Philadelphia, March 6, 2014 – In his annual budget address, Mayor Michael A. Nutter detailed the proposed Fiscal Year 2015 (FY15) Budget and Fiscal Year 2015 – 2019 Five-Year Plan to City Council.
“Today, my proposed FY 15 budget builds on our track record of fiscal responsibility and strategic investment. It makes targeted investments for our children and citizens, in our neighborhoods and in public safety.” said Mayor Nutter. “This budget, which balances lower tax revenue projections with rising employee costs, takes a prudent approach to addressing both the long-term challenges we face and the immediate needs of our City departments and citizens.”
Mayor Nutter said he will set aside more than $44.3 million of fund balance for potential labor obligations with District Council Union 33, Local 22 of the International Association of Fire Fighters, the Fraternal Order of Police and non-represented employees, and for the cost of the new District Council Union 47 in FY15. In total, over the span of the Five Year Plan, Mayor Nutter will put more than $375.5 million in reserve for labor obligations over the FY14 labor set aside.
The Mayor has also committed to $131.5 million in City-supported Capital investments, the highest level of capital funding since FY02. Some of the Mayor’s FY15 spending proposals include:
Key neighborhood investment projects totaling $48 million include:
Each of these proposed investments is essential to meeting at least one of the five goals that Mayor Nutter has established for the City of Philadelphia. These goals are for Philadelphia to become one of the safest cities in America, to improve the education and health of Philadelphians, to make Philadelphia a place of choice, to become the greenest and most sustainable city in America, and for our government to work efficiently and effectively.
WHO: Mayor Michael A. Nutter
WHAT: Mayor Nutter will answer media questions on the proposed FY15 Budget.
WHERE: Mayor’s Reception Room, Room 202 City Hall
WHEN: Thursday, March 6, 2014 12:30 PM TODAY
Philadelphia, March 5, 2014 – Mayor Michael A. Nutter released the City of Philadelphia Priorities and Accomplishments Report outlining the Administration’s upcoming priorities as well as accomplishments during the past six years. Of the report, Mayor Nutter issued the following statement:
“When I was elected Mayor of Philadelphia, I said that it was time to challenge the status quo, to take bold action and to write a new chapter in this City’s great history. Over the past six years, Philadelphia has made significant progress toward a better tomorrow.
“We have lowered the crime rate for Part I Offenses – homicide, assault, rape, robbery and property crimes – by 15 percent since 2007. In the face of unprecedented fiscal challenges facing the School District of Philadelphia, we have invested more than $155 million in our public education system since 2010. We’ve streamlined the business development approval process, lowered the wage tax rate below 4 percent for the first time since 1976, and through sound financial management – all three major bond rating agencies have put the City in the ‘A’ category for the first time since 1979. Businesses responded by investing more than $7.5 billion in Philadelphia in 2013 with planned, ongoing and completed construction projects. And our city’s population has grown each year since 2006, reversing a fifty year trend of population decline. Smoking rates have dropped 15 percent since 2008 and we’ve nearly tripled the residential curbside recycling rate. Furthermore, we have instilled a culture of honesty, integrity and transparency in city government.
“This report not only presents the accomplishments of our bold vision for the City of Philadelphia, but also our priorities and the work that remains to be done in order to sustain the renewal of our great American city. By focusing on improving public safety, enhancing educational opportunities and outcomes, supporting economic vitality, advancing health and well-being, establishing Philadelphia as the greenest city, acting as an efficient steward of public resources, leading with the highest standards of ethics and transparency, and investing in public infrastructure, we will continue to accomplish great things and write that new chapter of Philadelphia’s history.
“This report is high-level look at the work of City departments in neighborhoods that we serve; an on-going narrative of the story of what is happening and what is to come. It is certainly not a catalog of everything we have done, are doing, or will do. We will continue to provide updates on the Administration’s priorities and accomplishments with the help of our community partners, dedicated city employees and citizens.
“Of course, none of this work would be possible without the hard work and dedication of our citizens who provide feedback, collaboration and partnership in our efforts to make Philadelphia one of the greatest cities in the world. I am asking for your ongoing help and commitment as we continue to invest in Philadelphia and achieve this ambitious agenda.”
A copy of the document can be downloaded at: www.phila.gov
WHO: Mayor Michael A. Nutter
WHAT: Mayor Nutter will offer a briefing on the PGW sale agreement with UIL, and introduce UIL President James Torgerson.
WHERE: Mayor’s Reception Room, Room 202 City Hall
WHEN: Monday, March 3, 2014 11:00 AM TODAY
Agreement must win approval from City Council and PUC
March 3, 2014 – The Nutter Administration announced today that it has signed an agreement to sell the assets of the Philadelphia Gas Works (PGW) to UIL Holdings Corporation for $1.86 billion. The sale, which would inject at least $424 million into the City’s pension fund, must still win approval from City Council and then the Pennsylvania Public Utility Commission (PUC), prior to closing.
