Testimony of the Greater Philadelphia Chamber of Commerce

On City Council Bill 130161

May 17, 2013

Good morning Chairman Green, Councilwoman Quinones Sanchez, and members of the Finance Committee. I am Rob Wonderling, President & CEO of the Greater Philadelphia Chamber of Commerce (GPCC), and am here today to testify on Bill 130161, which offers an exemption from the Use & Occupancy tax for certain small city businesses, and also sets a U & O tax rate that is higher than the U & O rate set forth in legislation offered by the Nutter Administration.

Over the past few months, Council has proposed a series of measures to generate additional revenues for the City without raising taxes.  In February, Council introduced a measure to examine how the City collects delinquent property taxes – a total delinquency exceeding $500 Million. The Chamber testified in support of Council’s initiative – and supports Mayor Nutter’s efforts as well to invest resources to better collect delinquent taxes.

Council President Clarke has introduced a bill to create a new Chief Revenue Generation Officer for Philadelphia, to seek innovations to raise revenues for the city – without raising taxes. The Chamber supports this idea – as well as the mayor’s appointment of Tom Knudsen to a new post, chief revenue collections officer, to coordinate all city efforts to collect delinquent taxes owed the city.

The Chamber also testified this spring in support of the Council President’s proposal to establish a comprehensive plan for advertising on city property – to generate millions of dollars in new city revenues – again, without raising taxes.

These proposals are all worth supporting on their merits. They also earned our support given the recent, unfortunate trends that have seen City Hall approve tax increases totaling $275 Million over the past four years.[1]

The sales tax increase, a series of property tax increases, a parking tax increase, and last year’s 19 percent increase in the Use & Occupancy tax to help the Philadelphia School District have created a chilling economic effect and additional costs for every business, small, medium-sized and large, that are the generators of hundreds of thousands of jobs for our citizens, the lifeblood of our city.

The Chamber also supports public education in Philadelphia, as one of our highest priority goals.  The Chamber just began our 9^th year of operating Read to Me, a highly successful program aimed to encouraging early literacy among the youngest children in Philadelphia public schools. Working with the School District, Read to Me matches up business executives who donate to our Foundation, and volunteer their time to read to more than 3,000 children in over 30 Philadelphia schools. These donations help us purchase books and materials to fund and fill libraries in every one of these schools.

We are full, vigorous participants in the mayor’s 10,000 Summer Jobs program, and the Chamber regularly helps to create, among our members, more than 1,000 paying summer internships for the young men and women in our city, exposing them to the real world, teaching them valuable career skills.

As the Chamber’s chief executive, I was privileged to serve on the search committee that led to the School Reform Commission’s selection of Dr. William Hite as the School District’s new Superintendent. We strongly support Dr. Hite.

The Chamber collectively and myself individually have worked closely with the new leadership of the School Reform Commission, under Chairman Pedro Ramos, to help the District secure approvals for a $300 Million financing last year as the SRC did everything possible to reduce its large deficit to manageable levels.

There is nothing more important than giving every child in Philadelphia a quality education, and helping them achieve their fullest, God-given potential to be productive citizens.

However, the Chamber also has as its core mission advocating for more than 5,000 member businesses from throughout the Greater Philadelphia region – including over 2,500 members from here in Philadelphia. The majority of our members are small businesses, working hard every day to meet payrolls, grow their businesses, and contribute to a more vibrant economy in our city.

When every spring brings another tax increase, whether it’s from the property tax, the Use & Occupancy tax, or another tax, it sends a signal to these job creators that our city may not be the most conducive place to create jobs and continue growing their businesses. The signal it sends is the absence of economic opportunity.

And when a narrow slice of our citizenry – office building tenants – are asked for the second consecutive year to shoulder the burden for a broad-based public need – adequate funding for public education – we cannot support that. We do support the exemption in Bill 130161, as narrowly tailored to help small businesses in neighborhoods impacted by higher AVI assessments. But we cannot and do not support the higher Use & Occupancy tax rate as proposed. We remain open to discussions as to whether small businesses located in larger buildings downtown should receive a exemption similar to the one proposed in the legislation.

When Mayor Nutter introduced a series of measures yesterday to generate $95 Million in new revenues for the schools, he specifically noted that both residential property owners, commercial property owners, and business taxpayers have paid through a series of tax increases in recent years to help the schools, and that it was the wrong direction to take again this year. We concur.

We stand ready to assist this Council, the mayor, and the Philadelphia School District – as we have already done on countless occasions – to help gain support from Harrisburg to ensure our children receive a quality education in our schools.

Thank you for the opportunity to testify. We look forward to working with you on these issues, and I’d be happy to answer any questions you may have.

Greater Philadelphia Chamber of Commerce President and CEO Rob Wonderling said, “The passing of Joe Mahoney is a tremendous loss to the city and region. Joe made a difference in the lives of so many people throughout our community. He loved Philadelphia and will be greatly missed by all who had the honor to know him.”

