By Tom Ferrick

 After a few weeks of getting beat up over city budget cuts that target libraries, fire stations and pools, the Nutter administration has finally gotten its mantra down.

What people must realize, Mayor Nutter has said, is that many of these facilities and services were created for a city of 2 million.  Today, we are a city of less than 1.5 million.

It was an argument Nutter made in his It’s Our City interview with Dave Davies that is posted on this blog. The message is being echoed by other city officials.

This is not the Philadelphia of 1960.  We have to “right size” our spending to the Philadelphia of 2008.

The mayor and his backers raise an interesting question:

If we have 25% fewer people in the city, why doesn’t city government cost 25% less?

To answer that we have to step into the Way Back Machine and set the dial for 1960 - the year usually used as the benchmark in these discussions. Richardson Dilworth (the tall guy holding the shovel in the picture to the right) was mayor then.

In 1960, Philadelphia had 2 million people, 27,500 city employees and a city budget that totaled $245 million.

Today, Philadelphia has about 1.45 million people, 24,500 city employees and a city budget that totals $4 billion.

It’s unfair to use those budget figures without taking the effect of inflation into account, so let’s do that.

Adjusted for inflation, the city had a budget of nearly $2 billion in 1960.  Today, it is $4 billion.

In other words, not only did the city budget not shrink by 25% because of declining population, it is double the size of the 1960 budget.

How could this be?

Was it those demon libraries and rec center pools sucking up all the money? No.  The libraries cost less to run today than they did in 1960 and they have roughly the same number of employees.  The Recreation Department costs more but has 90 fewer employees.  You can’t blame those two departments.

So what’s the reason why city spending is double what it was in 1960?

Let me point out the big three:

(All of the 1960 figures in this piece have been adjusted to 2008 dollars.)

Fringe Benefits:. About $800 million is due to one factor - the cost of benefits for city employees.  Adjusted for inflation, in 1960 the city spent $132 million on health coverage, pension payments and disability for city employees.  Today, it spends $925 million.  In 1960, the city spent an average of $4,825 per employee on these fringe benefits.  Today, the figure is $36,997 per employee.

That is a huge increase. 

In 1960, then-Mayor Richardson Dilworth was worried about the pay of city workers being so low that government couldn’t compete with the private sector in attracting good people.  We appear to have solved that problem.

The average salary of city workers has increased as well, but not much above the rate of inflation.  The average salary was $27,219 a year in 1960.  Today, it is $28,822.

 Public Safety. People talk about industry fleeing the city over the years to sunnier and cheaper climes. But, there is one business that has flourished and grown locally.  Just our luck, it is crime.

In 1960, in a city of 2 million people, police reported 38,500 major crimes.  Today, the number is closer to 93,000 a year.

This long surge in crime has caused the cost of public safety to soar.  Even adjusted for inflation, the cost of the cops, the courts, the DA’s office, the sheriff’s office, etc. increased $1 billion over the cost of delivering the same services in 1960.

To give just one example, in 1960 Philadelphia had 3,013 inmates in the city jails watched over by 579 prison employees.

Today, we have close to 9,000 inmates in city prison and 2,400 prison employees.

In 1960, the District Attorney’s office had 143 employees.  Today, it has 442.

The list could go on.  We do have fewer police today than in 1960, but the cost of putting a patrolman on the street has gone up exponentially.

One thing about crime: when it comes to social services, the city budget is heavily subsidized by the state and federal government.  But, there is hardly any federal and state aid given to public safety. The burden falls on local taxpayers.

Winners & Losers:  Fringe benefits, public safety and services to the poor are the three big growth areas in comparing ‘60 to today.  But, for every winner, there are losers.

In Philadelphia’s case, what mayors have had to do to feed the kitty in those areas is to take money and personnel from other city services, one of which is the city bureaucracy - the agencies that issue permits, do inspections, collect taxes, maintain city offices, etc..

The list includes such departments as Law, Revenue, Finance, Procurement, Records, and Licenses and Inspections.

In Dilworth’s day, they got 25 percent of the budget. Today, their share is 13 percent.

Number of employees: down 1,070 from 1960.

Ditto the city’s service agencies - the ones that provide services in the neighborhoods. Recreation, the Free Library, the Streets Department, Fairmount Park. Their share of the city budget in 1960 was 20 percent. Today, it is 9 percent.

Number of employees: down 2,950 from Dilworth’s day.

In 1960, Richardson Dilworth declared it a priority to continue the “rehabilitation and renewal of our city.” In 1961, he opened 19 new rec centers and playgrounds and five new libraries.

Today, the Nutter administration is beginning the process of turning the lights out.

Here is a chart that tells more details of the story.