Philadelphia Council will miss May 31 budget deadline

This year's budget season - the two-month parade of city department heads testifying before City Council about their finances - has been the most subdued and even boring one since Mayor Nutter took office.

Unlike in past years, there have been no fights over a controversial proposed soda tax or trash fee, no rancorous debates about closing libraries and rec centers.

The chamber has been largely empty during hearings, which began in early April, with just a handful of stalwart members attending. And the only horse-trading being discussed so far has been over the bland subject of alleyway lighting.

Despite all that, Council is going to miss the City Charter deadline of May 31 for passing a budget.

How in the world is that going to happen?

Blame the May 17 primary and the School District's enormous $629 million budget gap.

Nearly everyone expects district officials to go before Council and, in the parlance of City Hall, make "an ask" - a request for additional funding.

"It's going to be quite interesting. . . . Something's got to give," Councilman Frank Rizzo said. "They would be negligent if they didn't ask for help."

School District hearings - the last items on the budget agenda - were scheduled for this week, with a first reading of the budget to follow today.

But the district hearings have been pushed back to May 24 and 25, with a first reading of the budget not expected until May 26. A second reading, required before passage, would be on June 2.

Although the district requested the delay, Council now won't have to consider such a fraught topic until well after the last primary ballot has been cast.

(After the election, Council also plans to squeeze in reform legislation of the voter-reviled DROP pension program and, possibly, a contentious paid-sick-leave bill.)

What exactly the district will request, and what Council will be willing to provide, remains to be seen.

"I learned in this business not to make any predictions," Councilman Darrell Clarke said. "You simply wait and see what the ask is."

Michael Masch, chief financial officer for the School District, said it would be "premature" to discuss what Council could do to help the district until "we have an opportunity to discuss it with them and answer their questions."

"The School District's responsibility is to go before Council and show them what the schools would look like if there's no change in revenue," Masch said. "They can then decide what they want to do about that."

Councilman Wilson Goode Jr. said "there probably is some appetite to look at whether we should shift some money into the School District."

"It's clear that the Nutter administration has not offered more money," he said. "If it's going to happen, it will be because . . . members of Council decided that's a good thing to do."

About 30 percent of the district's budget comes from city revenue sources, including a portion of the property taxes and a liquor-by-the-drink tax. Goode said the most likely scenario would be Council's approving a shift in millage rates, which determine how the money is divided.

That means a larger percentage of property taxes would go to the schools and less would go to the city, with no impact on homeowners' tax bills.

Is there an appetite for some kind of tax increase?

"Absolutely not," Goode said.

Still, shifting millage rates means taking some money from the city, a notion sure to encounter some opposition on Council, especially because shifting the rates would do little to solve the district's money problems.

Councilman Bill Green, a frequent inquisitor at this year's budget hearings, has been critical of the School District's financial stewardship. "I expect them to try to dump their mismanagement in our laps and say, 'Save the children,' " Green said. "I expect them to ask for more money and not care where it comes from."

He said the budget season had been quiet until now partly because the mayor put forth a noncontroversial budget that was not materially different from last year's.

"To be frank, less attention has been paid, number one, because things are stabilized," he said. "And, number two, there's an election."

In the last days before a primary that could result in a historic shakeup of Council, the members have been focused, perhaps understandably, on the campaign trail.

Besides, there is no real penalty for missing the May 31 deadline, which last happened in 2004, when Council wrangled with Mayor John F. Street. The more important deadline is July 1, when the fiscal year begins. If there is no budget by then, the city cannot spend any money.

Clay Armbrister, Nutter's chief of staff, said the administration respected the May 31 deadline. "However, recognizing that this year's budget is complicated by multiple factors outside the city's control . . . we have no strong objections to the budget being enacted shortly after the May 31 deadline," he said.

Councilman James F. Kenney also said he was not worried about going beyond May 31. "If it's a week?" he shrugged. "I don't sense a long-term stalemate."