The Philadelphia City Council yesterday approved amendments to a power-sharing proposal for the city's oversight board, setting the stage for a final vote next week that is needed before Philadelphia can sell its long-awaited deficit bonds.
The amendments are intended to address union complaints that torpedoed an earlier version of the plan. In September, the council voted against the city's proposed cooperation agreement with the Pennsylvania Intergovernmental Cooperation Authority after angry union members said it would give the oversignt board too much power.
Yesterday's amendments, which were approved 11 to 3, delete language that would have required unions involved in the collective bargaining with the city to provide weekly informational updates to the oversight board.
"We don't think we've given up anything substantive," said Ronald G. Henry, the board's executive director. The amendments merely put the board's powers "in more moderate language" while allowing members to obtain "any information requested" regarding the bargaining process, he said.
The unions are still reviewing the amendments and have not yet decided whether to support the proposal when it comes up for a final vote at the end of next week, said Deborah Willig, a lawyer with Walters, Willig, Williamson & Davidson. The Philadelphia firm is counsel to three of the city's four main unions.
Three city council members voted against the amendments, but council sources said they objected to the short time span given to review the proposals, not necessarily to the amendments themselves.
Councilman John F. Street acted as the council's principal negotiator on the power-sharing agreement.
An aide to Councilman David Cohen, who voted against the amendments, said the councilman might support them eventually but felt he was not given enough time to make sure they did not materially change the underlying legislation, which would require new public hearings.
A new council will be sworn in Jan. 6, meaning the proposal must pass next week or go back to the beginning of the process. A new bill would have to be introduced and new public hearings held.
But council sources say that, given yesterday's strong support for the measure and the fact that there are no more public hearings before next week's vote, the measure is likely to pass.
Under the provisions of state legislation that created the oversight board last June, the cooperation agreement and a five-year financial recovery plan must be approved before the oversight board can sell deficit bonds on behalf of the cash-poor city.
Lawmakers originally envisioned a bond sale last summer, but numerous distractions, including a mayoral election, forced the city to resort to expensive short-term borrowing instead.
Public Financial Management, the financial advisory firm hired by Mayor-elect Edward G. Rendell, is helping the incoming administration construct the required five-year plan. F. John White, co-chief executive officer at the firm, said yesterday he expects a preliminary version to be ready by the middle of next month, about the time the new mayor takes office.
Mr. White said that would allow the administration to submit a final proposal to the oversight board in early February. But he noted that board members are already working closely with the incoming administration on the details of the plan, "so it won't be a surprise" when the mayor-elect formally presents it to the board for review.
Given the six to eight weeks needed to prepare a bond sale, Mr. White predicted the deficit bonds will be issued in early spring. Projections from the city finance director show Philadelphia will be scraping the bottom of its cash reserves over the next several months, but will not actualy face insolvency in the absence of bond proceeds until June.
