Planning Municipal Investment: A Case Study of Philadelphia [Reprint 2016 ed.] 9781512814873

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PLANNING ^ MUNICIPAL äjp* INVESTMENT: a case study of Philadelphia

G o v e r n m e n t Studies FELS INSTITUTE SERIES University of Pennsylvania Press This volume is one of a series devoted to problems of current and long-range significance which are of particular interest to students of local and state government. Other volumes in the series are: Metropolitan Analysis— Important Elements of Study and Action Education for Administrative Careers in Government Service

F E L S I N S T I T U T E OF L O C A L AND STATE G O V E R N M E N T U N I V E R S I T Y O F P E N N S Y L V A N I A P H I L A D E L P H I A

P L A N N I N G j». MUNICIPAL ^ INVESTMENT: a case study of Philadelphia

jjgft, W. H . Brown, J r . SWARTHMORE

· C. E. Gilbert COLLEGE

Philadelphia University of Pennsylvania Press

Copyright © 1961 by the Trustees of the University of Pennsylvania All Rights Reserved Published in Great Britain, India, and Pakistan by the Oxford University Press London, Bombay, and Karachi Library of Congress Catalog Number: 61-5540

Printed in Great Britain by W. & J . Mackay & Co Ltd, Chatham

ACKNOWLEDGMENTS

F O L L O W I N G study owes much to the kindness and candor of a number of officials and knowledgeable observers of Philadelphia's city government. We want to thank all those who so freely shared with us their experience, information, insights, and evaluations. We are particularly grateful to several persons who submitted to repeated inquiries and requests for data. Those persons include Robert Coughlin and Charles Pitts of the Philadelphia City Planning Commission; Kirk Petschek of the Office of the Development Coordinator; James Patterson of the City Finance Director's office; Lennox Moak, Edwin Rothman, and John Carson of the Bureau of Municipal Research-Pennsylvania Economy League; Aaron Levine of the Citizens' Council on City Planning; Mrs. Dorothy Montgomery of the Philadelphia Housing Association; and William Wilcox of the Greater Philadelphia Movement. We are deeply indebted to Professors Joseph Conard and J . Roland Pennock of Swarthmore College and C. E. Lindblom of Yale University for critical comment on the manuscript. Parts of Chapter I X appeared in the American Political Science Review for September, i960; and we wish to thank the editor and publisher for permission to include that material here. Since completion of our manuscript (May, i960) the Philadelphia City Planning Commission has completed its THE

comprehensive plan for the City and has begun to apply the plan to capital programming. This is a continuation and, in a sense, a culmination of developments described in this volume. Neither the content of the plan nor its current contributions to capital programming seem to us to require any modification of our analysis and conclusions. This point has special reference to Chapter X. W.H.B. C.E.G.

&

CONTENTS

Introduction

I I PART

I II III IV V VI VII VIII

The City Charter 17 The Departments 32 The Administration 68 The Planning Commission 87 The Council 98 Citizen Organizations I 12 Capital Budget Execution 158 Capital Improvements and Budgetary Perfection 170 PART

IX X XI XII ]Index

I

2

Politics, Administration and Public Investment City Planning and Capital Programming Criteria for Public Investment Conclusion

191 224 253 286 .290

TABLES

ι Capital Budgets by Major Objectives

171

2 Tax-Supported Funds by Major Function as Percentage of Total Tax-Supported Funds

172

3 Total Funds Scheduled for 1959 Capital Budget in Previous Capital Programs

174

4 City Funds Scheduled for 1959 Capital Budget in Previous Capital Programs

174

5 Funds Scheduled for Sixth Y e a r of Capital Programs

175

6 Project Changes at Various Stages of 1958 and 1959 Capital Budgets

178

7 Changes Made by Council in Planning Commission's 1958-63 Capital Program

180

^ p k INTRODUCTION

a study of capital programming in Philadelphia. Broadly, it is an attempt to discover and describe how a city makes its investment decisions—among, say, ports and parks, public hospitals and police stations—and to determine what can be learned from that city's experience. THIS

IS

Capital programming itself is a method of separate budgetary decision upon " c a p i t a l " as distinguished from "operati n g " expenditures. T h e r e are two common justifications for this procedure. O n e emphasizes fiscal planning and perspective regarding projects that are loan-financed. T h e other is couched in terms of physical planning of items distinguished by "lumpiness" and longevity. O n this justification the principal advantages of a separate budgeting process are (ι) that it emphasizes the long view and the process of research; (2) that it attends to the integration of projects and programs, thus averting the diseconomies of overlap and early obsolescence; and (3) that it provides more explicit attention to end values (of planners, administrators, politicians, or publics) and to means to those ends—that is, to criteria for public investment decisions. Capital programming in practice is a variety of institutional and intellectual activities. A practical manual should include sections on how to be a city planner, sensitive politician, successful administrator, financial magnate, social philoso11

12

Introduction

pher, and how to simulate the market, all to the end of "welfare." There is, of course, no such work extant. Several studies have examined substantive trends in municipal capital outlay, though the comparative data are extremely difficult to interpret.1 The more general political and administrative aspects of capital programming in local governments have not been much studied.2 The largest body of analytical literature on the subject is that dealing with "underdeveloped areas," to which American cities are sometimes compared in their fiscal and physical problems. Recently economists have given increased attention to criteria for public investment in some federal government programs.3

1 See, e.g., Pennsylvania Economy League (Western Division), Public Capital Improvements Planning and Finance by Major Governments in the Principal Metropolitan Areas (Pittsburgh, 1956). Sec also the statement by Amos Hawley that " . . . it is evident that capital improvement costs (i.e., expenditures) are responsive to different (urban) characteristics than are operating costs." "Metropolitan Population and Government Expenditures," in Paul K. Hatt and Albert J . Reiss, Jr., eds., Cities and Society (Glencoe, 111., 1957), p. 778. s

A good general treatment, together with references to the literature, is Jesse Burkhead, Government Budgeting (New York, 1958), Ch. 8. Three summary studies of the New York City experience have been published, all aimed at immediate fiscal and administrative problems. These are: J o h n D. Millett, "City Planning;" Ch. 5 of The Mayor's Committee on Management, Modern Management for the City of New York (New York, 1953), Vol. I I ; Frederick C. Mosher, "Fiscal Planning and Budgeting in New York City," in New York State-New York City Fiscal Relations Committee, Report (New York, November, 1956), pp. 65-84; and Henry Fagin and C. McKim Norton, "Physical and Fiscal Planning," ibid., pp. 85-94. * One of these programs is water resources, on which see: Edward F. Renshaw, Toward Responsible Government (Chicago, 1957); Otto Eckstein, Water Resources Development: The Economics of Project Evaluation (Cambridge, Mass., 1958); J o h n Krutilla and Eckstein, Multiple Purpose River Development (Baltimore, 1958); Roland N. McKean, Efficiency in Government through Systems Analysis (New York, 1958); and, for a review of the

Introduction

13

T h e common elements in all this literature are its recency, its departure point in practical policy problems with widespread ramifications, and its commitment to planning and "rationality" in public decisions. T h e literature m a y reflect a minor trend in American politics from a "politics of reform" to a "politics of improvement" affecting all levels of government. Apart from studies of policy-making at the federal level there have been, however, few essays at locating investment criteria and decisions in their administrative and political context. 1 Capital improvements planning has been " g o o d practice" for American municipalities for a number of years, but few cities have developed it intensively or extensively. Philadelphia has carried capital programming as far as—some say farther t h a n — a n y other major American jurisdiction. T h e process encompasses most City facilities; it is the subject of continuing attention by officials and publics; and it has produced a large number of public works. It thus provides a promising context in which to study investment planning. T h e study that follows is formally divided into two parts. Part I consists in description of the process of decision on investment priorities, of the issues and interests relating to decisions, and of the resultant and relevant trends in city

literature, Vincent Ostrom, "Tools for Decision-making in Resource Planning," Public Administration Review, 19 (1959), pp. 114-120. Another field is that of military investment, on which see: Frederick C. Mosher, Program Budgeting: Theory and Practice (New York, Public Administration Service, 1954); and Arthur Smithies, The Budgetary Process in the United States (New York, 1955), Part I V . 1 A good example of a political and administrative counterpart to economic analysis in the water resources field is Arthur Maass, Muddy Waters (Cambridge, Mass., 1951). For the local level, see Martin Meyerand son Edward Banfield, Politics, Planning and the Public Interest (Glencoe,

111·, 1955)·

14

Introduction

policy. The three chapters of Part 2 are intended as analytical essays dealing with the roles of political and administrative processes, comprehensive city planning, and formal investment criteria in capital programming. These chapters build on the material in Part 1, but they can be read separately. The background of this study may be of some interest. We began with an interest in the values, techniques, and criteria that might be employed in municipal investment. Philadelphia, for reasons suggested above, seemed to offer a useful case-study. As we examined the experience of capital programming in Philadelphia, the critical role of political and administrative processes—their relevance for theory as well as practice—became clear. Hence our attempt to provide a reasonably complete description of the process of decision before undertaking any discussion of formal criteria. The generalizations offered in Part 2 thus followed the description in Part 1 in our thinking and writing, as they follow in the format of this volume.

φ

PARTI

I

Λ1f*

The City Charter

framework of capital programming in Philadelphia is set forth in the City Charter. The Home Rule Charter, adopted in 1951, is basically of the strong-mayor type. It replaced a more-or-less weak-mayor form of government, and the commission that drafted it expressly chose the strong-mayor form over the council-manager model which an earlier charter commission had unsuccessfully recommended to the state legislature in 1939. The chief factors in this choice appear to have been a belief in the leadership, energy, and direct accountability of an elected chief executive and the dearth of big-city experience with council-manager government. 1 In order to strengthen the Mayor and his administration the Charter Commission both streamlined the City Council THE

FORMAL

1 See especially Lennox L . Moak, "Background and Principal Features of the Philadelphia C h a r t e r , " Appendix i - A of Leverett S. L y o n (Ed.), Modernizing A City Government (Chicago, 1 9 5 4 ) ; Bureau of Municipal Research-Pennsylvania Economy League ( B M R - P E L ) , A Discussion of Some Proposed Revisions of the Home Rule Charter: The 1951-1956 Experience (Philadelphia, 1 9 5 7 ) ; Editors of Fortune, The Exploding Metropolis (New York, Doubleday Anchor Books, 1958), Ch. 3 ; Joseph D. Crumlish, A City Finds Itself: The Philadelphia Home Rule Charter Movement (Detroit, 1958); Charleton F . Chute, " H o w to Get a City C h a r t e r , " National Municipal Review, 40 ( 1 9 5 1 ) , pp. 4 0 3 - 1 0 . Our account also relies upon interviewing and upon materials in the files of B M R - P E L .

«7

18

Planning Municipal

Investment

and circumscribed its powers. Council today consists of seventeen members of whom seven are elected at large. T h e minority party is guaranteed at least two of the Councilmenat-large; in fact, there are presently (i960) two Republican Councilmen. Council's powers were curtailed in the following w a y s : Council now appropriates lump sums rather than line times in the operating budget; Council can no longer determine personnel policy through the appropriations process, nor does it confirm the appointment of any official save the City Solicitor; Council approval is now required for only a few types of contracts, and all others are administratively negotiated; Council has no authority over administrative organization, and such authority is exclusively vested in the administration; rate-making is defined in the Charter as an administrative determination. In addition, the Charter provides for an austere system of personnel administration a n d — via a series of court decisions—subjects nearly all City personnel to that system. T h e last provisions have been felt as body blows by the regular Democratic organization which has attempted without success to amend the Charter so as to ameliorate them. T h e seat of "organization" control in the City government is the Council; neither of the two Democratic Mayors under the new Charter have been identified with the organization. 1 Intra-party political conflict has, then, been an incident of the separation of powers since 1952; but there is now a good deal of governmental, social, and " p u b l i c " leverage on the side of the "strong M a y o r " — a t least, when he is personally as strong as have been the last two.

1 For a recent study of Philadelphia politics, see James Reichley, The Art of Government: Reform and Organization Politics in Philadelphia (New York, The Fund for the Republic, 1959).

The City Charter

19

In its early versions the new Charter placed the theretofore advisory City Planning Commission in a line Department of C i t y Development together with the Zoning Board of Adjustment, the Board of Building Standards and Appeals, and the A r t Commission. This provision did not endure, however, and the Planning Commission emerged as a quasi-independent body. Six of its nine members (including the Chairman) are private citizens. T h e other three, who are ex officio members, are members of the Mayor's cabinet. In consequence, the Planning Commission is neither a pure example o f the traditional independent commission, nor is it a staff agency to the M a y o r — n o r is it a compromise between these two. Certainly it is well insulated from line activities. O n the whole it seems to be regarded—both popularly and within the City government—as closest to the traditional independent commission. 1 Three other aspects of the Charter merit introductory notice. O n e is the adoption of the "general manager" idea in the form of a Managing Director, who has sweeping responsibility for day-to-day conduct of ten of the City's line departments. Some commentators have seen the office as an attempted compromise with the city manager plan. But Managing Directors have regarded themselves as the Mayor's

1 T h e annotation to the City Charter confirms this point. Those w h o designed the original Planning Commission and saw it instituted in 1943 were anxious to avoid an independent commission with independent powers, and settled, after considerable study, for a purely advisory commission. See Walter Phillips, " L e t the Citizens Play a P a r t , " National Munidpal Review, 37 (1948), 529-533, esp. p. 530.

For a discussion of opinion within the city government on how the Charter organization of the Planning Commission has worked, see B M R P E L , op. cit., pp. 43-45. It is there reported that "predominant thinking in the community at this time supports the existing arrangement" over any proposal to shift the planning function closer to the M a y o r and to line operations.

20

Planning Municipal Investment

men in principle and in practice, and this seems to have been the intention embodied in the Charter. 1 A second position—that of the City Representative—was, however, the product of compromise. Intended originally for an incumbent who would be a "ceremonial alternate" to the Mayor with responsibility for public relations and promotion, the final version of the Charter added supervision of the Port, Airport, and several of the City's commercial facilities: Convention Hall, the Commercial Museum, Exhibition Hall. A third aspect of the Charter also broke new ground for large cities; this was the centralization of nearly all budgeting, accounting, and fiscal functions (save for auditing) in one office under a Director of Finance. The form and theory of the Charter thus split the operating and budgeting functions squarely between the Managing Director and the Director of Finance and placed them potentially at loggerheads; and the form of the Charter (there seems to have been no theory on this point) splits off the City's two chief transportation termini for the supervision of the City Representative (who is alternatively called the Director of Commerce). These three officials and the City Solicitor form the Mayor's Cabinet. Beneath them range the heads of City departments or facilities, and under those officials in turn sprawl a number of departmental boards and commissions in charge of other City facilities and improve1

M o a k , op. cit., p. 339. O n the merits and demerits of this approach to

city management see: Joseph E . M a c L e a n , " W e d d i n g Big-city Politics and Professional M a n a g e m e n t , " Public

Administration

Review,

14, (1954)

5 5 - 6 0 ; W a l l a c e S. Sayre, " T h e General M a n a g e r Idea for Large Cities," Public

Administration

Review,

14 (1954) 2 5 3 - 2 5 8 ; and the rejoinder b y

J o h n E . Bebout, " M a n a g e m e n t for Large Cities," ibid.

(1955)

18&-195.

For an account of how the charter worked in its earliest years, see the statement

of then-Mayor, Joseph

S.

Clark, Jr.,

"Experience

with

Philadelphia's N e w Charter," A p p e n d i x i - B of Leverett S. L y o n (Ed.), op. cit.

The City Charter

21

iments. Yet the number of line departments is not large, nor dlo the surviving boards and commissions seem seriously to iimpede City administration. Most observers and officials feel tlhat the City's topside administrative structure has served tlhe Mayor and the City well. 1 Two fields of substantive policy—urban renewal and transportation—seem not to have been well served by the Charter, fcor reasons that the Charter Commission could probably nieither anticipate nor control. Urban renewal not only cuts aicross planning and operating agencies already mentioned b)ut is in large part administered, as in most cities, by a Redevelopment Authority and a Housing Authority. The pjrogram is intended to receive coordination and drive from tlhe Office of the Development Coordinator attached to the M a y o r ' s own office. In 1959, in a move for more coordination, tlhe Development Coordinator became executive director of tlhe Redevelopment Authority. Some observers have tended tco view this office as a rival to the Planning Commission biecause of its active concern with planning, capital improverments, and central coordination and its strategic administratiive placement. How serious such rivalry becomes will dloubtless depend upon the priority attached to "urban rcenewal" in City policy. So far, renewal has been simply one bmndle of objectives among many others; it has not been an owerriding goal despite some administrative and citizen pressures to make it such. A second area of administrative ambiguity is that of transportation. This field is also one of more recent concern, of ccomplex inter-governmental relations, of prolix relations with

• Joseph S. Clark, Jr., op. cit. See also BMR-PEL, op. cit., for accounts of interviews with a large number of City officials, and for arguments pro aind con the retention of boards for administration of certain facilities weithin the departments.

22

Planning Municipal Investment

private providers, and of novel forms of City ownership or subsidy. In recent years a citizen Urban Traffic and Transportation Board and a Transportation Coordinator attached to the Mayor's office have had chief responsibility for such integration as transportation policy has received. In 1955 U T T B produced a long-range circulation plan, but to date both coordination and delivery on the plan have been spotty. 1 Although the difficulty stems in large measure from programmatic and organizational complexities just suggested, it seems also to result from "the inability of the Administration (plus U T T B plus the Planning Commission) to control the Streets Department" and to counter the cordial and occasionally porkbarreling Departmental liaison with City Council. 2 It should be noted that both redevelopment and transportation policy have given rise to similar problems in other cities. Finally, it should be noted that Philadelphia has a separate School Board with its own fiscal base and budgeting process and that public education does not, therefore, figure in the capital budget and program. Cooperation between the School Board and the Planning Commission on land use problems has generally been cordial, but the lack of more formal integration of redevelopment planning has been criticized. Where capital programming is concerned, the Charter is not explicit as to underlying values and aims; but it does provide in some detail the framework of decision. It mandates

1 Here again there has been some overlapping in planning between U T T B and the Planning Commission, though U T T B ' s plan was produced with Planning Commission assistance. See City of Philadelphia, Urban Traffic and Transportation Board, Plan and Program 7555. 1 The quotation is from a comment upon an earlier draft of this chapter by a knowledgeable member of the Planning Commission staff.

The City Charter

23

a capital budget and puts teeth in it; and it defines at least loosely the agencies involved in its formulation, the basic order and chronology of the process, the form and content of the capital budget and program, and the financial framework that supports the capital budget. (1) Capital budgeting in Philadelphia dates from 1945; but prior to the Charter of 1 9 5 1 , the budget assembled by the Planning Commission constituted nothing but advice. It was never a part of appropriations legislation; and as a rule, bonds were voted for projects and projects were approved by Council before the Planning Commission's belated advisory document was assembled. The Charter of 1951 provided for both a capital budget and a six-year capital program. Each is adopted by Council; and the former constitutes an appropriation, thus giving to Philadelphia's capital budget a status virtually unique among American municipalities. (2) The Charter provides that Council shall adopt a sixyear program of capital improvements and a capital budget for the coming year at least thirty days before the end of the fiscal year (which, in Philadelphia, is the calendar year). Council adoption occurs at the end of a long process that begins, formally, with the operating agencies. The Finance Director is to gather from these agencies and transmit to the Planning Commission such information as the Commission needs to develop the program and budget. The Planning Commission, in turn, must transmit a program and budget to the Mayor at least 120 days before fiscal year's end; the Mayor must forward these to Council at least ninety days before fiscal year's end "to the extent approved by the Mayor." Council may delete items at its pleasure or cut estimates or appropriations; it may not, however, otherwise amend the budget until thirty days after it has requested, through the Mayor, the advice of the Planning Commission.

24

Planning Municipal Investment

No Council amendment to the capital budget is valid unless it conforms to the capital program, which may itself be amended on the same terms as the budget. T h e Charter further provides that: The City Planning Commission shall make recommendations, to be transmitted to the Council through the Mayor, on all bills originating in the Council which shall in any manner affect any zoning ordinance, the Physical Development Plan of the City, or the capital program, or which would authorize the acquisition or sale of City real estate. Unless such recommendations are received by the Council within thirty days from the date any such bill shall have been introduced, the approval of the Commission shall be presumed. 1 Although the basic chronology of capital programming is thus set forth in the Charter, it is not clear from the bare phraseology which points along the way are to be crucial and which parties to the capital program are intended to have major influence. T h e operating departments are mentioned only as an implied source of ideas and materials; yet this bare mention is potentially a base for forward planning in the line. T h e Finance Director, it seems, is simply to gather and transmit infomation; yet this prescription can and does carry with it control over the format and much of the required content of program and budget justification. T h e Planning Commission has five months (from April to September) to " p r e p a r e " and " s u b m i t " a " p r o g r a m " and budget to the M a y o r ; evidently it is here that the departmental fragments are composed into a " p r o g r a m , " for this is the first mention along the w a y of such a program; yet

1

Philadelphia Home Rule Charter, Sec. 4-604.

The City Charter

25

this suggestion will not prevent others taking part 1 . The Mayor has thirty days to review the program, and his freedom to revise it implies that the program and budget are his\ yet the annotation to the Charter makes plain that the Mayor is bound to transmit in full the pristine product of the Planning Commission while indicating the extent to which it has failed to meet with his approval. Council's discretion to overhaul the program is subjected to the advice of the Planning Commission; yet this transaction is to move through the Mayor, as is Planning Commission advice to Council on other legislative matters connected with the capital program. The Charter is thus complex and reticulate, and its intent is not plain regarding the question of whose program is the capital program. One possible interpretation is that this was the extent of Charter Commission intent: there was no explicit decision for or against an "independent" Planning Commission, for or against the primacy of fiscal concerns in capital programming; it merely provided a multipartite decision and left the actual distribution of influence to shifting developments in the channels of government, the tides of politics, and the shoals of personality. Generally speaking, this interpretation seems correct. The ambiguities in the Charter reflect in part a statesmanlike aversion to constitutional detail. But the Charter does embody (on the testimony of participants in its drafting) a rejection of the purely independent planning commission, a desire to secure city planning against the vicissitudes of city politics, and an

1 The official Charter annotation to this section reads: " T h e capital program and capital budget are vital steps in planned city development. For that reason their initial preparation is a function of the City Planning Commission," Philadelphia Home Rule Charter, Sec. 4-602, p. 60 (our emphasis).

26

Planning Municipal Investment

intent to make fiscal planning and capital programming both expert and effective. Four further aspects of the chronology require notice. One is the fact that the fiscal year is the calendar year, which places the period of most intensive administrative preparation in the vacation season and the dog days. A second point, or hiatus, is of more moment: while it was doubtless assumed that the term of capital budget execution was to be annual, the Charter neglected to say so. This left room for a longer executory period, and the life of all capital budgets since the first one has in fact been eighteen months. Moreover, save for the requirement of Planning Commission advice on Council initiatives, the Charter says nothing about amendments to the capital budget. Thus, the decision that is finally reached thirty days before year's end is not necessarily a final one and is, in fact, freely amended during the life of the budget. 1 Finally, the Charter does contain some procedural safeguards over capital budget execution, which at once protect architectural and contractual standards and tend to delay execution. (3) The Charter defines, if loosely, the form and content of the capital budget. Since the definition of "capital" is everywhere difficult, it seems best to quote the Charter itself: §2-300. Expenditures for the repair of any property, for the regrading, repaving, or repairing of streets, for the acquisition of any property or for any work or project which does not have a probable useful life to the City of at least five years following the time the expenditure is made for it shall be deemed to be ordinary expenses to be provided for in the annual operating budget ordinance. . . .

1

Amendments are normally passed by Council, but the Finance Director in 1952 assumed discretionary authority to vary appropriations among projects by 10 per cent. For details on amendments see Ch. V I I .

The City Charter

27

§2-303. The capital program shall embrace all physical public improvements and any preliminary studies and surveys relative thereto, the acquisition of property of a permanent nature, and the purchase of equipment for any public improvement when first erected or acquired that are to be financed in whole or in part from funds subject to control or appropriation by the Council. It shall show the capital expenditures which are planned for each of the six ensuing fiscal years. For each separate purpose, project, facility or other property there shall be shown the amount, if any, and the source of the money that has been spent, encumbered or is intended to be spent or encumbered prior to the beginning of the ensuing fiscal year and also the amounts and the sources of money that are intended to be spent during each of the ensuing six years. The Charter thus attempts to guarantee the integrity of the capital budget and program against the most obvious deferred maintenance, and the fiscal integrity of the City against the temptation to borrow. In fact, all capital budgets enacted since the Charter was adopted have carried a considerable amount of what everyone agrees is deferred maintenance, and many observers have been critical of this. The Finance Director's office has, however, been inclined to accept most of it, arguing that capital budgets carry no provision for depreciation, that replacement and repair expenditures must occupy a considerable portion of future capital programs, and that these facts together with the seriously run-down state of many facilities in 1952 argued placement of the deferred maintenance in the capital program. (4) The City Charter is silent concerning the amounts and mechanics of capital budget financing, but the State restrictions on debt apply to these subjects. Indebtedness for "self-supporting" projects is not limited, but the State

28

Planning Municipal Investment

constitution and judicial doctrine narrowly define the "selfsupporting" category. 1 State law, plus considerations of financial rating and integrity, form the outer financial limits on capital programs. But the City itself has adopted a "fiscal program" which today imposes a $25,000,000 limit on city funds for the taxsupported segment of the capital budget, of which a stated proportion must come from current revenues. The "pay-asyou-go" percentage began at 5 per cent in 1954 and was raised to 6 per cent in 1957 when the limit on City funds was raised from $20,000,000 to $25,000,000. It is to rise by one per cent a year until in 1961 it amounts to ten per cent. At that time, presumably, the policy will be reviewed and perhaps extended; and there are many both in and out of City government who believe that "down payments" should rise to at least twenty-five per cent. The mechanics of authorizing and incurring City debt can be briefly described. The State constitutional debt limit applies to authorization of debt, not to issuance of debt. Tax-supported debt proposals are voted by City Council and placed on the November ballot. These proposals cover general authorizations for general purposes rather than specific projects. Tax-supported and self-supporting debt proposals are separately listed. After authorization by popular vote the City issues bonds as needed to cover its expenditures. Although the bonds are earmarked for particular capital purposes or

1 Tax-supported debt in Philadelphia is limited to 1 3 J per cent of the average of the previous ten years' real estate valuations. Councilmanic debt is limited to 3 per cent; all further obligations require voter authorization. The courts have also held that the self-supporting category may only be used for "systems" of projects and not for individual projects or bond issues (with the exception of transit projects). Thus, if an airport as a whole cannot qualify for "self-supporting" treatment then airport projects that are individually self-supporting will not qualify.

