Monday, October 28, 2013

Republican City Committee Recommends “No” On Debt Due to Lack of Details



FOR IMMEDIATE RELEASE
Contact:          Joe DeFelice, Executive Director
Phone:             215-756-4158 (mobile)
Email:              josephjdefelice@phillygop.com

City Hall Needs Better Bond/Debt Disclosure for Vote
Republican City Committee Recommends “No” On Debt Due to Lack of Details
Philadelphia, PA, October 24, 2013:  Philadelphia Republican City Committee unanimously voted to recommend a “No” vote on the request for a bond issue for the Nov. 5th election due to lack of details on how the debt will be spent.
“If City Hall wants voters to approve more debt for buildings and infrastructure, they need to disclose to the voters what those projects are, so we can make an informed decision.  Right now, a voter doesn’t know on where the money is going.” says Executive Director Joe DeFelice.
The Philadelphia Republican City Committee feels strongly that the voters should reject this ballot question and demand that City Council provide them with adequate information to make an informed decision on future bond issues.
 “Philadelphia has a history of using capital funds for operating expenses, which is the functional equivalent of taking out a mortgage to buy groceries,” added Matt Wolfe, member of the RCC Policy Committee. “For example, Democratic Mayor Street’s signature program, the Neighborhood Transformation Initiative (NTI) was a nearly $300 Million scheme whereby the city sold bonds and, using cronies of the Mayor to manage the project, did things like clear vacant lots and tear down vacant buildings.”
“Philadelphia spent capital dollars and was left with long-term debt but few capital assets.”
The ballot question asks the voters to authorize a bond issue for almost $95 Million.  The question on the ballot reads as follows:

Should the City of Philadelphia borrow NINETY-FOUR MILLION SEVEN HUNDRED FORTY-FIVE THOUSAND DOLLARS ($94,745,000.00) to be spent for and toward capital purposes as follows:  Transit; Streets and Sanitation; Municipal Buildings; Parks, Recreation and Museums; and Economic and Community Development?

The legislation that City Council passed that authorized that this question be placed on the ballot gives little additional information.  It puts an amount of money for each category as follows:
Transit
$   1,070,000.00
Streets and Sanitation
$ 18,448,000.00  
Municipal Buildings
$  44,599,000.00
Parks, Recreation and Museums
$  18,816,000.00
Economic and Community Development
$  11,812,000.00
Total
$ 94,745,000.00
The legislation also states that City Council can transfer money between the various categories at any time.
Capital expenditures are critical to the city’s operations.  The failure to adequately address renovations of property can end up costing more money over the long term.  In order to carry out its responsibilities, the city requires an infrastructure that logically must be financed over the life of the asset.  The RCC understands and appreciates the necessity for the city to borrow money to meet its capital needs.
Philadelphia should look at adopting legislation or a City Charter change that requires disclosing and linking bond debt votes to the programs they are intended for,” responds Adam Lang, Chairman of the Policy Committee.

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