PHILADELPHIA (KYW Newsradio) — Philadelphia officials unveiled a $5.6 billion budget proposal for fiscal year 2023 on Wednesday afternoon, ahead of the Mayor's address to the city council on Thursday.
The spending plan proposes no new taxes, but Finance Director Rob Dubow said he's expecting a 4.5% increase in property tax revenue because the City is restarting new assessments, after a two-year hiatus, and values have increased.
“If the growth winds up being higher than that, we will talk to Council about whether and how we should use those additional revenues for relief and rate reforms,” Dubow said during a briefing with reporters, via Zoom.
The first 4.5% in increased revenue will go toward the roughly 5% increase in spending in the proposed budget.
“The budget would enable investments that would provide quality government services and infrastructure while maintaining the city’s long-term fiscal health, reducing racial disparities, and advancing equitable outcomes for all Philadelphians,” Dubow said.
Among the spending increases:
— An 18.5% increase in anti-violence funding, including an additional $12 million to community groups and $1.5 million for vacant lot maintenance.
— $14 million more to the School District of Philadelphia, bringing the city’s contribution to $270 million.
— An additional $2 million to the Community College of Philadelphia, which will allow the expansion of the Catto Scholarships.
— 300 new pre-K seats, bringing the number of free pre-school slots to 4,300.
— Three new community schools, making a cohort of 20.
— $20 million to prepare the city to apply for funds under the bipartisan infrastructure bill, plus another $60 million in the capital budget to provide matching funds where required.
— A $9.7 million increase in the Free Library fund, which should enable all branches to stay reliably open five days a week.
— A dramatic increase in the Housing Trust Fund to $27.9 million, since voters approved a referendum requiring funding as a percentage of the budget rather than an annual amount.
— $2 million added to the Streets Department budget to address illegal dumping.
— $12 million to the Office of Homeless Services to continue opioid-related and shelter services the federal government has been subsidizing.
Other spending increases are connected to rising costs, including salaries, benefits and fuel.
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Budget director Marissa Waxman said the only department with a reduction in the budget was the Revenue Department, because it had saved $243,000 in postage by moving correspondence online.
Dubow said the administration is also proposing two new fees — one for document recording to avoid a backlog like the one the city recently dug its way out of, and one on deed recording that would be used for the demolition of imminently dangerous buildings.
The proposed budget also does not restart the incremental reductions in wage and business taxes that the Kenney administration had been making before the pandemic.
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It still needs to draw on its fund balance to keep spending and revenue balanced, leaving the fund balance at $153 million, one-third of what it was pre-pandemic.
The budget offers no bold new initiatives, but Mayor Kenney's chief of staff, Jim Engler, said the administration is delivering on the priorities it set in past years.
“The budget is helping the city respond and recover from the pandemic in the best possible way to ensure our financial stability, as well as the health and wellness of the city,” he said. “We’ve launched throughout the first term, and the first two years of the second term, a number of key initiatives that you’re seeing come to further fruition through this budget.”