Review: Nutter Plan for Housing (The Next Mayor)

Man, these plans are long! I remember a certain candidate that I worked for whose most frequent criticism of the policy material that I helped him create was "It's TOO LONG! Cut it in half!"

But seriously, anyone running to be the mayor of the 5th largest city in the nation, the chief executive of one of the largest metropolitan regions, and the face of Philadelphia in the global economy better make sure that he has all of his bases covered.

On to the Nutter paper. My first thought after reading parts of this paper was that I better get myself to Philadelphia Forward's Real Estate Taxation Conference on the 23rd. It appears that I have a lot to learn about real estate taxes.

I also thought this might be a good time to plug this op-ed from yesterday's Daily News by Greg Heller. Heller's a smart guy who has spent a ton of time thinking about these issues and he's ready to call "shenanigans" on any candidate whose plans fail to consider all the necessary angles (at least in private). He specifically addresses the problems that occur for low and moderate-income families when the value of their property increases rapidly due to the revitalization of their neighborhoods. Often, this gentrification leads to an increase in property taxes that leave these suddenly "house rich" and "income not-so-rich" people facing the prospect of losing their house when they can't pay their taxes. He provides some suggestions but my point in bringing up his op-ed is so that we use it as a jumping off point for an analysis of Nutter's plan.

Click "Continue Reading" for that analysis.

From the top:

As Mayor, I will fully fund the Housing Trust Fund to target more resources to the production and preservation of affordable housing in neighborhoods throughout the City.
Good suggestion and he offers some answer to the question of how you pay for it later on in the paper. For my part I could use some more clarification about what the mechanism is by which "City housing officials... pursue the goal of producing 1000 units per year of low and moderate cost housing using the proceeds of the Trust Fund." I suppose it's by sending this money along to the CDCs and other institutions (Habitat?) that build this type of housing.

As Mayor, I will expand supports that allow Philadelphia homeowners to maintain their homes and avoid catastrophic losses due to failing roofs and aging plumbing.
Where do the numbers of home repairs come from?

I will propose and work with City Council to expand the number of homeowners who receive Tax Abatements on improvements they make to their properties. No Philadelphia homeowner should be deterred from improving their homes because of concerns about paying increased property taxes.
How do you draw the line between basic repairs like roof upkeep and luxury upgrades like new kitchens and bathrooms? Would there be some kind of means testing so that people who can afford to put in those beautiful, new granite counter tops wouldn't also get out of having to pay taxes on their beautiful new home? Is there a need for such a distinction?

As Mayor, I will establish a CDC assistance office that applies for grants on behalf of community groups, instills a community planning step into the development permitting process, provides capacity-building for under-performing CDCs, and allocates community funding dollars.
This scares me a little. A lot has been made of the pay-to-play culture that has existed in city government for years with the result that several of the "players" have had their influence curtailed by recent ethics legislation. CDCs may, for the most part, be well-intentioned non-profits that are trying to make positive changes in their neighborhoods but they are just as susceptible to corruption as profit making entities. Many of these CDCs are just as big a player as the large law firms that do bond work with the city. I'd hope that there are procedures in place to ensure that there's no abuse of this system. Also, CDCs have employees and executive directors with salaries and as such, need that grant funding to keep rolling in so that they can make payroll. If the city gets into the game, won't it just become another competitor for already shrinking federal funds?

Other than that, my critique is the usual one whenever someone proposes establishing a new office: isn't someone already doing this job or doesn't an office already exist that should be doing this job?

As Mayor, I will consolidate the city’s housing agencies and make efficient operation of the city government the number one priority.
I've heard this so many times. I'll believe it when I see it. On the plus side, he worked in the phrase "alphabet soup of housing agencies" and I really like alphabet soup.

As with any suggestion like this (which includes establishing a Development Coordinator to get PIDC, RDA etc. to play nice together), there are the political realities of lessening someone's power.

As Mayor, I will improve the NTI program and ensure that vacant property is quickly acquired and transferred to productive uses in accordance with community desires.
As I understand it, a big part of the problem with moving this property into the hands of the people who want to develop it is that it is often left to the whim of the council person who represents the district (the whole "feudal lord" complex). I don't see that problem addressed anywhere.

As Mayor, I will promote a property tax system that treats people fairly, is predictable, and easy to understand.
Here's where we get to the part that may require some expert feedback. First Nutter affirms his support of the citywide reassessment by the BRT and lets us and City Council know that City Council does not set property values (no matter how many referendums it puts on the ballot).

He then proposes a two-part solution - a "homestead exemption" to "make the property tax progressive" and the "cap and deferral plan" that often comes up when this issue is raised. Wikipedia has a little bit of information on homestead exemptions but since I'm by no means an expert on PA law on homestead exemptions, I'll quit while I'm behind.

As Mayor, I will reform the Ten-Year Tax Abatement program to provide benefits to all Philadelphians.
Suggestions like "targeting the abatement to spur housing development in underserved areas" sound good and have a really good populist feel to them but will they work? If you stop the abatement program in areas that don't really need it (ie Center City, Chestnut Hill, Northern Liberties, etc.) and keep it in areas where most developers wouldn't even consider building a sandcastle (Southwest, parts of North and West, etc.), will that actually move private developers in to those areas? Has this worked for those Keystone Opportunity Zones that were supposed to spur business development in distressed neighborhoods?

