Discussion about the Pittsburgh Promise in today's council meeting

Live Blogging:
At the table:
ex-Judge Cindrich, UPMC.
Ira Weiss, PPS Solicitor.
George Specter, city attorney.

Highly inappropriate to discuss this bill, said Peduto. City gov has never given a tax deduction or tax credit for a contribution. This isn't done all the time.

A decision by three executives.

UPMC and UPMC alone, by virtue of its size and power, gets a right. I can not ever support a special right to an individual, nonprofit, or corporation. Don't ask the Pgh Taxpayers to provide a tax credit for it.

We have no such deductions in city government.

"My phone is ringing off the hook about the disgust about the backroom deal that has been done," said Peduto.

I have no questions. I am very disappointed.

Len Boadack, lame duck:

There is a whole lot on my mind. Happy with the Pgh Promise. But nobody saw the strings that were attached. Now we see the strings. Federal tax deductions are fine. But we represent the residents of the city.

His kids go to Catholic schools. Every child in the city should benefit. Seems that if Len had the tax break for his kids he'd vote for it. He'd live with it. The small segment of the population.

Jim Motznik:
Let's UPMC talk.

UPMC:
We shouldn't look a gift horse in the mouth.

Story: Uncle Pete wants to give money to Charlie, nephew. One condition. Don't ask for it again.

The only condition that UPMC is asked for, we will give $100 M. Please don't ask us to give it twice. If there is a change in the law.

Lawrenceville was blighted, so says UPMC.

Nonprofits don't have stockholders.

Jim Motznik:

He is thankful. He thinks it will benefit the city. He thinks it will attract families and keep families to the city. Jim's buddies left the city. Jim stayed. The schools were the ultimate decision. The schools in BP, USC, Mt. Lebo are better. This gives the poor people in the city a chance. It puts second thoughts in the mind of young families.

Jim is glad to see the criteria for the Promise. He read em.

Jim's son is in first grade at Carmault. Marvelous school. He is learning about periods. It is a great thing. Jim is not crazy about the high schools that are in Pittsburgh today.

"What are we going to do with Jack?" We are not "holy rollers." We care about his safety. He thinks the school system will get better and better over the years.

Jim's 18-year old daughter, now at CCAC, went to Catholic Schools. Jim has no answer for the others about the "catholic promise" or the "private school promise." It is the responsibility of the school system to do that same thing.

Jim not in agreement with Peduto. Jim asked: Are we changing the tax structure at all?
Specter: The agreement is to protect UPMC in the event that in the future that if these gifts also get a tax -- then the amount of money to the Pgh Promise is reduced. The city is not required to grant a tax credit to UPMC, under this bill.

It may well be that the city may not have a choice or the power to grant a tax credit. Then UPMC would reduce the gift to the foundation for the Pgh Promise.

Doug Shields: Not sure if the city solicitor is at the table for the administration or not. This goes to the heart of the "uniformity clause" of the PA Constitution. The fundamental issue here is how one nonprofit gives another nonprofit money -- so why does the city come into play.

Specter: We don't know if there will be a change in the law. What I meant by the possible illegality, how, when, why, etc. If the city is to tax UPMC, it may not have the power to give a tax credit to UPMC. Then UPMC would reduce in corresponding amount.

Doug Shields: Blah, blah, blah about a bill in the old days when the city was broke. What if a .055 payroll tax comes? How would there be a legal authority to exempt UPMC?

Specter: That's my point. We don't know.

If and when taxation comes to UPMC, the tax credit could not occur. Then UPMC would

Len: Why do we need to have the city come to help UPMC renig on the Pittsburgh Promise.

Bill Peduto: The Pgh Promise is not the city of Pittsburgh. UPMC is confusing the subject. We are here to say if any organization should be given a tax credit for a charitable contribution. This is not a PILOT program. This is a very big situation.

Why is there nobody here from the Mayor's office?

UPMC dude: You've gotten to the crux of the issue. Who is the city of Pittsburgh? We are not at an interesting position.

UPMC gives $1.5M to the city. Are we making an impact? We felt not.

The visionary opportunity here. :/

Why in the hell are they talking and not just sending this to a public hearing?????


Doug Shields: You (UPMC) are buying an insurance policy. You bring up an agreement from the 1990s? There were plenty of bad agreement in the past.

Did you read the depositions? We give them a wallet biopsy? We check their wallet for an insurance call.

