In a rare show of bipartisanship, Democrat and Republican lawmakers across the state — including the members and leadership of the Philadelphia delegation to the House — hailed the recent passage of a sweeping, $2.4 billion transportation bill that will fund bridge and roadway repairs and will prop up statewide public transportation systems.
State Rep. Jeffrey P. Pyle introduced House Bill 1060 in the spring, and Gov. Tom Corbett signed the measure on Monday.
“Today I put my signature on Pennsylvania’s passport for the future,” said Corbett during the signing in Centre County. “Through bipartisan spirit and an agreement that crossed party lines it shows that Pennsylvania is a state in which moderation, careful thought and good faith still play a large role in how we govern. Pennsylvania is a state that puts progress ahead of party lines with a common goal of serving our citizens.
“This is an investment in the safety of our citizens and the progress of our economy,” Corbett continued. “It will create more jobs and keep Pennsylvanians moving across safe, world-class highways and bridges.”
According to Corbett’s office, the transportation package will keep Pennsylvania safe and economically competitive by investing an additional $2.3 to $2.4 billion into the state’s roads and bridges by the fifth year of the plan and providing funding for transit systems across the state.
By the fifth year of the plan, the governor’s office is forecasting the bill will have invested $480 million to $495 million annually for public transportation, $237 million annually for local roads and bridges, $144 million annually in a multi-modal fund, $30 million annually for dirt, gravel and low-volume roadways and $86 million annually for Pennsylvania Turnpike expansion projects.
Many road and bridge projects are slated to start next spring. Also, because of this investment, transit systems in the state will continue to be able to operate without interruption.
“Because we worked together, we can now put shovels in the ground and rebuild our transportation system,” Corbett said. “The men and women who stood for this bill understand that compromise is not surrender, but rather a path to success.”
Locally, the funding for public transportation may be the more crucial element of the bill. Officials with SEPTA have long warned of discontinuation of lines and the closing of several stops should state funding not come through.
Helping SEPTA too is a recent letter from U.S. Sen. Bob Casey to Federal Transit Administration Regional Administrator Brigid Hynes-Cherin asking the administration to consider extending the south terminus of the Broad Street Line 1.5 miles, connecting it to the Navy Yard.
“I write to request that you meet with SEPTA, the Philadelphia Industrial Development Corporation and the International Brotherhood of Electrical Workers Local 98, the Philadelphia Building and Construction Trades to discuss extension of the Broad Street Line in Philadelphia. This project would provide for the construction of a 1.5-mile subway extension into the Philadelphia Navy Yard,” read a portion of Casey’s letter. “The Navy Yard is home to more than 130 companies and 10,000 employees in the office, industrial, manufacturing, and research and development sectors, occupying 6.5 million square feet of real estate in a mix of historic and new high-performance building construction. Currently, the Philadelphia Industrial Development Corporation runs a shuttle bus service to two different points on SEPTA’s system which is widely utilized. As the Navy Yard continues to grow, we need to start planning for a long term solution that will provide commuters with direct access to the Navy Yard as part of SEPTA’s subway system.
“In 2007, the Delaware Valley Regional Planning Commission funded a feasibility study to evaluate the construction and to estimate capital costs, ridership, and economic benefit of extending the subway by way of two stations into the Navy Yard,” Casey continued in the letter. “At the Navy Yard’s full build-out, ridership is estimated at more than 8,000 boardings between the two stations and would attract significantly more riders than the current bus system.”
Philadelphia Delegation Chairwoman State Rep. Cherelle Parker said that infusing SEPTA with much-needed funds should be one of the primary takeaways when considering the legislation.
According to Parker, the problems facing mass transit in Philadelphia and across the state are well-documented. Pennsylvania has a $5 billion-and-growing transportation funding deficit. Corbett’s transportation Funding Advisory Commission said state funding for mass transit alone was $500 million short in 2010 and will grow to $1.4 billion by 2020, increasing by $90 million per year. The need stands at $765 million today.
“Transit ridership is up. More people are riding SEPTA than at any time in the last 23 years. Commuters are choosing public transportation more and more to get to and from work, school, recreational activities, shopping and services,” said Parker, who is also the chairwoman of the House Transportation Committee’s Subcommittee on Public Transit. “This legislation makes the investment that Philadelphians need in order to avoid the harsh service cuts and fare increases that loomed over our city. My vote was a vote for jobs, safety and security for our region.”