“When I announced nearly two years ago that the City would begin exploring the sale of PGW, I pledged that I would sign an agreement only if the terms benefited Philadelphia taxpayers and PGW customers,” said Mayor Michael A. Nutter. “This agreement accomplishes those goals and much more. UIL submitted the highest bid for PGW and agreed to contract terms that were important to the City. Our agreement keeps rates frozen for three years, maintains PGW’s discount programs for low-income families and seniors, safeguards PGW employee and retiree pensions and positions PGW to take full advantage of the abundant supply of natural gas in Pennsylvania to make our city and region a prime energy hub.”
Headquartered in New Haven, UIL serves approximately 706,000 electric and natural gas customers in Connecticut and Massachusetts and has combined total assets of more than $4 billion. Its holdings comprise The United Illuminating Company, The Southern Connecticut Gas Company, Connecticut Natural Gas Corporation and The Berkshire Gas Company.
“We are very excited about coming to Philadelphia and getting involved with the community,” said UIL CEO James P. Torgerson. “Energy is our core business and UIL is well suited to operate the natural gas utility business in Philadelphia and make substantive investments in its infrastructure. UIL has substantial experience running an urban natural gas utility and being an engaged civic partner in the communities we serve. We also see this as a great opportunity to explore strategic growth opportunities that will benefit the customers and citizens of Philadelphia. We look forward to working with the City Council and PUC through the approval process.”
Once the sale is complete, UIL plans to operate dual corporate headquarters in Philadelphia and New Haven. PGW will become UIL’s largest operating company, and UIL officials say it is very important to them to become part of the Philadelphia community, including personal involvement in civic activities and financial commitments to charitable organizations.
“PGW will become a bigger, stronger company under UIL’s ownership and that will create more opportunities for us,” said PGW President and CEO Craig E. White. “Our company has made major strides over the past several years, but there are constraints as a city-owned utility that prevent us from realizing our full potential. The ability to react quickly to market opportunities and a greater investment in developing markets will result in a win-win for both the company and its customers and will result in a greater demand for jobs.”
The contract signed by UIL and the City requires that all PGW employees be offered employment at UIL. If an employee decides to retire or accept a job elsewhere, that position may go unfilled, but total employment may not dip below 1,350 employees for at least three years. A privately-owned PGW will require highly skilled employees to maintain and operate the gas company and will ensure that the system continues to deliver gas safely to customers, while improving the gas infrastructure. Like PGW, UIL has strong relationships with the Utility Workers of America. Also like PGW, UIL has a highly diversified workforce and places an emphasis on contracting with minority and woman-owned businesses in selecting its vendors.
The sale will provide substantial support for the City’s pension fund, helping address one of the most pressing financial issues facing the City. After paying off all of PGW’s bond obligations and putting aside funds for other liabilities, including fully funding the PGW pension plan and prudently reserving for residual risks, the City expects to have between $424 million and $631 million remaining, based on current stock and bond markets and reasonable assumptions. The Administration will then deposit the sum into the City employee pension fund. With the pension fund now less than 50 percent funded, this contribution is one part of a strategy to provide additional resources to the fund, while lowering its costs in order to improve that funding percentage.
The Administration proposes other measures to preserve the value of this contribution so that the benefit to the City pension fund will be protected over time without any negative impact on the City’s general fund. The pension funds’ low funded percentage is one of the greatest concerns mentioned by rating agencies, so the deposit should be a credit positive for the City.
Interest in buying PGW, which remains the largest city-owned gas company in the nation, was overwhelming. Thirty-three entities submitted indications of interest last fall. Through a series of bidding rounds the City whittled the field to a handful before finally selecting UIL.
“We thoroughly vetted all bidders and chose UIL for a number of reasons, not the least of which was that it provided us with the strongest contract terms and value. But beyond the numbers, UIL has an outstanding safety record, excellent employee and customer relations, credibility, a commitment to infrastructure improvements, and is a valued corporate citizen in the communities it now serves. I am confident that City Council and the citizens of Philadelphia will arrive at the same conclusion as I have: that UIL is going to become a great addition to our City,” Mayor Nutter said.
PGW is the nation’s largest municipally-owned gas utility, with annual revenues of more than $600 million, more than 500,000 residential, commercial and industrial customers, and more than 1,600 employees. Read more about the sale process and submit questions or comments at www.exploringasale.com.
February 27, 2014 – Mayor Michael A. Nutter issued the following statement in response to President Obama’s announcement of the “My Brother’s Keeper” Initiative