Revised Philadelphia budget shows COVID-19’s impact with $650M in cuts, new taxes

By KYW Newsradio 1060
PHILADELPHIA (KYW Newsradio)  Philadelphia’s COVID-19 cases continue to decline, very slowly, but the virus’ devastating effect on city finances became clearer Friday as Mayor Jim Kenney submitted a revised budget with $600 million in cuts and $50 million in new taxes and fees. 

“I have never faced as difficult, in fact as painful, a period as the one in which we find ourselves today,” Kenny said, noting the $650 million budget gap created by COVID-19 is more than five times the deficit seen in the Great Recession, which led to cuts that took years for the city to recover from. 

The mayor said his revisions were guided, in part, by the lessons of those cuts.

“There will be no police or fire layoffs, all firehouses will remain open, all health centers will remain open and all libraries will remain open,” he said. 

What is being cut includes new programs in the budget he proposed less than two months ago, such as citywide street sweeping and free community college. 

Most of the savings will come from layoffs. Non-union employees will take a pay cut, overtime will be reduced. Pools will stay closed — partly for health reasons. 

Similarly, there will be savings when large gatherings are cancelled.

“This is not what I want for our residents and I understand if this leaves many of you angry. Frankly, I’m angry and disappointed too,” Kenney said. 

Hikes in fees, parking and non-resident wage taxes and canceled discounts and tax reductions make up the final $50 million shortage, but the mayor is also asking for a four percent property tax increase for the school district.

“This will enable the district to avoid draconian cuts that will set our kids back years and harm the future prosperity of the city,” he argued. 

But Councilmembers Allan Domb and Kenyatta Johnson rejected the idea immediately, while Councilmember Maria Quinones-Sanchez balked at some of the cuts.

Council President Darrell Clarke said nothing can be ruled out.

“It will be very difficult. The most difficult budget process that I have ever been involved in,” Clarke said 

He said the budget may need to be amended once the COVID-19 closures are fully behind us.

“This is an ever-evolving situation, both from a fiscal perspective and from a health perspective,” Clarke added. 

The Health Department reported 669 new COVID-19 cases Friday, bringing the total to 15,137. The death toll reached 638, with 31 new fatalities.