City budget now needs state approval

After months of wrangling over how to close a more than $1 billion dollar budget gap, Philadelphia City Council unanimously passed a budget on Thursday. The deal struck with Mayor Nutter includes several items that need approval by the General Assembly, and the whole budget has to be approved by the Pennsylvania Intergovernmental Cooperative Authority, or PICA.

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If legislators do not approve the sales tax hike, or some of the pension re-financing plans, the city would be facing drastic service cuts.

Uri Monson is executive director of PICA, the state agency tasked with overseeing the city's finances. He says there is so much in the budget that depends on forces beyond the city's control, that he has asked for a contingency plan that includes the impact of the potential cuts.

Monson: If you reduce the number of police officers by a certain amount, what is the impact on crime, impact on prisons and the rest of the criminal justice system. A lot of the city's activities are inter-related, and will have impacts if there is less spending in some areas greater impact in other areas. We're trying to get a handle on not just specifications of cuts but also the ramifications of those cuts.

Monson says if the cuts have to be made, the sooner the city knows the better.