Philadelphia freezes payments to city vendors

The state of Pennsylvania’s budget impasse is trickling down to its biggest city.

The state of Pennsylvania’s budget impasse is trickling down to its biggest city.

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[audio: 090717tmcash.mp3]

Philadelphia Mayor Michael Nutter says the city only has about $197 million worth of cash on hand, and a bi-weekly payroll in the $170 million range. Because the state hasn’t approved a sales tax hike and changes to the city’s pension payments that would save a millions, the mayor says they won’t pay its vendors for now.

Nutter: The delay will work much like any one of us individually will experience, you are just not sending a check that’s unfortunately what people are doing in this economy, pretty much every day, they are making choice decisions about which bill they are paying and the timeliness of paying because of cash flow.

One city councilman is concerned that minority owned and other small businesses will be squeezed, but Mayor Nutter promises the vendors will be payed once the state budget impasse is ended.