After extracting $17 million in donations from Peco Energy, former State Sen. Vincent J. Fumo raised the ante with Verizon Pennsylvania, demanding more than $50 million in contributions to settle a legal dispute, Verizon’s former president testified yesterday.

Fumo wanted Verizon to deposit $10 million in his family-owned bank. He wanted $2.5 million in legal work for his law firm. And he wanted $15 million to go to Citizens’ Alliance for Better Neighborhoods – the nonprofit that is at the center of the federal indictment against Fumo.  read more »

A Philadelphia judge yesterday blocked Mayor Nutter’s plan to close 11 libraries starting at 5 p.m. today, frustrating the mayor’s emergency budget-cutting plan, raising cheers from library users, and potentially tipping the balance of power in city government.

Common Pleas Court Judge Idee C. Fox ruled that Nutter needed City Council’s approval to shut the libraries and that they must stay open until Council or a court says otherwise. Nutter had ordered 11 of 54 libraries closed as part of a plan to address a projected $1 billion, five-year budget deficit. The closings were to save $8 million annually.

Nutter said he would appeal the ruling to Commonwealth Court, calling it “an absolute assault on the city’s Home Rule Charter” and the powers it gives every mayor.  read more »

A former top executive for Peco Energy Co. told a federal jury yesterday that the utility never would have paid former State Sen. Vincent J. Fumo personally as part of deals in which it gave millions to a nonprofit that Fumo backed.

The ex-executive, Thomas P. Hill, helped Peco strike the secret arrangements with Fumo under which the power company gave $17 million to Citizens’ Alliance for Better Neighborhoods starting in 1998.

According to testimony, Fumo shared personally in some of that money. Prosecutors allege that Fumo’s use of the nonprofit’s money was illegal, but the defense contends that any benefit was legitimate compensation for Fumo’s fund-raising efforts.  read more »

More than 8,800 Philadelphia-area households – about 25 percent more than last year – are entering winter without central heat after having utility service terminated this year, Peco Energy Co. and Philadelphia Gas Works reported yesterday.

Peco said its annual Cold Weather Survey identified 2,563 such households in the city and suburbs, about 70 percent more than a year ago, when it found about 1,500 dwellings without heat. PGW said it found 6,285 city households that lacked service, up 13 percent from 5,552 a year ago.

The utilities reported their survey results to the state Public Utility Commission, as required by state law. The PUC is expected to release statewide data later this week.  read more »

Cut costs. Raise revenues. That’s the mantra in any monetary crisis.

Last month, the Nutter administration proposed drastic cuts in city services to close the projected billion-dollar deficit in its five-year budgetary plan.

Yesterday, City Controller Alan Butkovitz cast harsh light on the revenue side of the ledger, noting that $20 million to $30 million a year has gone uncollected by the Department of Licenses and Inspections since 2005 because of “inadequacies” in the program that manages the demolition of condemned buildings.

While L&I pays for the demolitions out of its budget, the department is responsible for seeking reimbursement from the owners of the unsafe properties.  read more »

Mayor Nutter warned at a town hall meeting last night that the city’s already dire financial situation is continuing to deteriorate.

“Unfortunately, I have to tell you here tonight that things have gotten worse” since last month, when he discussed Philadelphia’s financial woes in a live television address.

Citing the recent dismal performance of the city’s pension fund, and startlingly low real estate transfer-tax collections, Nutter said the city’s five-year deficit would be larger than the $1 billion estimate he made Nov. 6.

Just how much larger won’t likely become clear until January, Nutter said, when the administration will be better positioned to quantify it.  read more »

The nation’s governors will get a chance to lobby President-elect Barack Obama for help next Tuesday, when he meets with them in Philadelphia to discuss the ravages of the economic crisis on state budgets.

Nick Shapiro, a spokesman for the presidential transition office, said Obama and Vice President-elect Joseph R. Biden Jr. will address “the unique challenges facing our states” during a conference at Independence Hall. The meeting will be hosted by Gov. Rendell, chairman of the National Governors Association, and Gov. Jim Douglas (R., Vt.), its cochairman.

Douglas said 40 governors and governors-elect planned to attend. The event was put together in the past few days, organizers said. Details were still being worked out.  read more »

Closing libraries and draining pools will get Mayor Nutter only so far.

If he hopes to fundamentally improve Philadelphia’s financial footing, Nutter likely has no choice but to try to reduce the enormous burden of health care and pension costs, which now represent nearly 25 percent of all city spending.

He said little about those costs during the recent round of budget bloodletting, but behind the scenes there are signs his administration is maneuvering to reduce those expenses.  read more »