The City Charter

29

groups of purposes they may, in fact, be used for subsequent purposes, the original purpose having been financed by a previous bond issue, and so forth. The transactions all move through the consolidated loan fund, which contains the proceeds from sale of all City bonds. Authorization of bonds by ordinance and popular vote may thus precede by some years the actual sale of the bonds; the consolidated loan fund permits some pacing of bond sales to the course of the money market and permits the aggregation of authorizations and their sale at some savings in underwriting expenses. The popular vote upon bond authorizations therefore bears little relation to the capital program. Bond authorizations must be voted upon before Council has voted upon the capital program and before the program is in any way before the voters qua program. 1 For many projects, however, the administration requests authorizations annually for annual sums rather than asking for approval of the entire project. For the City this practice has the advantage of lowering its annual debt authorization requests, thus easing political and legal limits on borrowing. For voters and taxpayers the practice offers the putative advantages of more accurate cost estimates and more opportunities to check spending. In fact, neighborhood organizations have been critical of the practice and "sometimes resent being called on several times to generate interest and support for a single project." 2 Philadelphia under the Home Rule Charter may be termed an "executive-centered" city, although, as we shall 1

It was suggested b y M a y o r Clark that the time-table of capital program

preparation be moved u p to "permit the question of electoral loans to be considered b y Council and the electorate in the light of an approved Capital

Budget

and

Program. . . . "

Mayor's

1956

Capital

Budget

Message to Council (October io, 1955), p. 9. ' From a staff memorandum to the Citizens Budget Committee, courtesy of M r . W i l l i a m H . Wilcox, Executive Director.

30

Planning

Municipal

Investment

see, there is some tendency toward decentralization as urban renewal and redevelopment move toward the forefront of concern. 1 A p a r t from this tendency—as yet a minor one— there appear to be three potential obstacles to thoroughgoing authority in the chief executive. One of these is the continued use of citizen boards for particular projects and activities within the departments—for example, the Fairmount Park Commission in the Recreation Department or the board of Philadelphia General Hospital in the Public Health Department. Another is the quasi-independent Planning Commission, and the third is the division of functions and interests between the Managing Director and the Director of Commerce. W e have noted, however, the general belief that none of these institutions has seriously curtailed central authority. M a n y old City hands believe they are a necessary hedge against the day when a " r e f o r m " administration is no longer in office, and most reformers believe that the quasi-independent Planning Commission has an important contribution to make to any regime. 2 So far as decisions on priorities in 1

See Robert A. Dahl, "Organization for Decisions in New Haven," a paper prepared for delivery at the 1958 annual meeting of the American Political Science Association, St. Louis, September 4-6, 1958. Dahl distinguished between two broad categories of municipal organization, which he terms "executive-centered" and "multi-centered;" and he stresses that the labels are simply for convenience rather than for the delineation of precise types. Both orders, he says, are "pluralistic." They differ, however, in three respects: the locus of decisions; the distribution of influence over decisions; and the means of coordinating decisions. 1

There is, of course, a seeming contradiction in this statement: if such institutions are now no obstacle to executive authority, what good will they be against "organization" control? Old City hands argue that citizens and/or independent boards provide leverage for sound administration in " b a d " times while responding to executive leadership in "good" times, and that the present topside administrative organization may allow professionals to carry on under an organization Mayor.

The City Charter

31

capital programs are concerned, administrative boards make little difference since departmental priorities are by-andlarge settled at the departmental level. The quasi-independent planning commission device is generally regarded as the heart of capital programming, though we shall argue later that the ex officio City members of the Commission carry decisive weight in the process. We shall also argue that this fact, combined with the division of interests between the Managing and Commerce Directors, has on occasion led to a "bargaining" approach to capital programming. Yet it must be said that none of these institutions is a serious qualification of the generalization that Philadelphia is an "executivecentered" city, probably as much so and possibly more so than any other American metropolis. It conforms to most of the conventional canons of "sound" city organization, and it would seem to provide as favorable a framework as possible for capital programming. These aspects of structure having been described, it remains only to emphasize that Philadelphia is a metropolis —a jurisdiction of a diversity of politically relevant regions and interests. Administrative departments are large, and most of them have developed traditions and clientele affiliations. In such a situation policy normally proceeds by negotiation rather than by exercise of authority, and "planning" is as much institutional as intellectual.

II

Λ1f*

The Departments

IT is commonly said in city circles today that planning is not exclusively the j o b of the Planning Commission; that capital programming requires and should stimulate departmental planning; and that Planning Commission review will be neither informed nor effective lacking a basis in long-range planning in the line. Nevertheless, such planning has been slow to develop for four principal reasons. O n e reason is the vast backlog of improvements that existed in 1952. This led to an emphasis upon simply getting the work out on the assumption that nearly everything that might be done was of pressing and roughly equal importance. A second and allied reason was the renovation and restaffing of the top levels of some departments. As experienced and energetic commissioners were hired (some from careers in other cities), they brought with them faith in their personal judgment together with the desire to make a record and put their stamp on their departments. A third reason was a lack of departmental personnel for planning and a nationwide shortage of research and doctrine on the determination of service levels in many fields. A final reason was the lack of an administration philosophy to dictate where in the City machinery planning was to take place, together with heavy reliance upon the reviewing activities of the Planning Commission, which alone was staffed for planning purposes. 32

The Departments

33

T h e C o m m i s s i o n in its turn relied heavily upon " t e c h n i c a l advisory c o m m i t t e e s " in the fields of transportation,

re-

creation, health a n d welfare as well as u p o n direct consultation w i t h the departments. These

fields—largely

oriented

to " w e l f a r e " — r e c e i v e d h e a v y emphasis in the early years of the C l a r k administration, 1952-1956. In these fields standards o f " n e e d " w e r e a m b i g u o u s ; and the tradition of administrative responsiveness to public d e m a n d , h o w e v e r expressed, w a s strong. I t w a s also true, as it still is on occasion, that as the P l a n n i n g C o m m i s s i o n got its comprehensive planning prog r a m u n d e r w a y it initiated projects w h i c h were then taken u p b y the r e l e v a n t departments. O b s e r v a t i o n o f the departments today reveals a b r o a d r a n g e of p l a n n i n g practices. T h e s e practices c a n be seen as representative o f four conceptually distinct approaches to d e p a r t m e n t a l p l a n n i n g . A first a p p r o a c h seeks to define in g e n e r a l terms the extent of d e p a r t m e n t a l (that is, of public) responsibility in a given field. A second a p p r o a c h is the search for standards to determine levels of service or of investment in facilities. A

third a p p r o a c h is the simple programming of

facilities a c c o r d i n g to some order of priority. T h e fourth " a p p r o a c h " is n o a p p r o a c h at all save ad hoc decision, a m e t h o d still characteristic of some departments. W e should a d d , h o w e v e r , that project planning—that and

design—is

crucial

in

the

still

necessary,

central

review

and and

is, specifications that

its timing

assembly

of

is

capital

program. W e h a v e then three c o n c e p t u a l approaches to long-range p l a n n i n g proper, involving determinations of (1)

respon-

sibility, (2) standards, a n d (3) p r o g r a m m i n g . Distinctions a m o n g these approaches are not always sharp; w h e t h e r they are likely to b e depends somewhat upon the field. I n where

such sophisticated criteria as benefit-cost

fields

analysis

m i g h t b e applied, responsibility, standards, a n d p r o g r a m m i n g P.M.I.—Β

34

Planning Municipal

Investment

would in theory result from application of the criterion. 1 In fields,—for example, recreation and welfare—in which such a criterion is adjudged unreasonable, the reasonable procedure then becomes a decision, in order, on extent of responsibility, standards, and the order of programming. In this method, departmental responsibility results from what has been termed a "requirements" approach; that is, a decision that substantially ignores comparative inter-departmental or inter-programmatic evaluation. 8 Such evaluation is thus deferred to the stage of capital budget review, at which stage it must take place, if only implicitly. Although the scope, methods, sophistication, and sincerity of long-range planning have varied widely among the departments, no department has utilized such quantitative criteria as benefit-cost or rate-of-return analysis. Almost no department has taken a formal approach to determination of (ι) responsibility. Where this has been done the method has been that of a more-or-less broadly representative committee, supplemented, however, by top-level administrative and political judgment. Similarly the question of (2) standards has generally been answered by tradition and political or administrative judgment. In fact, it is sometimes difficult to decide when administrative judgment is sufficiently explicit to be termed a "standard." Sometimes it is simply a response (often incomplete or modified) to someone else's standard— for example, the standards of fire underwriters on the location and quality of fire-fighting stations and equipment. Sometimes professional activities evolve into something approach-

1 We say "in theory" because in no field is the criterion easy to apply without including a number of administrative judgments. See M c K e a n , Efficiency in Government through Systems Analysis; Eckstein, Water Resources Development: The Economics of Project Evaluation. 1

Cf. McKean, op. cit.

The Departments

35

ing standards—for example, in recreation—though such standards may be seen as the interested preaching of a pressure group. Standards may be set entirely by the department concerned or by a committee representative of functional specialists from without as well as within the department. Few Philadelphia departments have made an explicit approach to standards. Finally, (3) programming takes different forms. Departmental programming of capital facilities has rarely been a committee function, and it has rarely received extra-departmental attention except for some instances of Planning Commission advice and consultation resulting from Commission research and projections. It should be added that departments differ, both inherently and circumstantially, in the extent to which responsibilities or standards of service directly relate to capital facilities. In the case of the Free Library, for example, it is broadly agreed that its function is to foster—in fact, to merchandise—reading; and decisions on the type and location of facilities directly relate to this objective. Similarly for recreation. T h e r e would seem to be an inherent difference between, say, the Police Department and the Water Department in that the level of service of the latter is much more dependent upon capital facilities. There would seem to be a circumstantial difference (in Philadelphia) between, say, the Water Department and the Public Welfare Department in that the latter does not today face serious problems of obsolescence and replacement. T h e examples of departmental planning that follow illustrate the approaches just discussed. Public Health. In Philadelphia, health is a field in which it has been difficult to define the extent of public responsibility. Techniques and costs change, as do cultural traditions bearing on the extent and division of public and private

36

Planning Municipal Investment

burdens. 1 There is a strong eleemosynary tradition in local medicine; and as a result, Philadelphia has fewer public hospitals and facilities than most other large cities. There is also an enviable reputation for private medical training and research. Today both capital and operating costs are rising rapidly in public health, a trend that provokes demands for both more public participation and more public cost-consciousness. The Department of Public Health has for its chief constituency a small but articulate public of functional specialists federated in the Health and Welfare Council, which attempts the integration of public and private endeavors and the surveillance and encouragement of public activities. Other elements of the environment are the medical profession (organized in the County Medical Society), those leading and influential Philadelphias still philanthropically interested in medical institutions, and the public at large for which public health is a popular service. Of these three groups the first two tend to view public health somewhat warily. The problem of the Department of Public Health has thus been to operate in ways that would appear complementary rather than competitive to private endeavor, to integrate its program with the private activities of functional specialists, and to place the traditional private leadership behind its program. Probably for these reasons the committee approach to definition of problems and functions has been a common one. The principal object of the Department's capital outlay has been Philadelphia General Hospital. In addition, the 1 "Surveys . . . have aided the Department in arriving at the following conclusions on which the program is based . . . that the utilization of the acute hospital facilities . . . will gradually diminish because of changing concepts in medical practice, a continuing increase in utilization of health and hospital insurance . . ., and the probable reductions in the length of stay for patients presently being admitted. . . ." Capital Program 1953-1958 (Philadelphia, 1953), p. 35.

The Departments

37

City is divided into ten health districts; and the Department has pressed and gradually programmed a policy of decentralized administration that would provide a health center for each district. One such center has been completed (in 1952, at the time present capital programming procedures began), four more are at once under construction and in partial use, and three others are scheduled in the 1958 capital program. 1 In 1956 the Mayor appointed a committee "to make a study and advise as to Philadelphia's proper role in the field of public medical care of needy persons." 2 Chaired by a prominent Philadelphia lawyer, for whom it was known as the "Duane Committee," it consisted of 20 members including "members of the medical profession, other persons long experienced in the field, leaders of union labor and of business and finance, and four of the leaders of the Philadelphia City government, including the President of City Council and the Managing Director." 3 The Committee's purview did not extend to the entire program of the Health Department, aspects of which had been covered in the studies of previous committees. "Medical Care for the Needy" (the title of the Duane Committee's report) is, however, the aspect of public health most likely to give rise to capital

1

" T h e need for a health center is determined by the extent and urgency of the community's health needs, population development and changes, the type and scope of such services in relation to the need of the people and the adequacy of existing facilities. Selection of site is determined by transportation facilities, requirements of the neighborhood, proximity to hospitals, medical schools and other major health facilities, and by other factors." Capital Program 1954-1959 (Philadelphia, 1954), p. 40. This was the first capital program in which a number of health centers appeared. * Report of the Policy Committee on Medical Care for the Needy to the Mayor and City Council (Philadelphia, February 5, 1957), p. 2. 3

Ibid., p. 2.

38

Planning Municipal Investment

facilities. When the Committee reported in 1957, its study had included a survey of public health in ten other cities. The report classified "medical care" in six conventional fields (prevention, rehabilitation, mental illness, tuberculosis, chronic and acute illnesses), and essayed a broad definition of public responsibility for each. "The needy" were likewise broadly defined, and Departmental discretion to extend this category from time to time was accepted. The City's overall objectives were declared to be "the prevention of disease, the cure and alleviation of illness, the promotion of public health, and the advancement of medical knowledge, all within reasonable and practical limits." Because of changing economic circumstances, the report continued, no standard or generally applicable formula for determining "need for free care" could be devised—this would have to be fixed by "community decisions made from time to time in the light of . . . circumstances and the then state of medical knowledge and public opinion on these matters." The report thus sketched a generous outline of public responsibility, to be filled in by Departmental judgment. The Committee emphasized throughout that public and private medical facilities should be regarded together in charting a public program; and it proposed to institutionalize this perspective in an advisory planning board of both public and private representatives, to which proposals for the creation of new hospital facilities, public and private, should be referred. In its recommendations respecting capital projects the Committee saw the City's function as essentially supplementary to existing private facilities. It did not recommend an enlarged public hospital program (except for minor additions) and urged that the City contract with voluntary facilities to meet expanded needs. The chief proposals for new facilities were recommendation of a rehabilitation center, acceptance of the Department's health

The Departments

39

center program, and an emphasis on keeping Philadelphia General Hospital up to date. Given the study and report, the next step for the Health Department has been to win acceptance for the report from the administration, that is, from the Mayor, or at least from the Managing Director (who was, in fact, a member of the Committee). Such acceptance, in the view of the C o m missioner of Public Health, would serve as a City commitment to a capital program embodying the facilities endorsed in the report. It might be that the report itself, in light of the City personnel on the Committee, could be construed as carrying sufficient official endorsement; but the C o m missioner, alert to the need for leverage for his program, has striven for formal acceptance. As this account is written there has been no such acceptance, and the 1958-63 Capital Program in fact reduced the number of new district health centers in the capital program. T h o u g h the City's commitment to the program is generally assumed and though formal acceptance of the report might lend impetus to its programming, even an explicit City decision on departmental responsibilities and service levels cannot determine the pace at which health facilities will be programmed relative to other objects of investment. This outcome suggests the conclusion that the M a y o r and the overhead administrators resist broad or " p r e m a t u r e " commitments and that the capital program itself tends to remain a vehicle for annual policy making. Recreation. Public health and public recreation are similar programs in several respects. Both fall essentially in the " w e l f a r e " category, and the extent of public responsibility in each is subject to debate. In each case proponents of increased public responsibilities consider the debate itself a result of cultural lag and of failure to recognize the consequences of urbanization. T o some considerable extent the same publics

40

Planning Municipal Investment

are involved in each program, with the Health and Welfare Council as principal protagonist; and proponents of public recreation have linked it closely to health. Both programs are characterized by strong professional organizations. 1 The City's planning for public recreation, however, has differed importantly from that just described in the field of health. For one thing, the planning has emphasized standards (and their physical and fiscal implications) rather more than the definition of public responsibility; and it is thus representative of the second type of planning discussed above. In the second place, the machinery of planning has differed importantly. The Planning Commission has been more directly involved; and the committee work has drawn less broadly upon lay members of the community, more directly on professionals and officials. The principal capital expenditures of the Recreation Department go for playgrounds and recreation centers; and by the standards of most departments, capital costs are large relative to operating costs. The Department budget also includes the Fairmount Park Commission, the Zoological Garden, the Atwater Kent Museum, and the Art Museum. The 1958 capital budget allocates $ 1 . 2 million to the Recreation Department, which is about 4 per cent of the City funds; in the past the Department has commanded as much as 10 per cent of the City funds in individual capital budgets. Recreation centers and playgrounds are politically among the most popular of capital items. Councilmen vie for their

1 For discussions of the development of public recreation in the United States, see Arthur Hillsman, Community Organization and Planning (New York, 1950) and the references there cited; Martin H . and Esther S. Neumeyer, Leisure and Recreation (3d ed.; New York, 1958); and Howard G . Danford, Recreation in the American Community (New York, 1953).

The Departments

41

location (they are generally spread judiciously through the Councilman districts), and the Commissioner of Recreation does not face a difficult time at Council hearings on the capital budget and program. The Commissioner is a career man in his field, recruited from a successful career in another city by the Clark administration. He is a vigorous and personable salesman for his program. The topside staff of the Department is small but able and is interested in the development of more sophisticated and persuasive programming. Departmental programming in the past has been largely a matter of informed administrative judgment, together with some administrative responsiveness to neighborhood pressures, governed by such considerations as population densities and the present location of recreation centers. As we have seen, the Department's program is largely a matter of facilities. The facilities, moreover, are largely a matter of real property, which brings the Department close to the center of land use planning in both its utilitarian and esthetic aspects. For this reason the Planning Commission has since 1945 maintained an advisory committee on recreation. T h e fifteen members of the committee largely represent public agencies—the Planning Commission, Recreation Department, FairmountPark Commission, School Board, Redevelopment Authority and the Development Coordinator's office— but such private groups as the Citizens' Council on City Planning, the Health and Welfare Council, the Catholic Youth Organization, and the Philadelphia Recreation Association also have representatives on the committee. In recent years this committee has played a major role in the location and scheduling of facilities. In 1957 a subcommittee of the technical advisory committee, chaired by a representative of the Health and Welfare Council and staffed from the Planning Commission, produced the first stage in a long-range plan for recreation facilities in

42

Planning Municipal Investment 1

Philadelphia. T w o basic considerations appear to have prompted the study. One was the need of the Planning Commission for standards of recreational land use for inclusion in the comprehensive plan and of the Commission and Department of Recreation for standards for programming. T h e other was the commitment of many in the Planning Commission to the idea of a city marked by open space and circumferential parks and a recognition that, if this were to be achieved, land should be reserved early and opportunely. The development of standards for "recreation space" thus became a matter of urgency on both counts. Though it was later modified, the subcommittee's study will be reviewed in some detail here as an illustration of the application of professional standards and the evolution of land use standards. The study begins and concludes with an argument for City responsibility in recreation. Recreation is a public responsibility since (a) open space and active play are essential to individual development in the crowded conditions of city life, and (b) in such conditions no one but the City can provide the necessary facilities. From these considerations the study draws some "principles" to govern public recreational policy: recreational facilities and qualified leadership should be provided on a city-wide basis; voluntary agencies should handle special programs designed to meet the particular needs of particular groups not served publicly; both public and private efforts should be integrated through a central coordination agency; governmental boundary lines should be 1

Recreation Space Standardsfor Philadelphia: Preliminary Report (Philadelphia City Planning Commission, 1957). The seven members of the subcommittee included (besides the chairman) the Commissioner of Recreation, representatives of the Board of Education, the Development Coordinator, the Health and Welfare Council, and two staff officials of the Planning Commission.

The Departments

43

crossed in the process, and a regional recreational program is strongly to be recommended. T h e last recommendation is necessary if the large, circumferential parks envisaged in the study are to be part of the ultimate picture. In its effort to provide standards the recreation study is the most elaborate statement of criteria for public investment yet produced in Philadelphia. T h e study considers seven types of general recreation

facilities and a number of specialized

facilities. A s guides to site selection it offers considerations of accessibility, relationships to other facilities, and complementarity among facilities. A s standards for acquisition (that is, for space) the study offers the following: Playgrounds are to serve up to 15,000 people within a quarter-mile radius, for all types of playgrounds. T h e recommendations are derived from study by the staff of the Planning Commission of use of existing playgrounds in City areas of different population densities. In addition, and from the same effort, the study makes recommendations as to e q u i p m e n t for playgrounds. Greenways and Small Parks: E a c h of these acquisitions is aimed at esthetic enhancement of the City, and especially " t o bring green open space into densely built a r e a s . " Greenw a y s are to be reserved where public or community facilities are built (they are simply strips of l a n d ) ; small parks should be developed only in connection with the active play areas of the neighborhood greenway system, due to the high maintenance cost of isolated park areas. As a standard, there should be public park area within 1,000 feet of all homes in areas of more than 5 5 % building coverage. This program, that is, is aimed at high-density areas, and there is a more detailed f o r m u l a provided for the amount of green space required. Playfields are to range from eight to twenty acres in size, and there is to be one for each five or six playgrounds. W h e r e v e r possible, school grounds should be used.

44

Planning Municipal Investment District Parks are to provide, in a "natural setting," the facilities for day camps, hiking, picnics, boating, etc.; that is, open country on a small scale. T h e y may range from twenty to ι oo acres in size; they should have approximately a one mile service radius, though this may be modified by ease or difficulty of reaching them by public transportation. Regional Parks and Reservations: Regional parks range from 300 to 2,500 acres; regional reservations consist of 1,000 acres or more. There should be one of the first within 40 minutes' travel time of the majority of the homes in a region; there should be one of the second within two hours' travel time of every home in a region. Some proposed land acquisitions are listed. A c h a p t e r on " S p e c i a l i z e d R e c r e a t i o n F a c i l i t i e s " identifies

as p u b l i c responsibilities s w i m m i n g pools, museums, zoos and a q u a r i u m s , trails, libraries (the Free L i b r a r y ' s l o n g - r a n g e plan is a d o p t e d here), b o a t i n g and marinas, c a m p i n g areas, and golf. T h e r e is no labored attempt at standards for provision of a n y of these facilities save for s w i m m i n g pools, w h e r e the effort is elaborate. Starting w i t h the A m e r i c a n P u b l i c H e a l t h Association standard of seventeen square feet per user a n d a staff study showing that, where pools are a v a i l a b l e , a b o u t 3 p e r cent of area population use t h e m d a i l y , the

study

calculates a present deficiency of 970,000 square feet w h i c h , at a n a v e r a g e 5,500 feet per pool, leaves a shortage of 194 s w i m m i n g pools. Provision of these pools w o u l d m e a n one pool for each 10,000 population. A l l o f the standards are then applied to arrive at an a c r e a g e deficit; a n d for each type of general recreational facility save the " r e g i o n a l " ones, the same step is taken. I n the end, the study arrives at a shortage of 2,102 acres for such facilities a n d r e c o m m e n d s a thirty-year " c a t c h i n g u p " p r o g r a m of site acquisitions. L a n d acquisition costs for such a p r o g r a m w o u l d a m o u n t to over $7,000,000 a n n u a l l y ; b u t , it is a r g u e d , the

The Departments

45

program could be had for significantly less if geared into the redevelopment program in the form of "non-cash" city contributions. In summary, the draft recreation standards study does two things: (ι) it sets forth broadly and without detailed argument a position on the scope of City responsibility for recreation; and (2) it moves from this position to a thirty-year program via the derivation and application of "standards." In outlining the scope of public responsibility the committee could take official notice of the fact that recreation is an administratively successful and politically popular City activity. It is fundamentally—but tacitly—from this fact that the "standards" derive, for they are largely based (so far as the ratio of services to population is concerned) upon extension of existing patterns of public use in a reasonably well-developed program. The standards and program produced by the committee were the first stage of the recreation phase of the City's ultimate comprehensive plan. The next stage was review of this product at the top level of the Planning Commission. This review, together with some negotiation and compromise with the original committee, resulted in the final, published recreation plan. 1 No outside observer can say what considerations governed the review, but it resulted in a number of changes which may be summarily indicated. The plan as published omits all discussion of coordination of Recreation Department activities with related efforts of other departments, and discussion of the history and objectives of public recreation is sharply attenuated. In general, both standards and objectives are more conservative in the public version: though the standard governing playgrounds and 1

Recreation Plan for Philadelphia (Philadelphia City Planning Commission, September, 1958).

