According to a report in the Inquirer, Mayor Nutter gave top City Council members a preview of his city budget yesterday. The budget, which will be formally introduced on Thursday, doesn't appear to contain any big surprises. As we've noted before, local tax revenues have mostly stabilized, but possible cuts in state and federal aid loom on the horizon.
The cuts are cause for concern, but let's take a moment and celebrate the return of city tax revenue to regular levels. This means more money for city government, but more importantly, it's a signal that the local economy is finally starting to recover. Many cities can't make that boast. Just ask Rahm Emanuel, the newly elected mayor of Chicago. He's probably envious of Mayor Nutter's budget, since he has to deal with a $650 million deficit.
Now back to the bad news. Pennsylvania Gov. Tom Corbett has promised to close a $4 billion deficit without raising taxes. That means big cuts to state aid for social programs in Philadelphia, which could lead to fewer services (primarily for low-income children) and possibly layoffs of both city employees and contractors.
One big question has been how Nutter will deal with the possibility of state cuts in his budget. According to the Inquirer, he is not planning on factoring any reductions into his proposal.
Top Nutter administration officials briefed Council members Tuesday on the bones of the 2011-2012 budget, and made it clear that the city would not eliminate programs based on theoretical state cuts.
Instead, the budget should look much like the $3.8 billion blueprint for the current fiscal year, assuming about the same level of state funding, $575 million, as the city is line to receive this year.
The cuts will only be "theoretical" for a few days. Corbett will unveil his budget on Tuesday in Harrisburg, and the city will have a better sense of what's coming.