Caroline Bauer

09/15/2010
PLA 4208 Planning Techniques
Assignment 1: Describe Planning Problem
http://www.pewtrusts.org/our_work_report_detail.aspx?id=52092

The Philadelphia Research Initiative program of the PEW Charitable Trust released

Tough Decisions and Limited Options: How Philadelphia and Other Cities are

Balancing Budgets in a Time of Recession in May 2009. At the time of publication, the

city of Philadelphia was facing a $1.4 billion dollar budget gap over the next 5 years, and

has a $428 million one-year budget gap, the 7th highest amongst a survey of major US

metropolitan areas. This report both outlines the institutional and social reasons why

Philadelphia’s economy came to face such hardship and also proposes policy solutions to

the deficit.

The report compares Philadelphia’s financial horizon to that of 13 other US major

metropolitan areas. PEW researchers chose the comparison cities on the basis of

different sets of criteria; Baltimore and Boston as they are old & northeastern with an

industrial past; Pittsburg because they share a state; New York, Los Angeles and Chicago

as they “chart the course of municipal governance by dominating the national urban

spotlight”; inclusion of geographic diversity brought Atlanta as representative of the

South, Seattle for the Northwest, Columbus from the Midwest; Phoenix and Detroit due

to the act that “they have been hit particularly hard by the recession”; and Kansas City

because the city had recently approved a new budget to be implemented in May, making

them useful as a “preview” for the debate that cities like Philadelphia with later starting

fiscal years.

Research methodology was rather shallow and not exhaustive. Quantitative data on
the fiscal forecast and measures already implemented by the municipalities addressing

budget gaps was collected from city reports and local newspaper publications. The report

also contains qualitative data from interviews with various city public officials. The bulk

of the research examines how cities are coping with the recession and explores how

feasible such measures would be for the city of Philadelphia. Under the heading

“Leasing Assets” for example, the authors explain how Chicago’s sale of a $563 million

75-year lease on city parking meters is not a viable solution for Philadelphia as the

Parking Authority is state run. Other measures examined for releasing budget pressure

include the imposition and raising of fees, raising taxes, cutting costs per state employee

and reducing services. The report contains neither tabulated nor originally collected data.

The report found that Philadelphia’s hardship is worse than most of the comparison

cities for 3 major reasons. First, the state of Pennsylvania requires Philadelphia to present

a five-year budget to the Pennsylvania Intergovernmental Cooperation Agency (PICA),

an agency responsible for dispersing some city funds. Rather optimistically the report

points out that as most other cities are only required to present a 1-year fiscal outlook,

this long-term projection may be causing Philadelphia to be “dealing with the bulk of the

pain now and may not have to ratchet-up its budget balancing next year and the year

after.” Second, the urban area is classified as both a city and a county and thus

responsible for costs associated with corrections, courts, the district attorney’s office and

many social services- budget lines, which are hard to cut. Third, the diversity of sources

comprising the city’s revenue arguably makes budget discussion and incorporation of

public opinion into policy measures more difficult for Philadelphia than other cities.

Aside from acknowledging that Philadelphia has a more complex economic

structure and set of concerns than most of the comparison cities, this report offers no

policy analysis, recommendations or strategic plans of any sort. It also contains no

applied methodology. Quite on the contrary, it ends with a bleak predication of the

economic horizon of the entire US, implicating Philadelphia and the comparison cities:

“Unless the economy recovers quickly, a lot of cities will have to get accustomed to

making more tough choices in the years ahead.”