46

Planning Municipal Investment

playfields remains r o u g h l y

the same, the n u m b e r to

be

p l a n n e d for is s o m e w h a t r e d u c e d , as is the n u m b e r of district parks. G r e e n w a y s , small parks, "specialized facilities" (swimm i n g pools, g o l f courses, a n d so forth), a n d regional parks a n d reservations are all o m i t t e d . A l s o omitted is all discussion of overall costs a n d scheduling. C l e a r l y , the principal result of the review w a s a c o n t r a c t i o n in objectives. O n e c a n only speculate as to reasons for this; b u t since the P l a n n i n g C o m m i s s i o n is g e n e r a l l y b e l i e v e d to take a generous v i e w o f recreational a n d esthetic goals, the chief consideration w o u l d a p p e a r to h a v e b e e n a c a l c u l a t i o n o f administrative a n d political a c c e p t a n c e . T o this m i g h t be a d d e d a c o n c e r n that a c c e p t a n c e of the ultimate c o m p r e hensive p l a n not be j e o p a r d i z e d b y an early a n d too generous c o m m i t m e n t to recreation in the context of a g a t h e r i n g issue b e t w e e n the goals o f welfare a n d amenity a n d that of the C i t y ' s e c o n o m i c base. Similar considerations m a y h a v e g o v e r n e d elimination f r o m the published d o c u m e n t o f the reasoned discussion o f extent of g o v e r n m e n t a l o b l i g a t i o n a n d

the

necessity for i n t e r d e p a r t m e n t a l a n d i n t e r g o v e r n m e n t a l coordination. T h e reader of b o t h d o c u m e n t s will be left in d o u b t to w h a t extent the standards a n d totals in the c o m p l e t e d p l a n d e r i v e f r o m the rationale respecting obligations set forth in the prel i m i n a r y p l a n . 1 H e m a y w o n d e r that the rationale for p u b l i c obligation is o m i t t e d f r o m the public plan, t h o u g h it m i g h t b e e x p e c t e d to h a v e been taken for granted by the professionals w h o f o r m u l a t e d the p r e l i m i n a r y plan. This point m a y reinforce the speculation that the u p p e r levels o f the P l a n n i n g Commission staff w e r e r e l u c t a n t to seem p u b l i c l y to a g g r a n dize the goal o f recreation.

In fact, there will be few readers of both documents, since circulation of the first was closely restricted. 1

The Departments

47

Similar considerations would appear to have dictated omission from the final plan of all mention of costs and programming. This result, taken together with the other modifications, suggests once again that neither a functional nor a comprehensive plan (of which the recreation plan is to be a part) are likely to render capital programming automatic. Evidently those persons charged with central review and decision on priorities will not be apt to adopt firm advance commitments to a particular program or emphasis. If administrations hesitate from political considerations, planning commissions may hesitate from administrative considerations. The result, in the case of the recreation plan, is improved standards for facilities and improved justification for projects; but it is not, in itself, a program. The Water Department. Philadelphia's Water Department is one of the nation's oldest. In one way or another there has been public water in the city since 1799. Primitive sewage disposal was added early in the nineteenth century. In 1899 water filtration plants were recommended to cope with typhoid and were constructed by World W a r I, and construction of sewage treatment plants dates from a State requirement of the same period. The only major Departmental program that is distinctively modern is that of separate storm sewer construction, which began in 1947. Several aspects of the Water Department form a background to its participation in capital programs: (1) The Department commands a field in which, save for marginal decisions, the extent of public responsibility has long been settled. T h e principal exception to this point is the storm flood relief program. (2) The Water Commissioner is one of the city's more forceful administrators, with a proprietary view of the department in which he has made his career. The Department is old

48

Planning Municipal Investment

and independent, somewhat suggestive of a railroad in careerism and tradition. (3) In recent years the Department has been faced with heavy expenditures for what is essentially deferred maintenance of sewer pipe and water mains. At the same time, the financial and engineering aspects of the service require a long view of the future. (4) Under the Home Rule Charter, Council is barred from setting water rates, a function generally performed by city councils. Since, under the self-supporting criterion, water and sewer rates must still be set to cover the cost and debt service of improvements, this means that Council's approach to rates (a matter of political importance) must be a circuitous one through the capital program which ultimately influences rates; and the result of this is careful Council attention to the Department's program. (5) Though the bulk of the Department's budget is selfsupporting, its financing nonetheless affects the total of the City's debt and has repercussions on the City's credit. This means that both Council and administration are interested in the level of the Department's programs. An administration decision has held the Department to roughly $20,000,000 a year in capital programs since 1957. (6) Some of the Department's work, in both programming and execution, affects the work of other departments. In its programming, urban renewal, street repair, and some other activities must be timed so that basic utilities will be available when required and so that streets will not be opened up repeatedly. In execution, delay in the "groundwork" activities of the Water Department can delay the contingent programs of other departments.

The Departments

49

(7) Not all the activities of the Department lend themselves equally to advance planning and programming. Some, such as cleaning and lining of water pipe, can be reasonably predictable ; others, such as provision of utilities for new housing, are far more difficult to predict for even six years. Others of the Department's programs fall between these two extremes. (8) Prior to 1957 the Department had no published longrange program for any of its activities, though it was generally said that the Water Commissioner had a twenty-five year program which he "carried in his head." This may have been so, though the specificity of the program is in doubt. In 1957 the Department proposed an increase in water and sewer rents which, overall, amounted to 58 per cent. The proposal met with instantaneous opposition in Council, which commissioned a study of the Department's program and finances by the Bureau of Municipal Research. The study was sharply critical of the Department's programming and of about 20 per cent in the Department's water and sewer requests for the 1958-1963 Capital Program (storm flood relief was not studied).1 Council cut the program by more than half the suggested amount, and the Department (and the administration) ultimately decided upon a smaller rate increase. The Department adopted a "preliminary draft" program which has not, however, been made public. 2 The capital activities of the Water Department can be treated in four categories, each with distinctive problems of planning and programming. These are (1) large budgetary 1 B M R ' s study appeared in three volumes entitled: Water and Sewer Fund Finances, 1953-1957; Water Supply Facilities; a n d Sewerage Facilities, all published by B M R in 1957. 1 City of Philadelphia, Water Department, Supplement to 1956 Annual Report, Preliminary Draft (November, 1957).

50

Planning Municipal

Investment

line items (sewage treatment plants and interceptors, water treatment plants and pumping stations); (2) continuing programs to accommodate new city development; (3) continuing programs of improvement to existing facilities; and (4) storm flood relief. They are discussed in order. (1) T h e first category comprises the large " p l a n t s " of the Water Department " f i r m . " Most of them are extremely costly, are budgeted as separate line items, and require separate project planning and design. T h e Department's "sewage disposal and treatment" program (treatment plants and interceptors) derives from State anti-pollution legislation in 1905 and a long-range City plan for compliance adopted in 1915. In the event(s), World W a r I, the race for capital outlay in the igao's, the Depression, and World W a r II deferred the program until the post-war years, though it is now substantially completed. T o d a y , Departmental emphasis in programming for sewage is shifting from treatment plants to replacement of sewers. While the Department refers to a twenty-five year program for sewage treatment facilities, this has been outlined in only the most general form and does not extend to specific facilities or dollar levels. Despite the years of planning in this field, it is clear that project planning (and thus cost estimates) are rarely complete when projects enter the capital program. In the field of water supply, filtration and pumping stations antedate World W a r I ; but the modern program stems from a committee report of 1946 which outlined a program and a price for transition to so-called "rapid sand filters."1 Like the 1915 plan for sewage disposal facilities, this program is now nearing completion; and as with the sewerage program,

S t u d y of the B o a r d of Engineers for the M a y o r ' s W a t e r C o m m i s s i o n of 1946. See W a t e r D e p a r t m e n t , op. cit., p p . 20-24.

1

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emphasis in water supply is now shifting from plant to distribution, entailing both improvement of facilities and accommodation of new City development. Each treatment a n d p u m p i n g facility appears as a line item in capital programs, and B M R ' s study reviewed each line item. T h e reviews are studded with criticisms of forward planning, mostly to the point that project planning is not complete when items are entered in capital programs. 1 Thus, in both water supply and sewage disposal, the Department's planning of " p l a n t " has met the same criticism: lack of project planning and the failings this entails. Broader planning in these fields has faced the same problems: estimation of needed capacity and the utilization and capitalization of technological advances. Departmental planning in both fields has a history of a basic document (the product of consultants a n d committee work) that has been broadly followed. (2) Continuing programs to accommodate new city development are now large but uncertain items in the Department's capital programs. They include, in the Department's nomenclature: sewers for new housing; laying of sewers to relieve insanitary conditions (cesspools and septic tanks) and to permit street paving; and construction of new water mains. Each of these activities is budgeted in a lump sum. Each presents the same problem in programming: estimation of the level, direction, and design of city development. Most (though not all) of such development is in private hands; in addition, determinations on sewerage to permit street paving are largely m a d e in the Streets Department. For each of the three activities, the Department simply has a tentative six-year estimate of its cost, divided in six 1

B M R , Water Supply Facilities,

passim.

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installments for capital program purposes. No longer estimates are extant, and physical programming and assigning of priorities takes place in the very short run. While conceding the difficulties in estimating new development, B M R was sharply critical of the sewer program to relieve insanitary conditions in existing neighborhoods. Said the study: " T h e Department does not have a definite plan and schedule . . and . . we have seen no evidence of specific plans developed considerably into the future for this type of work." 1 With this exception, which has largely been "programmed" in response to popular demand, one must concede that reliable programming to accommodate new development is extremely difficult. (3) A second type of "continuing program" consists in the replacement and improvement of existing sewer and water lines. Many of these are ancient indeed; and the program, consisting in considerable part of deferred maintenance, will in theory continue indefinitely. Replacement of old sewers is illustrative: here the Department has offered a twenty-five year program of "approximate" overall and annual expenditures based largely on the age of sewer lines and emphasizing that "size, depth, variety of construction materials and methods, as well as character of the service rendered, make it difficult to determine the need and time for reconstructing of particular sewers." 2 Improvements to the water distribution system consist of three operations on water mains: cleaning and relining, reinforcement, and relay (that is, new mains). The first two of these are allegedly difficult to program since they depend upon the problematic performance of pipe. Recently the Depart-

1

B M R , Sewerage Facilities,

p. 36.

2

Water Department, op. cit., pp. 7 1 , 120.

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ment has installed new data processing equipment for faster fluid network analysis, which is expected to give better measures of need farther in advance. Relaying of pipe has for some time been programmed over a twenty-five year period based entirely on the age of pipe. In 1957, as the B M R study got under way, the Department was reportedly in process of adopting a new programming procedure based on an eight factor point system. 1 B M R recommended that the Department go further and publish standards for quantity, quality, and pressure; that these standards be circulated and discussed by Council, administration and public; and that the resulting standards be employed as yardsticks for reinforcement and relay of mains. As B M R ' s recommendations indicate, planning for water distribution improvements must go a step further than that for sewage collection improvements. Both involve "programming" which can be based in one or more criteria, but water additionally requires "standards" of service (that is, quality of water, pressure) whereas sewer pipe either works or it doesn't. In a non-competitive market these standards cannot be directly determined by demand; some organized procedure or judgment—political or administrative—is neccssary to decision. (4) Storm sewer projects appear individually in the City's capital programs and are extremely expensive, usually ranging from Si million to more than $5 million. Since they are taxsupported, they are difficult to accomodate in capital budgets; 1

T h e eight factors were age of mains; electrolysis deterioration; main break history; substandard service (low pressure or rusty w a t e r ) ; poor casting (thin w a l l ) ; fire-fighting requirements (flow pressure a n d National Board of Fire Underwriters' criteria); underground void condition ; and importance of service continuity to the users—e.g. hospital service mains vs. normal grid mains. O f these, the first four criteria were reportedly in use in 1 9 5 7 .

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and because they serve only certain flood-prone areas, they lack widespread political appeal. T h e Citizens' Council on City Planning has annually criticized the administration and the Planning Commission for not promoting the program. T h e program has not fared well: the Department's 1958-1963 Capital Program requests were cut by nearly two-thirds and similar reductions have regularly occurred. Storm flood relief offers thorny problems for planning which have not been resolved by either the Department or the Planning Commission. Some City responsibility for flood relief is clear, but it has not been officially decided that the City must provide complete and contingent protection against floods of any level. Benefit-cost analysis—the classical if problematical method of dealing with flood prevention and losses—has not been used. 1 Conversations with Department officials indicate that priorities are established by personal survey and judgment, plus the volume of complaint from affected regions. As we have seen, the program is not at all well advanced. In summary, capital planning in the Water Department varies among individual programs. M u c h of it—in the "continuing programs"—is sheer "programming" resting, to date, on such simple criteria as the age of existing pipe. There is some sign that criteria for replacement are becoming both more sophisticated and more reliable through technical advances in testing and data processing. Programming to accommodate new city development, however, will probably continue to consist of mere "guestimates." Where, as in 1 " W h i l e the flood d a m a g e in m a n y areas is p r o b a b l y less than the cost of c a r r y i n g bonds for flood relief, there is n o m e a s u r e m e n t of the nuisance to p e o p l e w h o live in such areas. V e r y f e w p e o p l e , e x c e p t those w h o h a v e e x p e r i e n c e d it, k n o w w h a t it is to h a v e three feet o f w a t e r in the basem e n t or the living r o o m ; a n d only those w h o h a v e suffered d a m a g e . . . c a n measure the a n n o y a n c e . " W a t e r D e p a r t m e n t , op. cit., p. 82.

The

Departments

55

renovation of the water distribution system, decisions on "standards" of performance are logically requisite to programming, these tend to be implicit, resting on the Department's view of what the public will accept as qualified by professional pride and convention and budgetary constraints. Parts of the Department's program (those for " p l a n t " now tapering off) have rested on the large-scale and long-run plans of consulting committees which sought to estimate physical requirements in the future and (in the case of sewage disposal) to meet legal requirements. These plans have on the whole proved sound in their estimates, but Departmental project planning of this " p l a n t " has been sharply criticized for delay and lack of specificity. Storm flood relief presents a classical problem in capital programming. The problem might be conceptually solved by benefit-cost or rate-of-return analysis or by proceeding from a determination of the level of City responsibility to standards or priorities for affording relief, and from this to programming of construction. So far, neither of these methods has been explicitly adopted, and there has been a tendency simply not to build storm sewers despite the "program" of the Department. Police and. Fire. These functions perhaps illustrate the departmental planning problem at its simplest. In each case the extent of public responsibility is decided by long tradition. In each case some performance standards are available from research and experience which submit readily to modification on the basis of administrative judgment. In each department there is no shortage of experienced administrators. The problem is simply one of programming, in which rough standards and long experience come into play. Soon after the City's capital programming process began, both departments submitted and won acceptance for "longrange plans." In each case the long-range plan consists of an uncomplicated statement of purpose: the replacement of all

56

Planning Municipal Investment

obsolete station houses within a twenty year period, together with a rough order of priorities for replacement. In neither case could there be any doubt of "need"; for a number of station houses antedated the twentieth century, neighborhoods had changed, and population had shifted. The priorities set by the departments reflected available standards ofservice and equipment, coupled with and modified by local experience in policing and fire-fighting. For each department the principal considerations were the "need" of the neighborhood and the condition of its existing facility. In the "measurement" of each, more explicit standards are available for fire-fighting than for police work, though it may be that police work offers a broader basis for unstandardized administrative judgment than does fire-fighting.1 The considerations applied to priority in replacement apply also to location of stations, on which point existing standards and professional experience were supplemented (especially in the Fire Department) by Planning Commission consultation on likely land use trends. 2 Strong claims have been made for 1 Among the factors considered by the Fire Department were age and condition of the facility (existingstandards apply) and neighborhood need as measured by density and type of housing—matters for the exercise of administrative judgment within general standards. T h e chief standards extant relate to the location of fire stations. They have to do with time required to reach a fire in areas of differing densities and land uses and are recommended by the National Board of Fire Underwriters. See F. Stuart Chapin, Jr., Urban Land Use Planning (New York, 1957), pp. 333-334. 1 T h e Fire Department made time and distance surveys toward the location of stations and consulted with fire underwriters. Locations were eventually set by a committee of Fire Department officials. See Testimony of Fire Commissioner McNamee at Council hearings on the 1957 Capital Budget (typescript); and Capital Program 1954-1959 (Philadelphia, 1954), p. 69. An example of the professional experience applied by the Police Department has been a tendency to shift the locations of police stations as a means of breaking up undesirable and undermining neighborhood connections.

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resultant operating economies through standardization of facilities (with savings in maintenance costs), some combined fire and police facilities, and actual reduction in the n u m b e r of police stations. Fire a n d police stations are not expensive as capital projects go. They have simply been phased into capital budgets and programs by the department, the Managing Director, a n d the Planning Commission. One or more fire and police stations have appeared in each capital budget since the first, though the level of expenditure has varied considerably. It is officially anticipated that the Police D e p a r t m e n t will be phased out of the capital program in the near future, thus raising the intriguing question of whether, so long as there are capital programs, there can be a City agency of any importance that is not represented in them. T h e long-range plans of these two departments are interesting for their simplicity alone, though considerable labor went into their formulation. They tend to show that it is i m p o r t a n t to have a " p l a n " a n d to have that plan accepted by the administration a n d Planning Commission, for the two departments have consistently done well in capital budgets. A Kote on Urban Renewal. Those urban processes with such naturalistic a n d vital names as conservation, renewal, and redevelopment seem to require much high financial contrivance and not a little of the dead hand of organization. Here we shall observe how redevelopment fits into capital programming, or vice versa. T h e "vice versa" has doctrinal significance for those who believe that capital programming is basically an instrument of u r b a n renewal—a method of scheduling delivery on centrally decided goals of physical reconstruction rather than a means of making one portion of City policy annually, a device to relate deductions from central goals to inductions from land use and population research rather t h a n a procedure for

58

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Municipal

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the gradual negotiation and decision of agency priorities. Such considerations agitate some planners and some civic organizations. A t the levels of City administration where broad policy is made or delayed there has, however, been rather little debate along these lines. City government is seen there rather more as a collection of agencies than as a hierarchy of goals. Basic and long-term emphases in capital programming have remained undecided, with the result that the contributions of the departments, if often random and unplanned, have continued to count heavily in the formulation of capital programs. T h e Redevelopment Authority appears in capital programs, but decisions in this field are made outside the regular framework of capital programming. Redevelopment projects are evolved in a complicated process partly mandated by the Federal Housing A c t of 1954. Their planning is marked by negotiation and committeework—an Interagency C o m mittee on Housing and an Interagency Committee on Industry and Commerce compose agency interests and contributions in the two principal fields of redevelopment. Allocation of land and money between the two fields has been a matter of constant bargaining among administrative and civic interests. T h e overall level of City expenditures for redevelopment has come to be a cabinet decision and is largely dependent upon matching federal grants. Prior to 1957 the funds scheduled for redevelopment varied widely from year to year both within and among capital programs. In 1956 it was decided to schedule future City funds for redevelopment at the rate of about $3 million annually, and capital programs since the 1957-1962 program have reflected that decision. T h e decision itself (to which the Planning Commission, the Redevelopment Authority, and the Administration proper were the chief parties) rested upon such considerations as the likely level of

The Departments

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available federal funds, the proper allocation of City resources, and the feasible scope of project planning and execution. Nonetheless, actual annual obligations are uneven. The prolix and time-consuming nature of redevelopment decisions, plus the fact that basic commitments have been centrally settled, are the main factors distinguishing the scheduling of redevelopment projects from the projects of the line departments. Projects of the Redevelopment Authority show up in capital programs as funds for assembly and clearance of land. The 1958-1963 capital program scheduled funds for eight such projects, plus monies steadily increasing over the six years for two other categories. One of these, entitled " U r b a n Renewal Areas," is for the "spot" clearance in "basically good urban renewal areas." The other item, listed as "Areas Unspecified," is a "reserve category" which in subsequent years has been allocated largely to industrial redevelopment projects. These items reflect two changes in City policy on renewal. One of these—the so-called "new approach to urban renewal" of 1957—reflected a conservative estimate of available City and federal funds and placed emphasis for the future upon "conservation," "spot clearance," and private efforts rather than upon the more dramatic assembly and clearance projects. The other change is still in process as this is written and reflects a continuing tug of war between the forces (civic and official) pressing for industrial and "economic base" renewal and those emphasizing housing, recreation, and amenity. In part this has been an interdepartmental issue in which the Commerce Department stood for the first emphasis while the Redevelopment Authority, the Planning Commission, and the Development Coordinator inclined to the second. In part it has been an issue among non-official forces in the city. The industrial position failed (literally) to gain ground until recently, when a shift of emphasis began. It

6o

Planning Municipal Investment

remains to be seen how far that shift will go and whether the Administration—ultimately the Mayor—will continue to resist an explicit and long-range commitment as it has in the past. 1 Each development project affects a number of line departments. Conversely, the capital projects of the departments have fiscal consequences for redevelopment since streets, sewers, recreation centers, schools, and other capital improvements may qualify as "non-cash" City contributions for the purpose of claiming federal funds. * Thus some departments find their scheduling affected by the planning and incidence of redevelopment projects; the priorities involved are worked out by the Development Coordinator, the Redevelopment Authority, the Planning Commission, the Managing Director, and the departments concerned. Sometimes the Housing Authority is also involved. Although the

It should be noted that the situation is complicated by the provisions in the Housing Act of 1954 which heavily favor residential over industrial redevelopment. O n this point see the testimony of M a y o r Dilworth (arguing for some shift in emphasis) in: U . S . Congress, House of Representatives, Subcommittee on Housing of the Banking and Currency Committee, Hearings on Slum Clearance and Related Problems, J a n u a r y 7 - g , '958.

1

2 Some observers have been critical of the Philadelphia redevelopment effort for not attempting a more thoroughgoing Gleichschaltung of departmental (and School Board) projects to a top-priority goal of maximizing federal contributions; but the City has yet to give such a priority to this program. T h e following suggests a countervailing consideration for the student of capital budgeting: " T h e provision by the city of certain community facilities within the renewal area m a y . . . enhance the attractiveness of the area as an investment. By offering such inducements to redevelopers, however, officials are tempted to concentrate facilities in renewal areas, thus discriminating against the remainder of the city. Note: " U r b a n R e n e w a l : Problems of Eliminating and Preventing U r b a n Deterioration," Harvard Law Review, 72 (1959), 504-552, at p. 533.

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procedure is complicated, it has not occasioned great difficulty in capital programming. 1 The principal functions of the Redevelopment Authority are project planning, land assembly and clearance, and relocation. Development of sites themselves is undertaken by other public or private agencies subject to Redevelopment Authority supervision. In Philadelphia this fact has resulted in some interesting experiments in private corporations publicly conceived and in quasi-public corporations. Perhaps the most interesting of these experiments is the Philadelphia Industrial Development Corporation, chartered in 1958. PIDC is a quasi-public corporation. It has a board of directors numbering thirty; fifteen of these constitute the executive committee, of whom seven are appointed by the City and eight by the Chamber of Commerce; the remaining directors are jointly selected by the City and the Chamber. A sound and succinct description of its functions is the following: (1) To market vacant city-owned land held in an "industrial land bank." (2) To make studies and recommend location for spot clearance of blighted land to permit the expansion of industry and for off street parking. (3) To organize financial measures to facilitate industrial development.2 PIDC is now taking over both the public functions of the Commerce Department and the private efforts of the Chamber of Commerce in planning and facilitating industrial development. Together with the Commerce Department, it is the main

1

A n exception is the Food Distribution Center—an elaborate commercial redevelopment project that requires a number of new and altered facilities. In this case an inter-agency committee for actual operations was instituted to coordinate execution of the project. Most redeveloped land, of course, requires few of the ordinary utilities. * Philadelphia Housing Association, A Citizen's Guide to Housing and Urban Renewal ( 1 9 5 9 ) , p. 122.

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protagonist in City circles of an "industrial" and "economic base" emphasis in redevelopment; in private circles it finds its chief constituency in the Chamber, in the Bureau of Municipal Research-Pennsylvania Economy League, and in the Greater Philadelphia Movement. Capital funds for P I D C are currently scheduled through the Redevelopment Authority, though the corporation's officials have sought to have them channeled instead through the Commerce Department, which is seen as more sympathetic to industrial objectives. In theory, P I D C is to work its way out of capital programs entirely by committing the funds from sale of properties to the improvement of new properties and by acquiring land in return for its own bonds secured by leaseholds. T h e result is to be a completely self-sustaining enterprise which will not need to depend upon public capital funds channeled through the Redevelopment Authority. Capital improvements to land redeveloped for industry, moreover, will not require City financing. However certain these developments may be (and observers are not agreed on this point), they are still in the future. 1 T o summarize, urban redevelopment entails departmental projects which, for maximum impact on intergovernmental aids, must be planned and negotiated well in advance. It requires careful timing ofprojectsyet complicates that timing (in both programming and execution) in a variety of ways. It has led to a number of experiments blurring the line between public and private enterprise, some of them designed to make

1 See Note: "Urban Renewal . . ." Harvard Law Review, op. cit., p. 507, for the general statement that "Few (privately financed) corporations have been formed . . . because the cost of acquiring, assembling, and clearing the land almost always exceeds its fair market value for the proposed re-use." The P I D C bet is that industrial land use, plus tax-free obligations through quasi-public status will make the corporation selfsupporting.

