What did the advertising consist of? who was it directed at? what firm did the work? what was the whole project?
Basically what we did 108 2/14/01 - WHOLE - BILL 010092 was put together a glossy pocket portfolio of all of the Keystone Opportunity Zones, maps, site-specific. Each one of these Keystone Opportunity Zone subzones have their own personality or specialty. For instance, the old industrials on the river are port-related, while you have over at the University City Science Center more of a technical. So we just gave people the feel for what it is. So we had that design developed and basically distributed it widely to all of the Realtors, to all of the Councilpeople, get a supply of --
KOZ. So the money is in the KOZ budget, not in the KOEZ budget.
I don't know. We bit it out through -- and I don't recall who did it.
But basically, we also 109 2/14/01 - WHOLE - BILL 010092 did outreach to -- this information outreach was done to a whole host of developers, brokers, Realtors through the northeast corridor; from upper Virginia basically to upstate New York. We got a few lists, we mailed them out to them. We also tried to get a lot of advertisement, 'cause that is our target, that's where we find is most -- according to the people working on it above me at that time were basically saying that's where we get our interests from.
The State has taken care of all the national, but we have not directly done that, no. 17
Right. We figured we'd piggyback on what the State's doing.
Thank you. My question is -- a couple of comments 110 2/14/01 - WHOLE - BILL 010092 have been made about choosing not to do residential. Why was that decision made? Or was that a question of legality?
No, Councilman, it's not a question of legality. It's a policy, I guess, that we -- that we used as a guiding principle, and it's really based on a couple of factors. One is, although we would be foregoing all of the City business and State business taxes, we felt as though the wage taxes were still important to the City of Philadelphia as a source of revenue. And two is the basic fairness issue. When you start to get into residential development, it really does create a situation where you could potentially pit neighbor against neighbor or block against block, even with potential developments into the future. As we talked about it, we just felt in the spirit the State legislation, it was targeted towards old industrial sites, and those are the areas we wanted to focus on.
Yeah, my reason for asking you is I've been working on some other abatement legislation for about three years, and 111 2/14/01 - WHOLE - BILL 010092 every time I twist and turn, I'm being told that under the Uniformity Act, we can't do wage taxes. So, again, I'm not critical of why you didn't do it. I'm really, for the record, trying to establish something on the record. The Law Department, no one said that it was something you couldn't do, to your best knowledge? It wasn't prohibited?
That's very interesting. All right. Thank you, Madam President.
You're welcome. Are there any other questions from members of the committee?
Madam Chair, may I just make one additional comment, if I may?
I appreciate the patience of Councilmembers in accommodating our schedule, and I would also just respectfully request that given the deadline that we're under with the State 112 2/14/01 - WHOLE - BILL 010092 application, would respectfully request if Council could waive its rules and have first reading at its next scheduled meeting.
Madam Chair, just as a note, a new Exhibit 4 was added to replace the one that was presented to you. PIDC gave me a technical change. I believe Melissa gave you a copy of a new Exhibit 4 -- let me make sure. Exhibit 4, correct. It's a technical change in the survey that was sent over by PIDC.
The Navy Yard. It's Exhibit 4, which goes with the Lower Delaware River.
Madam President, I had made a request to Mr. Cuorato relative to the issuance of maps. I mean, we have a map for the Northeast Airport that's easy to understand. The site descriptions on the other subzones are difficult to envision from a piece of paper. It's even more difficult now to envision an amendment 113 2/14/01 - WHOLE - BILL 010092 to a subzone that we don't understand, let alone understanding the amendment. I think we really need the maps here. I really would like to be able to see the boundaries, the borders, exactly where it is.
And I believe State law requires them to do that.
How come there was a map of the Northeast Airport and not of anything else?
That was the map that existed from the Northeast Airport so they could easily get it to me, so I -- that was, again, one of my tools to understand, just as you are, where sites fit in.
Now, this amendment, it's not changing at all any of the parcels?
I've been told by PIDC it does not change the parcel. It is a survey. There was a make made in the write-up of the survey of the area of the Delaware -- Lower 114 2/14/01 - WHOLE - BILL 010092 Delaware River, which is the Navy Yard. There was a technical error in the legal description by the surveyor, and that was corrected in this version.
So for the record, the correction of the legal description of the surveyor does not in any way change the shape, size, or number of parcels in the zone.
