Archive: December, 2010
We're glad the story is getting so much attention, since it's a complicated topic that has important ramifications for the city and region. But what does it all mean? Is it time to panic? Sure, it's a bad situation, but here are a couple of important points to remember about stimulus funds drying up.
1. Most agencies aren't facing budget deficits because of the stimulus. Our story looked at five different public agencies that got stimulus funding. Of that group, only one-- the School District of Philadelphia-- is dealing with a projected operating budget deficit in the next fiscal year that is related to the stimulus funds dying up. City government, PennDOT, Philadelphia Housing Authority, and SEPTA all used stimulus money to fund one-time projects like repairing bridges, upgrading transit stations. These agencies will have less money for capital projects going forward, but that's not an immediate concern for the next budget cycle. However, it could mean that fewer people will be working, reducing tax revenue. That would have an impact on the city budget, although not right away.
2. The end of stimulus funds is not unexpected. It's certainly big news that stimulus funds are running out, but it's not exactly shocking. The stimulus was always intended to be temporary, with most grants having specific deadlines for when the money needed to be spent. The real surprise has been the weakness of the national economy, which policy-makers at the federal level assumed would be almost fully recovered by now, replacing lost stimulus money with tax revenue. Economic recovery has been slower than many expected, which makes the loss of stimulus funds even more worrying.
3. Most decisions about the stimulus are not made at the local level. The Daily News article focused on how specific local agencies used the stimulus, but it's important to remember that most of the choices about how the money would be spent were made at the federal level. President Obama and Congress are the ones who decided how much the stimulus should be and when it would run out. Also, rules at the federal level guided how the money would be spent locally. For example, SEPTA picked which stations to fix up, but it was the Federal Transportation Administration that directed the money to be used to improve transit systems in the first place.
Wonder what's going on with all that stimulus funding in Philadelphia? Check out today's Daily News, which has an update on how the money is being spent. We also answer another question: What happens when the money runs out?
OVER THE past two years, more than a billion dollars from the federal stimulus program has poured into Philadelphia to help pave roads, hire cops, renovate SEPTA stations, rehab public housing and prevent teacher layoffs.
But time is running out on that money. Starting next year, many of the grants given to local government agencies, universities and nonprofits expire. A substantial amount of money used to prop up the state government will also sunset.
Are brighter days ahead for the city budget? In an interview out today with WHYY's Dave Davies, Mayor Nutter said that the city's finances may finally be recovering from the prolonged recession.
“For the first time in about two years, we've actually achieved budget stability here at the city level,” said Nutter.
Nutter went on to say it only happened after the city took many painful steps to fill a $2.5 billion budget deficit in the five-year financial plan.
From the Department of Christmas miracles:
Members of Philadelphia's state Senate delegation have decided to forego the 1.7 percent cost-of-living pay increase that went into effect earlier this month.
Shirley M. Kitchen (D., Phila.), the delegation leader, said Tuesday that difficult economic times and the struggles of working families across Pennsylvania were reasons for rejecting the raise. "Returning this money was something we all agreed we should do," Kitchen said in a statement released Tuesday.
An IOM editorial in today's Daily News:
LIKE ALMOST EVERYONE else, we were disappointed that Sunday's Eagles-Vikings game was rescheduled to tonight. But some fans have turned that disappointment into anger, criticizing everyone from NFL Commissioner Roger Goodell to Mayor Nutter.
The highest-profile complainer? Gov. Rendell, who told Fox 29 that the cancellation was a sign that "We're becoming a nation of wussies."
If it's Monday, it's time for another installment of the "It's Our Money" podcast!
With an incoming Republican governor and legislature, it looks like the sale of wine and liquor in Pennsylvania might finally be taken out of the hands of the state. Is that a good idea? On today's It's Our Money podcast, Ben Waxman challenges Doron Taussig to take a shot every time he (Ben) makes a valid point against LCB privatization.
Check it out by clicking here.
Another winter, another blizzard.
This being a blog about the city budget, we thought we'd turn your attention from making snowmen and shoveling out your cars to the fiscal impact of this storm.
After all, though it hasn't been given any ridiculous names — snowmageddon, anyone? — it's still going to cost money to clean up.
IN A TOWN FAMOUS for booing Santa, it may be no surprise to hear that Philadelphians are lacking in civililty, but a new report that says we are lacking in civics-ility- that we are pretty much as apatethic as the rest of the country -is a bit of a shock.
The Pennsylvania Civic Health Index released last week by the National Constitution Center showed that the state's voter registration is 70 percent, (71 for the nation) with a 51 percent voter turnout for ages 18-29 in the 2008 election (52.9 percent nationally.) But civics is not just about voting; it's about participating in our own and the larger community, and on this, while the state does slightly better than the national average, the numbers are also nothing to be proud of: 8 percent attended a meeting where political issues were discussed; 7 percent worked with neighbors to fix a community problem. Pennsylvanians are also better at joining and leading civic groups.
But we have to do better. Next year, instead of making resolutions about losing weight or being healthier, we should resolve to improve our civic health- to take advantage of the singular gift our democracy allows: participation.