Philadelphia Mayor Michael A. Nutter noted that “Joe cared passionately about our city and region. Whatever the issue, Joe would often be the first to lend a hand or give an opinion.  He worked hard every day on behalf of the business community, cared greatly about city policies and always gave of his time to make things better for all of us. I am deeply saddened to hear of his passing away, and ask that we keep his wife Patty and their family in our prayers. We have lost a good man, and we will greatly miss him.”

Joe joined the Greater Philadelphia Chamber of Commerce in 1990, after having served 9 years on the staff of U.S. Congressman R. Lawrence Coughlin (R.- PA). He served as Executive Vice President and oversaw the Chamber’s Public Policy activities at the federal, state and city levels as well as outreach to the county governments in the surrounding counties. He graduated from St. Joseph’s University and served as the Chair of the Haub School of Business’ Board of Visitors.

Joe is survived by his mother Edna, his wife Patricia McElwee Mahoney, two brothers Rev. Shaun Mahoney and Dennis and Josephine Mahoney, and six nieces and nephews. He resided in Bryn Mawr, Pennsylvania.

Relatives and Friends are invited to his viewing Tuesday, May 7 from 6 to 9 p.m. in the Funeral Home of John Stretch, 236 East Eagle Road Havertown, Pa. 19083 and Wednesday, May 8, from 9:30 to 10:30 am in St. Joseph’s University Chapel, 5600 City Ave. Philadelphia, Pa. 19131, and to his Mass of Christian Burial following at 11 a.m. Internment at Calvary Cemetery. In lieu of flowers an offering in Mr. Mahoney’s name to St. Joseph’s University at the address above would be appreciated.

“It turns out men run the world, and I think equality would be better. If we sourced our talent from the full talents of the population, our companies would be more productive.”

Sandberg’s book, Lean In examines women’s stalled progress in achieving leadership roles, offering personal anecdotes and practical advice on how to seek challenges, take risks, and pursue goals with gusto. She encourages women to lean in and share their stories and the Greater Philadelphia Chamber of Commerce encourages you to do the same.

Submit your story and join us at our next event where we will discuss that it’s no longer a career ladder, it’s a jungle gym.

View the full interview:

The CEO Council believes it is necessary to reform policies concerning highly-skilled immigrants to maintain the region’s economic competitiveness. Doing so will help our region attract and retain highly-skilled immigrants and foreign-workers, which is vitally important for regional businesses that are heavily invested in knowledge-based professions.

During our meetings yesterday, we were told that members of the Senate Judiciary Committee, which has jurisdiction over immigration, will be able to file amendments to BSEOIM through Tuesday, May 7, and that the committee will consider the bill and take votes beginning on Thursday, May 9.  It will likely take the committee several weeks to work through amendments before the bill can be reported to the full Senate for consideration, which we expect to happen in June.

Since there will likely be hundreds of amendments offered to BSEOIM, which have the potential to change the legislation significantly, the CEO Council and the GPCC urge their members to contact their Senators and advocate on behalf of the  provisions regarding highly-skilled workers so that they  remain intact in the final legislation.  We also recommend contacting Senators who represent facilities or subsidiary companies located in other states.  It is especially important to convey the positive aspect these reforms will have on your business with specificity.

For additional information please feel free to reach out to CEO Council policy staff at: (215) 545-1234.

“The Chamber offers many programs that are critically important to development, such as how to manage certain aspects of your business and bringing people together to learn from one another.”

Learn more about Chamber membership benefits. Ready to Join? Call 215-790-3700

Watch the full video below:

As part of a continued effort to showcase the bustling activity of Philadelphia area technology entrepreneurs, the community unveiled 40+ startup stories in the form of 60-second elevator pitches, now available on the Philly Startup Leaders channel on www.PhillyInFocus.com.

“We are proud to support the entrepreneurs in this region and offer an important platform for their storytelling,” said Bill Kettleson, Regional Vice President, Government & Regulatory Affairs at Comcast Cable.

Philly In Focus is a Comcast/NBCUniversal, local multimedia platform dedicated to supporting the people, businesses and organizations in Philadelphia. The more than 40 initial stories were captured by Philly In Focus, and the most engaged videos on the channel, based on views and social media activity, may appear on Xfinity On Demand.

“The idea behind the videos is to continue to build a warehouse of easy to access information about the Philadelphia entrepreneurial community that will inspire press coverage, and motivate other entrepreneurs, potential investors, and support organizations to build businesses right here in Philadelphia,” said Philly Startup Leaders President Bob Moul, CEO of Artisan, a growing mobile company founded and based in Old City.

A number of organizations will feature the videos, including Select Greater Philadelphia during an international innovation press tour of the region this week, the City of Philadelphia’s Startup PHL project, Philly Startup Leaders, Philly Founded and the Philadelphia Convention & Visitors Bureau, among others. A coordinated social media campaign will push the stories out over the next few weeks.

Check out the 60-second Pitch Project at http://www.phillyinfocus.com/channel/60-second-pitch-project/

If you are a Philadelphia startup, you can submit your 60-second pitch to the channel by contacting Philly Startup Leaders or Philly Founded who helped lead the project.