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redevelopment more immediately self-supporting. Coordination of redevelopment efforts has been a continuing problem, complicated by the intergovernmental relations involved. While a central decision was ultimately taken which sought to schedule redevelopment funds evenly, based upon at least an implicit ordering of City priorities, the administration is under constant pressure for new and more explicit central decisions. T o d a t e the administration has resisted strong commitments, but a decision for all-out renewal with reasonably specific goals would tend to reduce capital p r o g r a m m i n g to a secondary a n d instrumental status in the making of policy. As it is— a n d this should be emphasized—redevelopment policy is on the whole m a d e outside the machinery of capital programming. Conclusions. T h e early capital program carried frequent mention of departmental " p l a n s " and " p r o g r a m s , " as well as acknowledgment that such preparations were nonexistent for a n u m b e r of fields and facilities. With few exceptions, existing d e p a r t m e n t a l outlines were simply programs hurriedly collected f r o m scratch or from prior surveys and documents for the purpose of reserving space and funds in the later years of capital programs. T h a t this was so would seem neither surprising nor censurable. Such f r a g m e n t a r y departmental planning has resulted in w h a t one administrator terms a "gleam in the eye" a p p r o a c h to capital programming, with projects neither well defined nor well justified appearing in the later years of capital programs. This leads to instability in capital budgets a n d programs for several reasons: projects get a h a r d e r look from reviewing authorities as they move closer to the budget a n d m a y be discarded or deferred; departmental priorities lightly assumed are lightly c h a n g e d ; cost estimates are poor, with ramifications t h r o u g h o u t the budget and p r o g r a m ; project p l a n n i n g is delayed, with adverse effects upon timing and justification.

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It can be argued, as is said of French governments, that despite lack of stability there has been considerable continuity since the same projects turn u p repeatedly after deferral until capital programs become familiar in their substance if not in the scheduling of that substance. T h e a r g u m e n t suggests the question of whether more explicit departmental planning would result in any real improvement. T h e r e are several answers to this question. O n e is that in Philadelphia, if not in France, stability is thought to be a virtue. Another is that advance planning could be expected to improve cost estimates and project planning with resultant gains for stability. A third is that central review and interdepartmental comparisons would gain in information and rationality. A fourth answer may be that departmental planning is in itself a good thing, resulting in more informed a n d efficient service, a n d that it is one of the objectives of capital programming to promote this planning. A final answer may be that while more explicit planning might not have turned u p " n e w " projects or economizing alternatives in the early period when departments were "catching u p " with conventional requirements, such planning may lay off as that period draws to a close in a number of departments. If one seeks to analyze the forces militating for and against forward planning in the departments, the very spottiness of such planning is suggestive. A goad to planning in some departments has been the desire to make more secure their place in the capital program. For some departments this is no problem. T h e Streets Department will always have work to do by virtue of deterioration and new development; it will be encouraged to carry on through political pressures and intergovernmental grants; and experience to date indicates that its list of projects will always be so long that,save for these large projects closely related to City development policy, it will be free to set its own priorities without m u c h overhead control. Departments such

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as Recreation, Public H e a l t h , and the Free Library find themselves in a different position—program levels or new prog r a m m a t i c departures are closely tied to physical facilities, but the programs themselves are less generally accepted or a p p e a r less essential t h a n the more traditional City services; hence the hope for City c o m m i t m e n t to a " p l a n " a n d the physical facilities it entails. Some encouragements to forward planning operate, if unevenly, u p o n all departments. A project's place in a plan or program is likely, ipso facto, to be persuasive in central and civic p r o g r a m reviews. I n recent years, as the City administration has settled d o w n for the long run, overhead m a n a g e m e n t has urged on d e p a r t m e n t a l planning. T h e M a n a g i n g Director has done so t h r o u g h project and budgetary review and by exhortation of the Finance Director through frequent revisions in the project justification forms. O n e reason for the M a n a g i n g Director's pressure has been his conviction that most planning belongs in the line r a t h e r t h a n in the Planning Commission. T h e hypothesis seems w a r r a n t e d that a vigorous planning commission will force planning, or some motion to that end, in the line in order to preserve initiative and autonomy in policy. O n the other h a n d , there are forces at work, apart from mere inertia, t h a t discourage d e p a r t m e n t a l planning. Some administrators u n d o u b t e d l y prefer to feel that the department's p r o g r a m is their personal handiwork and reflects their personal experience, wisdom, a n d world view. Some administrators m a y mistrust planning because they mistrust advance c o m m i t m e n t s . Some administrators m a y see in " p l a n s " a deterrent to dynamism and/or flexibility which, for them, m a y be the cardinal administrative virtues. Still o t h e r s m a y conclude t h a t reasoned "obligations," " s t a n d a r d s , " or " p r o g r a m s " can cut two ways; t h a t risk that bargaining and personal or political persuasiveness are more dependable t h a n a plan t h a t isn't (comparatively) persuasive; and this P.M.I.-C

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may be especially true of departments that have hitherto done well without planning. At least one influential overhead administrator expressed the view to us that a six-year capital program is unrealistically long if it is intended to be both specific and stable. This official argued that, in many instances, departmental reservations of funds in the program for unspecified or vaguely defined purposes is the only realistic way to deal with the six-year requirement. For those departments whose programming cannot be firm, the requirement poses a dilemma: they must either submit requests for funds which are poorly supported in fact if not in form or risk getting the short end in the future. Thus the six-year period may encourage genuine planning in some departments and bogus programming in others; the perspective of the capital program is not equally appropriate to all activities. The argument appears to have especial validity in the case of those departments (for example, Public Welfare, Streets, Water) that are chiefly concerned with modernization, modification and extension of existing and traditional facilities in fields of uncertain demand. We think there are several such areas in which programming (substantially unrelated to decisions on responsibility or standards) must remain unstable. It is clear, of course, that departmental planning—of whatever type or degree—can never amount to outright prediction. All of the departments are faced with acts of God. Population and land use research in the Planning Commission can never predict absolutely. All of the departments work in political contexts, some more so than others. Technology and professional fashions change; bright ideas and alternative programs may occur at any time. And a programming change—or a slip-up in execution—in one department may have ramifications for several others. While some officials and observers have evidently hoped for

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long-term departmental planning and programming that would closely approach prediction, most of the proponents of planning have had something more conservative in mind. It is fair to say, however, that no informed and extradepartmental observer in Philadelphia would maintain that departmental planning is today a success; and some departmental officials would concur with respect to their own departments. We have noticed some putative advantages and disadvantages in forward planning for the departments themselves, but perhaps more important are the advantages that might accrue for the capital programming process as a whole. Explicit departmental planning should provide more information to those charged with overall review and assembly of capital programs. Such information should (here by definition) result in a more rational comparison of projects a n d order of priorities. It should simplify the reviewing process insofar as the department's own priorities are accepted, and it should relieve the reviewing agency of independent research into the history and "merits" of projects. Yet departmental planning, no matter how firm, cannot automatically create capital programs; there must still be a comparative evaluation among departments. Moreover, it would seem that the capital program must remain a vehicle of annual decision. As we have seen, departmental priorities will change; and thus interdepartmental comparisons are likely to change (depending upon the techniques of central review). Even assuming that departmental plans are perfectly firm the conditions (not alone the political conditions) governing comparisons among departments change, an a n n u a l review and revision will remain necessary. Firmer departmental planning could, however, result in less frequent revision, if not less frequent review, of capital programs and budgets.

III sfetifa

The Administration

is largely a matter of departmental proposal and overhead disposal, and we have accordingly begun our description with the departments. The more interesting aspects of the process, however, are those of central comparison, criterion, evaluation, and policy. If the formal structure of capital programming is complex, the activity of decision in the upper reaches of administration is more so. Here, as in government generally, it is difficult to conclude where particular decisions are taken or which are the places where influence typically looms largest. Yet the heart of capital programming may well be format and procedure designed to introduce certain general and particular competences into decisions. This means constant attention to both the form and reality of procedure. We set forth summarily our main conclusions about the usual loci and determinants of decision before taking up the process in detail. To begin with, not all of the capital program receives the same treatment. Some items—they are usually "lumpy" and to be scheduled for the very near future—are matters of top administration policy and receive their impetus or their argument from the Mayor and his cabinet. The remainder of the capital program is finally decided—with varying degrees of deliberation and sophistication—at the level of the top officials in the Planning Commission, the Managing Director's CAPITAL

PROGRAMMING

68

The Administration

6g

office, the Finance Director's office, and the office of the Director of C o m m e r c e . F o r the most part, decision on t h e capital p r o g r a m is a collective, cooperative, constant, a n d casually consultative process involving four or

five

staff

principals from the offices j u s t n a m e d . A s we h a v e observed the process, w e think that the point of most influence is t h e M a n a g i n g Director's office. T h i s is so only for the ten o p e r a t i n g departments, t h o u g h the M a n a g i n g Director himself will cast a vote on the projects o f other agencies at the P l a n n i n g Commission. T h e P l a n n i n g Commission's role, w e think, has tended to decline over time. O u r discussion thus begins with the M a n a g i n g Director's office and then proceeds to the other agencies of c e n t r a l administration. T h e c h a p t e r to follow describes the role o f the P l a n n i n g Commission. The Managing Director. T h e C h a r t e r of 1951 left the role o f M a n a g i n g Director to be defined b y circumstances a n d the incumbents of the office. I n c u m b e n t s h a v e taken a latitudinarian view, and a variety o f circumstances h a v e c o m b i n e d to m a k e the position influential. T h e office is strategically l o c a t e d as the jointure between t o p policy a n d day-to-day administration. Because so m u c h top policy emerges from line a d ministration, its position close to the line gives it strength a n d influence. Because the n u m b e r of departments under it is a reasonable one (10) and because these departments are a b l y administered, the M a n a g i n g Director has been free of the necessity of more detailed administration than he requires for his policy functions. His m e m b e r s h i p of the C a b i n e t requires only to be mentioned. F r o m the beginning the M a n a g i n g Director has been active in capital p r o g r a m m i n g , b u t w e think there has been a trend t o w a r d still greater participation and influence. T h e M a n a g i n g Director's office t o d a y distinguishes " p h y s i c a l " or land use p l a n n i n g from other p l a n n i n g activities.

ηο

Planning

Municipal

Investment

While the first is recognized as the province of the Planning Commission, it is argued that forward planning and programming and most immediate capital program decisions belong in the line and with the Cabinet members collectively and individually. The role of the Planning Commission is regarded as a broadly integrative one—the long-run avoidance of overlap and obsolescence—to be performed by applying land use and comprehensive planning to the capital program review. The Managing Director's office faces a classical problem in budgeting and programming: whether the line departments should be taught, encouraged and assisted to sharpen their own administrative practice through decentralization, or whether tight overhead control is to be exercised through lineitem budgeting, central planning, or detailed review. The present staff sides formally with the first position and argue that they do not envisage their job as one of day-to-day administration. Yet their discussion of "their" departments is proprietary and their knowledge of them most detailed. Budgetary control of the departments through the Managing Director's office is relatively tight. The pattern of budgetary and policy control extends to capital programming. The departments testify to a continual screening and consultative process that endures the year round. As they develop projects, they consult the Managing Director or his deputy; and revisions not infrequently follow the consultations. It is clear that a department's first hurdle is to sell the Managing Director (and, in the case of big ones, the Mayor) on the project, and that—lacking such support— the project's chances are slim. The Managing Director, moreover, will usually have a view respecting capital budget allocations among departments, though this view becomes vaguer for the remoter years of the capital program and will vary from one year to another.

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The Managing Director asserts that the screening process is not a rigorous one. If, he says, a proposal seems "sound" and if the department's total request is not too far out of line, he will let the project go through. O n the other hand, if he is sure that the project is politically or financially out of the question at present, he will forestall it. 1 Evidently the preliminary review of project requests has varied in rigor from one department to another. The larger departments with long lists of projects large and small will be allowed some independence in going to the Planning Commission, whereas it is the view of Commissioners of other departments that the Managing Director goes to the hearings and debates of the Planning Commission with a "slate" of projects composed from the lists of his departments as a result of the screening process. T h e loose rein on some departments and tight rein on others appears to reflect in part the bargaining position of the departments with the Planning Commission, the Council, and the public. T h e Planning Commission staff contend that project screening in the Managing Director's office has appeared ineffective and often negligible in the past. In recent years the review has been tightened and formalized following a promise by the Managing Director to the Planning Commission. 4

1

The

Managing

Director g a v e

the f o l l o w i n g illustrations

in a n i n t e r -

v i e w . A s a rule, h e b e l i e v e s the Streets D e p a r t m e n t s h o u l d r e c e i v e f r o m 1/4 to 1/3 of the C a p i t a l B u d g e t , w h i c h m e a n s

$6 to

$8 m i l l i o n . Y e t ,

h e said, he h a d j u s t let the D e p a r t m e n t g o t h r o u g h to t h e C o m m i s s i o n w i t h a t o t a l r e q u e s t of

Planning

$ 1 4 million. T h e projects were all

s o u n d a n d , he said, h e w o u l d r a t h e r see the P l a n n i n g C o m m i s s i o n d o t h e c u t t i n g o n it. O n the o t h e r h a n d , h e h a d a t the s a m e t i m e c u t the W a t e r Department's

request considerably

b e c a u s e , in v i e w of a d e c i s i o n

by

C i t y C o u n c i l o n w a t e r rates, it w a s clear t h a t the D e p a r t m e n t c o u l d n o t f i n a n c e m o r e t h a n t h e a m o u n t to w h i c h h e r e d u c e d the request. •It

will

be seen f r o m o u r a c c o u n t

of t h e s c r e e n i n g process t h a t

the

a c c o u n t s of p a r t i c i p a n t s d i f f e r . T h e M a n a g i n g D i r e c t o r b e l i e v e s t h a t t h e s c r e e n i n g has n o t b e e n m u c h intensified a n d t h a t it has a l w a y s

been

72

Planning Municipal Investment

Conceivably the administrative screening could become too " t i g h t " for the Planning Commission's taste, leaving too little for its decision. T h e staff of the Commission reported in the summer of 1959 that departmental requests for the i960 capital budget and 1 9 6 0 - 1 9 6 5 capital program h a d been screened nearly to the financial limit. T h e Planning Commission review was thus completed sooner and dealt almost solely with scheduling rather than "substance." One innovation in the screening process has reinforced the trend to more rigor. T h a t is a Cabinet subcommittee which began work in 1957. It is composed of the M a n a g i n g Director, Finance Director, Commerce Director, and Development Coordinator; and its function is to review the " b i g " projects— the large and lumpy ones that are the trouble-makers in the capital budget. Such review necessarily requires scanning the entire capital program to determine where room can be found for the larger items related to administration policy. T h e subcommittee takes no final decisions; it simply looks over the ground and reports to the cabinet, which then comes to a decision. This decision is communicated to the Planning Commission, which may or may not follow it, but which will know that the three ex officio members of the Commission will be following that line when the time arrives for final decision. In fact such large projects have usually been matters for decision by the M a y o r and the cabinet and have often originated at the top of the City administration. T h e process of decision has not, however, been so formalized in the past and has not extended to the review (if only cursory) of the remainder of the capital program, which is necessary if priorities are to be determined at that level.

lenient; some members of his staff see it as more stringent. T h e Planning Commission staff found it ineffective in the past. Most of the departments report it as rigorous and pervasive, though some do not.

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O n e further aspect of the screening process deserves notice and occurs after the formal hearings by the Planning Commission, to which, of course, the Managing Director is a party. At this point, when it is clear that the programs of some departments must be cut, there will again be some screening by the Managing Director's office. Here, too, the autonomy of the departments varies. For the most part it is up to the departments to decide where to take their cuts, but the M a n a g i n g Director intervenes on occasion. His usual practice is to set a dollar figure to which each department must reduce its budget and program. This figure represents his reading of the Planning Commission's attitude at its hearings as well as his own view of project priorities. The Director of Commerce. T h e role of the Director of Commerce with respect to the Port, the Airport, and the Board of T r a d e and Conventions is somewhat similar to that of the Managing Director vis-a-vis his ten departments. T h e Airport has had a relatively free h a n d within the Commerce Department in recent years for several reasons: the stature and vigor of the Deputy Director of Commerce for Aviation, the interest of Council a n d commercial quarters in Philadelphia's competitive position, a n d the rapid and recent advances in jet aircraft. These advances have required extensive and expensive revisions in airport facilities, the scheduling of which has raised the question of the city's competitive position. T h e Deputy Director for Aviation has borne down h a r d on this question and, on balance, can be said to have h a d his way within the D e p a r t m e n t , the administration, and vis-ä-vis the Planning Commission and Council. Though he did not always win out in the first instance, capital budgets have been extensively amended to accommodate the Airport. T h e other programs and facilities of the Commerce Department are headed by a Deputy Director of Commerce for Port and Industrial Development, and there has been some screening

74

Planning Municipal Investment

of project requests at this point. In 1959 industrial developm e n t proper was r e m o v e d to a quasi-public corporation, b u t the C o m m e r c e D e p a r t m e n t is still c h a r g e d w i t h p r o m o t i o n a l activities. T h e projects of all agencies o f the D e p a r t m e n t h a v e , in fact, been the subject of consultation a n d some i n f o r m a l screening b y three or four officials at the top of the D e p a r t m e n t a n d , o f course, the large projects n o w g o before the cabinet subcommittee discussed above. I n the past, c o m p e t i n g claims of departments u n d e r the M a n a g i n g D i r e c t o r and the Director of C o m m e r c e h a v e often f o u n d final resolution in the Planning

Commission,

but

the

new

cabinet

machinery

appears likely to shift determinations to the administration. The Finance Director.

T h e F i n a n c e Director's

concerns in capital improvements are the C i t y ' s

principal financial

posture and policy. T h e s e interests, together w i t h his c a b i n e t status and his ex officio membership of the P l a n n i n g C o m mission, h a v e supported a b r o a d i n v o l v e m e n t b y his office in capital p r o g r a m decisions. T o these bases of participation must be a d d e d his responsibilities in capital b u d g e t e x e c u t i o n : he has discretion to v a r y appropriations a m o n g projects b y ten per cent, is consulted on all amendments to the c a p i t a l b u d g e t , and, as b u d g e t officer, is charged w i t h both a c c o u n t i n g a n d reporting a n d a r r a n g i n g for the financing of c a p i t a l budgets. It follows that the F i n a n c e Director's office is a l w a y s a source of information and potential control. T h e C h i e f o f the C a p i t a l B u d g e t section of the Budget B u r e a u is one o f the most knowledgeable men in the C i t y respecting c a p i t a l p r o g r a m s and projects, their origins, a n d their execution, a n d is in constant contact with the departments, the P l a n n i n g C o m mission, and the C o u n c i l . T h e liaison a n d k n o w l e d g e resulting at this point from the functions of the office, together w i t h the cabinet position of the Finance Director, c o m b i n e to render the Director (and his principal assistants for capital b u d g e t i n g ) influential in project priorities as well as financial policy.

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Administration

75

Financial policy logically extends to supervision of capital costs, accuracy of estimates, stability in programming, and the impact of capital budgets upon operating budgets. T h e " C a p i t a l Project Reports" upon which departmental requests are submitted (through the Finance Director's office) to the Planning Commission have been the Finance Director's principal avenue of attack on these problems. Recently the Capital Budget section of the Budget Bureau has been more fullystaffed, and project report forms have been reviewed and revised repeatedly in a continuing search for closer cost estimates and fuller project justifications. T h e project report forms provide cost breakdowns in categories common to most projects. 1 T h e detailed breakdown is preceded on the forms by an attempt to disclose unit costs for project planning (as a percentage of building construction cost) and for land and construction (per cost unit—front foot or acre; square foot or cubic foot). A second major purpose of the forms is to obtain an estimate of the probable timing and direction of a project's impact on the operating budget. In the past this portion of the form has not been a success—agencies either ignored it or submitted "horseback" estimates. T h e result has been continuing revision and increasingly detailed accompanying instructions for the calculation of contingent costs or savings. No one in the City is yet satisfied that the reporting is satisfactory though it has undoubtedly been improved by the revised instructions and by increased staffing in the Budget Bureau.

T h e 1957 forms provided for the following categories: preliminary surveys; plans and specifications; purchase of land; construction (to be subdivided "according to the recognized and logical component parts which have been or will be required for construction bids"); inspection and supervision; furniture and fixtures; other equipment; other. T h e 1958 revision retained these categories and added two: demolition; site improvement. 1

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Planning Municipal Investment

T h e inevitable complement to cost is justification; that is, provision through the project report forms of sufficient information—either categorical or descriptive—that proposals from all agencies may somehow be compared and priorities assigned. Officials of the Finance Director's Capital Budget Division and the Planning Commission's Projects Division have worked together at revision of the forms to this objective, and it was hoped that the 1958 revision would constitute a major advance. In fact, the form itself provided no change in format save for space—where there were once some two inches provided for the department's description of its project there is now the better part of a page left empty for this purpose. The accompanying instructions do, however, improve upon earlier versions in providing illustrative justifications of "need" and suggested explanations of the department's scheduling of projects. 1 In their present format the forms and instructions provide some incentive to departmental programming and to generous definitions of responsibility but little incentive towards evolution of standards. Perhaps their most striking hiatus is the lack of categorical and reasonably common indicators of "need" other than the most general and impressionistic. No measures of "gain" are enjoined or suggested to set against the required (if problematical) estimates of cost. As they stand, the "Capital Projects Reports" add little of form to departmental planning or of comparability to central review. The question is whether these ends can be further advanced through more efficient paper reporting, and on this question those experienced in reading and revising the forms are divided. Some would like to develop common categories,

Budget Bureau, Office of the Director of Finance, Instructions for Use in Preparation of the Requests for the ig^g-igß^ Capital Program and the 1 959 Capital Budget (Philadelphia, 1958), p. 19.

1

The Administration

77

standards, and measures of project " n e e d " ; others argue that such a format would be artificial, unreliable, and misleading. There is a similar difference of opinion respecting improvement of estimates of capital and operating costs, though the project report forms are generally considered tight enough in this respect. 1 Some departmental officials contend that the kinds of unit costs required by the forms cannot be reliably estimated; others have despaired of more accurately estimating effects on operating budgets, though there is more faith in the possibility of improvement on this point. T h e next step in cost estimates and control, for which support is building among critics, is likely to be imposition of more overhead controls and sanctions respecting project execution and requests for supplementary appropriations. 2 Such a step would probably raise the question of how controls should be divided between the Finance Director and the Planning Commission, for recommendations to date have looked in both directions. Central cost controls over project planning and execution would necessarily trench upon policy in the "elimination of frills." Thus one of the organizational imponderables in capital programmingcomes to be whether the Planning Commission could be interested in cost consciousness

1 For a sharp criticism of experience in these respects see the excellent short study by the Bureau of Municipal Research, Memorandum Report on: The Budget Bureau and Instilling Cost Consciousness among Municipal Employees (Philadelphia, 1956), esp. pp. 17-20. B M R ' s criticisms are, however, directed less at the project forms than at departmental treatment of them, and its recommendations emphasize better project planning, more careful up-dating of cost estimates, and central cost control in the actual construction of projects. 1 T h e principal sources of support outside City officialdom are likely to be the Citizens Budget Committee and the Bureau of Municipal ResearchPennsylvania Economy League (on which see Ch. V I I below). See B M R P E L , Memorandum on Cost Consciousness on Philadelphia Capital Projects (Philadelphia, 1957), and the publication cited in the foregoing footnote.

j8

Plcmning Municipal

Investment

and whether the Budget Bureau should be interested in the " c o n t e n t " of projects. O n e recent trend toward a partial resolution of the problem has been a tougher policy on the part of the Finance Director and the Planning Commission in considering requests for capital budget amendments and supplementary appropriations, including several cases of outright refusal to consider supplementary appropriations. The Mayor and the Cabinet. W e now turn to the role of the political executive in capital programming. T h e fundamental question that arises is that of the extent to which capital budgets and programs reflect considered and explicit administration policy as opposed to administrative bargaining, ad hoc decision, and a minimum of broad "political" guidance from the Mayor's office. D o capital programs follow from guidelines and emphases laid down at the top, or is capital programming itself one of the principal avenues of City decision making ? In the first place, testimony is virtually unanimous that Philadelphia's two mayors, since capital programming began in 1952, have had no explicit and overall policy on the subject, with the exception of financial policy. W e shall begin with the exception. Every city requires some financial policy, if only to satisfy the financial community that underwrites the city's bonds. T h e policy may be informal and flexible, or it may consist in a firm fiscal ceiling. T h e nature of the policy is important in capital programming. It may provide constraints that compel priorities and lead to long-run planning, or a more flexible policy may discourage attention to the later years of the capital program. Prior to the 1951 charter and the 1952 administration, Philadelphia had an annual and informal financial policy. This practice continued in the Clark administration, and a financial ceiling on tax-supported capital outlay was adopted

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79

by the Mayor and cabinet. In 1953 the Planning Commission breached the policy and programmed improvements well over the ceiling. It is reported that Mayor Clark pleaded with the Commission to abide by the ceiling, but the best he could win was a list of priorities for reducing the budget to the ceiling rather than acquiescence in the ceiling itself. Accordingly— and at the strong urging of the Finance Director—the cabinet and then the City Council formally adopted a $20,000,000 annual ceiling on tax-supported City funds for the Capital Budget effective in 1954. 1 Earlier—in fact, in the first ( 1 9 5 3 - 1 9 5 8 ) Capital Program —the Mayor and Council had adopted a policy in which the City undertook pay-as-you-go financing of 5 per cent on taxsupported capital expenditures and lump sum "down payments" of Si million each on water and sewer self-sustaining projects. In 1956 the Planning Commission proposed, and the Mayor and the Council accepted, a new financial policy providing for a $25,000,000 ceiling on tax-supported projects, and a rise of 1 percentage point a year in the "down payments" until they should reach 10 per cent in 1961. 2 The "down-payment" practice was initially urged and has since been strongly supported by several citizen organizations; one view is that down payments should steadily rise until they 1 Accounts of the adoption of this policy—the only explicit C i t y policy respecting the capital p r o g r a m — d i f f e r with respect to its originator and the positions of the various parties. O u r account rests primarily on that given us by L e n n o x L . M o a k , then C i t y Finance Director. For an account that gives the Planning Commission credit, see B M R - P E L , The Central Problem in Developing the 19 56 Capital Budget (Philadelphia, 1 9 5 5 ) , pp. 4 - 5 . T h e Finance Director, of course, is a member of the Planning C o m mission.