I take your answer to be truthful. But, Madam President, I would like to get some verification, either from the Law Department or from Council technical staff that, in fact, the amendment does not increase, decrease, or change in any way the parcels in the zone.
You're welcome. And I believe Councilwoman Blackwell may have a witness or two. Do we have anyone else here that would like to testify on this bill? 115 2/14/01 - WHOLE - BILL 010092 (Witnesses come forward.)
Good afternoon. Thank you for your patience. Kindly identify yourself for the record.
Yes, I'm Glenn Brian (ph.), Director of City and Community Relations at the University of Pennsylvania.
Madam President, my name is Jack Shannon. I'm Managing Director for Economic Development at the University of Pennsylvania.
Good afternoon. Thank you for having us to testify this afternoon. This application is very, very important to the University of Pennsylvania and is important to the City and the region, and we hope that Council looks upon favor in terms of moving this bill forward. The Managing Director for Community Economic Development and can answer actually speak to this application.
Madam President and 116 2/14/01 - WHOLE - BILL 010092 committee members and members of Council --
Madam President, the University of Pennsylvania has been working extensively with the Administration, with City Councilwoman Blackwell's office along with the technical staff of City Council to provide a list of potential properties for the Keystone Opportunity Expansion Zone. Several years ago back, we also worked with that same group on the original KOZ for the University City West Philadelphia area. Since then, we've had some moderate success in terms of development of that area, but quite frankly, we have a number of challenges 117 2/14/01 - WHOLE - BILL 010092 still ahead of us and, therefore, we have, along with a coalition involving Amtrak, private property owners in the area, along with Drexel University, requested the expansion of the zone to include other properties that are eligible but were not included within the original list. As you're aware, Madam President, we have had a number of recent successes out in University City in terms of development, but we have a significant area that remains to be developed along the Schuylkill River between 34th Street roughly and the river itself. That area is characterized by a number of vacant lots, railroad yards, highways, and vacant industrial buildings. And we believe that with the designation of these properties as KOZ, it will facilitate the development of those properties in preparation for the United States Postal Service relocating its facilities from 30th and Market Streets to Southwest Philadelphia, at which time, over a million square feet of office space will become available in the marketplace. If you or any members of City Council should have any questions about the specific 118 2/14/01 - WHOLE - BILL 010092 properties that have been recommended by the University or any other parts of our economic development plans in the area, I'd be happy to answer them along with Mr. Brian.
Thank you very much. Thank you very much. We are in receipt of the letter. Thank you, Mr. Jack Shannon. Glenn, we are in receipt of a letter from you. Would you please list specifically for the record the property that you would like deleted from the KOZ, or KOEZ, application?
Okay, thank you, Councilwoman Blackwell. The property in question to be deleted is 3401-59 Chestnut Street. We would like that to be deleted since proposed future redevelopment use would primarily be residential.
Thank you. I think that does it for us. And certainly while the President is talking, I'll ask if any other members of Council have questions.
Councilman 119 2/14/01 - WHOLE - BILL 010092 Rizzo?
Earlier we had a discussion, and since we don't have anyone from the Administration here that can answer the question, maybe you can answer it for me. And I don't think there will be any need for me to confirm your answer. Could you explain the real estate tax-exempt status of the University and why it would apply to some of these vacant lots?
Councilman, a number of the properties that have been included on the list are tax-exempt because of the nature of the use being institutional formerly or having been acquired by the University. For the properties that we've included within Keystone Opportunity Expansion Zone application, it is our intention that they would be redeveloped on a 120 2/14/01 - WHOLE - BILL 010092 private-development basis, similar to what we've done successfully on a residential property at 3100 Chestnut Street in partnership with Dranoff Properties. As a result of that action, a formerly tax-exempt property was restored to the tax rolls; and in that case, over 275 apartment units have been created, instilling a new sense of life on the eastern section of University City. With respect to the properties that we have included in our request for KOZ status, those properties are vacant industrial buildings or parking lots or institutional uses that we would be seeing, hopefully, transformed into high-tech office space or related commercial uses that would create new jobs for the area, relatively high-paying jobs, and the City would benefit from the City wage taxes being created from that. I would also note that with respect to the parking lots at the University of Pennsylvania has, even if they are used for employees only, we do pay parking taxes for those properties already, even though they may be tax-exempt otherwise in their nature. 121 2/14/01 - WHOLE - BILL 010092
So, obviously, you're not giving me the legal interpretation of "tax-exempt." I just can't figure how a parking lot could be tax-exempt. And I understand that the buildings that support the educational process, and I know the parking lots, if you really spin it, could also be a part of that. Can you tell me, does the University pay any real estate tax other than the project that you've just described to the City of Philadelphia?
