Wednesday, August 27, 2014
Inquirer Daily News

State watchdog: Reject Phila city budget

PICA staff says Nutter plan ignores reality

State watchdog: Reject Phila city budget

The staff of the Pennsylvania Intergovernmental Cooperation Authority (PICA), which oversees Philadelphia city spending, "recommends that the Board disapprove" Philadelphia's revised five-year budget, as presented Sept. 10 after Mayor Nutter agreed to stop his court battle to block higher firefighters' expenses. PICA staff urged the board, headed by mayoral candidate-turned-filmmaker Sam Katz and including landlord Michael Karp, lawyer Rhonda Hill Wilson, Penn executive Gregory Rost, St. Joe's U business dean Joseph A.DiAngelo, and the top state and city finance officers, should vote No because:

   - The city budget includes unreasonable projections that city workers' wages and benefit costs will be flat, when it's more likely they will be forced higher over the next five years;
   - The city's plans for higher revenues and expense cuts " are not sufficient in themselves to produce a reasonable likelihood of positive fund balances over the next five years;" and,
   - More specifically, "reasonable estimates of the cost of employee wages and benefits, if incorporated into the Plan, would produce a budget imbalance of $411 million" by 2017-18.

The report also includes general steps the city needs to post a more realistic budget and win state approval: "a more rational and competitive tax system, a sustainable pension system, an efficient system of employee health benefits, competitive wages for workers, more robust economic growth, wellmaintained infrastructure, and improved services."

Read the PICA report at:  http://www.picapa.org/docs/SRFYP/SRFYP_FY14FY18.pdf

Joseph N. DiStefano
About this blog

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
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