* It should be noted that the original $20,000,000 limit was placed upon loan authorizations, not projects. T h e financing of projects includes funds available from " d o w n p a y m e n t s " and old loan authorizations, so that the rise in the ceiling was less than $5,000,000.

8o

Planning Municipal Investment

cover the "recurring expenditures" that seem an inevitable part of capital budgets in a city of Philadelphia's size. 1 One aspect of the history of the financial policy is of interest to the student of capital budgeting. This is that there is no evidence that the ceiling resulted from an appraisal of the City's capital needs or from other than an implicit attempt to relate these to the City's financial resources. The principal consideration appears to have been to achieve a relation between future debt and future revenues that would be "reasonable" and protective of the City's financial rating. Such ratings, in turn, are awarded conservatively and are not likely to reflect the positive (if problematical) fiscal implications of capital improvements. With the exception of the financial policy, neither Mayor Clark nor Mayor Dilworth have had—on the testimony of most City officials—an explicit and overall capital program policy; a policy, that is, that would generally supply priorities among activities and investments. Mayors have, however, by their decisions on particular projects, often altered existing capital programs late in the game, influencing capital budgets and giving some direction to capital programming. Mayor Dilworth, for example, is known to place emphasis upon transportation improvements through his statements and policies in areas other than capital programming. In 1958, on the Mayor's strong urging, a $20,000,000 (self-sustaining but previously unprogrammed) item was included in the 1958 capital budget for purchase of new subway rolling 1

Sec B M R - P E L , Financing Philadelphia's Future Capital Improvements, igsy-ig6s, Ch. 7. Philadelphia's down payments are genuine. For an account of New York City's circumvention of down payment requirements through short-term borrowing, see Frederick C. Mosher, "Fiscal Planning and Budgeting in New York City," in New York State-New York City Fiscal Relations Committee, Report (New York, November, I95 6 ). PP- 65-^4. at p. 69.

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Administration

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stock. 1 O n other occasions and in other fields Mayors may hedge or otherwise endeavor to avoid commitment. For example, the scheduling of storm sewer construction has occasioned interagency differences of opinion and conflicting civic pressures. T h e Mayor's 1958 Capital Budget Message took the line that " T h e construction of storm flood relief sewers generally poses a problem, and I believe it is important for the appropriate City agencies, primarily the Planning Commission, to give careful attention to projected new residential construction, to determine what the impact of the new construction will be on the need for storm flood relief facilities." 2 In Chapter I we noted some Charter ambiguity on the extent to which the Capital Budget and Program are the Mayor's; this comes about through the provision forbidding the M a y o r from changing the document which the Planning Commission sends him, though he is free to add his comments and proposals when he forwards it to Council. Perhaps it is partly as a result of this provision that the M a y o r normally proposes few changes in the document at that stage. In 1957 the M a y o r had no changes to propose in the 1958 Capital Budget and P r o g r a m ; in 1956 he wrote the Council of three changes (all simply deferrals) and noted that he had written the Planning Commission asking, and obtaining, their agreement to the changes. In earlier years there have been some messages recommending more changes—few of them controversial—but there has rarely been serious disagreement or sharp change. There appears to

1 In fact, the idea did not finally go on the November ballot, though it remained in the 1958 capital budget and was later transferred to the 1959 capital budget. T h e delay was occasioned by disagreement between the City and the subway company as to who would own the cars, a result of the peculiar and complex organization of subway ownership and control in Philadelphia.

* Mayor's ig§8 Capital Budget Message (Philadelphia, October 10, 1957), p. 16.

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Planning Municipal

Investment

have been a trend toward better liaison and agreement reflected in the original document, and we have already noted some of the probable reasons for this trend. T h e Planning Commission and its staff, moreover, have usually been sensitive to the policies or desires of the M a y o r regarding the capital budget. A number of significant capital budget and program decisions are made in the cabinet, and we have already noticed the institution of a subcommittee on the subject in 1957. Such decisions do not extend in detail to the budget as a whole or to later years of the program. They typically concern particular projects or groups of projects, the disposition of which, however, necessarily forces some cursory review of budgets and programs in toto. Many of these cabinet decisions are not olympian adjudications but result from the personal involvements of cabinet members in projects or programs. Some of them are compositions of differences between the Managing Director and the Director of Commerce respecting allocations to their departments. Some result from the Mayor's sponsorship of particular projects; it is reported that cabinet members on occasion attempt to talk the Mayor out of enthusiasms that the top administrators do not share. Decisions of the cabinet on such points are not reached by votes but by a process of discussion and progress of consensus often extending over several meetings. Sometimes outright bargaining is involved in which capital projects are counters. Moreover, agreement is not always reached; and the bargaining process sometimes carries over to the Planning Commission stage, where the three ex officio members either continue the discussion or differ on issues that have not come before the cabinet. There appears to be a trend, however, to strive for cabinet agreement before the Planning Commission stage; and the cabinet subcommittee discussed above is a significant step in that direction.

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The position of mayor in a large city is a far cry from that of manager of a small settlement, and the literature of local government has increasingly recognized the importance for the first of the time-consuming, precision-defying function of political leadership. In this context it would probably be unrealistic to cherish the expectation of comprehensive, hardand-fast guidelines for capital programming from the Mayor's office. In fact, overall emphases in capital budgeting have changed in some respects since 1952; and, in the ways just discussed, Philadelphia's mayors have been instrumental in those changes. It is generally said that Mayor Clark took an essentially "Fair Deal" approach to municipal policy, emphasizing health, welfare, recreation, and housing; and these interests were reflected in capital budgets. Such an emphasis stemmed from the generally admitted fact that the City lagged badly in those fields in 1952, as well as from the political appeal of the policy. The "welfare" emphasis was accomplished by Clark's hiring his most experienced and energetic administrators in these fields and through the tenor of the Mayor's statements and the content of individual decisions. Most (though not all) City officials and observers believe there has been some change in emphasis in capital programming since the advent of the Dilworth administration in 1956. In broad terms, this has been a shift from "welfare" to "economic base;" but the shift has not been a sharp one. Commissioners and cabinet members who remark the change attribute it to the City's having "caught up" in welfare and traditional services and to the present Mayor's personal interest in some aspects of the economic base, most notably transportation. Additionally, pressure for such an emphasis has mounted in business circles and from the Commerce Department and, most recently, the Council. The pressures stem from concern over the City's tax base, a conservative

84

Planning Municipal Investment

desire to stay the City's indebtedness and make more capital improvements self-supporting, interest in the competitive economic position of the city, and more effective organization in business. No one, in fact, is willing to attribute the shift in emphasis to an explicit policy decision by the Mayor; for no one knows of any such decision. The progression is generally felt to have taken place through particular decisions of the Mayor and his cabinet on projects. Such informants state that Mayor Dilworth is characteristically more pragmatic in approach and less interested in the generalities of policy than was Mayor Clark and that this difference, together with mounting pressures for attention to the City's economic base and a general "catching up" in the welfare field, accounts for such shift in emphasis as has occurred. 1 Conclusions. Two broad and paradoxical conclusions stand out respecting Philadelphia's city administrations under the Home Rule Charter and the reform wing of the Democratic Party. One is that opposing interests in capital programming are built into top-level administration by the Charter: given financial limits, the Managing Director and Commerce The Mayor's Capital Budget messages to the Council provide some clues to top-level thinking on policy. In 1956 Mayor Dilworth's first message read in part as follows: " T h e capital programs undertaken by the Clark Administration laid great stress upon facilities related to essential services, such as fire and police protection, recreation, refuse disposal, health, water treatment and sewage disposal. . . .There is no question but what this emphasis was correct, for essential services had to be brought up to decent levels as quickly as possible. . . . These same capital programs also foresaw the time when the construction of capital improvements related to direct services could be brought to a levelling point, and provision made for a coordinated attack on the City's longrange problems. Against the arrival of that time, certain key projects were gotten underway. In my opinion, that time has now arrived. It is a time for redirecting the emphasis of our capital program so as to see that the Philadelphia of the future anticipates municipal problems rather than suffer the heavy penalty of dealing with them only after they have created a crisis in the City's welfare and development. . . ." 1

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85

Director may be expected to be at odds over allocations; and both might be expected to oppose the Finance Director respecting the stringency of financial limits and administrative cost controls. The second conclusion is that, in general, teamwork has prevailed; and in administrations on any test "dynamic," vested programmatic interests have not generally clashed loudly or irreconcilably. Finance Directors have as a rule been "reasonable," and financial policy has been administration policy. Priorities between Commerce and the other line departments have been successfully negotiated in the cabinet or the Planning Commission. Such teamplay has stemmed from good will and negotiation. It has not, and probably could not, in the pluralistic administrative universe of a large city, result from simple directives from the top. In capital programming a number of decisions are taken on the administrative side and prior to the Planning Commission stage. In the ordinary decision the key points are the offices of the Managing Director, the Commerce Director, and the Finance Director. T h e Managing Director's control of his departments and their project proposals is generally tight. The Commerce Department is in fact a holding company, somewhat less tightly controlled and subject to strong constituent pressures for projects. The Finance Director has not actively intervened to the end of cost control but has, with his staff, participated in policy and priorities at points ranging from the Cabinet through the Planning Commission to the Council. Not all project decisions are "ordinary." Those entailing large outlays, broad policy ramifications, or inter-agency rivalries or coordination are likely to be the subject of decision by the Cabinet, and such decisions are sometimes labored. A few projects are conceived or backed by the Mayor himself and move from him through the Cabinet to the capital budget or program.

86

Planning

Municipal

Investment

In general, however, projects result from the work of administration itself and are advanced by administrative bargaining; they derive but indirectly from policies of the Mayor. In recent years the principal tuggings and haulings over policy as it relates to investment have concerned the emphases that we have termed "welfare" versus "economic base"; and a change in administration has brought some shift in the balance between them, more implicit than explicit. This particular issue is far from settled in Philadelphia, for the civic and official forces involved are both various and vested.

IV

The Planning Commission

P L A N N I N G Commission has five months in which to assemble the capital budget and program. This is the time of plenary review, of both detailed inquiry and the application of perspective. Yet city planning does not consist in a single discipline or perspective, and the process of review within the Commission reflects distinctive differences between staff divisions and among individuals. The process begins in the staff in April, and some six weeks of staff work ensue before the Commissioners begin hearings in mid-May. The staff of the Planning Commission operates under the Executive Director in three divisions: Land Planning, Comprehensive Planning, and Projects. Of these the second and, chiefly, the third deal with the capital program. The Projects Division is in charge of the "marking u p " stage of capital program review and has to date played the leading role in staff decisions. It is a small division, and its important determinations are made by its two top men. These men are veterans of City careers that began outside the Planning Commission and long before the Home Rule Charter. The Chief of the Projects Division, Charles Pitts, is more closely and continuously in touch with capital programs than anyone else in the Commission. He is in constant contact with the line departments and the City Council. He knows THE

87

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personally the men in the departments who are occupied in conceiving and developing project requests, and he attends all Council hearings on capital budgets plus (as a rule) the Democratic Party Caucuses in which the final product is decided. He is continuously in touch with those deputies of the Finance Director, Managing Director, and Commerce Director who are most concerned with capital programming. When the project forms arrive at the Planning Commission, Pitts will be cognizant of their background, contents, and sources of support. He will further have formed a judgment about what projects each important quarter—the Mayor, Managing Director, Commerce Director, Finance Director, and Council—will "die for." These are the items that the Projects Division recognizes are politically imbedded in the capital budget and "cannot be moved." They amount, ordinarily, to $ 12 or $15 million worth, leaving $ 1 ο to $13 million worth of tax-supported projects to juggle. When the project forms arrive on Pitts' desk, he and his immediate superior review them and begin consideration of their scheduling; then the forms are farmed out for further study to the staff of the Division. A t the same time duplicate forms have gone to the Comprehensive Planning Division, which reviews them for conflicts with the shape that Philadelphia's comprehensive plan is taking. This Division is charged with preparation of a comprehensive plan for the City. T h e effort began in 1952, though the Division has not until recently been fully staffed for it. The plan is promised for i960; and in 1957 a pilot plan was submitted for comment to all City agencies. Meanwhile, some detailed pieces and overall outlines have been developed and employed in capital program review. Review by the Comprehensive Planning Division has become more thorough and persuasive as the plan gains in clarity and body. Prior to 1958 the review was largely a

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formality, but in that year the Division prepared an intensive annotation of the Capital Project Reports, which principals in the Projects Division testify was both useful and influential. Comparison of the Division's recommendations with the final product of the Commission shows, however, that Comprehensive Planning infrequently prevailed in the project deletions it frequently urged on grounds of insufficient departmental justification. It may be, though it is difficult to show, that its positive recommendations carried more weight. 1 In 1959 the Division conducted a less intensive and, on the testimony of participants, less influential review. T h e Projects Division thus continues to play, as it was intended to, the main role in the review. It is possible that the contribution of the Comprehensive Planning Division will increase with publication of the plan. As the plan neared completion, a small staff was set up to connect the plan with the work of the Projects Division. T o date this staff" has studied methods by which the "maps and policy statements" in the plan " c a n be translated into a catalogue of desirable projects," and thence reduced to priorities. 2 It has endeavored to "cost" the comprehensive plan so as to arrive at rough capital program constraints in various fields, and it has devised a tentative conceptual

T h e Division's recommendations were most extensive and least successful in the cases of the Streets Department and the A i r p o r t — t w o agencies occupying strong bargaining positions with administration and Council. 1

2 R o b e r t E. Coughlin, " T h e Capital Programming P r o b l e m , " Journal of the American Institute of Planners, 26 (1960), pp. 39-48. T h e author is the principal member of the staff described here, and the article is a description of the method it has sought to develop. T h e method is of the hierarchical, "suboptimizing" variety, proceeding to derive from the purposes set forth or implied in the plan successively: a) allocations among major functional project groups; b) priorities among narrower sub-groups; and c) among individual projects.

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method of deriving functional and project priorities from the plan. T h e method was yet, however, to be applied in capital program review. Expectations vary significantly as to the eventual role of the comprehensive plan. Planners and City officials generally agree that comprehensive planning (and the review by that Division) can be of negative assistance in capital programming. It can exclude projects that fail to jibe with the planned or expected development of the city. It can indicate the dates when projects may become obsolete or redundant, and it can assist scheduling by helping to integrate the projects of different departments. T h e Planning Commission's staff expects the comprehensive plan to play a still more positive role, though opinions differ on just what that role will be. Some see the plan as the ultimate determinant of investment decisions and as properly crucial today. 1 Others, including the Chief of the Comprehensive Planning Division, are less optimistic. It is difficult, they say, to move from the abstraction and ultimacy of the plan to the concrete and temporal considerations in capital programs. They add that the comprehensive plan will not afford much guidance in the scheduling of projects. The Division has yet to arrive at the kinds of data and decisions that would make economic analysis a definitive guide to city development; and fiscal pressures and policies remain an important, independent determinant. The Commission's Executive Director takes a stronger view and holds out hope for the ultimate determination of capital programs via the comprehensive plan. He conceives of planning and capital programming, however, in terms that are as much individual, fluid and esthetic as they are political, categorical and economic; and he is inclined to emphasize the 1

Ibid.

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planner's "informed j u d g m e n t " and personal identification with the city. T h e preliminary review by the two divisions is followed in early May by staff conferences to prepare for the Commission hearings. There is no cutting or scheduling at this point, b u t there is some "marking u p " of projects for the Commission. Staff conferences continue during the period when the Commission is holding hearings. T h e objective of the staff-work throughout is consensus, achieved through informal consultation and discussion. Nevertheless, staff conferences often bring out characteristic differences in outlook between the two divisions. Some of these differences may be traced to personal background a n d modus operandi. T h e top men in the Projects Division were not formally trained as planners. T h e y are long-time career servants of the City who h a p p e n to smoke cigars a n d who conduct a good deal of their work across the street in City Hall or on the sidewalk area between the City's main buildings. Their probing and continuing City contacts result in an experienced feel for the history of the project requests and for their administrative a n d political relationships. T h e staff of the Comprehensive Planning Division, by contrast, are nearly all under forty. All are professionally trained a n d dedicated, and none have m u c h personal acquaintance or interest in the more traditional agencies of the City's government. Their work is done at their desks and drawing boards. I t follows that the principals of the Projects Division are likely to point to political or administrative aspects of projects that the other division has "missed." Comprehensive Planning is likely to look to long-range guidelines or research and professional conclusions that may be undermined by those projects. T h e r e is also some tendency toward a difference in scope of decision. T h e Projects Division now rarely alters the priorities

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a t t a c h e d b y the departments to their projects, confining itself to interdepartmental

allocations a n d to

scheduling

projects and fitting them to the financial limit. S o m e shifts in priorities result, h o w e v e r ; a n d others are urged in the C o m prehensive P l a n n i n g Division's review. T h u s Projects' e m p h a sis has c o m e to be p l a c e d u p o n fund allocation (to w h i c h its knowledge

of departmental

programs

tributes), while the C o m p r e h e n s i v e

a n d projects

Planning

con-

emphasizes

project review based u p o n land use guidelines for the future. A s the plan develops a n d land use goals (or projections) evolve, there appears to be some tendency, too, for C o m p r e h e n s i v e P l a n n i n g to favor projects related to the physical d e v e l o p m e n t of the city, while Projects sympathizes somewhat w i t h the m o r e traditional fields o f C i t y policy. T h i s marginal difference m a y reflect relative reliance u p o n " c a t e g o r i c a l " as opposed to " d e s c r i p t i v e " criteria of evaluation, each of w h i c h is more persuasive in certain fields. Departmental

liaison

is not confined to the

Projects

Division. T h e Commission's technical advisory committees in certain fields are largely staffed b y the C o m p r e h e n s i v e P l a n ning Division. A t one time such committees w e r e h e a v i l y relied upon in the fields of transportation, recreation, health, a n d welfare. T h e y function today for recreation, health, a n d the Free L i b r a r y . I n each case the committee consists of a g e n c y officials, P l a n n i n g Commission staff, and a few citizens o f private a g e n c y representatives. T o d a y only the recreation committee meets r e g u l a r l y : its subcommittee drafted the recreation plan, a n d it reviews capital p r o g r a m proposals throughout the year. Neither the health nor library c o m mittees are particularly active t o d a y because, it is said, the long-range plans a n d short-run capital p r o g r a m s of the agencies concerned h a v e been basically determined. T o the functional liaison committees there h a v e been a d d e d ad hoc inter-agency committees f o r m e d to d e a l w i t h the

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implementation and implications of certain large projects such as the Food Distribution Center or the Delaware Expressway. T h e Planning Commission is represented on such committees (usually through the Projects Division), and the information this provides is channeled into capital program review. Finally, the comprehensive Planning Division maintains its own informational contacts with the departments through which d a t a and ideas pass in both directions. Some departmental planning and projects have been stimulated through these connections, and departmental experience a n d expertise has been brought to bear on comprehensive planning. T h e Commission's preliminary stafT work thus draws upon the Finance Director's forms, the liaison of the Projects Division, the guidelines of comprehensive planning, and some institutionalized inter-agency advice. It also rests upon a growing familiarity, since most of the project requests recur again a n d again. T h e next stage is the hearings of the Planning Commission itself, at which departments appear to defend their proposals. These begin in m i d - M a y and continue, as a rule, into J u n e . Prior to the hearings no decisions have been taken. Nor do the hearings go far toward decision; the Commissioners do not strike m u c h f r o m the departmental agenda. But the lines and tones of their questioning serve to indicate their interests a n d attitudes to the departments and the Commission staff. At the close of the hearings the Commissioners make a tentative allocation of funds among the departments for the next year's capital budget. T h e j o b of scheduling funds through the sixyear program is then returned to the staff, which proceeds on the basis of occasional directives plus indications of the Commissioners' thinking revealed during and after the hearings. Most observers agree that the direct influence of the Commission on capital budgets and programs has declined

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in recent years. A close observer of the hearings has c h a r a c terized the Commissioners' participation as " u n e v e n . " S o m e Commissioners h a v e tended simply to pursue particular interests or to press for pet projects. A t t e n d a n c e at the hearings is said to h a v e been good in the past, but ex officio C o m missioners report the regular Commissioners irregular in attendance today. G e n e r a l l y , it is said, the three ex officio members will h a v e their w a y if they are agreed a m o n g themselves. 1 T h e C h a i r m e n of the P l a n n i n g Commission, however, h a v e been able, hard-working, and influential. T h e Commission's first C h a i r m a n was a prominent banker from an old Philadelphia family. H e presided over an effective Commission w h i c h found its effectiveness increased b y the Charter of 1951. T h e C h a i r m a n from 1956 through 1958 was A l b e r t M . Greenfield, a self-made m a n , a powerful personality, and Philadelphia's leading realtor. Greenfield is said to h a v e felt that b y virtue of his b a c k g r o u n d he knew as m u c h about the city and its physical development as the official " e x p e r t s , " and he held strong views on a n u m b e r of projects and policies. H e did, however, make use of the Commission's staff (though occasionally ignoring its a d v i c e ) ; and he did believe in city planning. H e

1 As to the decline in Commissioners' participation, informants who attend the closed hearings are generally agreed. O n e member of the Commission staff comments, however, that " . . . Commission members spend more time in meetings for all planning purposes than they did in the earlier years. . . . If your statement is valid it may be explained b y : (1) Early Commissions contained members who b y their personality and occupation were more interested in capital programming problems. (2) In the early years the Executive Director was new on the job. As his competence and that of his staff has increased so has the Commission's confidence, and the Commission has properly delegated more responsibility. (3) T h e Commission . . . has built up knowledge of projects proposed, most of which by the nature of programming reappear for several years." (Our emphasis.)

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not infrequently argued with the ex officio Commissioners and sometimes won the arguments; when he found the ex officio members divided, he often played a role ranging from mediation to decision. H e managed to promote or forestall some projects on which he felt strongly, and he is said to have held o f f t h e City's industrial land development policy for three years (though he ultimately accepted it). T h e present Chairman is G. Holmes Perkins, a professional planner and designer, who was Dean of the University of Pennsylvania's School of Fine Arts. While he was not drawn from the city's business leadership, it can be argued that planning no longer needs to be " s o l d " or socially supported in Philadelphia. T h e Commission's Chairmen, then, have regularly played an important role in capital programming. Most observers feel, however, that the Commission lacks the strength of membership that it had in its early years. This fact, together with administrative developments described in the preceding chapter, has resulted in some decline in the Commissioners' impact on capital programs. Y e t the Commission as a body still has an influence. Several Commissioners are well informed and active in particular areas of personal interest. T h e ex officio Commissioners have not always been in agreement; in the early years the M a n a g i n g Director and Commerce Director often disagreed over allocations to their agencies, and the Finance Director sometimes opposed the views of the spending agencies. In these situations the Commission was able not only to mediate but also to advance new perspectives and actively make decisions. This is still the case when the cabinet members disagree; but we saw in the previous chapter that these disagreements are diminishing. T h e Commissioners' hearings are followed by further staff work and conferences, consuming about six months. During this period the staff begins to shave down the capital budget and stretch out the capital program. M u c h of the shaving is

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left to the departments themselves, but there are some points at which the Commission staff substitutes its own views. These occasions result largely from recommendations of the Comprehensive Planning Division or from the overview achieved in the Commission, by which the staff is enabled to integrate the projects of a number of departments. Generally such decisions result in deferral rather than elimination of projects. Gradually the easier and more obvious decisions give way to more difficult decisions. The staff participation narrows until, at the end, it reduces as a rule to four: the Executive Director, the two principals of the Projects Division, and the Chief of Comprehensive Planning. In this process the departments are consulted and occasionally recalled for further hearings. Some decisions are normally left for the Commission, and the Chairman is typically consulted from time to time. Final Commission approval, with occasional changes in decision, is the last step. There are two aspects of capital program review in the Planning Commission: the institutional and the intellectual. Of the first, we conclude that the role of the Commission per se has declined somewhat in relation to the staff and the City administration; that the staff review is so organized as to balance long-range land use planning with considerations of politics and administration; and that the Comprehensive Planning Division has made some progress toward an impact upon capital programming and is now in a position to do more. A second aspect is that of the criteria for decision. In broad terms these are reflected in the different outlooks of the two staff divisions and the individual concerns of the Commissioners. These differences have been detailed above, but it should be emphasized that agreement is readily reached in the staff and the Commission and that a common perspective has tended to develop over the years. In precise and categorical

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terms, criteria hardly exist, though the comprehensive plan and subsequent research may be expected to provide at least suggestions along this line. T h e Commission's Executive Director, who has had considerable influence on City policy, hopes that the comprehensive plan will govern capital programming. He adds, however, that the plan must rest as much upon "informed j u d g m e n t " and its authors' image of the city as on academic analysis. T h e reviewing process in the Planning Commission is intellectually informed and institutionally open and diverse. It is far more a matter of study, experience, and application than of formulae.