Hey Charlie....

Let's not forget where you are at.

And what do you do when they don't have insurance? They put them back into the ambulance and send them to St. Francis. ???

UPMC then gave in and came on to give PILOTs. Then UPMC then went to the state politicians.

Back to the point that Mr. Specter brought up. This might not be even legal.

Doug Shields: Where is this agreement? Why is it not on the table. Not interested in buying a pig in a poke nor a Trojan horse.

You as the solicitor, I assume you have read the agreement.

Specter: I have NOT.

This guy has not even read the blasted agreement. But, the solicitor is within the legislation, directly.

Where is the agreement? When was it hatched?

Specter: The agreement isn't finalized.

Shields: Who is negotiating the agreement? Who? Who is in charge? When did it begin?

Specter: I assume....

When did the negotiations to this side agreement begin? And, if this is not done today, is the gift removed?

Specter: This is a work in progress. Then the solicitor steps in.

Shields: I'm trying to find out what you know. The solicitor's office was not involved. You are not aware of who negotiated. I'm here to ask the questions that are being asked of me. The public has yet to hear an answer on specific points.

The school board needs to provide the same agreement to UPMC.

Quote from PG: If the school board says "no" -- then there is no agreement. The Pittsburgh Promise needs to have the two side agreements. You gotta go 2 for 2 here. Both the school board and the city of Pittsburgh.

Both agreements are needed to put this in place. They are covering all their bases.

Ira Weiss thinks that this gift would exceed any tax. Well, a .055 on a payroll tax was once proposed. Given a $4B payroll tax, then that would net $20-Million. Over 10 years that is $200-M.

Shields would be happy to take the $200-M and put $100 of it into the Pittsburgh Promise and call it the Pittsburgh Guarantee.

Doug: This is aobut process. This is a total disregard to the people. Who knew? Were there any administration briefings as this was going on.

Any good attorney would cover all the bases -- but who is covering the basis of the city's finances? Who is looking at the other options? Has the solictor's office caluclated what a .055 payroll tax would be?

Doug Shields: I might vote for this next year. I might vote for this next month? We are going to be out of session in one more meeting. Heck, nobody even thought to pass a note to the city's citizens on December 5. YOU ALL OWE an appology to the city.

Shields: It is wrong to bring it forward today. It was made behind closed doors.

Tonya Payne: In light of all the questions that have surfaced, and in light of the petition, and the language.

I'm going to motion to hold for one week.

If we need to have a public hearing, we can ask for that.

At 12:27 they are getting to the matter.

Tonya Payne: If the citizens have a legitimate petition, then we are going to hear from the citizens.

Peduto seems scared about the way the administration has handled. There is something going on. Nobody is sitting in the chair. Peduto wants it to be voted on next year. He doesn't want to leave the door open.

Point of order from Len: There isn't enough time. For the record, Len is okay with a public hearing.

Doug Shields: It is obvious that they are going to have the signatures.

YES!

Public hearing will be held. YES!

Jim Motznik: I'd like to ask UPMC and solicitors if the public hearing would be okay.

UPMC: I respect the council and the concerns about the process. No, I do not think that we'll pull the promise. It is important to us, as UPMC has finite resources.

The hearing will be televised. Thanks.

Now Darlene Harris is not sure if the donation is a donation. She isn't able to get a grip on the promise and its side agreements. Why wasn't this on television?

UPMC: The purpose was to energize the public. We tried to inspire the public. We wanted to show them the potential of the promise.

The PFT made a donation of $10,000. Ira Weiss forgot about that.

UPMC says the superintendent rushed them. He was on the line. They were rushed up to Dec. 4. There are 3,000 seniors this year. This years class is to take advantage of this year's class.

Darlene says: They don't graduate until June.

UPMC: When this fails in other places, it isn't for a lack of money. The Pgh Foundation is the other agreement. If it is okay with them (Pgh Foundation), it is okay with me (UPMC).

Some things about administration of funds.

UPMC gets one board member out of the seven.

Len Boadack should get an invite to speak at the public hearing -- as a citizen. Len, come on down. Don't be a stranger. Len wants to change the language in the agreement.

Peduto: There is a lot of miss-trust with the way this has been handled, even in the last 24 hours by the administration.

Done at 12:50. They were at the table for about 90 minutes. They got some insights out into the public light. But, this could have been done in 4 or 5 minutes.