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Thursday, July 9, 2009

Nutter: Plan C would devastate city
Mayor Nutter seeks major changes in how the city pays for workers' salaries and benefits. (Clem Murray/Staff file photo)

Mayor Nutter said if the state doesn't sign off on the city's plan to raise its sales tax and stretch out required pension payments it would deal a "devastating blow" to the city budget.

Nutter told The Inquirer Editorial Board today that if state legislators didn't approve Philadelphia's request for a higher city sales tax and pension relief, he would be forced to lay off 600 to 800 police officers, plus 200 firefighters and paramedics; reduce hours significantly at rec centers and libraries, and shut down "a couple" of unspecified city agencies.

"These are dire consequences," Nutter said. "We'd be talking about a city you wouldn't recognize."

Nutter said he has made several trips to Harrisburg in recent weeks to speak with lawmakers about the two measures. But the city's issues are on the backburner while the state wrestles with its own budget problems. The state missed its July 1 budget deadline for the seventh year in a row. Gov. Rendell has proposed a $28.8 billion budget that relies on about $1.6 billion in new taxes, including a 16-percent increase in the personal income tax. 

Senate Republicans in May approved a $27.3 billion spending plan that calls for no tax increases.  But since then, state tax collections have dropped further, meaning legislators would need to cut the GOP's proposal another $1.5 billion or so to balance the plan. Frustrated House Democrats are debating whether to put forward a budget with those deeper cuts, just to show the public the impact of reduced services.
Posted by Dave Boyer @ 4:41 PM  Permalink | 16 comments
Comments   
  • 0 like this / 0 don't   •   Posted 5:37 PM, 07/09/2009
    That "devastating blow" has been a long time in coming. The city has to cut itself down to size, a size based on the true property tax base, and then the city has to stop sabotaging its tax base. The RDA will have to sell all the property it has held in limbo by using real estate agents, so the city can maximize the number of property tax paying owners. The city and the RDA are the city's top property tax delinquents. The city has to sell the various unused/underused property it owns using an open, competitive process. The city will have to collect the $522 million in overdue property taxes, and collect the $1 billion in forfeit bail. AVI has to be implemented now, and notices on the new program going out in August. Yes, next month. Council has to adjust the millage. PHA has to sell off lots and properties it can't repair or rebuild and concentrate on programs it gets from the stimulus money, and the city will have to start charging PHA property taxes. The property tax exemption has to be audited and renewals required. We had to do this anyway, and Nutter promised all of the above. So now he actually has to do it. Now Council has to get itself together and fix the broken assessments and collections functions. Perhaps now the paper will cover these issues fully.
    — CleanupPhilly
  • 0 like this / 0 don't   •   Posted 5:42 PM, 07/09/2009
    What many of us take the time to comment every day is that no city can survive and not collect overdue property taxes. Why do you never cover this issue, when the city obviously needs the money? Yes, this will involve sheriff sale and foreclosure. This is not a bad thing. There are properties in my neighborhood with such tangled deeds that a sheriff sale is the best way to resolve this long-standing blight that costs the city millions. There are whole zip codes in Philly where 40% to ALMOST HALF of all owners are not paying ANY property taxes. These are in North Philly, West Philly, and other zip codes. Even in some of the hottest areas, like SWCC, the property tax delinquency rate is almost one in three owners. That's derelict, and it's negligent of the papers not to cover this issue objectively, especially at such a time as this. You can't wait for the mayor to write a press release to tell you what to think and say. How can you guys write about the "willful blindness" of one party, but miss this in your own city?
    — CleanupPhilly
  • 0 like this / 0 don't   •   Posted 5:45 PM, 07/09/2009
    Philly will have to be a city that relies on the income from the private market via property taxes, like Boston. It can't just have economic taxes and afford this huge welfare city state anymore that owns all this property that produces no revenue. This is not a philosophical debate anymore -- there is simply no way to pay for this behemoth that got left behind in time. People who can't afford to live here will have to move. It likely will be the best thing that could happen in their lives.
    — CleanupPhilly
  • 0 like this / 0 don't   •   Posted 5:50 PM, 07/09/2009
    Some of us would like to not recognize the city. Maybe the new incarnation will be an improvement.
    — J.Sco
  • 0 like this / 0 don't   •   Posted 5:52 PM, 07/09/2009
