Inside Take: City Hall Has Long Coddled Big Business

And somehow CEOs still think they don't have enough influence?

(Editor’s note: This is an opinion column from a Citified insider.)

In this town, business and government get along like Jimmy Fallon and The Roots.

This Festival of Requited Love has been ritualized by Mayor Michael Nutter’s annual addresses to the Philadelphia Chamber of Commerce, with the final kiss being blown at their Sheraton Philadelphia luncheon today.

Some will remember the late, silver-haired Leonard Tose, a millionaire who owned a thriving, regional trucking firm and our beloved Philadelphia Eagles. One sunny day, Tose decided he wasn’t rich enough (who really is?) and the city should pay to construct new, luxury skyboxes in the city-owned stadium where his team played. The scheme was that the additional revenue would go straight to Lenny’s pocket where there existed a gaping hole created by an infamous gambling and drinking problem.

A suckers deal, to be sure, but we were all in.

In the early 1980s The Rouse Company decided there’d be millions to be made from building a downtown shopping bazaar and Gallery’s I and II were born. Of course, Rouse claimed it wasn’t feasible unless the city paid to construct multi-level parking lots for their customers. 

No problem, said Mayor William Green, and the Philadelphia Parking Authority proceeded to make this rich company even richer with this gift from the taxpayer. Rouse’s bottom line fattened like Paula Deen at a cheese cake festival.

To entice Disney Quest into opening at 8th and Market Streets., Mayor Ed Rendell and Council President John Street spent millions of tax dollars to subsidize the development with market studies and a very costly excavation (and subsequent refilling) of the site.

Disney never came and Goofy is still laughing.

When the regionally renowned Kimmel Center opened, Parkway Corporation decided they could make millions if they built a parking lot for the patrons of this cultural gem. 

But, Parkway claimed it needed financial help from taxpayers to make this project a success. That help merrily came in the form of a clever scheme known as Tax Increment Financing which, of course, failed to produce promised benefits for the city treasury.

More recently, city council passed a second bill mandating that low-wage Philadelphians receive three measly days of paid sick leave a year. The Chamber of Commerce again assumed a proudly penurious posture of opposition that would’ve made Ebenezer Scrooge kvell. 

Mayor Nutter, in valorous service to Philly’s one percent, carried the council bill and a pen to the lobby of the chambers offices and vetoed it as the members surrounded him, contentedly purring like kittens who’ve just been fed. Proving that hope springs eternal, Mayor Nutter has successfully negotiated to produce a sick leave bill he now intends to sign.

In case I’ve not made my point, let me cite one final example, which is the relocation of the Philadelphia Inquirer to its current home on East Market St. It is a little known fact- ours is a city filled with “little known facts” – that taxpayers helped foot the bill for that as well.

In a boxing match with business, Philly pols don’t simply have a “glass” jaw rather, it’s cellophane. Still, local rich guys want more and have formed a new political action committee – enigmatically called Philly Rising – to get it.

Given that former Mayor Rendell built almost a dozen new hotels, none of which paid real estate taxes for at least five years and housing developers get to sell homes that come with a 10-year tax abatement, Philadelphians can be forgiven for being as wary as a hemophiliac at a knife throwing contest.

If business advocates are indeed “paralyzed,” as one slightly dramatic, anonymous insider claimed, what could vigorous animation look like? What more is there to want besides tax breaks, free land, super cheap loans and secret subsidies?

We need a vigorous and prosperous business community every bit as much as we need quality schools and effective policing. The public and nonprofit sectors cannot possibly create sufficient jobs for America’s fifth largest city.

Developers will tell us a vibrant commercial/business environment sets the table for tourism, can expand the tax base and draws new residents. Developers complain about complicated government regulations and high labor rates obstructing their good work.

But, let’s get real. Everybody has a tough time dealing with government. Try going through the permitting process for a rooftop deck, sometime. A Philadelphian may have to trudge through  as many as three different government agencies (Licenses & Inspections, Zoning Board and Historic Commission), architectural drawings, fees and much time. Citizens have to suck up the cost while business passes it on to their customers.

Ask any Philadelphian about the cost of hiring a plumber, electrician or carpenter. We all pay high costs for skilled workers. While citizens have to tap savings, visit their credit union, or make sacrifices, businesses go to government for gifts, breaks or subsidies that come at a cost to the poor, education, public health and police.

There is zero guarantee that the companies we subsidize will stay loyal to us. Today, they do business at 15th & Chestnut and tomorrow they can invest their juicy profits in King of Prussia, Cherry Hill or a tax-free account in the Cayman Islands.

If I may refute Charles Erwin Wilson, CEO of a major auto maker in the early 1950s, what’s good for General Motors ain’t necessarily good for the USA. Banks automate, large retailers import from China, our service economy thrives on low wage jobs. Business prosperity doesn’t automatically translate to the general community.

We’ve recently read of elected officials risking careers, pensions and freedom to pocket envelopes of unreported cash. How much more will they be seduced by the sweet entreaties of a powerful new business PAC?

PAC’s are perfectly legal and, if you believe the US Supreme Court, equate to free speech. But, I’m mindful of Bob Dylan, the great American troubadour, who said “money doesn’t talk, it swears.”

Jay McCalla has served as a city deputy managing director, a director for the Redevelopment Authority and as chief of staff to Councilman Rick Mariano. He is now a consultant.