Board of Education Holds Facilities and Finance Committee Meeting

by Diane Payne

The new Board of Education held its first Committee meeting on Thursday September 6 as part of an effort to have more community engagement and information before the Board votes on Action Items. Three members of APPS attended the first meeting of the Facilities and Finance Committee; two testified. This Committee will meet on the first Thursday of every month, unfortunately the 10:00 AM meeting time is impossible for many parents and SDP staff. Several speakers asked the Committee to consider changing the time.

The meeting was co-chaired by BOE members Lee Huang and Leticia Egea-Hinton; Joyce Wilkerson and Wayne Walker are Committee members. Present in the audience were Board members Angela McIver and Chris McGinley. A representative from State Senator Vincent Hughes office was also in attendance.

The Co-chairs acknowledged that the Committee is a “work in progress.” For now, they are not setting a three-minute timer for speakers; they asked that speakers be mindful of time. The Action Items that pertain to Finance and Facilities will be available before Committee meetings in the future but they were not available before this meeting.

There were two staff presentations. Chief Financial Officer Uri Munson gave an overview of the budget process along with a manager’s report. Chief Operating Officer Danielle Floyd gave a facilities renovation and remediation report. In addition, Sylvie Gallier Howard, the City’s First Deputy Commerce Director, gave a presentation on Keystone Opportunity Zones. All of these power points are available on the SDP website under the BOE’s Committee menu.

Munson noted that all budget information can be accessed through the SDP website as well as every vendor who is paid $100,000 or more. In answer to a question from Ms. Egea-Hinton, Munson said a teacher vacancy update would be available by October or November after staff leveling is completed. Floyd’s presentation included information on: paint and plaster stabilization, renovation projects, environmental projects (asbestos abatement and mold remediation), and preparing buildings for school openings.

In his testimony, Jerry Roseman, the Philadelphia Federation of Teachers’ Director of Environmental Health and Safety and a member of the Healthy Schools Initiative , acknowledged the efforts made by the District in these areas. He pointed out that often what was lacking was the input of the stakeholders with the lived experience in these buildings, and he encouraged the Board to develop a more open working relationship with the Healthy Schools Initiative and stakeholders.

Ms. Gallier Howard’s presentation provided general information but lacked any specific information. Our understanding, after hearing the testimony and gathering information from other sources, is that the mission of the KOZ program is to stimulate economic/job development on sites that might not otherwise be considered. ALL taxes are abated for 10 years BUT they must agree to PILOTS (Payments in Lieu of Taxes) which are a payment of 110% of the 55% that would ordinarily go to the SDP on the currently assessed value of the property. So, in theory, the SDP would get more money generated on properties that would have provided very little without this development. This is done at the cost of NO TAXES FOR TEN YEARS IN ALMOST EVERY OTHER CATEGORY. According to Greg Windle of the Philadelphia Public Schools Notebook:

“The program is essentially the much-derided 10-year tax abatement in Philadelphia on steroids. Instead of just being exempt from property taxes, these developers are also exempt from the city’s net profits tax, business income and receipts tax, use and occupancy tax, and the hotel tax. It simultaneously exempts developers from the state’s corporate tax, the personal income tax, the sales tax, the corporate stock tax, the bank shares tax, and the mutual thrift tax (imposed on savings and loan institutions as opposed to commercial banks).”

KOZ’s do not encourage a strictly residential development but rather seek applicants that will encourage economic and job growth. But, by law, they cannot deny an applicant based on residential use alone. (Worries of expanded gentrification are inherent in residential development.)

The BOE will be voting on this matter at its September 20 Action Meeting. They will either approve or deny the most current list of properties sent from the City. BOE President Wilkerson had reviewed the most recent list prior to the meeting. She raised questions about properties on the list that were located in the booming Frankford Avenue corridor. She questioned how they fit the criteria of blighted, vacant, and underutilized. Gallier Howard replied that her office had developed a “scorecard” to guard against the very pitfalls Wilkerson raised and that the current list was undergoing a review based on the scorecard. Gallier Howard implied that some properties would be removed.

The updated list will go before City Council for a vote on September 13th; the list will not be available to the pubic until that date. Both City Council AND the SDP must pass a vote approving the properties. The SDP does have the authority to reject particular properties, although in the past the SRC voted on them as a complete block without any public review. Both the City and the SDP are working to meet the October 1 state deadline, placing a lot of political pressure on them. This information should be available to all parties, including the public, in a timely fashion in order to assure an informed vote.

It was encouraging to see the Committee questioning the City’s placement of some of the properties on the list. APPS also questions the placement of the Frankford Arsenal site as a KOZ. Franklin Towne Charter is located in the Arsenal, and its landlord, Franklin Towne LLC, stands to profit even more than it already has. Franklin Towne has received serious political backing, as documented in another Notebook article.  Where is the documentation that shows that the Arsenal is blighted? There is already significant development underway at the site.

APPS has also learned that the partners of the second largest law firm in the city, Dechert, LLP, are benefiting from ownership of property at a KOZ at 30th and Market Streets. Again, does anyone think that property near Drexel, Penn and the 30th Street Station is blighted? It was heartening to see members of the BOE questioning this process and it is incumbent on the community to demand full transparency and timely information from all of the parties involved in making such crucial decisions.

APPS will be researching to answer the following questions:
• How and where is the list of KOZ properties made available to the public?
• Is the owner of the property identified?
• Is the applicant’s proposed use of the property part of this list?
• Where can the public view the scorecard developed by the Commerce Department?
• Where can the public view the data that supports economic/job growth in past KOZ properties?

It should be remembered that these properties receive 10 year tax abatements in local and state taxes!