Great Expectations

I'll lead off the session with an observation.
Chris and I were at a Civic Leaders Summit on Saturday that drew about 75 nabe and civic leaders from around the city.
It was -- in one way -- a very inspiring session: so much energy in the room, so many savvy people.
In another way, it was disturbing, tho.
These folks, many of whom deal day in and day out with the city bureaucracy really desire an improvement in city services.
At the same time, as I pointed out in my Sunday piece, the city's capacity to meet those demands has been diminished in the last 8-10 years, so more and more of the city's resources go to pay for fringe benefit costs, prisons & debt service.
The budget -- and the personnel -- of most city departments is down.
More money is not the only answer. There are surely ways to improve performance of city agencies without adding more money to their budgets.
But, the reality is that you cannot complain about how long it takes L&I to make an inspection without increasing the number of inspectors. Sometimes you just need more feet on the street.
Michael Nutter spoke at Saturday's session and was greeted warmly by the assembled crowd.
They have the expectation that Nutter will improve services.
Frankly, I cannot see him doing it, though, without some additional revenue/personnel in key departments.

-- Tom Ferrick

Chris,
What's your take on the Keystone Opportunity Zone program? Is it working? Is it fair? Is it an example of something we should build upon?
Here in Philly over 1,500 acres in something like a dozen zones are available for tax free enterprises until 2011.
It's hard to measure their impact though, because each Pennsylvania region has one KOZ administrator who serves as the point person for doling out the largesse - that's a lot of info going through a pretty small funnel - if you get my drift.
And I've never run across any state oversight on the program.

All true, Tom.
But one of the great unknowns, until we get a few years of cleaner campaign finance and, one hopes, a more ethical hand at the tiller (as opposed to "dipping into the till) is this:
How many resources to do what the city is supposed to do would be freed up by eliminating much of what you and I often call "the graft tax" of pay to play. If you could limit how many resources the players and the hacks eat up as they feed at the public trough, how much would be freed up to do things like hire L and I inspectors.
Is it 2 percent, 5 percent, 10 percent???
No one knows.
It would be nice to find out.

Well, taking the most conservative savings, freeing up 2 percent of the budget would result in about $68 million in additional dollars.
You could hire a number of inspectors with that, plus more rec center personnell, plus beef up the budget of Fairmount Park.
The problem is, if you do free up that 2%, under current spending strategies, that additional money would have to go to pay for the rise in fringe-benefit costs, which are project to continue to rise at triple the current rate of inflation.
And -- not to sound gloomy -- but there is emerging some thinking that the economy may weaken over the next year or two. A weaker economy means lower tax revenue.

- Tom Ferrick

Matt - I don't know that anyone has done a systematic study of the KOZ's impact. Really, when you look at it, none of the people most involved have any stake in any real data or accountability for the data. The businesses enjoying the tax break aren't eager to submit to a skeptical analysis of whether the job and wage tax benefits of their project justify the tax breaks they get. Politicians just like to brag about approving the zones, to attend the ribbon cuttings and collect the campaign donations from the business people they've helped.
I once did an investigative piece on a 70s version of government help to favored businesses in the guise of job creation - industrial development bonds. It was simply shocking to me as a naive young reporter how feeble the upfront documentation of potential job impact was, and how utterly nonexistent was the followup to see whether the bonds really generated jobs.
KOZ, I think, is defensible as a temporary fix for the city's screwed up tax structure in areas where it's likely to enable some capital investment in entrepreneurial or high tech jobs that would not happen otherwise. Was the KOZ for the CIRA Center worthwhile, or did it merely allow some professional firms to do tax avoidance? I love the building and what it does for the skyline and for w. Phila. - but that's not the same thing as really analyzing whether the tax break is delivering value.
Now would probably be a good time to do it.

Chris

Four Horsemen:

1. Health Care

2. Pensions

3. Prisons

4. Debt Service

Easy-peasy. Last first, debt service -- pay off debt ahead of schedule in large chunks.

Prisons -- after expenditure (bonds) to build high rises above current prisons, hire prison contractors to run instead of PPS. Use cost-benefit analysis to compare cost savings and outcomes between private and public systems.

Pensions -- contract out for city services from reputable, national municipal providers. Lay off employees in city agencies where competitive, open bidding results in a company that does the work on time and under budget.

Cut city property holdings by selling property to highest bidder. Use money to pay off debts, balance budget.

Collect overdue taxes on property - some $700 million will go a long way for schools, budgets.

Foreclose on all overdue liens to the city held against real property -- gas, water, nuisance. Empower L&I to levy substantial fines against nuisance owners. Collect those fines or foreclose/seize property.

Use drug house/car seizures to fund police at a more efficient rate by shortening time waiting for courts to process drug convictions and drug seizures.

Have no-wage tax zones and no BPT zones where property is vacant and owned or controlled by city agencies or agents. Then auction those properties to the highest bidder.

Where housing or redevelopers have used city money but not performed, demand reimbursement using court or other means. For example, where property was conveyed by the RDA to a redeveloper, when that property has not resulted in the promised development, charge the developer for lost property tax revenue to compensate for loss to city of no property tax paying owner.

Have No BPT/no Wage tax zones overlap in certain areas. Auction property to highest bidder that is held by city.

Last, health care for city employees -- use a foreign health care provider/insurer service to give the insured the option of having procedure with low deductable overseas, or high deductable such as $2500 per surgery, here.

There are numerous national foreign health care providers who use a variety of hospitals competing from a variety of countries where the health care standards are as high or better than the US. Those companies arrange all travel, hotels, accomodations, and hospital stay.

Bang -- city budget surpluses and the highest quality schools in the nation will abound.