Philadelphia delegation vice chair State Rep. Michelle Brownlee concurred with Parker, noting the importance of SEPTA to her many constituents.
“My responsibility as an elected representative to ensure the safety of our bridges and invest in vital city resources such as SEPTA compelled me to vote for the package,” said Brownlee, adding that she felt “encouraged” by the promise of improving traffic conditions on the Schuylkill Expressway with various proposed projects that could be funded by the bill and that he increased multi-modal funding will support the numerous pedestrian- and bike-trail projects planned throughout her district. “And my optimism as citizen-leader led me to see the value in a funding package that would boost the state’s total economic output by an estimated $6.5 billion.
“That means jobs for my constituents and a return on investment down the line when we need it to offset property and school taxes or to improve the health and human services in Philadelphia.”
While the overwhelming majority of statewide lawmakers where generally pleased with the bill and voted in favor of it, some, such as State Sen. Vincent Hughes, noted HB 1060 did not include certain language regarding wage protections.
“I must also express my outrage at the process by which this bill passed. Senate Democrats prepared an amendment that would strip the prevailing wage language from the bill. Republicans resorted to a rarely used parliamentary maneuver to stop a vote on our proposed changes,” said Hughes, who added that he, too, favored the bill overall. “The bill should not have included a provision to change the prevailing wage law, which undermines the wages paid to construction workers who are employed on public projects. It is simply not right to include such a controversial issue as part of a transportation funding plan. The issue of prevailing wage should have been debated separately and not made part of the transportation funding bill. That is not how important legislation should be decided by the Pennsylvania Senate.”
In the lower chamber, Brownlee also voiced concern of the inclusion of the provision. But Brownlee remarked that in such a compromise — which including working across the aisle with legislators with different ideologies and goals — no one gets everything desired.
“With any bill comes compromises, and although I objected to including prevailing wage language in this package throughout its process, my commitment to public transportation and the needs of my constituents who depend on it to get to work won out,” Brownlee said. “And my optimism as citizen-leader led me to see the value in a funding package that would boost the state’s total economic output by an estimated $6.5 billion. That means jobs for my constituents and a return on investment down the line when we need it to offset property and school taxes or to improve the health and human services in Philadelphia.
“SEPTA and mass transit hubs across the state can update their fleets and stations on the back of our vote, and that improves the urban experience and gets people moving. Left alone, SEPTA faces 500 million dollars’ worth of planned upgrades, including much needed car upgrades,” Brownlee continued. “I’m proud to help them achieve those goals, because their goals align well with many of my constituents’ needs.”
U.S. Congressman Chaka Fattah used a stop in Philadelphia late last week to promote a measure that would divert monies recouped from federal seizures and not used for victim restitution toward three broad programs, including funds for programs related to science, technology, engineering and math, also known as STEM.
Fattah unveiled his FOCUS Act – House Resolution 3580 – during a press conference at Science Leadership Academy, and noted the bill has to potential to impact the lives of 124 million Americans in the areas of STEM, medical research and innovation and justice reinvestment. According to Fattah’s office, the Department of Justice has collected billions of dollars annually from corporate fines and settlements. And reports from business research firm SNL Financial showed that between 2010 – 2012, the country’s largest banks agreed to more than $62 billion in settlements, a number that is expected to rise significantly in the wake of recent landmark settlements.
HR 3580 is currently referred to the Committee on the Judiciary, Committees on Education and the Workforce, Science, Space and Technology, and Energy and Commerce for consideration. The bill, Fattah said, has the support of key groups such as the National Association of Counties, National Urban League, Boys & Girls Clubs of America, Big Brothers Big Sisters of America, MENTOR, First Tee, Civil Air Patrol, U.S. Dream Academy, American Brain Coalition, National Council for Community and Education Partnerships, and Amachi.
America’s FOCUS Act identifies three key areas with evidence-based success in improving outcomes for individuals and directs the money to be evenly distributed through corresponding agency-administered funds. The annual grants will put money to: Support innovations in research and development to provide cures and treatments for medical diseases (National Institutes of Health), fund justice reinvestment projects that increase public safety by managing criminal justice populations more effectively (Department of Justice), and expand youth mentoring and STEM education programs nationwide (Department of Education). The remaining one percent of funds would be reserved for Federal deficit reduction.
