With the "doomsday" budget deadline approaching and the city's sales tax and pension legislation still bottled up in Harrisburg, some observers have been quietly suggesting that Nutter and City Council ought never to have put the fate of Philadelphia's budget in the hands of state lawmakers.
"Heard in the Hall" asked Nutter if, in retrospect, he would have done anything differently.
"This is the worst kind of Monday morning quarterbacking. We've been very responsible here," he said.
Theoretically, the city could have solved its budget mess on its own, through radical local tax hikes and a massive round of further spending cuts. Practically, though, Nutter's options were limited.
Council opposed a property-tax hike from the start. Then The Inquirer series on the Board of Revision of Taxes appeared, making any property-tax hike impossible, Nutter said.
A wage-tax increase was off the table, due to state gaming revenue regulations. The budget gap was too big for business taxes alone to bridge, and, anyway, Nutter considers higher business taxes terrible public policy.
And closing the gap with still more spending cuts was not feasible, Nutter said, not after he'd already trimmed $1.7 billion (including the elimination of scheduled tax cuts) from the city's five-year budget.
"We're not asking for money from Harrisburg. We are just asking for authorization to solve our own problems. All of us are dependent at times on some other government entity. The states have looked to Washington for help in this recession," Nutter said. "We looked at a lot of different options. This was the best one available."
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Has anyone ever seen the raw numbers that Dubow relied upon when he determined that the decrease in the wage tax revenues was not sufficient to trigger the provision in the Gambling Act that would allow the City to raise the wage tax? It would be interesting to check his math.— NotADoneDeal- So Nutter didn't even consider going back and trying to raise real estate taxes rather than his "doomsday Plan C"? This could have forced BRT reform.— phillyccgwm
- The Ink piece by Kerstra didn't "make property tax hikes impossible," it pointed out that the city is owed $425 million in overdue property taxes that it hasn't collected for more than a year. The city's option then was to collect and put integrity back in the property tax system. Nutter and Council chose not to. The fixes needed in property tax collection AND assessment such as AVI and changing the millage are what they should and could have been working on last year, and chose not to, instead, betting the whole pot in the roulette square labeled "H-burg."— CleanupPhilly
- Philly CC is right -- why didn't Nutter and Council agree to move the BRT out of the School District budget, subjecting it to civil service regs, and making it less of a political liability for Rendell to raise state taxes to provide for the Philly school system? Nutter and Council's inaction created this huge blunder that Rendell coasts out on in the form of the failed state personal income tax hike that was to provide Philly about $400 million under the failed Rendell budget plan. You could argue that Nutter and Council got that conflagration of failure started by refusing to fix the primary objection the voter statewide had to the state personal income tax hike after arguing that it wasn't needed, that it was "going to bail out Philly's system of corruption" from which Rendell sprang. This charge mars Rendell as he finishes his term. Council screwed Rendell, and oddly, Rendell let them. Are we surprised that Pileggi will be tougher with them?— CleanupPhilly
- To butcher a Rumsfeldian phrase: the sales tax hike required trading a "known" be it wage tax, property tax or another tax the city controls to a "known unknown" based on an assumption: depending on the kindness of strangers in Harrisburg to give the city permission to increase the sales tax rate. Like Blanch DuBois in A Streetcar Named Desire, the outcome has led to madness. By giving away the decision-making power from our city to a huge body of people that don't like Philly, certainty became uncertainty.— Joshua911
- $425 million is owed in property taxes and most of these accounts are on average years and years old, and the city is just putting delinquents in "payment plans" no matter what their income is, or assets, or payment history. It's completely unprofessional, and Council and Nutter not only refused to fix it and put the pot on the square marked Harrisburg, they refused to even put the fix in future budgets to include that revenue. Harrisburg is going to "authorize Philly to solve its own problems" alright -- they will tie sales tax hike legislation to the Council legislation and Executive Orders to collect property taxes, base property taxes on real, modern numbers, to make honest payments to the pension. It's dawn in Philadelphia, and the party-goers are looking around, surveying the mess.— CleanupPhilly
- Josh is right -- the PICA submission was never a budget. It was never based on real revenue, the definition of the concept. But Nutter is not stupid, and I'm feeling certain that this deal was worked out early with Harrisburg, and the course mapped out. I'm pretty sure this chess game was played out before even moving a piece.— CleanupPhilly
- Nutter spent A LOT of time in Harrisburg. He was working out some kind of deal. Options were explored. There are some members of Council Nutter is not that fond of. He's not so worried that property tax fixes in their base would hurt their electability, and fixes proposed to the pension would require Philly to have the fixed payment line item that it always promised to fund the pension. It will be adding debt service to debt service that is already forcing the city to base its revenue on property taxes again.— CleanupPhilly
- NotADoneDeal, I've been thinking about what you wrote, but I think Rendell and the state won't let Philly use that money set aside for wage tax relief for operating capital, especially when there is all this money the city hasn't collected or assessed properly. The state supporters of gaming don't want to look like they changed their promise mid-stream. Supporters of gaming want gaming to be for growing the city revenue base, not just running the city day-to-day.— CleanupPhilly
- Please print my comments.— John Law
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