P.M.I.-D

V

The Council

P H I L A D E L P H I A T O D A Y is basically a one-party city. General elections in most Councilmanic districts are not close, and primary elections are normally controlled by the Democratic "organization." This situation has obtained since the party overturn that accomplished the 1951 Charter reform, though the composition of Council has changed somewhat since that time. "Good government" observers feel that the quality has declined, for nearly all Democratic Councilmen today are in good standing in the "organization" with which the ClarkDilworth "reform" administrations have frequently been at odds. Council's decisions are effectively taken in the Democratic caucus, which in turn is effectively led by the President of City Council and one or two other loyal organization men. The result is a Council no longer predisposed to support the administration automatically, though both sides must perforce work together to make a Democratic record. The Home Rule Charter provides for strong mayor government. Council probably has less budgetary authority than any other metropolitan legislature. The operating budget is a lump-sum budget, though Council has strenuously attempted to cope with it by exacting detailed supporting documents and promises of performance for subsequent reference and review. Administrators note that Council con-

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stantly attempts to narrow their discretion by requiring commitments that nearly amount to line-item justifications. Since the commitments are sought for performance (rather than expenditure), there is some trend toward informal performance budgeting. Councilmen, for their part, feel that the administration is inclined to pressure many items through on rather spurious grounds of necessity, that it hides a number of luxuries among the necessaries, and that it does not consistently honor commitments to performance (or lack of performance). Commitments to withhold performance sometimes arise from the City's use of a quadrennial budget. Revenue and expenditure patterns are established at the beginning of a quadrennium to balance the budget over that period and obviate more frequent tax adjustments. T h e usual practice is to budget a surplus in the early years and to end the fourth year with a zero balance. 1 While the practice presumably assists flexible long-term financing and better long-term planning, it further confines Council's fiscal and budgetary powers. It has probably encouraged the tendency to exact administrative commitments. Council appears more interested in the operating budget than in the capital budget and program. O n e knowledgeable Councilman estimates that 80 per cent of appropriations' time is devoted to the operating budget, though amendments to the capital budget receive proportionately more attention. Council's small budget staff was mainly designed to dig into operating budgets, but it also gives some attention to the capital budget and program. Council must pass the capital budget and program by December. Hearings begin in October. Line items in the 1 See B M R - P E L , Philadelphia's Operating Budget Practice—the versus the Quadrennial Budget (Philadelphia, 1956).

Annual

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budget and program are discussed striatum; and each agency is heard, some briefly and some for a day or more. The President of Council and the Chairman of its Finance Committee clearly control the hearings, but individual Councilmen are given opportunity to ask questions and are encouraged in inquiries about projects affecting their districts. While the rank-and-file concern themselves with the progress of particular items through the capital program, the leadership normally attends to project cost and justification. The administrative agencies receive varying treatment, but some of the questioning is intense. Most individual budget items require some justification, and forward programs are discussed in varying detail. Departmental commissioners are usually accompanied on the stand by the Deputy Managing Director, who can thus speak for the administration and, perhaps, forestall departmental deals with Council. Officials from the Planning Commission and Finance Director's office also attend. They rarely testify, but they acquaint themselves with the attitudes of Council and help safeguard their agency interests. Council also hears from the civic and neighborhood organizations. The annual review of the capital program by the Citizens' Council on City Planning reaches Council concurrently with the official documents. It provides a basis for much of the questioning; agency representatives know that they must normally essay convincing rebuttals to the CCCP's judgments if they are to escape trouble. Council also hears from the Health and Welfare Council (always by letter and sometimes by direct testimony) and from the Citizens' Budget Committee. There is ample communication from neighborhood organizations, businessmen, and other individuals who support or oppose particular projects. In other cases, neighborhood meetings and soundings may have been part of the planning process of the department; this is often

The Council

ΙΟΙ

the case with the Recreation Department, for example, the projects of which are usually popular. Council's hearings are followed in late November by the Democratic Party caucus, the real locus of Council decision. At this stage, which may last for hours a n d into the wee hours, the capital budget and program are put together. Bargaining and negotiation are the order of the night both within Council and between that body and the administration. Councilmen (particularly district Councilmen) bargain for the early placement of popular projects in the program, a n d it is reported that the leadership is careful to see that they are adequately taken care of. Yet Councilmen must also accept deferrals of desired projects in order to accommodate exigent items and large expenditures for the City as a whole (for example, airport improvements); a n d the leadership is strong enough to articulate " b a l a n c e d " budgets a n d programs, which facilitates relations with the administration. Before the session is over, key officials will generally have been called in to provide information—these include the principals of the Planning Commission's Projects Division a n d the Chief of the Capital Budget Section of the Finance Director's Budget Bureau. Toward the end, when the product is pretty well put together, the caucus customarily consults the Mayor. It is reported that if the Mayor strongly objects to the scheduling of certain projects or insists on inclusion of others the caucus will nearly always accommodate him. From time to time it cuts or defers items to "teach the Mayor a lesson"— items that will usually be restored if the M a y o r applies strong pressure. In the past the C h a i r m a n of the Planning Commission also exerted pressure on occasion, a n d this pressure is said to have been effective because of his financial role in the Democratic Party. Some observers of City politics have predicted a decline in Planning Commission influence in Council with the change in Commission chairmen that occurred in

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1958. So far as Council and administration are concerned, the process is one of give and take, with the administration usually able to count upon getting what it will press for strongly, b u t — presumably—so long as it does not press for too m a n y items and so long as it has correctly anticipated what Council will not take. Following the Democratic caucus, Council takes formal action on the capital budget and program, which action is purely formal. T h e foregoing account of Council's action suggests several points that deserve amplification. (1) T h e level of interest and information on capital programs in Council is high and Council's review is far from cavalier. But " C o u n c i l " in this statement is largely an expression for its leadership and the extent of information and interest varies among Councilmen. Three or four are extremely well informed upon the politics, planning, administration, and financing of capital programs and upon the projects themselves; several others are apparently untutored in anything but a few local projects, and the rest of the members stand or fall somewhere between the two extremes. O n e of Council's problems to date has been a lack of staff resources for capital program review; another has been a lack of widespread Councilmanic interest in projects lacking in political appeal. T h e result has been careful attention to politically sensitive items, balanced by decisions of the leadership on the remainder of budgets and programs and by administrative initiatives. (2) In a number of cases Council will not be making its first acquaintance with a project at the hearings. Some departments will have sounded Council or individual Councilmen while a project is in the departmental planning stage; the Mayor will have discussed a few projects at meetings with Councilmen; and constituent organizations will, of course, have registered their opinions.

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(3) Council, or Councilmen, from time to time initiate projects themselves. Some recreation projects and street and highway projects have been so conceived, some of them in liaison with constituency organizations. It is said that Council itself worked out the final form of the large Delaware Expressway project from the conflicting proposals of the Planning Commission and the Streets Department. Projects initiated in Council usually go directly into the coming capital budget after the required submission to the Planning Commission; but they are sometimes amended into the current capital budget during the executory period or are placed down the line in the program. Council-initiated projects are, however, few in number. (4) Some departments will have easier sledding than others in Council. O n e factor, of course, is the popularity of the department's projects. While the Recreation Department always faces deferral of a number of projects to make way for " l u m p y " and urgent items, the total number of its projects is large; and it meets with a favorable reception in Council. T h e reputation of a department for efficiency and, to a lesser extent, for effective programming, may affect its progress in Council. Council keeps an eye on project execution, and dilatory departments generally find their projects deferred more often than other departments. Some departmental commissioners maintain especially close liaison with Council; and if their projects are popular, such liaison may undercut the capital programs of the administration and Planning Commission to some extent. T h e Streets Department has traditionally done well in Council because of the mutual interest of Councilmen and the Commissioner in local projects and because of the political "visibility" of the Department's projects. O n e line in the Streets Department's capital budget (for " G r a d i n g and New Paving") simply consists in one large lump sum, and Councilmen assist the Streets Commissioner in the annual specification of its content.

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(5) Relations between Council and the Planning Commission are generally good. Most Councilmen evidence respect for the Commission's review. Yet the Commission's decisions are not sacrosanct; and Council has felt free to amend them, especially in the rescheduling of politically sensitive projects. Councilmen also intervene with departments and the Commission respecting site selections, particularly for recreation centers, health centers, and fire stations. Site selection is jealously regarded by the Planning Commission staff as vital to its competence in land use planning. Generally the Commission (rather more than the departments) stands firm against locational changes by Council; but it does entertain Councilmanic suggestions earlier in the process, and some of the suggestions are reported to be good ones. Councilmen defend scheduling changes and locational concerns as a normal part of their representative function. The Planning Commission, for its part, has recognized the political interest of Councilmen in certain types of projects and has been willing to defer on scheduling changes respecting them; in fact, as we have seen, the Proj ects Division makes some effort to anticipate Council's attitudes in this respect. (6) For the most part, Council is not in on administration intentions respecting the capital budget and program at an early stage. The Mayor holds a monthly luncheon meeting with Council (which is, in fact, passed over from time to time), and discussion may touch on the capital program together with the other subjects; but there is no other formal attempt at prior liaison respecting the capital program. No doubt this is partly due to the late date at which many administrative decisions are made, and the lack (until recently) of any systematic administration effort at explicit or overall policy decisions respecting capital programs. 1 1

One Councilman who is more active and better informed than most (and closer than most to the administration) discussed the Mayor's role

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The general view of Council appears to be one of independence and aloofness from the administration rather than one of cooperation in a common cause. Probably this attitude results in part from political differences between the "organization" forces dominant in Council and the forces of "reform" in the administration. Probably it results as well from the normal institutional rivalry between the separated "powers" and the constant administration endeavor to maintain the independence of a "strong mayor" by dealing with Council at arm's length. There is no question that the initiative in capital programming lies with the administration; but the practice of the administration has been to endeavor to anticipate Council where possible and to leave Council a relatively free hand in certain areas—for example, the scheduling (and occasionally the siting) of recreation projects—while putting its weight behind projects of less local or direct appeal. On occasion the administration takes a licking. Thus, in 1958 it badly wanted a $10 million municipal administration building and, in order to obtain it in the 1959 Capital Budget, proposed both to breach the $25 million financial ceiling and to defer a number of other projects including several recreation centers.1 The proposal antagonized Council on two grounds: breaching the limit struck at Council's rather deep sense of

vis-a-vis Council in the following terms. It was not clear, he felt, that the Mayor had a comprehensive program or an explicit pattern of emphasis. But, he said, it did appear to him that the Mayor pressed hardest with Council for those projects that were of a city-wide and not of obvious or direct interest, and that he seemed to feel that there was less need to press for projects in such popular fields as welfare or recreation. 1 T h e proposed breaching of the limit was defended on the ground that long-run savings in office rents would make up for it. T h e limit was to be exceeded by roughly $6 million, and other projects in the amount of roughly 84 million were to be deferred. T h e proposal is a good example pf a late but "urgent" administration decision.

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fiscal conservatism and at the limit which Council had formally adopted; and deferring the recreation centers and other projects just before an election year disturbed Councilmen who were sensible of the projects' popularity and who felt that they had already yielded too many such deferrals to accommodate administration projects. Accordingly, Council sent the entire capital program back to the Planning Commission with instructions to revise it. Ultimately the administration building was "stretched o u t " over a long period, a few other projects were deferred, and the budget remained within the limit. O n the occasion of Council's return of the capital program to the Planning Commission, one Councilman is reported to have said: " W e have community meetings involving the city commissioners and the district councilmen and we promised the people these new playgrounds or bridges. . . . Then, without a word to us, the City Planning Commission throws them out." 1 Although it was the Planning Commission that "took the r a p " in this case, it was the administration that had, late in the game, developed the project and pressed its extreme urgency on both Planning Commission and Council. In the course of this episode Council enjoined the Planning Commission against so freely altering the scheduling set forth in previous capital programs; and the result, in 1959, was stricter adherence by the administration and Commission to the scheduling in the 1959-1964 Capital Program in their preparation of the succeeding program. T h e institutional aspects of Council's treatment of the capital program having been described, we now turn to some generalizations about the perspective, orientations, and attitudes of Council. Council's perspective is "political" in the 1

Philadelphia Inquirer, October 25, 1958, p. 18.

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107

sense that it is less interested than other City quarters in abstract criteria for investment decisions. It is most apt to re-order the scheduling of projects rather than the substance of programs; and Councilmen state that scheduling is properly, in their view, a matter of what people want at the moment. By comparison with other sections of the government, Council's view is short-run. It evidences more interest in next year's capital budget than in the six-year capital program and, respecting the program, more interest in early years than in the far horizons. Interest in the most remote two or three years of programs is faint indeed, save for particular (usually local) projects and the weather eye that Councilmen keep on election years. Even election year programs, however, receive little attention until they are imminent; and Councilmen appear to have a sense of unreality about the later years of the program. Generalization is rife in City circles reporting the types of capital projects that are popular in Council. It is said, for example, that project popularity is a matter of project "visibility"—that is, that fire stations outrank storm sewers— but such a generalization seems a bit too simple. The physical attributes of projects are doubtless of importance, primarily in symbolizing either local or municipal progress; but functional attributes would appear to loom larger. Thus projects in the fields of health, welfare, and recreation have, to date, had more support in Council than projects of the "economic base" variety. Councilmen appear to have felt that most political mileage could be logged in the traditional "welfare state" fields; and significantly, in the 1957 political campaign, Democratic candidates stressed the record of their administrations in just such projects and directions of development. Councilmen still favor such projects, but perhaps less unqualifiedly. There seems to be a recognition—especially among the leadership and Councilmen-at-large—that the City is "catching u p " in the welfare field and may be lagging

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competitively in some matters of physical plant, terminal and transportation facilities, and other projects with potential employment and fiscal pay-offs. This attitude is reinforced by the fiscal conservatism of the leadership and its response to tax-conscious civic organizations. It may be, therefore, that the politics of improvement is undergoing a sea-change and that —so long as a modicum of "welfare" projects is supplied— support will build in Council for some shift in the emphasis of capital programs, particularly if pressure mounts from opinion leaders and citizen organizations. Improvement in some basic City facilities has regularly been popular; for example, the basic street repairs in capital budgets. Storm flood relief is popular in the limited areas affected, but the dramatic capital cost of such projects leaves the leadership and representatives of other areas indifferent at best. In fact, save for a few items, there is not unanimity among Councilmen on the question of which projects are most popular or politically sensitive. All agree that recreation centers, health centers, welfare facilities for relief, juvenile delinquents, and the aged are popular, and most would add fire and police stations. Nearly all agree that libraries are neither popular nor unpopular. Few projects are downright unpopular in principle though some cause political problems in practice—these include redevelopment projects or major expressways that displace local populations, and the public housing component in redevelopment projects (which, however, does not appear in capital programs). To conclude: no definite scale of project popularity seems possible. The safest statement is that "welfare" projects have traditionally ranked high (they appear to provide widespread public gratification at low project cost); but Council's concern for the total level of capital budgets is mounting. In addition to the active perspectives just discussed, inertia plays its perhaps inevitable role in Council decisions. There is a

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tendency—common in the budget reviews of most legislative bodies—to be guided in considerable measure by the figure that an agency obtained the previous year; and to this tendency is added the prescriptive force of the capital program backed up by constituency pressures. Councilmen state that the tendency to abide by previous budgets is more marked in the operating budget than in the capital budget but that, in the absence of other demands, it affects the capital budget as well. The difficulty with capital budgets is that their "lumpiness" virtually requires departure from precedent, necessitating cuts in one agency to accommodate increases for another; and this is especially the case when the administration's large and urgent items must be accommodated. Both inertia and precedent retain some importance, however; and Councilmen state that when agency programs involving several similar projects are once adopted and the first one budgeted, the remaining projects are likely to follow as a matter of course, albeit with some deferrals. An example is the Health Department's program for construction of ten district health centers —most observers predict that Council will strongly support all ten since a beginning has been made. One reason for this is simply that acceptance of the principle is the big decision; another is that pressure for the remaining projects in the capital program comes to bear from those who want them, and district Councilmen will press for construction of facilities in their district. Conclusion. Council's role in capital programming is predominantly one of review rather than of initiative, and of setting broad limits to administration and Planning Commission action. Council does not drastically amend the capital budget and program, though its review has been somewhat less inhibited in recent years. Most revisions in Council relate to scheduling—projects are moved forward or backward or spread

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over a longer period of time to accommodate more capital activity. Though Council's attention is focused on the budget, amendments to that document necessarily entail amendments to the program as well. Council adds few new projects and, as a rule, does not delete projects entirely—it simply postpones them. Council also cuts the dollar level of capital budgets. For example, the 1957 Capital Budget was cut nearly 10 per cent; the 1958 Capital Budget by roughly 6 per cent. 1 In each year nearly every department was cut (a few with small programs remaining unchanged). Because of later amendments and delays in budget execution, it seems unlikely that Council's reductions really curb administrative accomplishment. T o date, despite some tendency toward increasing freedom of amendment, Council's alterations of capital budgets and programs have been marginal from the standpoint of policy or accomplishment in capital improvements. T h e Mayor, when determined, can normally maintain the integrity in Council of those parts of the capital program which he seriously takes as "his;" and Council has placed more reliance upon the operating budget than the capital budget as a means of legislative control of administration. This situation appears to have obtained since 1952. Though it may, in the long-run, turn out to reflect a temporary political balance of power (a problem beyond our purview), the process of capital programming itself provides for administrative initiative and, given a modicum of public support, casts a heavy effort and responsi-

T h e 1957 C a p i t a l Program w a s c u t b y a b o u t $26,000,000 ( f r o m a b o u t $606,000,000); the 1958 C a p i t a l P r o g r a m w a s cut b y a b o u t S11,000,000 (from a b o u t $595,000,000). C u t s in the p r o g r a m are smaller p e r c e n t a g e s than those in the b u d g e t . T h i s reflects in p a r t the stretching out of projects to a l l o w cuts in the b u d g e t ; it m a y also reflect less C o u n c i l attention to the later years of the p r o g r a m . I n recent years the later years of capital p r o g r a m s h a v e b e e n q u i t e full.

1

The Council

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bility on the legislative body that attempts seriously to impede it. T h e broad limits that Council sets to the program and budget reflect its own major interests and competence. These are principally: (ι) certain politically sensitive functions or programs (for example, recreation, public housing); (2) neighborhood and regional interests reflected in Council's structure of representation; (3) questions in which the institutional interests of the legislative body are particularly involved (for example, water rates, taxes and financial policy); and, related to these, (4) a policy of fiscal conservatism. The broader implications of Council's role for democratic values and "rational" decision come in for analysis in Chapter I X .

VI siöjtffe Citizen

Organizations

As THE previous chapter has indicated, political organization in Philadelphia is strong; and the city is a far cry from "government by civic association." Nevertheless, policy in the metropolis is made and administered in a variegated context of group activity, ranging from specialized occupational groups to neighborhood associations to the type of organization styled "civic." Philadelphia is probably as pluralistic as the average American city, but it has been argued that there is more organized citizen support for planning and physical improvements in Philadelphia than elsewhere. 1 We do not know whether this is so, but there is some reason to believe that a City administration in dubious alliance with the dominant political "organization" has turned to other organizations for aid and support. In this chapter we describe the activities of five organizations and attempt to appraise their influence upon capital program decisions. In some respects our selection is an arbitrary one since many neighborhood, regional and economically segmental groups touch capital programming decisions from time to time. The organizations dealt with here are city-wide in scope and are in general committed to some 1

Aaron Levine, "Philadelphia Story: A New Look," New York Times Magazine, July 14, 1957, p. 8 ff. 112

Citizen Organizations generous modicum of public capital improvements and of planning and professionalism in public decision-making. Some readers may feel that this sets them apart as middle-class, commercially oriented groups, not representative of all the organizations affected by or affecting capital programming. T w o reasons may, however, be advanced in support of our selection. For one thing, these are the only organizations that are constantly in touch with all or significant aspects of Philadelphia's capital program—so much so that their review, criticism, and promotional efforts are factors of more-or-less constant significance in the process. Secondly, while these organizations are in broad agreement on public improvements and "rationality" in public decisions, they are not in agreement on the substance of capital programs. They represent different economic, social, and ideological commitments which are, as it happens, common commitments in American city politics today. 1 With only occasional exceptions, the organizations studied in this chapter are not invested with governmental authority, though some of them maintain consultative relations with City departments. For the most part, then, we will not be describing direct private participation in public administration by citizens or elites. Nor is this chapter an effort to depict in action the " p o w e r structure" of Philadelphia. 2 It is simply 1

For a general discussion, see Charles R . Adrian, Governing Urban America (New York, 1955), Chs. I I I , V . * We have enough reservations about the "power structure" concept that we eschew it here. For representative critical literature see: Herbert Kaufman and Victor Jones, " T h e Mystery of Power," Public Administration Review, 14 (1954), 205; Robert Schulze and Leonard Blumberg, " T h e Determination of Local Power Elites," American Journal of Sociology, 63 (1957), 2 9 2 ; Robert A. Dahl, " A Critique of Ruling Elite Theories," American Political Science Review, 52 (1958), 4 6 3 ; Nelson W . Polsby, " T h e Sociology of Community Power: A Reassessment," 37 (1959), Social Forces 2 3 2 .

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intended to complete our description of the major elements in the milieu and the process of capital programming. T H E C I T I Z E N S ' C O U N C I L ON C I T Y P L A N N I N G . A S "planning," governmental integration, and similar matters of doctrine and technique have claimed increasing metropolitan attention, citizen groups to support these concerns have come to claim a place among those organizations arguing for political and administrative reform, fiscal consciousness, or particular public functions. Philadelphia's Citizens' Council on City Planning (CCCP) was one of the first of such organizations. Formally a federation of private groups and institutions (plus some individual members), it seeks through group liaison, local meetings, lay committees, and its small staff to link the "grass roots" and the business and professional community in support of planning and physical improvements.

The informal origins of C C C P date from 1940. In that year a group of younger Philadelphia business and professional men began a movement for a city planning commission. Beside efforts at publicity and nuclear organization, these men drafted an ordinance for an advisory planning commission which was introduced in Council in 1941. Lack of enthusiasm in Council led to further organizational effort; the original citizen group expanded under the title of City Policy Committee. This organization worked for the support and testimony before Council ofother organizations. It is reported that, though both the Real Estate Board and the Urban Land Institute opposed the project, there was some independent support from realtors and a good deal from businessmen and citizen groups. The hearing on the ordinance represented an organizational triumph for the City Policy Committee, which was followed by passage of the ordinance and institution of a planning commission. The City Policy Committee then decided to continue. It

Citizen Organizations

I15

incorporated under a charter providing that the base of the organization was in its constituent groups and organizations acting through delegates voting in the name of the groups and, on important issues, submitting the issues to group referenda. T h e purpose of the organization was to provide citizen backing for city planning; its chief financial backing came from the Community Chest (the City Policy Committee had been largely underwritten by the Housing Association). By all accounts C C C P ' s organization functioned in the manner prescribed by charter and was, in fact, broadly representative of existing citizen organizations. It was a vigorous organization with a core of dedicated members and a good sense of public relations, and it did get city planning accepted and used within existing political and charter limitations. T h e year 1947 marked some change in the organization's character, for in that year Community Chest backing was lost in an entanglement in the election campaign. This thrust C C C P b a c k on the financial support of local business which, in turn, resulted in some loss of its group-representative character to business representation. A lapse in activity ensued; but about the time of the new Charter, C C C P took a new lease on life. It found a formula for continuance in a series of luncheon meetings of interested business and professional people, large forums for the discussion of particular issues, and committees concerned with particular fields of policy. In all this history, promotion of the contributions of the city planner was a constant policy mediating the concerns of both "boomers" and " t a x p a y e r s " in the work of the organization. T o d a y C C C P consists of more than 160 member organizations and of several hundred individuals. T h e member organizations range from local to city-wide, from altruistic to commercial, professional, and vocational. They are active in C C C P in widely varying degree, but most send delegates to luncheon meetings for discussion of problems of City policy

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and planning; and the delegates elect a board of directors. The organization operates on an annual budget of about $40,000, of which roughly $25,000 derives from corporate contributions. The current president has described its functions as "interpreting to the citizens the programs for the physical improvement of Philadelphia and providing the governmental agencies with an unbiased, independent citizen viewpoint on all major planning proposals. . . , " 1 Besides the stimulation and coordination of member organizations, the "town meeting" (that is, neighborhood meeting) device has been extensively employed to publicize improvement plans, to tap neighborhood attitudes, and to provide neighborhood leadership in physical improvements ranging from outright land clearance to recreation projects and private clean-up and conservation efforts. C C C P has often held membership on governmental advisory committees dealing with physical improvement. It has organized and sponsored (usually with outside financial assistance) occasional exhibits to dramatize physical improvement in the City; such promotional work tends to stress the wholesale and symbolic aspects of physical development, such as the Penn Center development and large redevelopment projects. Through a series of committees on such problems as zoning, public housing, community relations, transportation, and comprehensive planning, C C C P reviews City policy and issues periodic recommendations. For the most part, C C C P ' s subject-matter committees are staffed by business and professional people and experts rather than the "grass roots." But the "grass roots" community relations program is a means of activating and tapping local sentiment as well as of popularizing city development, and the 1

C C C P Annual Report, 1956-57, p. 3. T h e Report gives a list of member organizations and a financial report.

