In his first term, Bill has quickly become a leading voice on Council regarding budget issues. Bill is determined to bring data-based decision-making to the City's budget process, identify opportunities for savings, and ensure that revenue measures are fair, broad-based, and do not fall hardest on our most vulnerable citizens.In the past three years, Bill has identified over $350 million in budget savings -- including through using technology and retirement/attrition to reduce the size of the city's workforce -- as alternatives to tax increases. Bill and his colleagues on City Council successfully prevented a series of regressive tax increases proposed by the Administration -- including a 19% property tax increase and a $300 residential trash fee.
When Philadelphia first faced a significant budget deficit in the fall of 2008, Bill joined with his two freshman colleagues on Council to come up with 15 ways the city could save $50 million annually. These recommendations, "The Freshman 15," outlined specific, concrete ways the city could save money -- primarily by trimming unnecessary administrative expenses and using technology to streamline workflow processes. The Administration has adopted the majority of these proposals, saving the city tens of millions of dollars a year.
Pension System Reform
Philadelphia's pension system is in trouble. With barely half of the assets it needs to fund its liabilities, city government is transferring more than $400 million every year into its pension system to prop up the fund -- and the cost keeps rising.
City government must honor its commitment to its current and retired employees by ensuring that the pension fund is solvent and able to fulfill its funding obligations for many decades to come. To maintain the fund's solvency while easing the burden it places on the operating budget, Bill has proposed transferring additional assets to the fund. For example, the city owns parking garages and other physical assets that can be leveraged to generate tens if not hundreds of millions of dollars to invest in the pension fund. By increasing the value of invested assets, the fund's annual investment returns will increase and the system's funding level will improve. Shoring up the pension fund in this way would, in turn, reduce the city's annual contribution -- making it easier to maintain core city services and reduce the tax burden on our citizens.
Bill strongly supports innovative ways to improve the fiscal integrity of Philadelphia's pension system. As chair of Council's Labor and Civil Service Committee, Bill has shown a strong commitment to working with the city's workforce to make sure that the pension system will always be able to meet its obligations to our city's dedicated employees.
Put in place under Mayor Rendell, the Deferred Retirement Option Plan (DROP) was meant to be a revenue-neutral management tool that would encourage long-time employees to retire and allow orderly succession planning. DROP has not worked as planned, and the public has become understandably outraged about elected officials signing up for the program, running for re-election, retiring for a day, collecting large DROP payments, and then starting a new term in office.
Bill thinks DROP never should have been available to elected officials and the first piece of legislation he introduced upon taking office in 2008 was a bill to exclude elected officials from DROP. Bill's legislation was passed in 2010, and as a result, no future elected officials may enroll in DROP. Though the program is now closed to elected officials, other city employees remain eligible to participate in the DROP.
Bill believes that City Council needs to have data-driven, open, and thorough hearings on DROP. He wants to determine why one of the primary goals of the program -- succession planning -- has not been pursued by city officials and determine whether the program can be modified to make it cost-neutral or result in savings to the city. If it is the case that DROP costs the city money and does not deliver a measurable, meaningful return, Bill believes that the program should be eliminated. This is the same standard to which Bill holds any expenditure of public funds.
Health Care Reform
Just as for employers in the private sector, rising employee health care costs are a growing problem for city finances. In his role as Chair or the Labor and Civil Service Committee, Bill has proposed innovative approaches for the city to drive down these costs, including through targeting health care resources to employees and beneficiaries with the highest health care costs, forming an accountable care organization, and forming our own third-party administrator. All of these initiatives require partnering with our municipal unions, tapping into their knowledge regarding major cost-drivers, and identifying opportunities for shared savings -- something that has not been done over the past three years.
For more information:
Comast Local Edition - Bill Green on the Budget (July, 2009)
Powerpoint on FY11 budget alternatives
Spreadsheet of proposed spending reductions, FY11
Green unveils alternative budget proposal (press release, May 3, 2010)
Bill No. 100309: Alternative real estate tax proposal
Bill No. 100303: Rainy Day fund
Powerpoint from FY10 budget
Res. No. 090605: "Plan C" and the Five-Year Plan
"Freshman 15" One Year Later PPT
Res. No. 090528: Hearings on efficiencies and cost savings
Res. No 100511: SCOUR
Res. No. 080049: Hearings on the Pension System
Bill No. 080020: Prohibiting elected officials from joining DROP
Bill No. 100095: Prohibiting elected officials from joining DROP
Res. No. 110019: Targeted health care
Res. No. 100510: Accountable care organizations