“This bill presents an opportunity to intentionally direct sums from settlements between the federal government and corporate and financial institutions to programs that can improve the life chances of Americans and allow our country to maintain its economic competitiveness,” said Fattah, Senior Democrat on the House Appropriations Subcommittee on Commerce, Justice, Science and related agencies. “America is the leader in the global economy, but we can only maintain this status by producing a healthy, productive, innovative and educated workforce.”
The introduction of the FOCUS Act is in step with Fattah’s long-held support of STEM and neuroscience, so much so that the Big Brothers and Big Sisters of America recently recognized the longtime legislator for Fattah’s national leadership regarding youth mentoring.
“It is an honor to be recognized by my friends at Big Brothers Big Sisters, and I share this award with all of the mentees in our community and across the country, who work every day to make a difference in the lives of young people in America,” Fattah said in regard to the honor. “Mentoring must be a national priority. It is too important to the future of our next generation, and the future of our country, not to be. We must continue our outreach and advocacy, and work to ensure that every one of our children has access to a mentoring program.”
The Philadelphia Delegation to the State House led by Chairwoman State Rep. Cherelle Parker has introduced several bills relating to the Actual Value Initiative and other real estate-targeting measures over the last year.
Last week, the delegation won State Senate approval of several of those bills, including legislation from State Rep. Mike O’Brien that would allow for age and financial need to be considered when determining relief for long-term owner-occupants, and a measure from State Rep. Mike McGeehan that would authorize the city to allow the Revenue Department to present homeowners with the option of making property tax payments in installations.
Parker said all of the bills represent “more than a year” of collaborations among Mayor Michael Nutter, City Council President Darrell Clarke and influential members of the State House and Senate delegations.
“With the assistance and support of the City of Philadelphia and my colleagues in the House and Senate from both sides of the aisle, we have succeeded in our efforts to provide Philadelphia with the tools needed to address tax delinquency and tax fairness,” Parker said. “However, tax fairness is not just a Philadelphia issue, it is a statewide issue. That is why I am proud to say my legislation will also provide municipalities across the state with the ability to collect outstanding debts to benefit our local governments and underfunded school districts.”
O’Brien, the prime sponsor of House Bill 390, said that the city “needs additional tools to effectively collect delinquent property taxes from speculators who own vacant, blighted tax delinquent properties” and from investors who purchase and rent properties and fail to pay their property taxes.
“Over the past 10 to 15 years in Philadelphia, many adjacent or nearby Center City residential neighborhoods that were deteriorated and filled with vacant or abandoned homes and properties have become desirable places to live as a consequence of the refurbishing or renovation of residents or the construction of new residences. Initial studies of the impact the Actual Value Initiative will have on these long established residential areas show that they could see dramatic increases in property values. Further, studies have shown that the average length of ownership on these blocks, where ownership is ten or more years, is slightly above 30 years,” O’Brien said via a memo attached to HB 390. “Although the City of Philadelphia is authorized to provide gentrification relief under the First and Second Class County Property Tax Relief Act, the City is not authorized to use age or financial need, which is permitted in counties of the Second Class, to grant such relief. We seek to amend the First and Second County Property Tax Relief Act to afford Philadelphia the same authority to use age and financial need when considering relief for long term owner-occupants.”
Similarly, McGeehan’s legislation, HB 391, would help the 40 percent of Philadelphia homeowners by allowing them to make periodic payments on their real estate tax bill.
For her part, Parker measure, HB 388, would give all counties additional authority to collect delinquent property taxes in a more timely and cost efficient manner.
According to the chairwoman’s office, HB 388 would allow local governments such as Philadelphia to place liens on real property under common ownership in Pennsylvania when at least one is delinquent in the taxes owed to the home municipality. When the property owner attempts to sell any property located within the state, the lien would have to be satisfied.
“An analysis of delinquent property taxes shows that many non-residents own 10, 20 or more properties that are tax delinquent, vacant or abandoned,” Parker said. “Non-resident investors own rental properties that not only have code violations but are delinquent in paying their property taxes.”
HB 388 is estimated to collect an additional $30 million in tax revenue for the city, money that could be used to assist with the School District of Philadelphia’s financial issues.
