What Happened to Michael Nutter’s “Honest Budget Now”?

The Mayor is set to leave behind a tax-hike legacy.

Mayor Nutter and his lackeys have tried to spin his latest budget as containing no new taxes. Let’s be clear: That is a lie. Plain and simple, Nutter wants to raise taxes—again. Nutter’s plan calls for the city to hike property taxes another eight percent. The added revenue is in addition to the “temporary” property tax hikes introduced in the last two years that appear to be permanent.

Nutter operates like George W. Bush did when he argued that Iraq had WMDs. If he just repeats the bogus lines enough it will somehow become fact.

Just weeks before unveiling the new budget, Nutter administration members boasted that there would be no tax hikes. Then the Mayor proposed a budget that increases property tax revenue by $90 million. Nutter claims this isn’t a tax increase because it comes from proposed changes in the way the city assesses real estate. Please. Try telling that to homeowners whose property taxes will go up for the third straight year.

Nutter claims the new assessments will capture increases in property values since the last assessment in 2004. Will the assessments also capture the declines in property values since 2008?

Residents cut Nutter some slack on the previous tax hikes because of the economic collapse. That excuse has been milked dry. At some point, Nutter has to take responsibility for his fiscal record.

Counting the previous increases in the parking tax, hotel tax, sales tax and property tax, Nutter is on course to raise taxes all five years he has been in office. Not to mention, Nutter ended the cuts in wage and business taxes the last three years, but thankfully plans to start them back up. Nutter is on course for a tax-hiking legacy unmatched since Mayor Rizzo’s fiscal insanity drove the city to the brink of bankruptcy.

In a city that already had one of the highest overall tax burdens in the country, five years of additional tax hikes could take a generation to undo. The result is an even more uncompetitive city.

No doubt the Great Recession put a huge strain on the city’s finances. But the reality remains: Nutter has failed to respond to the tough times with any substantive cuts or reforms to the city’s bureaucracy. There have been some nips and tucks. But employee salaries and benefits—consuming nearly 70 percent of the city’s budget—remain largely intact. Any job cuts have come mainly through attrition.

Meanwhile, taxpayers, including many who have not seen much in the way of salary hikes, have repeatedly been asked to dig deeper into their pockets to pay to preserve the City Hall bureaucracy.

The Mayor says he refuses to sign a contract with city workers that doesn’t include reforms to pension and health costs. Sounds good, except the police and fire unions got a contract that did little to reform the pension and health costs. The one big concession the Mayor got was the ability to furlough cops, but he has never used that option. It gets harder to push for real savings with the other unions as the economy improves and Nutter becomes a lame duck.

The other reason cited for the tax hikes is to bail out the Philadelphia School District. But Nutter supported former Superintendent Arlene Ackerman right up until she embarrassed him last year by finding funding for kindergarten while he was pushing a tax hike to pay for it. It had long been obvious to others that Ackerman was a lousy and arrogant leader who was overmatched in Philadelphia—just as she was in her previous failed stops in Washington and San Francisco.

Ackerman left the school district’s finances in shambles with big spending on new programs, sweetheart teacher contracts and little, if any cuts, during the economic downturn. Now taxpayers are being asked to pay for her mismanagement.

Yes, there have been recent state and federal funding cuts, but the school district’s budget soared from about $2 billion to $3 billion in a relatively short period of time with little accountability. Meanwhile, enrollment has been dropping. As such, the city now spends much more to educate fewer students.

Residents may be willing to pay higher taxes if they thought they were getting something of value in return. As a candidate for mayor, Nutter promised to create what he called an “Honest Budget Now.” Taxpayers are still waiting for that day to arrive.

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