Pica

Ronald G. Henry, executive director of the state board overseeing Philadelphia's finances, has resigned effective early next month. The Pennsylvania Intergovernmental Cooperation Authority was established by the state Legislature in 1991 in response to Philadelphia's financial crisis. It issues bonds on the city's behalf and regularly monitors its finances. "It's been three years, and I've largely accomplished what I set out to do," Henry said yesterday, "to help PICA get organized, to help the city get through its financial crisis, and set up a structure to promote fundamental institutional change.

SOMEONE alert the academy! It's Our Money is making a summer blockbuster movie. It's called "PICA 2011: Judgment Day. " Here's our tagline: In a world of many fiscal dangers, one city budget fights to survive. The plot? Tomorrow, the Pennsylvania Intergovernmental Cooperation Authority, also known as PICA, will vote on whether to approve the city's five-year plan. PICA's job is to make sure the city has enough money to cover the spending it projects over the next five years.

Memo from the state fiscal oversight board to Mayor Rendell: Get out your pencils and calculator and do some more homework on your five- year plan. The response of the mayor and his financial advisers to the Pennsylvania Intergovernmental Cooperation Authority's first evaluation of his plan to make the city solvent? No problem. "I accept their assessment; they have legitimate questions," Rendell said. Those questions - contained in a five-page memo released by PICA yesterday - cover matters like the $400 million the administration wants PICA to borrow on the city's behalf and how the city will use some of it. The authority also wondered what calculations the city used to forecast its revenue and proposed labor and management savings over the next five years.

James Eisenhower, Gov. Ed Rendell's appointee as chairman of the Pennsylvania Intergovernmental Cooperation Authority, stepped down Tuesday as Gov. Corbett was sworn in. PICA is the state-appointed board that oversees Philadelphia finances. It was created in the early 1990s during the city's fiscal crisis, and requires each mayor to submit a five-year budget plan for approval by the board. In his final meeting, Eisenhower said he was optimistic about the prospects for a comprehensive study of the city's firefighting needs - meaning the Nutter administration and the city firefighters union may be able to agree on its parameters.

District Council 47 president Thomas Paine Cronin was briefly detained by city police yesterday after a lunchtime demonstration against the state panel overseeing the city's finances. Cronin and his union of white-collar city workers were protesting comments made last week by members of the Pennsylvania Intergovernmental Cooperation Authority. While dozens of picketers protested outside of PICA's offices on Walnut Street near Broad, Cronin and five other union members occupied the agency's suite of offices and refused to leave until board members apologized for the remarks.

So you think the city budget is balanced? Not so fast, says the state agency overseeing city finances. In a report yesterday, the Pennsylvania Intergovernmental Cooperation Authority said it would be "incorrect and dangerous" to believe that the city's "revenue structure is sufficient to maintain city services. " That despite the city's audited statement for the most recent fiscal year showing a $118 million surplus. PICA warned that when adjusted for inflation, the city's tax base has been shrinking since 1988, and that "budgetary balance at present expenditure levels cannot be maintained in a declining economy.

Empty pleasantries and a fond farewell were all the board overseeing city finances expected yesterday when it asked City Finance Director David Brenner to say a few words. Instead, Brenner delivered a bitter tongue lashing that left members of the Pennsylvania Intergovernmental Cooperation Authority speechless - until one of them bit back. "I have not enjoyed the experience," Brenner told the board at the last meeting he'll attend as an ex-officio, non-voting member. "From day one, you exhibited a lack of trust in me or anyone connected with the city.

The state agency overseeing city finances is scheduled to give city officials their first report card tomorrow, and the grade apparently will be much better than the agency's staff originally planned. After protests by the Rendell administration, the Pennsylvania Intergovernmental Cooperation Authority is toning down a caustic draft report that blistered city officials' progress in making the city fiscally solvent. The draft of the PICA analysts' report - obtained by the Daily News - shows that the authority's staff wanted to give an "F" to the administration for its efforts to cut costs and improve worker productivity to balance the city's budget.

I WANT TO correct a few inaccuracies in your June 23 editorial ("We Want the Bad News, Too"). Foremost is your assertion that "PICA ruled that the city didn't need to submit [Plan B], too. " In fact, as reported in your own paper, the board requested that the mayor submit a five-year plan for PICA's review by June 22. As in every year since 1992, PICA did not dictate what the city should submit, save that it be a plan the city believes meets the statutory requirement of a five-year balanced budget using reasonable assumptions.