House Bills 388 and 390 now head to Governor Tom Corbett for his signature; HB 391 was amended in the Senate and now heads back to the House for Concurrence.
A fourth Bill – House Bill 383, introduced by State Rep. Michelle Brownlee – would allow for the creation of two different real estate tax scales, one each for commercial and residential properties. That bill has been reintroduced House Bill 1693, which Parker said the delegation will try to win passage for as well.
Contact staff writer Damon C. Williams at (215) 893-5745 or
If the latest report from the City Controller is correct, the city’s Department of Revenue failed — either through poor collections, enforcement or both — to collect $120 million over the span of two years in delinquent real estate taxes, money the controller says could have helped bail out the financially distressed school district.
According to Controller Alan Butkovitz, the city’s collection rate of 88 percent was below the average rate from the peer cities selected for the review. Due to this gap, the city and school district have lost approximately $25 million and $35 million, respectively, in both fiscal years 2011 and 2012.
“This is a serious revenue loss and the effects of poor real estate collections are hurting all Philadelphians,” said Butkovitz. “If that $70 million was collected for the School District, then needed positions such as nurses and counselors could have been provided in our schools.”
The report concluded that problems were found in every phase of the city’s tax collection and enforcement process; that efforts to prevent delinquency have been inadequate, payment agreements have been “idiosyncratic and difficult to enforce once a property becomes delinquent,” and once a property is moved from delinquency to foreclosure, there is an inordinately lengthy and unpredictable process before the property is transferred to more responsible ownership.
The report also included a graph that illustrated the timeline between when a homeowner is notified of a past due tax issue and when that house is seized and offered for sheriff sale. The controller’s office noted that the average is roughly 883 — and could reach more than 1,000 days if the matter is goes before Common Pleas Court.
“In Philadelphia, the process of bringing a delinquent tax property through Sheriff Sale and then to new ownership can take nearly 2½ years and sometimes reportedly upwards to six years, one of the worst records of any large American city. In recent years, approximately 200 properties per month have been sold at sheriff sale; at this rate, it will take over 40 years to clear the already-existing delinquent property inventory. Without a credible and timely threat of foreclosure, Philadelphia will continue to have one of the lowest property tax collection rates of any of its peer cities,” read, in part, the report. “Of Philadelphia’s 99,000 properties with property tax liens at the end of fiscal 2012, we estimate that approximately 65,000 properties with liens valued at $204.8 million are of sufficient quality to reasonably expect redemption via a negotiated bulk tax lien sale. Within the smaller universe of investor-owned residential properties, there is about $27.4 million in quality liens.”
The city’s Office of Property Assessment is responsible for annually determining the value of properties within the city, and submitting a certified list of property assessments to the Revenue Department. The Revenue Department is responsible for billing and collecting real estate taxes based on OPA’s valuations.
Of the cities included in the report — Atlanta, Baltimore, Boston, Chicago, Detroit, Houston, Los Angeles and New York City — Philadelphia only bested Detroit in terms of delinquent tax collections. To put in perspective, Boston led all cities with a 98.86 percent collection rate, while Detroit’s rate is 79.92 percent.
“While each peer city shares some of Philadelphia’s characteristics, there is no ‘one size fits all’ solution for the city’s unique needs. Several factors set Philadelphia apart: it has the highest rate of homeownership among the peer cities, 60 percent; it has one of the highest proportions of homes with no mortgage, 40 percent; it has very high rate of intergenerational property transfers and very long ownership tenures; and it has the second highest rate of poverty. These factors combine to create a need for a tax collection and lien management system that balances the city’s budgetary needs with the social costs of blighted, vacant, and otherwise neglected properties,” read the report. “The city’s low collection rate has had a major impact on both the city and school district of Philadelphia’s operations. With tax levies for 2012 and 2011 of roughly $500 million for the city and $700 million for the school district, the 5 percent gap between the city’s collection rate and that of its peers represents an additional $25 and $35 million that could have been added to the respective city and school district coffers in both fiscal year 2012 and 2011.”
While the report is sobering, it does contain a set of fixes that, if implemented, Butkovitiz believes can bring the city more in line with the collections of Boston and Houston — which also has a sparkling collection rate of 96.99 percent.
