Nutter proposes $3.75 billion budget for 2014

Chaos at City Hall: Mem­bers of fire­fight­ers uni­on Loc­al 22 hold signs crit­ic­al of May­or Nut­ter dur­ing a protest out­side City Hall. BRAD LAR­RIS­ON / FOR THE TIMES

May­or Mi­chael Nut­ter sup­plied a miss­ing num­ber for prop­erty own­ers to fig­ure their taxes last week when he pro­posed a $3.75 bil­lion budget for the 2014 fisc­al year.

The may­or pro­posed a tax rate of $1,320.40 per $100,000 of as­sessed prop­erty value.

But homeown­ers should make those cal­cu­la­tions on scrap pa­per and in pen­cil be­cause noth­ing is set yet. City Coun­cil mem­bers this spring will re­view and de­bate the may­or’s sug­ges­ted tax rate as well as his tax-re­lief and spend­ing pro­pos­als. The fi­nal tax rate will be de­term­ined by a coun­cil vote.

Be­cause the city has moved this year to as­sess­ing prop­er­ties at their ac­tu­al, or mar­ket, val­ues, the tax rate will be lowered from the cur­rent 9.71 per­cent to gen­er­ate the same rev­en­ue.

On March 14, the may­or tried to de­liv­er his budget ad­dress in City Coun­cil cham­bers, but was drowned out by ir­ate mu­ni­cip­al uni­on mem­bers who have yet to get new con­tracts. The pro­test­ers chanted, yelled and blew whistles while wav­ing “May­or Bozo” posters in the coun­cil gal­lery. The may­or’s ad­min­is­tra­tion has settled with the po­lice uni­on, but the fire­fight­ers and em­ploy­ees rep­res­en­ted by two oth­er uni­ons are work­ing un­der ex­pired con­tracts.

Nut­ter later gave his budget re­marks in his re­cep­tion room to the ap­plause of ad­min­is­tra­tion staffers.

Nut­ter also pro­posed a $15,000 homestead ex­emp­tion — an amount that is de­duc­ted from an as­sess­ment be­fore it is mul­ti­plied by the tax rate.

Be­fore the may­or re­leased his budget last week, the most fre­quently men­tioned rate was 1.25 per­cent, or $1,250 in taxes per $100,000 of prop­erty value, and the homestead ex­emp­tion fig­ure cited most of­ten was $30,000.

Op­pon­ents of the ex­emp­tion, which will be offered only to own­ers who live in their homes, say it in­flates the over­all tax rate.

The may­or also wants to set aside $30 mil­lion in yet-to-be de­term­ined tax re­lief for homeown­ers in gentri­fy­ing neigh­bor­hoods or the own­ers of small busi­nesses whose taxes will soar with the re­cent move to 100 per­cent mar­ket valu­ation.

State Rep. Ed Neilson (D-169th dist.) cau­tioned Nor­mandy Civic As­so­ci­ation mem­bers on March 14 that there is no guar­an­tee the homestead ex­emp­tion will be re­newed year after year.

“They can say, ‘We can’t af­ford it this year,’ and the tax rate stays high­er,” he said.

Both Coun­cil­man Bri­an O’Neill (R-10th dist.) and Neilson re­peatedly have said that the homestead ex­emp­tion could mean thou­sands of low-value prop­er­ties would gen­er­ate no taxes at all.

The main points of the may­or’s 2014 budget are:

• Prop­erty taxes will not in­crease, and no ser­vice cuts are planned.

• The city’s wage tax will de­crease very slightly and con­tin­ue to de­crease over the next five years, mov­ing from about $3.92 per $100 of wages to $3.76 per $100 by 2018.

• Spend­ing for the 2014 fisc­al year, which be­gins Ju­ly 1, will be $99 mil­lion high­er than it is in the cur­rent fisc­al year. Most of the in­crease, $69 mil­lion, will pay for city em­ploy­ee pen­sion costs and po­lice salar­ies.

• Fifty-four per­cent of the $1.2 bil­lion in rev­en­ues gen­er­ated by taxes will go to the school dis­trict, whose budget is not part of the city’s $3.75 bil­lion spend­ing plan.

• The city will spend more than $2.5 bil­lion on salar­ies, pen­sions and be­ne­fits.

• The move to as­sess­ing Phil­adelphia prop­er­ties at their ac­tu­al val­ues in­creases the value of the city’s tax­able prop­erty from $36 bil­lion to $98 bil­lion.

•  Com­munity Col­lege of Phil­adelphia will get $1 mil­lion to help off­set tu­ition cost in­creases.

• $1 mil­lion will be spent to ex­pand hours at the branch lib­rar­ies, and $5 mil­lion will be spent over two years to mod­ern­ize lib­rary branches.

• The city will spend $2.1 mil­lion to im­prove fire­houses and $4.7 mil­lion for new self-con­tained breath­ing ap­par­at­uses, air bottles and 35 new “Jaws of Life” gear.

In June, 160 fire ca­dets in two classes will be­gin train­ing that will end in Novem­ber. In Janu­ary, 148 fire ca­dets and 21 para­med­ics gradu­ated from the Phil­adelphia Fire Academy.

• More po­lice of­ficers will be hired to main­tain the de­part­ment’s strength of 6,525.

• The city will spend $624,000 for pub­lic com­puter cen­ters to con­tin­ue of­fer­ing In­ter­net edu­ca­tion classes and com­puter tu­tori­als.

• The city will hire 30 new De­part­ment of Pub­lic Prop­erty em­ploy­ees to per­form build­ing main­ten­ance, and 40 ad­di­tion­al Parks & Re­cre­ation work­ers to main­tain parks, re­cre­ation cen­ters and pools.

• The city will hire ad­di­tion­al code en­force­ment and build­ing in­spect­ors.

• The city will con­tin­ue to de­vel­op 4601 Mar­ket as a new po­lice headquar­ters and pub­lic health cen­ter, free­ing the city to sell the Round­house at 8th and Race streets and the health build­ing at 500 S. Broad. St.

• The city also is pre­pared to see the new prop­erty as­sess­ments it began mail­ing on Feb. 15 re­vised. Fin­ance Dir­ect­or Rob Dubow said Nut­ter’s budget in­cluded $32 mil­lion to cov­er tax rev­en­ues lost when new as­sess­ments are lowered. ••

Re­port­er John Loftus can be reached at 215-354-3110 or

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