I think it's going to take a lot more than these abatements before we see condo builders setting up shop at 20th and Diamond. As one piece of an overall plan to spur development in these areas, this could be useful. If it's the whole plan, I have my doubts. In fact, if you combined that with the part of Fattah's Transportation plan that talks about street-level lighting and sidewalk improvements, we could be on to something.

Overall, this plan is pretty solid but doesn't address some of the other basic problems that developers (non-profit and for profit) face when they seek to build something in this town. He leaves out any mention of the fealty that must be paid to district councilpeople and only barely touches the difficulty with which builders and homeowners seeking to do renovations navigate the system. (For some horror stories about that, check out this video from one of our Community Forums).

Perhaps that's simply not in the scope of this paper but any mention of building or doing business in Philadelphia that fails to talk about how much of a circus the city government is, neglects a major part of the story. I've heard Nutter talk about "imploding" L&I. Hopefully that makes its way into one of his future policy papers.

Others have weighed in on this document. Feel free to give your own thoughts.

Comments (11)

Dave

Great article. Thanks for the link.

I totally agree with your points on CDCs and NTI. As far as the tax abatement, my understanding when I read the document was that it would merely be reduced to 5 years in the more successful neighborhoods rather than being eliminated altogether.

Posted by Dave | February 13, 2007 5:47 PM

Aardhart

Do all of the criticisms of Nutter's plan also apply to Fattah's plan? Fattah's plan did not receive this in-depth nitpicking on this blog when it was released a few weeks ago.

You complained that the plan does not address the difficulty in navigating the system, but he has two paragraphs on page 4 promising that he will "make efficient operation of the city government the number one priority" and explaining some steps that he would take. After first griping about the length of the paper, I wonder how much more detail you wanted.

I have not analyzed the plans myself, but have the impression that both Nutter and Fattah have proposed many similar ideas that would benefit the city. I have the impression that Nutter is a lot more committed to making sure his proposals are achievable if he elected than other candidates are (e.g., Brady's elephants).

Posted by Aardhart | February 13, 2007 6:37 PM

I think Nutter's proposals tend to get held to higher standards because he actually makes specific proposals to solve specific problems the city faces. This gives people more of a chance to analyze the proposed solutions based on reality. I have no problem with this, but you're right that people should be aware that, for instance, Fattah's plan didn't face the same criticism as Nutter's because, well, he most likely didn't address the tough issues in question.

Posted by Dave | February 13, 2007 7:45 PM

One more thing:

From what I understand, the current system (and I don't think there's even a "system" here, but that's a different topic) used by the BRT to assess property values includes random 10% increases every couple of years on a neighborhood that's been gentrifying. Given this situation, I think it's pretty disingenuous of city council to propose a referendum where citizens can "urge" the BRT to keep the current system if the desired result is to protect those citizens from the tax increases brought on by gentrification.

And, yes, if the referendum makes it onto the ballot and you vote "yes" to it, you will merely be "urging" the BRT not to proceed with full value reassessments. If you think I'm joking, see for yourself:

http://webapps.phila.gov/council/detailreport/?key=6498

Posted by Dave | February 13, 2007 9:56 PM

Anonymous:

Thanks, Dave. You clarified what has made me uneasy about the quality of Dan and Wendy’s commentary on this blog.

Candidates who delve into specifics like Nutter get a much more thoroughgoing critique than those why deal in generalities.
Karen

Posted by Anonymous | February 13, 2007 10:01 PM

karen:

Posted by karen | February 13, 2007 10:02 PM

Wendy's coverage of Fattah's housing plan was not a critique, it was a description. http://blogs.phillynews.com/dailynews/nextmayor/2007/02/fattahs_housing_plan.html
It does seem to me that Nutter is being held to a higher standard.

I have several reasons for trusting that Nutter's plans are more achievable than, for example, Fattah's. Trust is a lot of it. Fattah's credibility took a hit in my eyes when he is shown spinning the shit with Brady in Shame of the City, making baseless race-baiting accusations that Katz is trying to prevent blacks from voting, even while thugs are attacking Katz workers. Additionally, most of Fattah's position papers this campaign have been criticized for not explaining how everything will be paid for. On the other hand, Nutter has testified months and years ago on the crime and transportation issues. His testimony and position papers strike me genuinely using a problem-solving approach, not telling voter what they want to hear.

Posted by Aardhart | February 13, 2007 11:21 PM

Wendy posted while I was writing. I believe Wendy and Dan that different levels of diligence are intended, but would appreciate if someone could similarly critique Fattah's plan.

Posted by Aardhart | February 13, 2007 11:31 PM

"NOT intended" that is.

Posted by Aardhart | February 13, 2007 11:32 PM

I just went back and looked in Fattah's plan for some proposed solution to the city's property tax problem and it doesn't appear to be mentioned at all. Somebody (myself included, although I didn't have time to read it at the time) should've called him on that. It probably didn't happen because he didn't mention it, though, which was my point in my previous post.

Posted by Dave | February 14, 2007 8:10 AM

Actually, after a more careful read, I think the up-to-$4000-tax-credit for first-time home buyers mentioned in Fattah's plan probably refers to property taxes.

Posted by Dave | February 14, 2007 9:43 AM

Comments (11)

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