The city should “improve its contractor efforts to contact past-due property taxpayers in the period between April 1 and Dec. 31. While we support the policy change implemented by Council Bill 120054 regarding the mailing of 60 and 90 day past-due notices to taxpayers, we believe that a more immediate outreach via telephone would provide an additional level of delinquency prevention,” the controller suggested in the report. “Work with lending institutions to educate property owners who are on the verge of paying off their mortgages of the importance of continuing to pay their property taxes.”
Butkovitz also suggested the city make a concerted and targeted effort to educate all Philadelphia property owners whose property taxes are not paid via an escrow account about their responsibilities and the systems available for paying their property taxes, while allowing those property owners to pay their taxes monthly and charge them a processing fee for each payment.
“To remove the barriers in accessing appropriate payment agreements for low-income taxpayers and offer taxpayers reasonable and feasible approaches for repaying their tax delinquency, we recommend that Revenue Department management effectively implement the monthly installment payment agreement provisions of City Council Bill 120054 in a timely manner,” Butkovitz concluded in the report. “The Controller’s Office will evaluate the Revenue Department’s compliance with those provisions in future engagements.”
As City Council nears the winter recess – with only one meeting between now and its final session on Dec. 12 – city legislators looked to both curtail a deadly phenomenon before it spreads to Philadelphia, and make Philadelphia an even greener city.
Councilman Kenyatta Johnson won passage of his bill that would outlaw the manufacture and possession of 3D firearms, noting the importance of passing such legislation within the city, as Pennsylvania currently has no statute expressly prohibiting the manufacturing and ownership of such a weapon.
Johnson said there is proof that someone created a 3D handgun that was able to fire 22 rounds, and that the national security and local criminology implications are clear.
“Today, Philadelphia became one of the first cities in America to proactively address an issue that has the potential to pose a significant danger to the public,” Johnson said, while thanking Councilman Curtis Jones for convening a recent hearing on the issue. “As technology progresses, three-dimensional printers will become more advanced, less expensive and more commonplace. As instructions for the manufacture of guns via 3D printing technology are already available on the Internet, we could be looking at a recipe for disaster.”
Presently, 3D printers run anywhere from $499 to nearly $2,000, with some designs costing even more. The bill now goes to Mayor Michael Nutter for his signature, and once the mayor signs it into law, Johnson’s measure would prohibit individuals other than licensed gun manufacturers from producing firearms using 3-D printers.
Council also passed an intriguing bill relating to the ongoing Marcellus Shale drilling operations in the central and northwestern sections of the state. Council passed Jones’ resolution – which calls on energy producers currently engaged in the hydrocarbon recovery within the Marcellus shale operations to provide discount natural gas molecules to the city as part of its consent agenda, which passed unanimously.
Councilwoman Mariann Tasco’s bill that further clarified the city’s ability to sell Philadelphia Gas Works’ Revenue Notes to either public of private entities were among the other highlights of the consent agenda. Tasco’s bill will allow PGW to raise funds to complete various projects while adopting a rate covenant with the city.
Meanwhile, council also passed a measure crafted between Councilmen W. Wilson Goode Jr. and Dennis O’Brien that frees up additional appropriations to allow the city to meet its financial obligations relating to the arbitrator-awarded contract for Local 22 of International Association of Firefighters.
Councilwoman Blondell Reynolds Brown introduced a measure that would make permanent the Mayor’s Office of Sustainability, noting that doing so is in step with Nutter’s vision of making Philadelphia the greenest city in America.
Brown’s legislation would amend the Philadelphia Home Rule Charter to better clarify the five main duties of the office: To develop and coordinate the implementation of policies and programs to meet sustainability goals, create periodic sustainability plans, disseminate sustainability plans, coordinate sustainability plans and programs across inter-governmental offices and, lastly, to promote public awareness and sustainability education.
“I can testify through a first-hand working relationship that the Office of Sustainability is bringing significant value to Philadelphia. They have put Philadelphia on the map as a national leader on issues surrounding the environment and sustainability,” said Brown, who serves also as the chair of the environment committee. “Cities across the nation now call Philadelphia for advice on how to become more sustainable; this simply did not happen before the founding of this office and their track record of achieving results.
“By making this office permanent, we signal Philadelphia’s long-term commitment to protecting the planet for our young people.”