Philadelphia City Council passed a $4.8 billion budget with deep cuts to departments and hundreds of layoffs following massive revenue shortfalls triggered by the novel coronavirus pandemic.
On Thursday, legislators voted 14-3 on the city budget that reduced spending by $222.4 million, or 4.3%, compared to the previous year. The package now heads to Mayor Jim Kenney’s desk for his signature.
The year-over-year drop in city spending marked the first under Kenney, whose administration was on track to raise city spending by more than a billion dollars since he took office — before the pandemic sunk city revenues. The budget the mayor originally pitched was for $5.2 billion.
Voting against the spending plan were At-large Councilwoman Kendra Brooks, of the Working Families Party along with At-large Councilman David Oh and District 10 Councilman Brian O’Neill, both Republicans.
Council President Darrell Clarke, a Democrat, said the budget process was unlike any he had ever experienced due to the financial challenges stemming from the pandemic. Considering the city was in line for federal and state funding and grants to respond to the virus fallout, Clarke expected legislators will tinker with the budget during the fiscal year, which begins Wednesday.
“It’s unlikely that we will not be back at some point during the next couple of months to address this budget again,” Clarke said.
Council members also passed a capital budget and five-year fiscal plan.
The budget for fiscal 2021 included no property tax increase but hiked parking and business taxes to make up for a projected 6% drop in revenues compared to last year.
Parking taxes will rise from 22.5% to 25%, as will the Wage and Net Profits Tax for non-residents. The budget wiped out a planned decrease for the Business Income and Receipts Tax and a discount for property owners who pay their property taxes early.
Budget cuts and layoffs
Departments citywide will see their budgets reduced compared to previous fiscal year, including the Free Library of Philadelphia (down 13%) and the District Attorney’s Office (down 14%).
The reduced spending is expected to lead to an estimated 454 layoffs.
Protests in the city over the police-custody killing of George Floyd in Minneapolis and police brutality across the country pushed officials to slash $14 million in spending for the Philadelphia Police Department. Yet the 1.9% reduction in year-over-year funding was tiny compared to the cuts imposed on other departments, and the police budget still amounts to the highest spending of any city department ($727 million).
The police budget cuts will lead to a reduction in personnel during the upcoming fiscal year, raising doubts about whether police reforms touted by city officials will receive funding, including training for implicit bias. There will also be a scaling back on anti-violence initiatives as homicides were up 22% compared to this time last year.
Yet Brooks contended the police department’s budget reduction included “no real cuts” and were “meaningless” because they merely shifted programs out of the department, including those for crossing guards and safety officers.
Brooks, a first-year council member, questioned whether the police budget was justified for a department that “failed to historically make our communities safer.” She called on diverting funding into neighborhood initiatives as well as anti-poverty and anti-violence programs.
“We cannot continue to pour our trust and our resources into institutions that have continued to exhibit racism and perpetuate violence against the most vulnerable communities,” Brooks said.
The Philadelphia Free Library will see the most layoffs of any city agency — 204 temporary jobs.
Siobhan Reardon, president and director of the library, said in an email earlier this week that the budget cuts and layoffs will prevent the library sysem from employing many temporary summer workers. But she noted her agency will maintain service at all 54 branches.
“Like many other organizations in our city and around the world, the Free Library is making painful decisions about how to best provide its vital services during and after the COVID-19 pandemic,” Reardon said.
In addition, neighborhood libraries will see their six-day service dropped to five days a week, with the Parkway Central Library and four regional libraries losing Sunday service.
Lower spending will affect other city services: Recreation centers will see programming reduced; the pre-kindergarten program will not expand by 1,000 slots as planned but remain at 3,300 this September; and city pools won’t open this summer.
The budget does include $20 million for The Housing Trust Fund, which pays for maintaining and creating affordable housing, and $350,000 to the African American Museum in Philadelphia.
Members of council also earmarked themselves $25 million to spend on reducing poverty through a series of initiatives.
At-large Councilman Allan Domb, a Democrat, slammed the Kenney administration for failing to be transparent during the budget process, claiming it has been on a four-year “spending spree” that has jeopardized funding for affordable housing, cultural and recreation projects.
Domb said he was putting the two-term mayor “on notice” that the City Council will seek quarterly updates to better account for city spending and investments.