Report calls for splitting L&I into 2 agencies

A draft report that a blue-ribbon panel has sent to Mayor Nutter calls for splitting Philadelphia's much-criticized Department of Licenses and Inspections in two, The Inquirer has learned.

The panel is calling for creating two cabinet-level agencies - one responsible for enforcing building safety and construction regulations, the other to issue licenses and deal with nonconstruction matters, according to sources with direct knowledge of the report's contents.

The draft report, roughly 50 pages in length, is the product of a 10-month review of L&I by the panel Nutter appointed in the aftermath of the fatal June 5, 2013, Center City building collapse.

Officials involved in the study repeatedly cautioned that it was still being revised before its public release, scheduled for next Thursday.

The main recommendation calls for getting rid of L&I as it has existed for more than six decades and creating two new agencies.

That would mean changing the 1951 City Charter - a complex process that requires legislation by City Council and a referendum to seek voter approval.

As proposed, a new Department of Buildings would oversee construction projects, demolition, and property inspections as it deals with the building code, the sources said.

That department would be under the deputy mayor for public safety, who now oversees the Police and Fire Departments. L&I is under the deputy mayor for economic development.

The sources said the second agency described in the draft would take over issuance of licenses - along with any other L&I duties not covered by the Buildings Department. The proposed name and responsibilities of the second agency could change before the final report is released, according to the sources.

The mayor received a copy of the draft report Monday. Nutter's spokesman, Mark McDonald, said the mayor would not comment on the report until its official release.

"He is naming a working group to review the recommendations, and in the very near term, recommendations will be presented to the mayor," McDonald said. "Key people in the administration" who deal with L&I will be on the working group, he said.

L&I Commissioner Carlton Williams, whose tenure began a year before the fatal collapse, could not be reached for comment Thursday afternoon.

Other recommendations in the draft report, according to the sources, include:

Citywide enforcement of the fire safety code should be shifted from L&I to the Fire Department.

The proposed Department of Buildings should be headed by a professional engineer.

The City Controller's Office should regularly audit the proposed departments to gauge their performance and ensure that they are adequately funded.

One of the main points of discussion among panel members, according to two people familiar with the conversations, was that L&I has become a catchall, responsible for licensing or inspecting everything from Dumpsters to day-care centers - and demolition sites.

It could not immediately be learned whether the report estimates what new costs to taxpayers might arise from splitting the agency and how such costs might be funded.

L&I received an additional $2 million this year to hire about 30 more inspectors and support staff. It has about 300 employees and an annual budget of $27.6 million.

The 17-member panel that drafted the report - officially, the Special Independent Advisory Commission - was tasked with developing "progressive proposals" to improve public safety when Nutter created it last October. The scope included examination of structure, management, operations, and policies and procedures of L&I.

Nutter launched the panel at the urging of City Treasurer Nancy Winkler, whose daughter Anne Bryan was among six people killed in the Salvation Army thrift shop at 22d and Market Streets in June 2013 when a wall of the building next door collapsed on it during demolition. Thirteen were injured; an L&I inspector responsible for checking the demolition project later committed suicide.

The panel's chairman is Glenn P. Corbett, a fire-safety expert at John Jay College of Criminal Justice of the City University of New York. Its executive director is lawyer Peter F. Vaira, former U.S. attorney for the Eastern District of Pennsylvania.

The commission, which includes people from inside and outside government, such as labor leaders and construction executives, had been scheduled to finish its work by July 1. But the job proved bigger than the commissioners had anticipated and they asked for an extension to September.

The panelists are expected to have a final draft early next week and will vote on it, said Ned Dunham, the commission's chief of staff.

Dunham declined to discuss specifics of the report, saying that was premature. "The report is going to speak for itself," he said Thursday. "It's still a work in progress."

It will be the fourth report since the Market Street collapse that takes a hard look at L&I.

The first was a list of 71 recommendations from a City Council investigating committee, several of which made their way into legislation and added safety requirements for demolition projects.

In February, a grand jury report on the 2012 fire at the former Thomas W. Buck Hosiery factory in Kensington that killed two firefighters painted a scathing picture of L&I procedures. One of the agency's myriad inspection responsibilities is vacant buildings like the one that burned that day.

And in May, City Controller Alan Butkovitz's office released an audit of L&I's oversight of private demolitions contracted by property owners. The audit slammed the agency for incomplete and inaccurate data, and concluded that it was "jeopardizing public safety." The Nutter administration disagreed with much of that report.

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