What a difference a couple months makes.
When Mayor Jim Kenney delivered his Inauguration Day speech in January, he announced few new or detailed plans. When he gives his first budget address Thursday morning, things will be completely different: He will lay out a vision that is bold and far-reaching.
The big details have already been revealed: Kenney wants to sell $300 million in bonds to completely redo the city’s parks, libraries and recreation centers. He also hopes to create a three-cents-per-ounce soda tax in order to help pay for expanded pre-K, community schools, a job creation plan, the debt service for his overhaul of public spaces, and much more. The tax would also help bolster the city’s underfunded pension system somewhat.
But there are lots of other fascinating and important things about Kenney’s five-year budget plan that haven’t been announced yet. Here are ten of them:
- Kenney wants to issue two bonds to raise a total of $100 million for Council President Darrell Clarke’s massive energy jobs plan. Clarke proposes creating more than 10,000 jobs by making numerous public and private properties more energy-efficient. By including Clarke’s plan in his budget, Kenney may have a slightly better chance of persuading Clarke to approve a soda tax. Clarke opposed a sugary beverage tax when former Mayor Michael Nutter tried to get it passed a few years ago.
- Kenney’s budget does not set aside any extra money for the School District of Philadelphia’s general fund next year. How could this be? Kenney administration officials say the school district has not yet requested any additional money — and they also point out that the city has boosted district funding by about $400 million over the last few years. Plus, Chief Financial Officer Rob Dubow says, the city is “looking at a different approach” by investing in expanded pre-K and community schools. Still, if history is any indication, the school district will likely request more money in the next few months — at which point things could get sticky.
- Kenney’s budget does set aside $200 million over the next five years to pay for future labor contracts and employee raises. That’s probably fiscally responsible, since lots of municipal union contracts are about to expire: the blue-collar union District Council 33’s is up in June; the white-collar union District Council 47, the police union and the firefighters union all have agreements that end in 2017. But is Kenney tipping his hand by so plainly putting this money in the budget?
- Officials don’t yet know which parks, libraries and rec centers would be rehabbed under Kenney’s plan. Managing Director Michael DiBerardinis says the city would work closely with community groups and Council members to make that determination. Kenney could potentially use this as a bargaining tactic to convince Council members to vote for a soda tax.
- Officials also don’t yet know which schools would become community schools. But Kenney wants to create 25 of them in his first term, at the cost of $4 million in the first year and $10 million annually by 2019-20. Community schools, essentially, are those that provide a host of resources to students and community members, such as dental and medical care.
- Kenney’s budget would spend $250,000 on developing a “Vision Zero” plan for the city. The goal of Vision Zero is to fully eliminate pedestrian and cyclist deaths.
- Kenney says the city will raise an additional $69 million over five years by doing a better job of collecting delinquent taxes. He says the city will do that by initiating a tax lien sale, increasing the number of service representatives, and adding programming to the revenue department’s IT system, among other things. Expect Council members to prod the Kenney administration about back taxes during this year’s budget hearings.
- Kenney’s budget has a fund balance of only $42 million next year. Even the administration admits that is low. This could become a problem if there is another recession soon, as some economists are predicting.
- Kenney’s budget would spend $600,000 annually on the city’s Storefront Improvement Program, which helps businesses redo their storefronts. This is part of Kenney’s plan to revitalize the city’s commercial corridors, which, along with his proposed parks overhaul, would help him keep his campaign promise to invest in Philadelphia’s neighborhoods.
- No surprise: The city’s underfunded pension system continues to eat up an ever-growing part of the budget. In 2000-01, the city contributed $194 million — or almost 7 percent of its budget — to the pension system. In 2016-17, the city expects to pay almost $641 million — more than 15 percent of its budget — on pensions.