In response to recent legislative activity surrounding the FY19 budget and recent amendments to a proposed 1% tax on construction across the city, the Chamber has released an open letter to Council that details our support for Mayor Kenney’s strategy to fund schools locally and continues opposes targeted industry taxes.

Read the full letter below:

Dear Philadelphia City Councilmembers,

As the FY19 Budget cycle is coming to a close, we are writing to clearly state our members’ priorities.

As a general matter, the Chamber supports increased funding for the School District of Philadelphia, affordable housing and the homestead exemption. The Chamber also supports continuing accelerated reductions in wage and business taxes. We believe these priorities are key to reducing poverty and stimulating economic growth that would expand the City’s tax base, add jobs and boost wages. The Chamber also opposes anti-business legislation that would stymie job creation and economic growth.

More specifically, we believe the following:

(1) Pro-growth initiatives will do more to grow our economy, expand the tax base, create jobs and increase wages than proposals that unduly tax and strain business. Therefore, the Chamber broadly opposes:

(A) targeted industry taxes such as the proposed 1% tax on construction citywide;
(B) increasing the realty transfer tax;
(C) increasing the homestead exemption unless there is an increase in the property tax;
(D) changes to the 10-year tax abatement plan; and,
(E) pending legislation that proposes to impose predictable scheduling formulas onto unpredictable business environments.

(2) Philadelphia’s public schools need more money to close a $630 million budget gap over the next five years. The fairest and best source of city funding to meet this need is to increase the real estate tax. Philadelphia’s real estate taxes are relatively low compared to our suburban neighbors in Pennsylvania and New Jersey. We support Mayor Kenney’s original proposal recommending a 4.1 % increase in property taxes.

(3) Philadelphia must remain committed to continued – and even accelerated – reductions in wage and business taxes, both of which are high compared to suburban tax rates and put Philadelphia’s businesses, workers and residents at a competitive disadvantage. Increased funding for education and a further reduction in wage and business taxes are not mutually exclusive. We encourage Council to reject the proposed slowdown in the wage tax reductions.

(4) We applaud Council for adopting proposals that reduce expenditures, particularly costs within the prison budget, by enacting cost savings on contracts and expenditures that are no longer needed. Further, we support Council’s action to move forward with a plan to collect delinquent property taxes in an effort to raise money for Philadelphia schools.

(5) We believe that Council should support legislation authorizing monthly financial reconciliation to encourage more accountability and better stewardship of taxpayer money.

The Chamber has always sought to engage with Council and the Mayor in a highly collaborative fashion, working together to overcome our City’s challenges while promoting growth that benefits all Philadelphians. When needed, however, the Chamber will oppose policies that stunt economic growth and, in turn, hurt Philadelphia and its residents. It’s far better and more productive to work together to execute on a pro-growth agenda that attracts business and stimulates job creation for workers at all skill levels. That is the best way for us to fight poverty, increase household incomes, and improve the quality of life for all Philadelphians.


Rob Wonderling
President and CEO

cc: The Honorable James Kenney