IN HIS June 3 column, John Baer warns that you'll hear a lot about tax increases, and he reports on a recent study showing that Philadelphia is the highest taxed among the largest cities in each state.
I'd like to put those comments in context. We are seeking a temporary 1 percent increase in the sales tax as one way of closing our budget gap. But the city has taken a number of other steps to close a $2.4 billion budget gap that the economy's crash created.
Among them is slashing department budgets by $200 million in just a year. More of those cuts have been in administrative agencies than in any other area, and we've slashed salaries for high-ranking officials and cut the cars in our fleet. Even after those steps, we had to deactivate fire companies, close pools and reduce the library budget.
The increase in the sales tax will help us avoid deeper cuts that would devastate city services. We don't want to increase taxes, but a temporary sales-tax increase would do less damage than those devastating cuts and, being temporary, will leave us better positioned when the economy recovers.
It's also important to put the city's tax structure in context. While it's important for us to do everything we can to reduce tax rates, there are differences between Philadelphia and the other cities in the survey that Baer cites. As a city and a county, Philadelphia provides an array of services that other cities don't have to.
For example, one of the fastest growing areas in the city budget is prison costs, which other large cities don't have because their counties fund them.
Other costs typically incurred by a county that Philadelphia must bear include the Department of Human Services, which has the largest budget of any department, and the local courts, which state courts have ruled should be funded by the state. Without those county costs, the city could have much lower taxes.
City Finance Director