Philly leaders negotiate anti-violence funding, federal aid, and tax cuts as budget deadline nears

As they negotiate next year’s budget behind closed doors, Mayor Jim Kenney and City Council members remain at odds over how much federal aid Philadelphia should tap in the coming year, whether to cut taxes, and how much to spend on violence prevention programs.

Council President Darrell L. Clarke had scheduled budget legislation to be considered Tuesday, but lawmakers can delay moving the bills if they haven’t yet reached a deal. The budget must be passed and signed by the end of the month to take effect July 1, the start of the fiscal year.

“I would be surprised if we got it out of committee [Tuesday] because I don’t think there’s a real consensus, and I still think there needs to be much more conversation,” Councilmember Maria Quiñones-Sánchez said Monday.

Following weeks of public hearings in which lawmakers questioned department heads on their spending plans, administration officials were hashing out details with Clarke, his leadership team, and other members Monday. But there were still major areas of disagreement.

On Sunday, 13 members — a veto-proof majority of the 17-member Council — sent Kenney a letter saying they want $100 million in funding for antiviolence measures in the final budget deal. That would include $15 million for community-led violence intervention programs, $45 million for “safe havens” such as playgrounds and libraries, and $15 million for jobs initiatives.

Kenney had offered $34 million for antiviolence programs in his original $5.2 billion budget proposal.

“This year threatens to be the bloodiest in our beloved city’s history. No place is safe. Not our streets, not our parks, not our schools, not our workplaces, not even our homes,” the Council members said in their letter, which was written by Kenyatta Johnson, Katherine Gilmore Richardson, Jamie Gauthier, and Helen Gym. “This is a generational crisis that has reached a bloody peak. Such unprecedented violence demands an unprecedented response.”

» READ MORE: Kenney’s budget would use stimulus money to cut taxes and return Philly to pre-pandemic spending

Kenney said last week that he’s open to increased funding but wants more details.

“I need to see specifically where that $100 million would go, and where that $100 million number came from,” he said in an interview. “Why is it $100 million as opposed to $50 million or $150 million?”

Clarke, who did not sign the letter, “is busy negotiating a budget agreement with the Kenney administration, and welcomes the input of all Council members,” spokesperson Joe Grace said in a statement. Grace noted that Clarke and a majority of Council in April released a Violence Prevention and Opportunity agenda.

Funding for neighborhood-based antiviolence programs has become a more urgent issue in City Hall due to this year’s record-setting pace for homicides and last year’s demonstrations over the Minneapolis police killing of George Floyd, when protesters called for the city to redirect police funding to community-based public safety programs.

It now appears likely that Kenney and lawmakers will fulfill part of protesters’ demands by increasing funding for alternative antiviolence measures while keeping spending on police personnel stable. Johnson, who chairs the Special Committee on Gun Violence Prevention, said he supports that path.

“We recognize that we’re in a state of emergency when it comes to gun violence here in the city of Philadelphia. We know that we can’t use law enforcement to arrest our way out,” Johnson said, adding that he wants much of the $100 million for antiviolence programs to come from the city’s $1.4 billion in funding from the federal stimulus package approved by Congress this year.

» READ MORE: 6 takeaways from Philly Mayor Jim Kenney’s new budget proposal

Before heading to the Council floor, budget and related tax measures must first be approved by the Committee of the Whole, which includes all members. Changes negotiated between the mayor and lawmakers are typically approved as amendments to the bill while it is in committee.

Once approved in committee, the bills must be read at two consecutive Council meetings. If Council follows its usual process, the legislation must reach the floor for a first reading by June 17 before final passage June 24, the last scheduled meeting before the budget deadline and Council’s summer vacation.

“In the end, every budget comes out altered, and we will negotiate that and get it done,” Kenney said last week. “It’s really no different from any other budget, except for the specter of COVID and what we’ve been through in the past 15 months.”

The city has already received half, or $700 million, of its share of the federal stimulus aid, and will receive the other half next May. Kenney’s administration has proposed using only $575 million in the new budget and $425 million the following year, while spreading the remainder over five years as tax collections recover from the downturn caused by the coronavirus pandemic.

Some members are pushing for the city to use as much of the aid as possible next year given the gun violence crisis and other pressing needs.

While much of the negotiations happen in private, the debate over whether to cut taxes is playing out publicly. Kenney proposed resuming small annual cuts to wage and business taxes that were paused last year as the city scraped for every penny in the first months of the pandemic.

Councilmember Allan Domb proposed going even further, saying the city needs to drastically cut the business and wage taxes — the latter of which is the highest of any large U.S. city — to grow the economy. Council Majority Leader Cherelle Parker also proposed reducing the city’s parking tax.

But significant reductions in tax rates appear increasingly unlikely, as Council’s progressive bloc has come out against even the incremental cuts Kenney proposed.

“Some Council members are talking about reducing taxes more than we’ve recommended,” Kenney said. “I don’t think there’s any appetite for that in Council at the moment. "

Opponents of Kenney’s proposed cuts on Monday afternoon held a rally outside City Hall that included a piñata pig representing wealthy Philadelphians.

“It’s not enough to say that Black lives matter if we don’t have the economic funding, if we don’t have the economic legislation to back that up,” activist Shane Riggins said at the rally organized by the new group Tax the Rich PHL. “The money is there. The money exists in this city.”