GPCC Supports Philadelphia Mayor Nutter’s Budget Solution

As the Pennsylvania legislature grapples with the Commonwealth’s budget issues, the Chamber remains committed to supporting Mayor Nutter and the needs of the City of Philadelphia. We support the Mayor’s call for the passage of House Bill 1828 and Senate Bill 105.

These bills are necessary for the economic survival of the City of Philadelphia and important to the entire southeastern region of Pennsylvania. They would authorize Philadelphia to change its pension amortization period, defer a portion of its pension payments, and temporarily increase the local sales tax by 1% to pay for pension obligations.

Passage of these measures by August 15, 2009, is imperative for Philadelphia to assure a balanced budget and provide for the safety and well being of the people and businesses who reside in the City and nearby, and those who work and travel here.

Beginning last fall and through the spring, when the City was faced with declining tax revenues, dramatic losses on earnings in their pension fund, and higher interest rates on debt, the city was forced to cut $2.4 billion from its five-year plan. They achieved the necessary reductions through belt tightening measures, enhanced efficiencies and additional fees on residents and businesses.

Last week, Mayor Nutter detailed a series of further drastic steps the City of Philadelphia must take to balance its budget if the enabling state legislation is not passed. In addition to the elimination of 739 police and 200 firefighter positions, the Mayor will also be forced to close all libraries and recreation centers. These and other crippling reductions would result in an unacceptable level of service and the long term deterioration of the City’s tax base.

The Chamber is committed to a public policy agenda that will generate jobs, strengthen the tax base, and fortify our economy. Alternative measures to balance Philadelphia’s budget, such as an increase in wage or business taxes, were considered and rejected. These were viewed by business leaders throughout our region as destructive and detrimental to our future economic recovery. HB 1828 and SB 1058 are necessary tools for the solvency of Philadelphia.