Absolutely, Councilman. We pay real estate taxes on all of our commercial properties in West Philadelphia, all of our residential developments that are off-campus also pay those taxes, and we also, as the City's largest employer, pay wage taxes on an employee base of over 27,000 people.
Well, let's stick to wage tax. I understand the -- I understand the other tax is associated, but I think it's a -- in all due respect, I think it's a stretch, and I'm going to check to see how a parking lot can be not subject to real estate taxes. Again, I understand 122 2/14/01 - WHOLE - BILL 010092 the rules that you're playing by and the rules that you know, but I just need to confirm that that's an appropriate exemption from real estate tax. Thank you.
Thank you. Is Mr. Cuorato still in the room? (Mr. Cuorato return to witness table).
I'm sorry. Any other questions for the witnesses at the witness table? Councilwoman? (No further questions for U. of Penn. witnesses.)
Mr. Cuorato, you heard Councilman Kenney earlier ask for the appropriate maps that we should be looking at before voting on this bill. Did you hear him?
And why is PIDC not here? I shouldn't be asking you; I should be asking them. They certainly should have been here to testify, and they should have been providing the maps. And you don't have to answer that. That's not your problem, that's mine.
PIDC is a delegate agency to the Commerce Department, so I'll take the responsibility for them not being here. We did get input from PIDC on this process, Madam Chair, and I should have had them here.
You're really too kind, you're too kind. But we still don't have the maps, and I don't think anybody's going to feel very comfortable voting on this until such time as we see the maps, as we're supposed to.
Excuse me, Councilman Kenney, what other information did you 124 2/14/01 - WHOLE - BILL 010092 want before you feel that you're able to consider this bill?
I wanted confirmation from either the Law Department or from Council technical staff that the, quote/unquote, technical change in the amendment does not in any way expand, diminish, or change the parcels in the Naval Business Center that were a part of the original submission for the subzone of the Naval business zone. Mr. Dougherty said he didn't -- he understood the question, but he didn't know the answer.
Can you prepare that for us in writing by tomorrow morning?
I understood the question. I don't know that the Law Department -- I'd simply 125 2/14/01 - WHOLE - BILL 010092 by relying on the same representations that you have been asked to rely on, which I think are reasonable, but I -- I -- the Law Department can't look at those and make that judgment. We don't have the expertise to do that.
I would think PIDC -- whoever made that legal description that you're concerned about, I'm sure they could come in and explain to you how it was done.
I mean, my understanding from the purpose of the amendment is to carve out the potential residential development at the yard -- at the naval base, I'm sorry -- to make sure that it's not a part of the KOEZ, but I want to make sure that there's no other non- -- there's no other industrial/commercial property that's been included or no existing property that's been suggest as being excluded by virtue of acceptance of this amendment.
Right, I understand your concern. I -- I'm not -- the Law Department is not competent -- any more competent than you are 126 2/14/01 - WHOLE - BILL 010092 to answer that question.
But Mr. Dougherty and PIDC together put those together. I mean, they are the ones you have to rely on.
And our technical staff couldn't do that. I insist that PIDC be here tomorrow morning.
And that they come here with the maps so that we could see exactly what it is.
Madam Chair, I will try to get -- maybe the Planning Commission can produce individual zone maps for us. We will shade in the KOEZ areas so that you'll be able to look at a map of each of the areas and see what we are designating. I will get the Planning Commission to do that.
Point of information. From a timing standpoint, I know the 127 2/14/01 - WHOLE - BILL 010092 application needs to be there in Harrisburg by February 28th. What are the drop-dead dates for our approval and the ability to get it there by the 28th?
I had asked for waiver of the rules, Councilman, so the first reading could be tomorrow and a hopeful final passage on February 22nd.
That's the last Thursday we're able to do that. Okay, thank you.
Thank you. Are there any other questions or comments? Councilman Nutter?
Unfortunately, Madam Chair, I missed some of the exchange about the maps and designated areas and the like. Was there a final decision made with regard to maps? And then I heard something about a letter. What was the conclusion of that?
Now that I believe we have a final set of properties, I will ask the Planning Commission to produce maps of the different subzone areas, and we will shade in the 128 2/14/01 - WHOLE - BILL 010092 proposed KOEZ subzones so that you can look at each map and clearly see where those areas are. So it will a visual graphic picture of what we've given to you on the property list.
