Philadelphia Mayor John Street delivered his annual budget address yesterday in the crowded City Council chambers of City Hall, announcing numerous changes in tax cuts for the remaining four years of his five-year budget plan.
Many councilmembers and visitors applauded Street's unveiling of the $3.1 billion operating budget for this fiscal year -- a plan which Street introduced as a "partnership for progress."
"This budget is not everything we want, but it is what Philadelphia needs," Street said. "It is an honest document."
Plans for tax reform focused on the wage and gross receipt taxes. Street called for one final cut in wage tax rates, to be implemented in July, before those rates are frozen.
The city cannot afford further reductions of the wage tax, according to Street.
However, the mayor also proposed decreasing the gross receipts tax by half.
The cut would mean over $50 million in total savings a year for business tax payers.
One of the most vocal opponents to some of Street's plans was city Councilman-at-large James Kenney.
"I agree with the mayor that the gross receipts tax is the most onerous tax that we have facing Philadelphia," Kenney said.
Kenney then added, "But to accelerate one tax and then stop the other is simply taking money from one drawer and putting it into another."
"You are not addressing the overall problem of the city, which is the highest tax city in the nation," Kenney said.
Kenney further criticized the mayor for not being able to reduce the size of the city government.
The city government "is bigger now than it was 20 years ago, when we had more people," Kenney said. "It's like a company that has 70,000 less customers but more employees."
This criticism clashed with Street's belief that, "In [city] business, you grow or die."
Street centered many of his remarks around the successes of the past year.
"2001 was a year of difficult challenges," he said, emphasizing the tragedies of Sept. 11. "Nonetheless, it was a year of accomplishment."
While outlining these accomplishments, Street stressed the prominence of Innovation Philadelphia -- a public/private partnership designed to establish the city as a world class leader in the knowledge-based economy.
"Our most valuable partner in this venture is our city's higher education community, which is attracting the very best and brightest minds to study, work and live in our city," he said. Street noted and thanked University President Judith Rodin, who chairs Innovation Philadelphia, a program for bringing cutting-edge businesses to the city.
Rodin was one of many in attendance recognized for their efforts to help the city.
The Mayor took his time in approaching the public schools controversy. He spoke on the issue of state takeover toward the end of his speech and identified the recent agreement between the city and the state as "historic and [illustrating] the value of partnership."
"If we were going to sustain these reforms and offer children the quality education that is their sacred right, we needed a new partnership with the Commonwealth," Street said. "We all agree the status quo is unacceptable."
The Mayor also proposed $45 million a year to support the public schools.
The need for a unified public opinion on the major issues facing the city was the core of the mayoral address.
"The ideals uniting us are far more important than the details dividing us," Street noted.
However, the budget address did not go into great detail.
Critics said they thought the address was more about political rhetoric than the actual budget proposal.
"What you need to do is go in and delve into this government and change it culturally and in reality -- not just move the deck chairs around because 2003 is re-election," Kenney said.
Street's budget proposal will be subject to City Council approval.