The CEO Council believes that a key part of the Greater Philadelphia region’s future success and competitiveness depends on smart immigration reform that allows highly skilled immigrants who have studied in STEM fields in the United States to obtain visas and green cards in order to fill positions in the innovation sector and start new businesses.

For the latest updates on #iMarch, follow @phillychamber and @selectgrphila on Twitter.

For additional information about the CEO Council for Growth, click here.

Both business and civic leadership organizations commended the Republican and Democratic chairs of the Senate and House Transportation Committees for working in a true bipartisan manner to develop legislation to address Pennsylvania’s $3.5 billion transportation funding gap. Earlier this year, Governor Corbett kicked off the effort to make a new commitment to transportation funding in his budget address, building on the recommendations of his Transportation Funding Advisory Commission (TFAC).

On behalf of the thousands of employers that make up their membership, both the GPCC and the Allegheny Conference support legislation to raise revenue for all modes of transportation, including transit systems that are critical to the economic viability of southeastern and southwestern Pennsylvania. Sufficient funding for public transit is particularly crucial, and must be predictable, with growth potential to address future operational and capital needs.

“A strong transportation system is the lifeblood of a robust economy. The primary issue in some areas of the Commonwealth is maintenance of bridges, roads, and highways. In other parts, the top priority might be improving ports or railways or airports. But residents in every county in the Commonwealth rely in one way or another on public transit. That is particularly true in the Pittsburgh and Philadelphia metro areas, which together account for roughly two-thirds of the state’s economic activity,” said GPCC President and CEO Rob Wonderling.

Mr. Wonderling added, “We applaud the introduction of this measure and look forward to working with the Administration and General Assembly to ensure that a comprehensive multimodal package has adequate funding for SEPTA, for the Port Authority and other transit systems across the state.”

“Transportation investment drives job creation and infrastructure improvements help our Commonwealth be competitive in attracting business expansion and investment,” said Allegheny Conference CEO Dennis Yablonsky. “We have thousands of structurally deficient bridges, miles of deteriorating roads and highways and transit systems that need sustainable, ongoing funding. Senate Bill 1 offers a comprehensive framework for funding all forms of transportation, and we hope that it will be debated and moved forward as soon as possible.”

Mr. Wonderling and Mr. Yablonsky served on Governor Corbett’s Transportation Funding Advisory Commission. Both the Allegheny Conference and the GPCC have endorsed the framework of the TFAC report which would raise additional revenues through user-related fees and require money-saving operational reforms of PennDOT and transit systems across the state.

Councilman Bill Greenlee, the legislation’s main sponsor, said he would not make the attempt because he lacked the necessary 12 votes to override the mayor’s veto of the bill.  The bill passed Council, 11-6, last month.

The six “No” votes on mandatory sick leave withstood strong pressure from supporters and proponents of imposing a paid sick leave requirement on employers in Philadelphia who employ more than five employees.  Those six “No” votes on Council are Councilmen Bill Green, Jim Kenney, Mark Squilla, David Oh, Brian O’Neill and Dennis O’Brien.

This is the second time proponents of paid sick leave failed to muster the necessary 12 votes to overturn the Mayor’s veto and make the bill law.  Councilman Greenlee, in a speech this morning, vowed to bring the legislation up again in the future.

The Greater Philadelphia Chamber of Commerce, along with many other advocates representing employers and businesses in Philadelphia, consistently opposed the imposition by law of mandatory paid sick leave on city employers. Such a law will make Philadelphia less competitive with other regions and the suburbs, where businesses are not required to provide paid sick leave. The proposal comes at a time when the city continues to struggle with the effects of a sluggish economy and high unemployment.

“We all support wellness in the workplace, and we look forward to working with Councilman Greenlee on other proposals to make Philadelphia a healthier city in which to live and work,” said Robert C. Wonderling, the Chamber’s President and CEO, after today’s session. “But we could not and cannot support this bill, essentially an unfunded mandate on employers and businesses in Philadelphia.”

CEOs for Cities’ research demonstrates that talent development is fundamental to the success of cities. To encourage regional post-secondary educational attainment they launched the Talent Dividend Prize, a national competition with a $1 million prize going to the city that exhibits the greatest increase in the number of college degrees granted per capita over a four-year period.

Greater Philadelphia is one of 57 regions in the running for the Talent Dividend Prize. If we work together to increase college attainment by 1% in Greater Philadelphia, we will all share in an annual increase of $4.4 billion in personal income through greater economic opportunities and activities.

The Regional Challenges are a local response to the Talent Dividend Prize. Developed by a diverse group of regional leaders, the Challenges will provide exposure, on a local and national scale, for the outstanding work of Greater Philadelphia’s many organizations who are dedicated to helping residents obtain degrees.

To learn more about the Regional Challenges or nominate an organization helping the region realize its talent dividend please visit talentgreaterphilly.org.

You can also visit CEOs of Cities’ Talent Dividend website at talentdividendnetwork.com to find out more about their national effort to increase educational attainment.