Philadelphia, July 30 – Today Mayor Michael A. Nutter called on Harrisburg lawmakers to approve legislation needed to avoid devastating cuts in City services. Mayor Nutter detailed a series of steps that the City will have to take to balance its budget without approval from the General Assembly in Harrisburg to temporarily increase the local sales tax, and to make changes to City pension payments. Without approval of these measures the City will need to cut $700 million in spending from its five year plan including laying off hundreds of police officers and firefighters, closing all libraries and rec centers, closing two City health centers, and eliminating almost 3,000 positions.
“Philadelphia is one of the major economic engines of the Commonwealth of Pennsylvania and it is in the interest of all Pennsylvanians that Harrisburg lawmakers give us the tools that we need to help ourselves,” said Mayor Nutter. “It is my hope that we do not need to implement these cuts, but Philadelphians need to know what is at stake. Without approval of our budget balancing measures in Harrisburg, we will have no choice but to lay off almost one thousand police officers and fire fighters, close all rec centers and libraries, and to eliminate vital city services.”
The two measures are contained within two pieces of legislation in Harrisburg, only one of which needs to pass in order for the measures to become law. House Bill 1828 and Senate Bill 1058 authorize the City to defer a portion of its pension payments, change our pension amortization period, and authorize Philadelphia to temporarily increase the local sales tax by 1% to pay for pension obligations. House Bill 1828, sponsored by Rep. Jewell Williams and Rep. Dwight Evans, was reported out of the House Appropriations Committee yesterday and is expected to be called to a floor vote early next week, and Senate Bill 1058 was introduced into the Senate.
If this legislation is not approved by the House and the Senate before August 15th, then the City of Philadelphia is required by PICA, the City’s fiscal oversight authority, to produce a new five year plan by August 30th which will require massive reductions in the City’s budget. In order to balance the budget and ensure that the City does not run out of cash, savings will need to be achieved beginning in November at the latest. This means that the City will have to start the layoff process almost immediately, mothball City facilities, shut down entire departments, and cancel police and fire recruit classes.
In addition to requiring the approval of this legislation, the City also needs the Commonwealth to pass a responsible budget to alleviate cash flow problems and so that state payments to City agencies can resume. On July 17 the City informed its vendors that due to the impasse in Harrisburg, we are forced to delay payments. Until both the Philadelphia legislation and a budget are passed the City will be forced to continue to delay spending on anything other than employee compensation, debt service, and emergencies.
In November 2008 the City took the unprecedented action of rebalancing the budget after the collapse of the global economy, saving $1 billion. In spring 2009 the City of Philadelphia’s FY2010 budget and FY2010-14 Five Year Plan contained major savings and revenue enhancements to close an additional $1.4 billion budget gap. Some of the key actions taken included:
Suspended wage and business tax cuts
Eliminated over 3,000 positions
Reduced overtime, impose pay cuts, and mandate 5 furlough days for exempt employees for FY2009 and FY2010
Deactivated 5 engine and 2 ladder companies in the Fire Department
Reduced library services to 5 days a week
Reduced the size of the City fleet
Charged businesses for trash collection
Today, at a public forum in the courtyard of City Hall, Mayor Nutter called on citizens and stakeholders to contact state legislators to urge them to support the City’s proposals and to pass a responsible budget for the Commonwealth of Pennsylvania.
“I had hoped this day would never come but the time is now,” said Mayor Nutter. “Call your state representative or state senator. Ask friends and family from other parts of the Commonwealth, especially our suburbs, to call their legislators to ask them to help Philadelphia, because it’s important for the rest of Pennsylvania.”
Budget actions needed without Harrisburg approval of 1% increase in City sales tax and changes to pension payments
Police
Eliminate 972 positions including 739 sworn officers, 43 civilians, and 190 by attrition.
Fire
Deactivate 6 engine companies, 3 ladder companies, and 5 ALS medic units.
As a result eliminate 36 officer positions, 120 firefighter positions, and 40 paramedics positions.
Engine and ladder deactivations will likely result in the complete closure of fire houses.
Health
Close 2 City Health Centers resulting in a significant negative impact on Philadelphia’s uninsured population.
Eliminate Medical Evaluation Unit.
Eliminate 112 positions.
Streets
Reduce trash pick up to twice a month, eliminating 350 positions.
Reduce citywide cleaning and eliminate all citywide support staff, an additional 50 positions.
Recreation
Close all Recreation Centers and cease all programming.
Eliminating 450 positions.
Free Library
Cease operations at all branch and regional libraries.
Eliminating 490 positions.
Fairmount Park
Cease all operations, eliminating 142 positions.
Commerce Department and Philadelphia City Planning Commission
Cease all operations, eliminating 59 positions in total.
Further eliminated positions
Mayor’s Office – 18 positions
Managing Director’s Office – 21 positions
L&I – 6 positions
Finance Department – 23 positions
Division of Technology – 79 positions
Human Resources – 8 positions
Records – 12 positions
Revenue – 2 positions
APPROXIMATELY 3,000 POSITIONS ELIMINATED
Posted by City of Philadelphia 
