Stimulus will not directly aid Philadelphia (Daily Pennsylvanian)

February 27, 2009

By Calum Davey

The global economic crisis has left Philadelphia's City budget with a $1 billion deficit and President Barack Obama's American Recovery and Reinvestment Act will not step in to help.

The stimulus plan will affect Philadelphia by cutting taxes, creating jobs and improving infrastructure, but according to city officials, direct fiscal assistance is not in the package.

The stimulus will "probably have little effect on the operating deficit," said mayoral chief of staff Clarence Armbrister at a budget workshop on Monday. "Hopefully, [the stimulus] will get people back to work."

Deputy Press Secretary to the Mayor Luke Butler said getting people back to work will generate revenue through taxes.

He said there is no plan to increase taxes in the city to offset the federal tax cuts included in the stimulus.

The stimulus is focused on the "capital side of things," Butler added, citing education as an area of investment that will help the city in the long term.

Through the stimulus, the federal government will invest $53 billion in education, according to the Obama administration's stimulus-dedicated Web site, recovery.gov.

Infrastructure is another major component of the stimulus package.

The Economy League of Greater Philadelphia, an independent, nonprofit group, published a policy brief describing transport investment funds included in the stimulus.

Only 6 percent of the stimulus will be spent on transportation nationwide with more than half of that going to highways, the briefing reports.

SEPTA is expected to receive $193 million from the stimulus, more than half of its annual budget.

The brief says SEPTA has lined up a number of improvement operations including the rehabilitation of Girard Avenue, Spring Garden and Allegheny stations, together costing $36 million.

They will also spend $34 million on the R3 West Trenton regional rail line.

According to the stipulations of the stimulus bill, projects must be "shovel-ready," meaning they can be implemented quickly.

Analysis suggests there are $1.4 billion worth of shovel-ready transportation projects in the greater Philadelphia area, according to the brief.

In total, the area can expect around $631 million in federal funds for infrastructure improvements, from both the Pennsylvania and New Jersey state governments.

The brief says the SEPTA improvements will help the agency "play catch-up," but the emphasis on immediate action risks overlooking the long-term impact that could be made by "visionary investment."

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