Citizen Organizations

ι1 η

data and recommendations of the "down town" committees are available to the affiliates through their delegates and the neighborhood meetings. The capital budget and program form a natural focus for C C C P . Since 1953 its Capital Improvements Committee has conducted an annual review of the capital budget and, since 1957, of the capital program as well. The Capital Improvements Committee is perhaps C C C P ' s most high-powered committee; its nearly thirty members are a good cross section of the city's younger business and professional leadership and include some professional planners and civil engineers. Nearly all members of the committee are individual members of C C C P rather than the delegates of member organizations; some of them joined C C C P when asked to serve on this committee. Like most of C C C P ' s committees, then, this one mobilizes influential opinion and professional energies. While in this sense the committee is "representative," it cannot be said to represent the grass roots; and in view of the background of its membership, it cannot represent all areas or citizen interests in the City. 1 Its work, moreover, is largely independent of the rest of the work—and especially the community relations program—of C C C P , oriented more toward City administration and especially Council than toward the public-at-large or the neighborhoods. During its first four years the C C C P review was carried out in cooperation with the Planning Commission. The Commission supplied project data and its own preliminary recommendations; C C C P reviewed these and returned its review to the Commission. This practice appears to have produced some marginal influence on the Commission's conclusions, 1

A staff" member of the Health and Welfare Council—more decidedly a "grass roots" organization—referred to the Capital Improvements Committee as a "down town" (i.e., business-minded) group.

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but it also appears to have engendered some irritation within the Commission and its staff". In any event, since 1956 the review has been conducted independently. Also in 1956 C C C P for the first time obtained access (from the Planning Commission) to the original project requests and justifications of the departments. Although the Public Improvements Committee still submits a preliminary report on its review to the Planning Commission, and later to the Mayor, the review today is aimed chiefly at Council and is not available generally until October 1. The review is not without effect in Council, and numerous citizen groups have come to look to it for guidance. Its general orientation is perhaps best described in the Public Improvements Committee's words: T h e problem is to consider how each project fits into the ongoing program of the particular department, how essential the need [JJC] is for the project, and how the cost of the project affects the City's financial structure. 1

One would conclude from this statement, and it appears to be the case, that there is no conscious programmatic or categorical emphasis upon, for example, "welfare," "economic base," or other types of projects. Though some attention is paid to the regional distribution of projects, there is no explicit emphasis upon regional parity. Each project is considered "on its merits" as measured by the standards in the statement above. Ultimately, the process results in a ranking of projects in four categories: essential, desirable, acceptable, and deferable. These categories are the heart of C C C P ' s review, and are defined as follows:

Analysis of Proposed 1358 Capital Budget and Capital Program (First D r a f t : Citizens C o u n c i l on C i t y Planning, O c t o b e r 1, 1957.)

1

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Essential. Projects which are required to complete or make fully usable a major public improvement; or to remedy a condition dangerous to the health and welfare of the public; or to provide facilities for a critically needed community program. Desirable. Projects which would benefit the community; are considered proper facilities for a large progressive community in competition with other cities; and whose validity of planning and timing have been established. Acceptable. Projects which are adequately planned, but not absolutely required by the community if budget reductions are necessary. Deferable. Projects which are definitely recommended for postponement or elimination from the Capital Budget or Capital Program since they pose serious questions of community need, planning or timing. 1 T h e C C C P review exemplifies a p y r a m i d i n g process of decision, m o v i n g f r o m individuals to s u b c o m m i t t e e s to p l e n a r y review, a n d developing a n d e m b o d y i n g specialization if not expertise. I t begins, as does t h a t of the P l a n n i n g C o m mission, with receipt of the " C a p i t a l Project R e p o r t s " in early April. C C C P ' s Public I m p r o v e m e n t s C o m m i t t e e a n d T r a n s p o r t a t i o n C o m m i t t e e then divide i n t o s u b c o m m i t t e e s , e a c h of which considers the requests of a n a g e n c y o r d e p a r t m e n t . Initial review of projects o r g r o u p s of projects is assigned to individual subcommittee members. T h e subcommittees interview o n e or m o r e representatives of t h e d e p a r t m e n t s (most often t h e commissioners), a n d they o r their m e m b e r s freq u e n t l y m a k e field trips to p r o j e c t sites. R e p r e s e n t a t i v e s of n e i g h b o r h o o d organizations are h e a r d b y t h e I m p r o v e m e n t s C o m m i t t e e c h a i r m a n a n d C C C P ' s executive d i r e c t o r a n d on occasion by the subcommittees. D e t a i l e d study of projects is

1

Ibid.

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followed by a meeting of minds within the subcommittee, followed in turn by further overview, comparison, a n d meeting of minds by the subcommittee chairmen and, ultimately, by the full Capital Improvements Committee. T h r e e points seem especially significant in this process. O n e is that the subcommittees rely heavily upon the impression created by the department and its representatives. If the d e p a r t m e n t is candid with the subcommittee a n d evidences perspective and detail in its planning, its projects will meet with a better reception. A second point is that, from this point on, few persons study more than a few projects in detail. Each m a n or team considers certain projects and tentatively ranks t h e m on their individual merits and an estimate of the " n e e d " they are designed to meet. T h e third point is, however, that there does appear to be more-or-less tacit agreement on standards for evaluation and comparison throughout the Public Improvements Committee and that the review by subcommittees, their chairmen in conference, and the full committee results, through a simple process of discussion, in a rather ready meeting of minds. C C C P ' s review is thus a committee process. T h e advantages of group discussion and a "shaking d o w n " of points of view are probably well-balanced with individual attention to project detail. Those who serve on the Public Improvements Committee become experienced in the process and knowledgeable of at least some geographical regions and/or City functions together with City finances and administration. T h e y are conscientious, tending to some fiscal conservatism, but they are vitally—and professionally and financially—interested in the future of the City, in its ability to compete, a n d in the more d r a m a t i c as well as routine aspects of City development. T h e y are neither "boomers" nor "aginners," nor are they prepared to accept at face value the justifications of the departments. T h e criteria of evaluation employed by C C C P really reduce

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to two. One, stressed in the review and in the definitions of the four priority ratings, is the adequacy—the program-mindedness and the detail—of planning and the energy of execution in the departments. The other, and crucial, consideration simply amounts to an assessment of "need." For this there are certain broad standards in the descriptions of the rankings: public "health and welfare," completion or fuller effectuation of an existing public facility, the competitive position of the City, and—much less explicit—"benefit (to) the community," or " a critically needed community program." Lacking sharp definitions of "welfare," "benefit," and community " n e e d , " large areas of the capital budget have to be assessed intrinsically in terms of the individual participants' personal knowledge, plus, at times, the Committee's judgment on departmental or City policy. Such judgments are frequently reported in the Committee's printed capital program review and alternative policies are occasionally suggested. In some fields —for example, streets, water—it is easier to show that a particular improvement will forward an "ongoing program" or further effectuate an existing facility. C C C P ' s reviewing process issues in a public report containing, for each item in the capital budget, a brief description and an explanation of C C C P ' s rating, together with some general recommendations. The report on the 1958 Capital Budget, for example, broadly paralleled reports of previous years in its "Recommendations on General Policy" and "Recommendations on Departmental Policy and Procedures." Most of the latter related to substantive policy; the burden of the "general policy" recommendations was as follows: that the departments submit more definite and detailed information regarding project need and justifications; that the Planning Commission require more information regarding the impact of capital outlays on the operating budget; that the operating budget carry more funds for

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maintenance of capital improvements in order to keep deferred maintenance items out of future capital budgets; that the Finance Director more closely examine the capital budget to see whether several types of smaller items might not more properly be included in the operating budget (for example, traffic signals, drinking fountains); and that more consideration be given to joint (interdepartmental) facilities in the interest of economy. Similar recommendations, plus some others more detailed, have been consistently m a d e in past years. C C C P ' s ultimate impact upon capital programs cannot be definitively assessed, but w e can conclude our discussion of the organization's role b y noting three aspects of influence. (1) It seems sensible to distinguish between C C C P ' s influence on the substance of projects and programs a n d its influence on the process of City decision. W i t h respect to the second, C C C P is one of a group of groups concerned with City procedures, perspectives, and cost consciousness. T h e combined effect of these groups is evaluated later in the chapter; but C C C P is the only organization conducting an overall review of capital programs. Its published review includes a critique and commentary on the policies and procedures of the departments, and it would seem that the review and the study upon which it is based is something of a force for departmental rigor, though this is difficult to demonstrate. (2) Influence does not all move in one direction. Since the Public Improvements Committee is anxious to work an influence on official decisions, it needs to appear "construct i v e " in its recommendations—neither highly critical nor seriously out of step with Planning Commission decisions, administration policies, or the temper of Council. It is interesting, too, though not a sure sign of reverse influence, that C C C P has changed its mind on crucial points from time to time. For some years, for example, C C C P reports were critical of

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the Water Department. They urged publication of a longrange plan and of six-year priorities for the water and sewer system, and they recommended a more stringent City scrutiny of Water Department projects. 1 In 1957 the Department proposed a substantial rate increase. This was followed by the critical consultants' studies and the Departmental fall from favor in Council described in Chapter II and by limited circulation of a mimeographed draft of a long-range Departmental plan. C C C P ' s report for 1958 simply commended the Department for producing the plan and urged publication of a "popular version" (which has never been produced). O n the previously urgent question of priorities, it added: The Citizens' Council has confidence in the administrative ability of the present Chief of the Water Department and believes that he can adjust the priority ratings of specific projects within his department according to the best engineering principles. The Citizens' Council believes that the basis for project priorities must continue to be this kind of considered judgment based on managerial factors and technical engineering studies and observations.2 One cannot know for sure, but it seems probable that this mild volte face resulted in part from the persuasiveness of the Department's " p l a n " in arguing the difficulties of long-range planning and in part from a desire to protect the Water Department (and its large role in city development) against Council efforts to stabilize rates by sharp reductions in the Department's capital program justified, in turn, by the critical studies of the Bureau of Municipal Research.

1

See Reports on the Capital Budget and Program, 1956 and 1957,

pp. 10-11 (1956); 13-14 («957)· 1

Report on 1959 Capital Budget and 1959-64 Capital Program, p . 10.

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(3) F i n a l l y , w h a t a b o u t C C C P ' s i n f l u e n c e o n p r o j e c t s a n d p r o g r a m s ? T h e o r g a n i z a t i o n ' s r e v i e w a n d reports m a y e x e r t some s u b s t a n t i v e i n f l u e n c e u p o n s u b s e q u e n t p r o g r a m m i n g in the d e p a r t m e n t s , t h e a d m i n i s t r a t i o n , a n d the P l a n n i n g C o m m i s s i o n ; a n d t h e r e is s o m e t e n t a t i v e e v i d e n c e in o u r interv i e w i n g t h a t this is so. B u t a n y i m m e d i a t e i m p a c t , g i v e n the t i m i n g o f t h e r e v i e w , m u s t b e m a d e in C o u n c i l . A s i m p l e test o f such i m p a c t is e x a m i n a t i o n o f the P l a n n i n g

Commission

r e c o m m e n d a t i o n s listed as " d e f e r a b l e " b y C C C P , plus those projects r e c o m m e n d e d to b e a d d e d to c a p i t a l p r o g r a m s b y the citizen organization.

Comparison

o f these C C C P

recom-

m e n d a t i o n s w i t h C o u n c i l a c t i o n for the 1 9 5 7 , 1958, a n d 1959 c a p i t a l p r o g r a m s r e v e a l s a spotty r e c o r d ; C C C P

recom-

m e n d a t i o n s f o r d e f e r r a l m e t w i t h similar C o u n c i l a c t i o n in a small m i n o r i t y o f cases, a n d a p p r o p r i a t i o n s for " d e f e r a b l e " items w e r e n o t i n f r e q u e n t l y i n c r e a s e d a b o v e t h e a d m i n i s tration's r e q u e s t . R e c o m m e n d a t i o n s for a d d i t i o n s w e r e almost e n t i r e l y i g n o r e d . E v i d e n t l y , C o u n c i l h a s not r e s p o n d e d w i t h e n t h u s i a s m to i n d i c a t i o n s o f " b e a r i s h n e s s " b y C C C P .

In-

spection o f i t e m s r e c o m m e n d e d b y C C C P as " e s s e n t i a l " or " d e s i r a b l e " in c a p i t a l budgets f o r the three years d e m o n s t r a t e s that C o u n c i l h a s i n c l u d e d a p r e p o n d e r a n c e o f t h e m . It m a y be, t h e r e f o r e , t h a t C C C P p r e v a i l s m o r e f r e q u e n t l y in s u p p o r t o f a d m i n i s t r a t i v e a n d o t h e r pressures o n C o u n c i l t h a n it does in o p p o s i t i o n to t h e m . C C C P ' s r e v i e w receives close a t t e n t i o n in C o u n c i l

and

p r o v i d e s a b a s e o f i n f o r m a t i o n a n d c o m m e n t a r y for C o u n c i l manic 1

questions during departmental

hearings.1

Yet

the

Cf. Ch. V above. Councilmen often interrogate the commissioners with the CCCP report in hand. The President of Council stated to us that CCCP's report is used in the Democratic Party caucus at which final Council decisions are taken, and that Councilmen are rather likely to be guided by it if they have not heard a sufficient counter-justification from the departments. Another Councilman stated that, in the absence of

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evidence above must lead to the conclusion that, in the end, Council is most likely to go its own way or the way of the administration or Planning Commission. How this comes about in caucus was described in Chapter V. In the sum of its activities C C C P has provided leadership and salesmanship for city planning and public improvements. It provides backing and goading for rigor in planning and administration, and this backing doubtless has influence in Council as well as in administrative circles. It may be that, if there is a trend toward more Council independence of administration and Planning Commission pressures, the C C C P capital program review will carry more specific influence with Council. But, in this event, it seems possible (witness the about-face on the Water Department) that the balance of forces and interests will result in still more C C C P agreement with administration and Planning Commission. C I T I Z E N S ' B U D G E T C O M M I T T E E . The Citizens' Budget Committee (CBC) is an auxiliary and protege of the Greater Philadelphia Movement (GPM). While of the two CBC is the more active respecting capital programs, the Greater Philadelphia Movement merits mention on three counts: it is without doubt one of Philadelphia's most influential citizen organizations; it is occasionally concerned with capital improvements; and it underwrites the Citizens' Budget Committee. 1 G P M dates from 1948 and had its origins in the concern of a nucleus of Philadelphia businessmen, with what appeared THE

strong constituency considerations, the C C C P report carries great weight with Council and that a high proportion of its recommendations are adopted. Our analysis simply does not square with this statement respecting negative recommendations. 1

For accounts of G P M see: The Christian Science Monitor for November 26, 1956; and James M. Perry, " G P M , " The Philadelphia Sunday Bulletin, July 12, 1959, Sec. 2.

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to them as the by-passing of the city in business a n d industrial location traceable, in turn, to complacency, corruption, or conservatism in City policy. T h e organization today has a prestigeful board of directors drawn from "leading bankers, industrialists, labor representatives, educational leaders, brokers, department store executives, a n d advertising m e n . " 1 Business and industrial auspices have, in fact, been dominant in the organization from the beginning; a n d continuity has been considerable: sixteen of today's thirty-one board members were members of the original board. T h e r e is every evidence that G P M ' s membership is a working membership that takes seriously the organization and its mission. Social scientists debate about the very existence of municipal "power structure," but G P M was founded in the belief that it exists in Philadelphia and that much of it is located in G P M . " W e decided," says one of the founders, " t h a t what we needed was men with power, men who wouldn't have to r u n home to P a p a to get approval of things we decided to d o . " 2 T h o u g h it was conceived to beget City action, G P M conducts itself more as a study group than as an action organization; and much of its considerable influence is routed through personal contacts and media less formal than its periodic public positions and pronouncements. Federal law governing taxfree contributions appears to be a major factor in this modus operandi. Today G P M ' s board of directors meets once a month (the executive committee meets twice a month) for study or discussion of some city or regional problem, often relying on an expert or official speaker to get the meeting started. T h e adjective " G r e a t e r " in the organization's title suggests two principal interests: improvement in the city and a

1

Christian Science Monitor, op. cit.

1

Perry, op. cit.

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regional outlook. In the first sphere GPM, though largely a business organization, has not limited itself to its ultimate goal of commercial and industrial development; welfare, recreational, and esthetic objectives have been seen as valid and instrumental and have received due study and emphasis. GPM's efforts in the second sphere have emphasized the competitive position of the region (as in highway improvements) and matters involving State aid (such as a regional parks system) rather than promotion of metropolitan integration. Since its inception the organization's range of concerns has been broad, including: promotion of the Home Rule Charter, port improvement, highway development, City pensions, water resources, and development of historical areas of the city. Its activities in 1958 included: public opposition to the so-called "shortway" (a main stem east-west highway that would have by-passed the city); study (in part through consultants) with recommendations on the city's "skid row" problem; and study (through a citizen committee) of juvenile delinquency. G P M has not, as a rule, sought specific City policies; it has pointed to problems and backed official action. While many of its concerns entail capital outlay, the organization has not become involved at the level of project priorities; it has simply backed improvement in general and, by its selection of problems for study, indicated areas of interest. The City administration, for its part, has on occasion sought and found G P M support for programs that have been in political trouble. 1 1 Cf. Perry, op. cil.: " T h e cooperation between G P M and the Democratic administration in City Hall has been something of a phenomenon. Most of G P M ' s board are Republicans. (Hardly anyone but Republicans have sufficient community power to be on the board according to Batten [one of the principal founders].) Batten is a Republican. But he believes that G P M reached new peaks in the past three or four years owing to '100 per cent cooperation from Mayor Dilworth.' Batten, who cites difficulties

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Since 1952 G P M has sponsored the Citizens' Budget Committee, and G P M ' s executive director serves C B C in the same capacity. This group, consisting of fifteen members, embodies two interests of G P M : the City's fiscal posture, and the encouragement of younger civic and executive leadership. CBC's hand-picked members thus represent a later generation than does G P M ' s board of directors. In its budgetary studies (including the capital budget and program) C B C comes as close as any local organization to an active "taxpayers" approach. It has concentrated on the fiscal aspects of capital programs and has generally eschewed substantive recommendations about either projects or explicit program emphases. CBC's fiscal study of capital programming has centered on three aspects of the process, which may be briefly reviewed. (ι) The first is the City's financial policy: the ceiling on taxsupported funds and the down-payment practice. C B C claims credit for initiation of the down-payment practice; and it seems clear that the organization was, in fact, crucial in Council's adoption of it, though some maintain that the idea and the initial pressure came from the administration and Planning Commission. 1 In any event, C B C has backed the policy from its beginning, occasionally writing letters to City officials or leaders of Council at times when the City appears to be wavering in its fidelity to the idea. While also continuing to support the financial ceiling, C B C has on several occasions urged that capital budgets be cut below it. (2) Related to the ceiling and to pay-as-you-go is CBC's concern over the impact of capital budget financing on the

with former Mayor Clark, calk Dilworth, 'the best mayor in the history ofPhiladelphia.' " 1

On the disputed history of the policy, see Ch. III.

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future fiscal position of the City and the taxpayer. Almost from its inception, CBC has commissioned annual studies by the Bureau of Municipal Research of the financing pattern of each projected capital program and the future debt service it entails.1 CBC's own review of these studies has frequently been followed by recommendations for reduction in capital budgets based solely on study of City finances, divorced from putative physical "needs" and possible fiscal pay-offs. (3) A third concern of CBC is the planning process itself as a method of fiscal consciousness and control. Since 1954 CBC has asked for a staff unit in the Planning Commission to review project requests for savings in construction and operating costs and has urged a tighter review to the same end in the Budget Bureau of the Office of the Director of Finance. It has sponsored studies by B M R on cost consciousness in the City government, one of which was expressly directed at capital programming. 2 It has urged on the City some of the findings of the C C C P review noted above respecting procedure, planning, and marginal "capital" items in the City's capital programs. The three concerns just discussed comprise a consistent pattern of advocated fiscal restraint. Few persons in the City administration would argue, however, that the program in general is an unreasonable one. In fact, it embodies some objectives—the ceiling on tax-supported funds, a degree (as yet undefined) of pay-as-you-go financing, tighter project justifications and cost estimates—to which City administrators

1 These studies, prepared until 1957 by M r . Leigh H e b b of B M R , have been of a very high order, and have been of considerable use to us in our own study.

* B M R - P E L , Memorandum Report on The Budget Bureau and Instilling Cost Consciousness among Municipal Employees (1956); and, Memorandum on Cost Consciousness on Philadelphia Capital Projects (1957). P.M.I.—Ε

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arc publicly and professionally committed. As a result, CBC is not seen in City circles as a hostile critic; at times, and to some administrators, it is a helpful ally. Nonetheless, the relationship is one of reserve on both sides; for the City is a potential spendthrift, and CBC is a potential Dutch uncle. Two frequent CBC recommendations, moreover, are unlikely to find universal favor in the administration. One is the proposal to institutionalize a cost-conscious project review in the Planning Commission. The other is CBC's periodic proposal to cut the capital budget. Planners and administrators have come to regard a quasi-permanent fiscal ceiling as a necessary cut-off point adding rigor to capital programming, while CBC has regarded it as a more flexible resultant of economic circumstances and of its conservative view of the City's future fiscal position. In addition, CBC has lately tended to press for reductions in those fields that do not immediately enhance the City's tax base or that threaten to compete with private enterprise. Thus CBC becomes involved in one of the central issues in capital programming— that of the emphasis to be placed on the City's "economic base." In its pressure for capital budgetary reductions CBC may have marginally abetted fiscal conservatism in Council, but it has had no specific influence on administrations. While Council, as we have seen, has tended to cut capital budgets somewhat, administrations have not. On most of the rest of its program, CBC's views and those of the current administration are complementary. CBC has not, to date, aimed at broad public impact; it has rather sought to strengthen the hands of the economy-minded within City government. Doubtless its usefulness in policing procedures would be heightened with the advent of an administration that valued professionalism and propriety less highly than does the present one; and this, of course, is a quadrennial possibility.

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Philadelphia's Health and Weifare Council differs significantly from the organizations so far described. It is to some extent an "action" agency. It is more decentralized and closer to the neighborhoods and "grass roots'' than our other organizations, and a major activity of its staff is the stimulation and coordination of neighborhood action. Finally, it is a programmatic agency, less interested in public planning and procedure for their own sake than in promoting programs—both public and private-—in health, welfare, and recreation, plus auxiliary fields. T H E H E A L T H AND W E L F A R E C O U N C I L .

The Health and Welfare Council, Inc. resulted from a merger of similar organizations in Philadelphia and two suburban counties in 1946. An assembly of delegates from member social agencies (public and private), regional and neighborhood organizations, private citizens, and a board of directors and executive committee make overall policy. H W C maintains five functional divisions for the aging, children, health, family, and education and recreation, and four staff services for volunteers, research, information and referral, and public relations. The organization operates on a budget of about $400,000. The important point about the central organization is that it is a planning, coordinating, and facilitating organization, not an organization operating directly in the provision of social services. On frequent occasions it becomes a budgetary organization, involved in the allocation of Community Chest or United Fund monies among "needs" and activities; and a major share of HWC's research program in recent years has been devoted to an effort to explore and define "needs" and criteria for the expenditure of private funds in the welfare field.1 The functional and staff operations are centralized in the ' S e e Health and Welfare Council, Inc., The Resources-Needs Study: Report of the First Phase of the Project (Philadelphia, H W C , Inc., 1956.)

A

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main Philadelphia office, but HWC's basic organization is decentralized in six Areas. Each Area is run by a committee nominated from functional and citizen organizations and lay citizens; each Area office has some professional staff. The major purposes of the Area committees are to " (1) promote the general welfare by studying community needs and resources, (2) develop cooperative planning of health, welfare, and recreational services, and (3) promote social improvements." 1 Representatives of the Area Committees serve on committees of the Philadelphia District in order to provide liaison and integration, and the staff and functional services of the central office are available to the Areas. While the emphasis upon decentralization presents problems, it has been a necessity in one of HWC's major programs—the organization of neighborhoods and stimulation of neighborhood leadership in "social improvement." At the same time, the staff services discussed above present some pressure for centralization. The trend of metropolitan policy, both federal and local, to physical renewal and redevelopment has affected the work of the Health and Welfare Council in two main ways. The Council has steadily increased its emphasis upon "grass roots" organization aimed at prevention of problems in the community rather than at institutional treatment. This emphasis, while antedating the Housing Act of 1949, was heightened by the advent of urban renewal. In consequence, capital program decisions have become of increasing importance to the Council. In its planning for services and its solicitude for neighborhood rehabilitation, HWC finds itself concerned with basic emphases and project priorities in capital programs and takes steps to make its views effective. These two trends in Council activity may be briefly and separately discussed. 1

Health and Welfare Council, Inc., "Sample Committees," Mimeo., 1959.