    It's not honest that you have cut "police and fire" to balance the Philly budget, oh, and we also have to shoot all the puppies. We have to cut the fat. Yes, the FAT. That means the redundant numerous marginally effective social service agencies that riddle the city. OHCD, what do they even do that can be measured? PHA can't be housing for life anymore. People have to transition over time into private rentals. Assets like property and inheritances have to disqualify people for free housing and benefits. There has to be lifetime limits on cash welfare. Welfare reform swept through the rest of the country, but it left PA behind. That's why PA is one of the states struggling with a budget morass. It spends way more money than it generates. Philly is the poster child of why socialism can't work here. No generous federal subsidy is coming for the city to live on. Philly has to live on its tax revenue, and it can't hike taxes anymore without simply decreasing total revenues still further. That means we can't have city owned and staffed health care clinics, a city owned nursing home, the Dell, yadda yadda. This stuff has to close now and be sold this year. Please wake up, it's not 1969 anymore.
    — CleanupPhilly
  • 0 like this / 0 don't   •   Posted 5:57 PM, 07/09/2009
    The editorial board seems unable to even comprehend that we can't afford a higher sales tax, because it will depress sales tax revenue STILL further. If you want less of something, tax it. That's why H-burg is going to say no. They'll reject the pension refi/payment delays also because they get what DROP is -- a way to pay still less into the pension system by high level city employees who want to opt out and not have to rely on a wonky pension plan. Would you let your own paper do that? Would you let your union approve a plan that allows the paper to "refi" your pension contributions, and delay pension payments? Why should Harrisburg let the city do what you wouldn't allow for yourselves?
    — CleanupPhilly
  • 0 like this / 0 don't   •   Posted 5:59 PM, 07/09/2009
    Sell the Dell. It's absolutely vacant and the city can't renovate it. LiveNation would buy it, or the House of Blues. But the city is too backwards-looking to face it.
    — CleanupPhilly
  • 0 like this / 0 don't   •   Posted 6:02 PM, 07/09/2009
    Nutter can win again as mayor. But he is going to have to be completely straight with people, and that means that the gamesmanship of attacking police and fire first before attacking secondary and tertiary city spending, cuts, collections, and assessment has to finally end. I hope the paper can hasten his process in facing it. The rest of us are tired of the BS.
    — CleanupPhilly
  • 0 like this / 0 don't   •   Posted 6:02 PM, 07/09/2009
    The worst part about the delinquent property tax issue that CleanupPhilly has posted about on numerous occaisons is that the Inquirer refuses to report on it. Why? This is a win-win solution for the city and its taxpaying residents, and I say that as a city property owner and taxpayer. The only losers here are the RDA and other delinquint property owners. But these folks SHOULD be losers in this mess...does the Inky have connections in the RDA that prevent them from doing this bit of honest reporting?
    — Tartan69
  • 0 like this / 0 don't   •   Posted 6:30 PM, 07/09/2009
    They would rather bash cops and firefighters and call for thier cuts.
    — jn3
  • 0 like this / 0 don't   •   Posted 6:32 PM, 07/09/2009
    After all most of the papers writers and editorial board do not even live in Philly. They don't care. Whatever will sell papers they write about.
    — jn3
  • 0 like this / 0 don't   •   Posted 9:35 PM, 07/09/2009
    Why not tax all the real estate owned by non-profits. A homeowner doesn't generate any profit in his property just like the non-profits. Why are non-profits be exempted?
    — parak
  • 0 like this / 0 don't   •   Posted 9:56 PM, 07/09/2009
    With all due respect, the City cannot thrive on tax revenue from its current business base. It cannot tax itself to solvency, much less to flourishing. The City vastly underperforms its potential. What is needed is a flourishing private sector, creating wealth from the City's health, science and arts/culture resources. The resources are there. What is lacking is leadership -- in all spheres.
    — Hector
  • 0 like this / 0 don't   •   Posted 5:03 AM, 07/10/2009
    Hey CleanupPhilly do you actually have a job or do you type on here all day. And stop harping about collecting money from people that dont have it. Collection efforts cost money too -the city has no money. And dumping people out in the street will only push them into social programs - that cost money the city dosnt have. Stop seeing the issue with blinders on
    — syrdude
  • 0 like this / 0 don't   •   Posted 11:16 AM, 07/10/2009
    I hope that the people of the Commonwealth of Pennsylvania...people of ALL political parties, see this puffery for what it is. Call, email or write to your State Legislators and put them on notice: vote in favor of Philadelphia's ADDITIONAL sales tax increase and start looking for a job. Vote out ANY State Legislator who votes in favor of the additional 1%. Philadelphia and Allegheny Counties already got the 1% raise. There is no such thing as a "temporary" tax! Every purchase in a PA Wine and Spirits Store today, in 2009, still includes the "temporary" Johnstown Flood tax. It's time for the Mayor and City Council to come back from North Wildwood and actually do something. No additional sales tax.
    — feltonville


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