the votes in the senate will be there,” said Pileggi (R., Delaware).

He made his remarks shortly after a group of Senate Democrats accused him and other GOP leaders of holding Philadelphia hostage by delaying a vote on the bill to gain leverage in his negotiations with Rendell over the state budget impasse, now in it’s second month.

“We still have time but it is running out,” said Sen. Shirley Kitchen (D., Phila.). “…This is not tied to the state budget in any way. It does not require the senate to raise any taxes. We are simply untying Philadelphia’s hands so that they can make the fiscal decisions that work best for them.”

Rendell did not attend the news conference. Doing so, he said, “would probably make it worse” as Republicans would see him and think “well the governor wants this badly so we will hold him off on the budget.”

Still, he ripped into Senate Republicans for their inaction to date.

“This is going to force the layoff of 3,000 people. Are we playing games with people’s lives?” Rendell said. “Take away 1,000 police from the streets of Philadelphia and somebody may die because of that. Those are not games that I have ever played, nor would I.”

Pileggi dismissed the claim he was using the city’s budget woes as a bargaining chip, instead framing the delay on a vote as a matter of good government.

“The House took more than a month to work through their handling of the bill and many of our members not only have questions about this but also may have suggestions for improvements,” Pileggi said.

Those revisions could include provisions that Democrats would object to, such as reduced pension benefits or higher pension contribution levels for unionized city workers.

Making the budget back-and-forth still more complicated are a set of looming deadlines established by the Pennsylvania Intergovernmental Cooperation Authority, a state agency which oversees Philadelphia’s long-term fiscal planning.

Last month, PICA gave conditional approval to the city’s five-year spending plan, but it warned that the plan would have to be scrapped, and a new one written, if state lawmakers did not approve the city sales tax hike and pension payment restructuring by Aug. 15, which is Saturday.

A five-year plan that does not include those budget-saving options would be grim indeed. Nutter has warned it would include up to 3,000 job cuts, the elimination of nine more fire companies, and the closure of two health centers, among many other service reductions.

The city would have until the end of August to complete a new budget, and then PICA would have until mid-September to consider and vote once more on the pared-down five-year spending plan.

Yesterday, Pileggi sent PICA a letter asking the agency to extend its Aug. 15 deadline by 30 days.
PICA Chariman James Eisenhower said he had not yet seen Pileggi’s letter, but he cast doubt on the likelihood that the board would extend the deadlines.

“We take our votes and our deadlines seriously,” Eisenhower said. “That date was a real date that was set for real reasons.”

City officials say that, in the absence of quick legislative approval of their plan, they have no choice but to begin the weeks-long process of preparing to shut down facilities and selecting workers to be laid off, a job that is complicated by civil service regulations.

Pileggi’s camp counters that, so long as the legislation is approved in several weeks time, the layoffs and facility closures would never have to take effect.

In the meantime, Nutter and his allies plan to keep pressuring Pileggi. The mayor will head back to Harrisburg today, while a host of activist groups that support the legislation have planned a noon rally in Media, in the heart of Pileggi’s district.

Also yesterday, Rendell announced that his administration had started the process of laying off state workers as a result of the budget crisis. Notices began going out to 255 state employees.

Rendell earlier had predicted as many as 800 could lose their jobs.

He said yesterday that the number, at least for now, isn’t as large as previously feared primarily because of the administration’s success in not filling 1,800 vacant openings through a hiring freeze that started a year ago.

More than half of those losing their jobs live in the central Pennsylvania counties of Dauphin, Cumberland and York; only eight are from Philadelphia. The layoffs are spread across 10 agencies with half coming from the revenue and agriculture departments.

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The Philadelphia Inquirer's Chris Hepp, Tricia Nadolny, Julia Terruso, and Claudia Vargas take you inside Philadelphia's City Hall.

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