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Council passes $3.8 billion budget

City Council passed the $3.8 billion budget today, ending weeks of negotiations with Mayor Nutter by approving a plan dependent on a five-year sales tax hike and changes to the employee pension fund to balance budgets over the next five years.

The Coalition for Essential Services, a group comprised of over 30 community-based advocacy organizations and labor unions in Philadelphia, staged a protest outside Council chambers before the start of the weekly council meeting. Sherrie Cohen, with the Rev. Jesse Brown by her side, talks to the media in front of Coalition members holding protest signs.
The Coalition for Essential Services, a group comprised of over 30 community-based advocacy organizations and labor unions in Philadelphia, staged a protest outside Council chambers before the start of the weekly council meeting. Sherrie Cohen, with the Rev. Jesse Brown by her side, talks to the media in front of Coalition members holding protest signs.Read moreCLEM MURRAY / Staff Photographer
    by Jeff Shields, INQUIRER STAFF WRITER
    Published 

City Council passed the $3.8 billion budget today, ending weeks of negotiations with Mayor Nutter by approving a plan dependent on a five-year sales tax hike and changes to the employee pension fund to balance budgets over the next five years.

Council voted 17-0 for each of nine bills that codify the Fiscal 2010 budget, capital budget and five-year plan. Nutter is expected to sign the bill and continue lobbying the state legislature, which must approve several key components.

They include: A five-year hike in the sales tax from 7 percent to 8 percent, which is expected to generate nearly $600 million; and various changes to the pension plan, including a delay of more than $200 million in contributions to the pension fund over the next two years, when the effects of the recession are expected to hit hardest.

The vote came after about two-dozen budget opponents protested in the hall outside the Council chamber.

The battle between Nutter and Council had focused on which taxes to raise - Nutter advocated a three-year sales tax increase coupled with a steep two-year property tax hike to pay current bills. Council rejected raising property taxes at all, instead winning Nutter's agreement for a five-year upping in sales taxes.

Union representaives and community activists, united as The Coalition for Essential Services, assailed those choices before this morning's Council meeting, calling the sales tax regressive and budget cuts harmful to residents.

They advocate an increase in wage taxes of the gross-receipts portion of the city's business privilege tax.