A multimillion-dollar cloud hangs over the city's budget and it's making the special state agency overseeing city finances impatient. Members of the Pennsylvania Intergovernmental Cooperation Authority think an arbitration panel is taking all too long to decide on a new contract for city police. The firefighters' panel has suspended proceedings pending a decision on a police contact. "The silence is deafening," said PICA member John Egan, noting how no final budget can be decided until the city knows how much it will have to spend on police and fire protection.

THE PENNSYLVANIA Intergovernmental Cooperation Authority. The name seems to embody governmental minutiae, a bureaucratic backwater with little relevance to taxpayers. At times in the past, that's not far from how PICA operated. But this year, the state board that oversees Philly's finances could play a dynamic role in shaping the city's budget plans. And it's already caught up in a political tango between City Hall and Harrisburg. "A lot of people are eyeing PICA," said Zack Stalberg, president of the good-government group Committee of Seventy.

Gov. Corbett announced Friday the reappointment of Sam Katz to chair Philadelphia's state fiscal oversight board, the Pennsylvania Intergovernmental Cooperation Authority. Katz, a documentary filmmaker and former Republican mayoral candidate, was first appointed in March 2011. The Pennsylvania Intergovernmental Cooperation Authority (PICA) was created in 1991 during the city's fiscal crisis. Philadelphia mayors each year are required to submit a five-year budget plan for approval by PICA's five-member board.

AFTER SERVING less than one full term, an outspoken member of the state-appointed board that oversees Philadelphia's finances is in danger of losing his post - and some are saying he's a political casualty. Sam Hopkins, the only member of the Pennsylvania Intergovernmental Cooperation Authority who voted against Mayor Nutter's financial plan last fall, was recently informed that he will not be reappointed, according to PICA Chairman Sam Katz. But staffers for state Senate Democratic leader Jay Costa, who appointed Hopkins to fill a vacancy in late 2011, said that Costa hasn't yet made up his mind about Hopkins.

IN ITS 22 YEARS as the city's fiscal watchdog, the Pennsylvania Intergovernmental Cooperation Authority (PICA) has done plenty of barking, but has not yet bitten the city's budget. That "bite" option - rejecting the city's five-year spending plan - would be nearly lethal to the city, since without PICA's approval, any state money coming to the city would be frozen, and the city's lenders would go running for the hills. This year, PICA's barking was a little louder than usual, after an arbitration panel awarded firefighters retroactive raises and benefits increases that will cost the city $200 million over the five-year plan.

AFTER SOME uncertainty, the city's fiscal watchdog has approved Mayor Nutter's five-year financial plan. The Pennsylvania Intergovernmental Cooperation Authority OK'd the plan, 4-1, Wednesday. It delayed a vote last month after receiving more information on how Nutter would pay for a potentially costly contract-arbitration award for the city's firefighters. Board president Sam Katz had raised questions about the city's declaration that if an appeal failed, it would pay for the award - which would add $200 million in costs to the five-year plan - through service cuts.

WITH TIME running out, Sam Katz, board chairman of the city's fiscal watchdog, says he still hasn't decided whether to approve Mayor Nutter's five-year financial plan. Katz and the four other board members of the Pennsylvania Intergovernmental Cooperation Authority meet Wednesday to vote on the plan. They delayed a vote last month after requesting and receiving information on how Nutter would pay for a potentially costly arbitration award for the city's firefighters. Katz said that he is still talking with the administration about the award, which city officials say would add $200 million in costs to the five-year plan.

CITY CONTROLLER Alan Butkovitz gave his approval to Mayor Nutter's revised five-year financial plan Thursday - but warned that the city still faces serious budget risks. Nutter updated the plan after members of the city's fiscal watchdog indicated discomfort with the original version, which didn't include details on how the city would pay for retroactive raises and benefit increases in a recent firefighters arbitration award. The administration originally had not included those costs because it appealed the award.

City Controller Alan Butkovitz says that he disagrees with the Nutter administration's handling of the ongoing contract dispute with city firefighters, but that he believes the city's latest five-year financial plan should be approved by the state oversight agency, the Pennsylvania Intergovernmental Cooperation Authority (PICA). For the second time, the city is appealing an arbitration ruling that would raise the firefighters' pay. The city says it can't afford the raises and refuses to work the arbitration award into its five-year revenue and spending forecasts, which need PICA's approval.

By Brett Mandel 'What does PICA stand for?" goes the joke among Philadelphia budget watchers. The punch line: "Nothing. " The humor of this joke may be lost on those who have counted on PICA, the Pennsylvania Intergovernmental Cooperation Authority, to stand for honest budgeting and fiscal integrity. Recently, however, the members of PICA have taken a major stand for financial responsibility, threatening to ruin this particular knee-slapper. Soon we'll see if they can really knock 'em dead.