It's -- it's -- it's just -- I don't know, it's just a little bit of a quirk of maybe my personality, but out of today's hearing, do you have, I guess, any impression that -- I mean, there seems to be a lot going on in a relatively short period of time and a lot of questions asked and, you know, some answered, some partially answered, some seem to have no answers for, you know, something that is, I think, you know, important and serious, at least conceptually. But you do start to, after a while, get a little bit of an instinct around here. And I guess I'd like to get some response from you, Mr. Cuorato, as to. . . do you have any sense that, I mean, this train is moving a little too 129 2/14/01 - WHOLE - BILL 010092 quick and that all of the various conductors And passengers don't necessarily have a good sense about what's going on? I mean, I've never seen so much running around in this chamber as today. And, I mean, it's not just the nine years that I've been here. I mean, I've actually been paying attention to this institution for years, and there have been 10 some fairly wild times in this place, but the last 11 10, 15 -- I mean, I've never seen a hearing like 12 this in recent times. 13 It just -- you know, it would change 14 after every Q and A, after every person. We've 15 got, you know maps floating around, maybe we got 16 the right ones, maybe we don't, lists, who's in, 17 who's out. I mean, do it, not do it. I mean, I 18 don't even have a tremendously big opinion about it. I mean, have a KOZ, nothing's going on in it. I don't have anything in this particular package. I talked about one, I think it got blown off the table without a whole lot of discussion or thought or consideration. You know, that's fine. But, I mean, I do care a little bit about how we do what we do. And I have a certain 130 2/14/01 - WHOLE - BILL 010092 discomfort, I guess, about it. And I've learned a little bit in my time here, and I guess I'd just like to get your response and reaction to that.
We could have done a better job of managing this process, Councilman, and I will take responsibility for that. We did the best we could in developing a list of properties that met the goals that we have for this program. It -- it. . . it's hard to --
Mr. Cuorato, I was not trying to -- you are -- I've known you for a good while. You've been in any of your positions, whether I was in the government or out of the government, I know you to be a conscientious person. I think you are trying to do the best you can under circumstances. I'm not trying to particularly criticize anybody for what they did or didn't do. I mean, we are where we are. But for me it was today. And as late as 4:15 today, after I don't know how long this hearing has been going on. I mean, there seems to be so many things that are loose for something that is pretty serious. We started with 1500 acres, we have some projects 131 2/14/01 - WHOLE - BILL 010092 that are done, other stuff in the pipeline, and the next thing you know, we say, Let's double it. We liked it so much, worked so well, I think we need some more of this. I mean, on any basis of analysis or examination or evaluation, I mean, that case has not been made today, from what I can see and from what I can tell. Again, I'm not as deeply involved as some of my colleagues because they have, like, real live properties and real live entities, and some have come up to the table and all of that. I have no idea what would happen if we didn't do anything, and I can't imagine that the State wouldn't figure out a way to give us another opportunity under a different set of circumstances and, you know a little more time and effort and development. I mean, I want to try to be as helpful and supportive as possible. Some days you will just, due to the nature of what we're doing, you won't appreciate the questions, you'll do your best to respond to them. In most instances, you do fine, and some days are a little better than others. 132 2/14/01 - WHOLE - BILL 010092 So I don't have any ax to grind, personal or political. I mean, I'm kind of not in this one that much, but I'm here. And at some point in time, I might be asked to make a vote, and I take those things pretty seriously. I try not to take myself too seriously, but I take the job and the responsibility very seriously. And, I mean, I just really didn't hear a whole lot here today and am just kind of watching this thing develop. I mean, it's been a circus around here. And you can respond or not respond. And if you don't, I won't be upset, but I think it just needed to be said.
Thank you very much. Thank you. For Bill No. 010092, the public hearing will be continued until tomorrow morning, at 9 a.m. 133 2/14/01 - WHOLE - BILL 010092 And may I suggest, Mr. Cuorato, that someone from PIDC be here.
Thank you. - - - (Adjourned 4:20 p.m.) 134 C E R T I F I C A T E I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia of Wednesday, February 14, 2001, were reported fully and accurately by me, and that this is a correct transcript of same. RE: COUNCIL COMMITTEE OF THE WHOLE BILL NO. 010092 __________________________________, JOSEPHINE CARDILLO, Registered Professional Reporter