Awarded to Frank Rizzo

On March 24, 2009, It’s Our City began an outreach campaign to every member of the Philadelphia City Council asking for them to share with us their thoughts about the budget. The questions are pretty straight-forward.

Do you largely support the mayor’s budget?

If you do not, what areas do you see as problematic?

What alternatives do you suggest that would still keep the budget in balance?

On Friday, March 27th, Councilman Frank Rizzo was the first to respond to our invitation.

As for the rest, We’re still waiting.

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By Frank Rizzo

Councilman-at-Large

Republican/Minority Whip

City of Philadelphia

Remember “The Grasshopper and the Ant”?  The Ant was industrious in preparing for the Winter, while the Grasshopper was feckless.  When Winter came, the Ant was ready, the Grasshopper wasn’t.  The City of Philadelphia has been the Grasshopper.

With a brief contraction of eight months from March 2001 to November 2001, we experienced a pro-longed period of economic growth from March 1991 until December 2007.  Instead of taking advantage of that extended period of revenue growth to reduce our debt, to fully-fund our City pension obligation, and to create substantial reserves; we exhausted our borrowing capacity, raided our Pension Fund (by reducing our contributions and letting the balance erode), and spent most of the surplus.

Now that we’re in a major economic contraction, we can’t borrow our way out, we can’t reduce contributions to the City pension fund, and we can’t draw down our reserves.

Everyone “gets” the crisis; this is an opportunity to do something “transformational.” The Administration always has the advantage in terms of access to the financial data. However,  City Council has a budget process (extensive hearings), where we can draw out the information necessary to make intelligent budget decisions.  It’s premature to say that in a $3.8 billion budget there are no more possible measures of economy, efficiency, and effectiveness.

Also, this is a speculative budget:  the pension fund changes and sales tax increase depend on the Pennsylvania General Assembly.  That support is not at all certain.

As a last resort, we can raise taxes to get us through this crisis.  Post-World War II Japan sacrificed to successfully rebuild its productive base pursuing policies promoting capital formation; and, Ireland in the 1980s invested in educating its population to successfully stimulate its economy.  If we need to sacrifice to get through the crisis, then we will.

And, . . . when the economy expands again, we need to learn from the past by using the increased revenue to prepare for the future:  reducing the debt burden, fully-funding the City pension fund, and creating substantial reserves.