Philly On the Rise

Philadelphia leaders have been doing their own math, but the value of "x" is still in dispute.
        On one side are organizations that want to see property tax breaks, and which tout those properties' attraction potential as enough to overcome the revenue dent. On the other are some economic developers, who say such breaks will sabotage broad-based wage and gross receipts tax reduction plans that have been in the works for some time. Either way, the fact that both are on the same page regarding the role of tax reductions in improving the city's regional competitiveness is a plus for corporations on the hunt.
        The analysis by Econsult concludes, "Our greatest concern regarding the revenue impacts of reducing the gross receipts and wage tax rates is whether the City can increase its property tax revenues in proportion to the predicted rise in property values associated with the tax reductions. The question is whether the City will resist the inevitable pressure to slow the growth of assessments and/or lower the effective property tax rate as property values rise."
        In the meantime, brownfield and infrastructure projects continue to improve the value of the metro as a whole. The former CSX rail yard in South Philly is seeing rebirth as a commercial development, just part of an entire neighborhood that Blue Bell, Pa.-based Goldenberg Group has taken under its wing, hoping to see around 1 million sq. ft. (92,900 sq. m.) of retail space blossom in what was formerly industrial wasteland. And PECO, the Exelon utility subsidiary, invested some $68 million in city infrastructure improvements in 2003, with its significant improvements to the center city's underground network garnering "project of the year" honors from Utility Automation magazine.
        The outlook is strong for manufacturers in the region, says the Federal Reserve Bank of Philadelphia. Its January 2004 survey of manufacturers with more than 100 employees in eastern Pennsylvania, Delaware and southern New Jersey revealed that about half of respondents showed new order growth. In addition to positive employment indexes, said Reserve senior economic analyst Mike Trebing, "there were some signs of increase in capital spending plans," with 58 percent planning to increase spending on new plants and equipment over the next year, much of that activity front-loaded toward the year's first half.
        One already growing is Lockheed Martin Corp.'s Integrated Systems & Solutions division in King of Prussia, which added more than 500 employees during 2003, bringing its payroll to some 3,300. Company officials have estimated that as many as 3,000 to 5,000 people will be added to the division as a whole in the next three to five years.