Paul Levy report could be a good roadmap for Philly's 20-year spending plan
Where's The Money Going?
Equally we enter budget season, Paul Levy's Centre City District is out with a new report that lays out 20 years of the city's spending priorities. Could it exist a roadmap?
Mar. 12, 2020
Paul Levy, president and CEO of the Center City District, has long been our principal evangelist for economic growth.
He has maintained that cities cannot grow but by taxing and spending. They accept to figure out ways to grow that revenue enhancement base of operations, by attracting new residents and businesses.
Yes, he concedes, Philly has been calculation jobs, albeit our median household income lags far behind peer cities. Just, with city tax revenues now rising, what have we been doing with that money? Have we been smartly investing in growth?
Sadly, that has not been the Chiliad.O. of Philadelphia (or many other Rust Chugalug cities) for some time. Levy's new written report, Investing the Gain of Growth: City of Philadelphia Budget Choices 2020-2024, represents as deep a dive as I've seen into what our local authorities's priorities have been for the terminal 20 years.
Information technology follows a contempo report from City Controller Rebecca Rhynhart that delves into the celebrated levels of spending past the Kenney administration. When I defenseless up with Levy this week, that'south where our conversation began.
Larry Platt: It'southward budget season, and the mayor has proposed a record $v.two billion budget, a 29-percentage increment over four years. Controller Rhynhart recently came out with a report that looked at all that spending. How does your written report differ from that one?
Paul Levy: Rebecca looked at increased spending. We asked, 'What is the increased spending focusing on?' And nosotros didn't just await at the Kenney assistants. Nosotros actually looked back over the past 20 years.
LP: And yous broke that spending up into 3 singled-out strategies, and the breakup of that is very stark. What you telephone call Strategy 1 makes upward—shockingly—50 percent of all city spending.
PL: That'due south right, 50 percent of the budget goes to address law-breaking, criminal justice 
and health and human services. There's no doubt that the metropolis has a large challenge when it comes to poverty and social services, and has to spend dollars on that. Only when you consider that 23 percent of the budget also goes to pension liabilities, that's 3-quarters of the budget right there.
LP: And what you call Strategy ii is the spending that yous and I have been calling for—investing in growth—and this is the get-go fourth dimension I've seen it laid out then starkly only how much we've disinvested in that category over the years.
PL: Yes, these are investments in quality-of-life issues. Cleaning streets, parks and recreation, arts and civilisation, sanitation, education, infrastructure, economical development. These are investments in attracting and retaining more than residents and businesses to the city so we tin can abound the tax base. And that makes up xiii percent of the budget.
LP: I was stunned at how low that is. In fact, yous provide charts that show we're spending less today on this than 20 years ago. (See figures below.) It's proof of chronic disinvestment over two decades.
PL: Yes, we started looking at 1998. So information technology's important to keep in mind that we're not talking simply about the Kenney administration. We're looking at long-term trends. Remember, Strategy 2 spending represents the things that people are lament about, things like potholes and sanitation. Well, spending on Streets is down fourteen percent over 20 years, and that'due south adjusted for inflation. Planning and Evolution? Down 53 per centum.
LP: Which suggests that those complaints are born of specific policy choices. What'southward clear is that we're heavily invested in the social safety cyberspace—your Strategy 1—simply underinvested in means to abound the economical pie, right?
PL: That'south right. We take real challenges and we need to address them by spending, merely there's no comparable investment in growing family unit-sustaining jobs and creating the conditions to concenter and retain residents and businesses.
LP: One manner to grow is to reform our tax system then the city can compete with neighboring states and the suburbs, which gets us to taxation reform, your Strategy 3. 
You've been saying for years that our wage and BIRT (Business Income and Receipts) taxes are job-killers. We disproportionately tax what can upward and move.
In the by, yous've called for addressing that by lobbying to change the state'due south uniformity clause which would open the door to taxing commercial properties at a different rate than workers. Simply now you've come upward with something else: A phone call for a 5-year commitment to a 0.v or a 1 percentage reduction in those taxes.
PL: It was actually interesting to get back and showtime in the '90s and look at what was done. Rendell was all nigh Strategies 2 and iii. From 1996 to 2010, the revenue foregone due to tax cuts was never more than than 1 percent of the upkeep in any year. Today that number is 0.sixteen percent. If we just go back to one-percent wage and BIRT revenue enhancement cuts, that's a $50 million investment in growth. The predictability that would come with a five-year commitment to this attempt could make a large difference.
LP: I don't see much of this thinking in the mayor's new budget proposal. Have 
you shared this with him?
PL: Nosotros shared this with the mayor and walked him through this. Information technology was a practiced meeting.
Photo past Scott Serhat Duygun on Unsplash 
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Source: https://thephiladelphiacitizen.org/paul-levy-spending-report/
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