By-Laws for Area

Citizen

Organizations

I

33

ι . Grass Roots Organization. The encouragement, and sometimes creation, of neighborhood organization has become a major function of H W C ' s area offices. In part this work stems from a twenty-year-old turn in the settlement house tradition toward movement into the neighborhood rather than waiting for the neighborhood to come in; in part it is a logical progression from remedial to preventive operations; and in part it derives from public initiatives. Public initiatives have figured prominently in this picture, and three programs have helped to stimulate grass roots organization. These are adult education, which has brought the Board of Education into the encouragement of community organizations; sanitation, in which the Sanitation Division of the Streets Department has stimulated block organizations to assist the City in periodic clean-ups; and urban renewal which, especially in Philadelphia, has involved City stimulation of neighborhood organization as a means of facilitating the program. 1 By no means all (and probably less than half) of neighborhood and community organizations spring from public efforts, however; others stem from local attempts at political leverage for particular services or projects, and many stem from the efforts of H W C . There is a tendency for most of these groups to become general-purpose neighborhood and community organizations, though they usually take their start from a particular policy or problem; and most of them are on occasion sources of pressure for public projects. Lest the picture of a hive of citizen activity emerge from this

Stimulation of neighborhood organizations for selling and assisting urban renewal has been part of City policy for some time; but it has received added emphasis since the decision of 1957 to concentrate City efforts on conservation rather than on clearance. With this decision, H W C organizing and maintaining activities become of real importance to the City administration and the "community relations" program of the Development Coordinator. 1

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description, it should quickly be said that much—probably half the population—of the city has nothing in the way of block organization, community council, housing committees, neighborhood organization, and so forth, and that, moreover, much of the organization that exists is very thin indeed. The very poorest sections of the City are the most difficult to organize; interestingly, some of the very well-to-do sections are well-organized. Yet, even a "thin" organization may claim Councilmanic attention out of proportion to its numerical strength. Councilmen frequently consult with or listen to the local groups respecting public improvements, and the same is true of the City's administrative agencies. 2. Action onCapitalPrograms. Health, welfare, and recreation consume a minor share of Philadelphia's capital programs but a larger share of political attention. HWC provides backing for public expenditures in all three fields. The H W C Philadelphia District office finds itself consulting with departments, serving on City committees, and urging projects or policy emphases productive of "adequate" services. In these fields the Council's District office reviews the project requests of the departments and the recommendations of the Planning Commission. This review is not as formal an affair as that of the Citizens' Council on City Planning; but it results, on occasion, in recommendations to the Mayor and Council urging amendments to advance programs in those fields. Capital programming in recreation involves HWC in a different fashion due to the neighborhood implications of capital budgets bearing a large number of small projects. Here the work of the District office is supplemented at the grass roots. Upon appearance of the Planning Commission's recommendations the District office usually compares the recommendations with the "promises" to the six H W C Areas contained in previous capital programs. The Area Committees are then notified of discrepancies, and they frequently

Citizen Organizations

ι35

take up the cause from there. This process is not restricted to recreation projects, however. The normal course of action on projects of a largely regional or neighborhood impact is thus a "grass roots" course encouraged and abetted by the District office. That this maximizes HWC's political effectiveness does not seem doubtful, and there is plenty of evidence that it works. It is probably all the more effective because combined with HWC's central liaison with administrative agencies and service on consulting committees. The Health and Welfare Council does not conduct an elaborate and overall review of capital budgets and programs on the order of the C C C P review. It undertakes no review at all until the Planning Commission's recommendations are in, and this means that there is not much time for a detailed review. 1 Itis normally more concerned with enforcing delivery on earlier capital program commitments than it is with detailed review of priorities, though it often has its say in the inception of projects through consultative relations with some City agencies. In capital programming H W C is a pressure group for "adequate" programs in health, welfare, recreation, and related fields; and its standards of adequacy are set by professionals and served by a dedicated staff. As a pressure group, however, H W C is not without restraint. Two factors, one doctrinal and one organizational, complicate the picture. In the first place, H W C is committed to planning and professional standards of service and is practiced in "responsible" conduct through its work in allocating the 1

B y and large, the Executive Director states, H W C

has increasingly

m a d e Council the focal point of its efforts, for two reasons: (ι) the lack of time for study and generation of pressure before the Budget goes to C o u n c i l , and (2) the fact that Council is playing an increasingly determining role in capital budgeting a n y w a y . While concerned about this trend, staff members state it nevertheless dictates a focus on Council.

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proceeds of philanthropy. In the second place, the agency's grass roots program can lead to differences of viewpoint between the Areas and the District office respecting capital projects. O n one hand, the Areas exert political leverage for projects which can be stimulated from the central office. O n the other hand, there is genuine decentralization in the Area Committees, which can lead to tension between the regional and the city-wide view. Differences in outlook are not frequent, though they may become more so as and if community organization develops apace. They are well known to national organizations; in the city they could even be intensified by virtue of the sentiment attaching to home and community. Thus the problems of locating industry, incinerators, public housing, throughways, and recreation centers, libraries, and schools may become as acute for private as for public agencies. H W C will have to balance city-wide against sectional considerations, and how it weights the scales may have important effects for capital programming in the future; it might tend to become a source of regional resistance to some projects and promotion of others, or it might become a source of enlightened restraint on all-out regionalism. For the time being, however, H W C does not generally need to choose. Philadelphia's Housing Association dates from 1909 and was one of the first of the "private philanthropic attempts to improve the housing condition of the poor (beginning) over half a century ago." 1 When it was incorporated in 1916 its charter defined its purpose as: " T o improve the housing conditions of Philadelphia, by making studies of the conditions and factors that THE

PHILADELPHIA

HOUSING

ASSOCIATION.

William L. C . Wheaton, "Urban Renewal—The New American Frontier," Philadelphia Housing Association, Issues, NovemberDecember, 1956. 1

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affect the housing of the people, by advocating adequate housing and sanitary laws and their enforcement, and by securing the adoption of such features of town planning or such lawful measures as bear upon the welfare of the home." Since 1921 PHA has been a Community Chest agency though it is also supported by membership fees and other contributions. It is a member of the Health and Welfare Council, with which it sometimes collaborates on projects; and it works closely with C C C P , which is officed right next door. It has a membership in excess of 500, a working board of directors, many of whom are professionals in housing, planning and municipal affairs, and it conducts a number of its activities through committees on the board, the membership, and other agencies. Throughout its history PHA has been active in technical, consulting, and advisory work; in research, public education, and the advocacy of public policy; and as a watch-dog agency with respect to government. The organization was influential in securing the State Housing Code of 1915, the City Zoning Ordinance of 1933, and City participation in the Federal public housing program from 1937. It was active in the postwar movement for charter reform and takes credit for the Charter provision for a single Department of Licenses and Inspections. In 1954 PHA was asked by the City administration to take charge of drafting a new City housing code. This it did, including in the project a number of lay individuals and agency representatives; and the code went into effect in 1955. In 1957 the Association produced a major study of City policy in public housing, with strong recommendations for continuation of the program but with some definite changes of emphasis. It has sponsored, usually with foundation support, several definitive studies of aspects of housing and redevelopment. Typically, the Association, through its small staff, its board,

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and its committees, will be carrying on a number of activities at once. These include consultation and adjustment in landlord-tenant cases and in problems of public housing and redevelopment; educational activities through tours, talks, forums, and publications; research projects major and minor; and consultation with and checking on a large number of public agencies and policies. For example, the Housing Association reviews all redevelopment projects and forwards its reactions to the several public agencies involved. On occasion, public agencies make use of the Association's informational facilities or contract with it for studies; such private agencies as H W C and neighborhood associations frequently avail themselves of the Association's resources. In this considerable range of activities the Housing Association has been less free of controversy than have other civic organizations. It has strongly advocated public housing and strict code enforcement—policies not popular with business and, especially, real estate interests. It seems, too, to have campaigned in the tradition of the "housing movement," with a harsh zeal for reform and a tendency to dissociate realtors and landlords from the public interest. In 1953 a complex of antagonisms led to an effort to cut the Association off from the Community Chest. 1 This led to a

1

Some of these antagonisms seem to have had political roots as well, for

M a y o r Clark had been closely associated with the Housing Association before his election. I n a n y event, the C o m m u n i t y Chest's review committee

mentioned

these sources

of complaint:

that

the

Association

advocated or had advocated public housing, standards of housing code enforcement, local and state legislation, and rent controls; that it was partial, promotional, and controversial; that housing was not a proper "health and welfare" concern; and that it overlapped with other agencies in the field. T h e H o w a r d Report (see below) gave no support to the last objection and treated the third as unrealistic; and the Chest itself decided that the first two objections did not disqualify the Association from Chest support.

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Community Chest review, which in turn led to the commissioning of a study of the Association by city planning consultant, John T . Howard. Howard's conclusions were generally favorable to the agency (and the Community Chest has continued to support it), but he did recommend that the Association seek to "reduce the area of controversy as much as possible." 1 As a matter of fact, the Housing Association and the "housing movement" generally have undergone something of a reorientation of ideology and program in the post-war years. 1 The outcome of this reorientation is the amorphous program known as "urban renewal," which had its legislative expression in the Federal Housing Act of 1954. Where this outcome has occurred, one result appears to have been a softening of some old controversies, though the public housing issue continues to give trouble. Though still in process of definition, urban renewal does include an emphasis upon "enlightened self-interest" by business and upon the fiscal base of the metropolis. In Philadelphia and elsewhere it has also included emphasis upon cooperative public and private activities replete with "grass roots" organization and education. These reorientations have naturally led to a deemphasis of controversy among civic agencies, with every effort to identify common and tangible interests among citizen groups. The old "reform" versus "business" and "taxpayer" attitudes have been transmuted into "welfare" versus "economic base" emphases in renewal, but this situation contains a large area

'John T . Howard, et al, " T h e Philadelphia Housing Association" (mimeographed), p. 18. The study was commissioned by the Community Chest. A copy is in the files of the Philadelphia Housing Association. * O n the "housing movement" see J. H. Bunzell, "Citizens' Housing Associations—Educators for Social Policy," Journal of Housing 4 (1947), 109.

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of common ground and the issues are more likely to concern specific projects than major policy orientations. Everyone has his own definition of "urban renewal." That of the Housing Assocation is comprehensive: " U r b a n renewal includes everything necessary to make the city a pleasant and desirable place in which to live." 1 In the remainder of this section we shall describe the development of the Association's "program" and its efforts to effectuate it; for it is this point of view that makes the Association a force to be reckoned with in capital programming. In 1955 the Association published A Statement of Housing and Urban Renewal Policy for Philadelphia, the work of a committee of planners and municipal experts. 8 Described as a "tentative" and "preliminary" effort "to formulate . . . policy for Philadelphia," the Statement nonetheless posited fiscal implications amounting to an average annual increase of $14 million in renewal for the succeeding decade. Among the recommendations of most consequence for capital programming were the following: A comprehensive plan showing in outline form the future development of the city, indicating how areas should be

1

Philadelphia Housing Association, Issues, January, 1958.

' Published October, 1955, by the Philadelphia Housing Association. Members of the committee were: Henry S. Churchill, Jefferson B. Fordham, Howard W. Hallman, Aaron Levine, William H. Ludlow, Martin Meyerson, Robert B. Mitchell, Dorothy S. Montgomery, G. Holmes Perkins, David A . Wallace, and William L. C . Wheaton. Several of these persons are well-known planners, all of whom were at the time Philadelphia residents. Jefferson B. Fordham is Dean of the University of Pennsylvania Law School, and now President of P H A ; Howard Hallman is a long-time staff consultant to the Association; Aaron Levine is executive director of C C C P ; and G. Holmes Perkins, then President of P H A and Dean of the University of Pennsylvania School of Fine Arts, is now Chairman of the City Planning Commission.

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treated . . . and showing the ways in which areas should be redeveloped or renewed. Standards governing population density, public open spaces, community facilities (including schools), new industrial development areas, commercial facilities, and transportation. Identification of the priority of treatment of each neighborhood and the development of financial, legal and administrative procedures for the achievement of planned objectives for each type . . . of . . . area, indicating . . . (i) physical changes sought . . . (ii) the financial methods to be used, including methods for financing both municipal and private activities and works. . . . There should be developed procedures through which all operating agencies of the city will be required to conform in their programs to the standards adopted by the Planning Commission. T h e S t a t e m e n t u r g e d " e f f e c t i v e use of the C a p i t a l B u d g e t and C a p i t a l P r o g r a m to m a k e funds a v a i l a b l e for c a r r y i n g

out, according to a priority schedule, the coordinated development of

area-by-area

renewal

plans."1

Some

priorities

were

suggested; for e x a m p l e , that m u n i c i p a l facilities should be so p r o g r a m m e d as to increase private residential construction a n d to e n c o u r a g e the d e v e l o p m e n t

of " n e i g h b o r h o o d s

of

a d e q u a t e standards," a n d that " e m p h a s i s should be placed on i m p r o v i n g c o m m u n i t y facilities in areas where conservation, rehabilitation a n d r e d e v e l o p m e n t programs are active. . . . " 2 A further suggestion was the p r o g r a m m i n g o f projects so as to m a x i m i z e the C i t y ' s non-cash contribution to m a t c h federal a n d State r e d e v e l o p m e n t funds. I n addition, the S t a t e m e n t urged

consideration

1

Ibid., p. 14, our emphasis.

s

Ibid., pp. 5, 13.

of

an

administrative

reorganization

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which would bring together in a single line department the Department of Licenses and Inspections, the Housing Authority, and the Redevelopment Authority. Basically, the 1955 Statement has remained the Association's policy, though it has been amended and elaborated at points. It did not, however, become City policy; and the next official development was the " N e w Approach" to urban renewal announced by the Development Coordinator in 1957. The " N e w Approach" began with the premise that the City could not afford to keep up with deterioration and should, therefore, deemphasize large clearance projects and emphasize conservation and a diversified renewal program. 1 The Housing Association was consulted during development of the " N e w Approach" and in general opposed it. Since its announcement, the Association has conducted a running argument on the following lines: more emphasis is needed on large clearance projects simply to protect the City's investment in existing ones; more public housing is essential for the many who cannot afford private housing and will, therefore, inevitably create and maintain blight; if the City would plan in larger terms this would help to encourage federal and state aid—the failure to go ahead is simply a self-fulfilling prophecy. Most basically, the Association argues that without a larger renewal program the City's economic base will continue to decline. Yet the Association has not been publicly critical of the City administration. It has pressed its own program and urged on the City; but the urging has been in the nature of encouragement rather than reprobation.

1

The "New Approach" is discussed in: City of Philadelphia, Office of the Development Coordinator, Workable Program for Urban Renewal: the Program in Practice (1957), Office of the Development Coordinator, News Release for April 2, 1957; Philadelphia Housing Association, A Citizen's Guide to Housing and Urban Renewal (Philadelphia, 1959).

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The Association's publication, Issues, for January, 1958, contained by implication the organization's answer to the "New Approach." Its title—"Let's Speed the Pace of Urban Renewal"—has become the title of its general campaign of forums, meetings, literature, and communications with City officials aimed at " a blight-free city, hopefully by 198ο." 1 In all this, and for our purposes, the most noteworthy criticisms of City policy are two: (1) lack of an explicit program and of a comprehensive plan thoroughly oriented to renewal; and (2) the City's reliance on a "project" approach too narrow in geographic scope. The Association views the capital program as the scheduling of a comprehensive plan aimed at removal of blight by 1980, with priorities set in terms of attracting federal funds, protecting existing redevelopment investment, and encouraging private investment and conservation. In fact, "Let's Speed the Pace . . ." contains a set of broad priorities and of cost and capital program estimates to 1980 summing to $3.5 billion, of $1.1 billion more than capital expenditures projected to 1980 at 1958 rates. The Housing Association thus presents the City with pressure for more expansive and explicit priorities in redevelopment and for more centralized decision on policy. It remains more solicitous for housing and amenity than most other important citizen organizations. It is raising more sharply than any other organization a basic question respecting capital programming in the future: is it to be consciously and comprehensively devoted to "urban renewal" and the scheduling of the land use standards in the City's comprehensive plan; or is the capital program to continue as itself a means of making basic policy year by year ? So far the views of the Housing Association have not prevailed. Its renewal program, however, has only recently been formulated; and 1

Annual Report, p . 1.

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there has not, to date, been a comprehensive plan. Should the Association's views prevail in the near future, capital programming would proceed along more definitive priorities; but the Association is only one of several interests urging conflicting goals and levels of "renewal." T H E CHAMBER OF COMMERCE. Philadelphia's Chamber of Commerce is not confined to the city but serves the greater Philadelphia area. It is elaborately organized into subject matter councils, each with committees, task forces, and staff. 1 Of the five councils, three—those dealing with Economics and Taxation, Commerce and Industry, and Traffic and Transportation—relate to capital programs. The Economics and Taxation Council maintains federal, state, and local tax committees and a subcommittee of the last on the City's capital budget. The subcommittee consists of six members: two investment house bond specialists, two lawyers, an industrialist, and a newspaper reporter. The subcommittee chairman is a bond specialist, and the subcommittee has mainly been concerned with the fiscal aspects and impacts of the City's capital budgets. Like the Citizens' Budget Committee, the Chamber's Capital Budget Subcommittee has confined itself to representations to the City administration and Council aimed at protecting the present financial ceiling and down-payment practices and at such other fiscal concerns as capital budget implications for the operating budget and the elimination from "capital" of deferred maintenance. It has not dealt in analysis of projects of substantive policies, and its interest in the fiscal aspects of the capital budget may fairly be described as conservative. The chief staff man of the Economics and Taxation Council is the Chamber's representative on CCCP's Capital Improve1

See, Chamber of Commerce of Greater Philadelphia, Organization for Action (Philadelphia, February, 1959).

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ments Committee where, as he says, he attempts to advance the subcommittee viewpoint just described. The Commerce and Industry Council is concerned, inter alia and through several subcommittees, with industrial location and area development. These interests, together with those of the Traffic and Transportation Council in public facilities, bring the Chamber into contact with capital programming and urban redevelopment. Through the Commerce and Industry Council, the Chamber played a major role in launching the Philadelphia Industrial Corporation; and it occupies a strong position on PIDC's board of directors. Since the establishment of PIDC, most of the Chamber's considerable activity in industrial development in the city has been channeled through the corporation. The Area Development Committee of the Commerce and Industry Council continues to boom industrial location in the suburban counties. The Traffic and Transportation Council is a profusion of committees and task forces. Its interest in capital programming is natural, and its liaison with the Commerce Department and the Streets Department is close. In the case of the Commerce Department, the relationship is formalized in a consultative committee. The Council is a continuing source of pressure for port, airport, and highway improvements; and it conducts a continuing program of research and publications. The Chamber's leading interest is "business"; but this is far from a single, monolithic concern. Internal conflicts and industry—or business-group resignations—frequently occur over Chamber policies. So far as the City's capital programs are concerned, two things may be said. One is that the organizational forces within the Chamber for fiscal conservatism and those "booming" projects and improvements are potentially at odds. They are, however, seldom if ever actually at odds because they speak through different Councils and do

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not clash on specific policies or projects. The other conclusion is that the Chamber's major interest in the capital program is an industrial and economic-base interest. This does not mean, as committee and staff members point out, that the Chamber is opposed to capital improvements in welfare and other facilities—the Chamber recognizes (as does GPM) that "liveability" is an important aspect of industrial location and fiscal solvency. It does mean, however, that on the more subtle and case-by-case questions of emphasis in urban renewal the Chamber will tend to be on the opposite side from, say, the Health and Welfare Council and the Housing Association. The organizations just discussed support broadly differing interests and emphases in capital programs. Nevertheless, they all support a substantial level of public investment. They all stand for rigor and professionalism in planning and capital programming and for a city-wide view of priorities. In this sense—and at the obvious risk of prejudice—they may be referred to as "enlightened" organizations. 1 One of the interesting things about Philadelphia (and many other large cities) is the existence of organizations in which "planners" balance "boomers" and "taxpayers." Those starting from the extremes of a naive "group approach" to politics are accustomed to think of group political action solely as the self-regarding pursuit of tangible gains and as generally at variance with "planning" and "standards." In fact, tangible interests and the logic and experience of municipal politics would seem to dictate organization in support of planning and administrative competence. Physical CONCLUSIONS.

1

We emphasize that the term "enlightenment" will here be used as a term of art, standing for the views set out in the preceding sentence, and not as a term of judgment.

Citizen

Organizations

147 improvement carried direct benefit for business and (most) taxpayers. 1 Esthetic interests in physical improvements are more tangible in an urban than in a national setting. And social welfare programs and projects are clearly related to both esthetic and economic base objectives. These gains demand high standards of administrative performance and—so experience (now practically folklore) has argued-—"planning," defined as an independent source of standards and integration. More recently, students of municipal affairs have begun to argue that political leadership is a third ingredient in the recipe. 2 Mere political and administrative responsiveness to neighborhood demands cannot, as these groups have interpreted municipal experience, provide for urban renewal with a fiscal payoff and for satisfaction of esthetic standards; nor will they eliminate waste in welfare. Municipal experience has also been construed to teach that party politics does not in itself provide these municipal virtues and that independent citizen organization works more effectively in their behalf than does routine political participation. Our argument, then, is this: that "enlightenment" results from the "objective conditions" of the post-war city in which most groups have a stake in renewal. Though their programmatic emphases differ, the groups dealt with in this chapter are in substantial agreement on the general policy 1 In recent years this has become increasingly evident to citizens in many cities through studies of inter-regional economics and competition and through the more obvious post-war decline of the center city vis-ä-vis much of the remainder of the metropolitan area in terms of fiscal base.

* Probably this ingredient is less generally accepted than are the other two, partly because urban reformers have historically seen "politics" as corrupt and inimical to "administration" and "planning"; partly because strong political leadership may, in fact, involve compromises of administrative and planning standards at the same time that it involves support for them.

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described as "enlightenment." This seems the more remarkable because four of our five organizations stand for traditionally different interests and ideologies in American metropolitan life; viz., the taxpayer interest, the "business" interest, the settlement house and welfare tradition, and the "housing movement." Four other factors, however, probably reinforce and extend the area of agreement. One is Philadelphia's strong, if dominantly nonpolitical, civic tradition and the recent role of some "old Philadelphians" in City administration.1 Another is overlapping organizational membership, together with the professional staff work discussed below. A third is the close balance of interests and forces, which may encourage the groups to seek and support such common denominators as "renewal" and "planning." A final factor is the "enlightened" and "executive-centered" City administration, which is generally supported by all groups because it is such a favorable alternative to most municipal experience.2 This factor lends bargaining power to the City administration and probably enables it to enjoy support, or at least lack of opposition, when short-run group interest might otherwise dictate opposition. Apart from this general characterization and explanation of group "enlightenment," two common aspects of citizen group action in Philadelphia seem especially significant in relating the groups to the administration. These are: (1) the relation of the groups to the "grass roots," and (2) the extent of group professionalism and participation. See, for example, Digby Baltzell, Philadelphia Gentlemen (Glencoe, 111., 1958), and James Reichley, The Art of Government, op. cit. 1 Long-time staff officials of the Chamber of Commerce, for example, report that the Chamber was often at odds with the old Republican administrations of the City, but that the Chamber has worked cordially with the present Democratic administration.

1

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(1) Relations with the grass roots. Not unnaturally, it is the " w e l f a r e " rather than "business" oriented groups that reach into the neighborhoods. On frequent occasions these organizations find themselves working together, and the Health and Welfare Council and Housing Association cooperate closely with public agencies in the neighborhoods. For local planning purposes C C C P , H W C , and the Housing Association belong to the Area Planning Conference, a "clearing-house for agencies at the city level which are concerned with the various phases of local planning." 1 Equally significant is the fact that C C C P and H W C are to some extent clearing houses for neighborhood and functional groups. They are means of transmitting to the "grass roots" some of the "enlightenment" defined above and, conversely, of integrating and transmitting grass roots demands of government. The question is, which role is dominant respecting the capital program ? As we have seen, there is a marginal response to neighborhood pressures in C C C P ' s capital budget review; and ΗWC's central office takes a more city-wide view than do its area committees and local organizations. Yet it is part of C C C P ' s mission to sell "planning" to the grass roots, and H W C exists in large part to promote standards and planning in welfare services. Both agencies stand for "enlightenment" in public and private decisions; they are a source of pressure for such decisions upon both government and grass roots because they involve in their efforts the most respected elements in city life, because they employ professional staffs, and because they link up at many points with the work of other and similar (thus reinforcing) organizations.

1

Conference on Area Planning, Relationships between the Health and Welfare Council and the Citizens' Council on City Planning (Philadelphia, 1948). Membership of the Conference includes both public and private agencies.

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T o d a y , therefore, the l o n g a n d the broad v i e w s e e m d o m i n a n t in these organizations. T h e possibility of all-out u r b a n renewal, w i t h a t t e n d a n t inter-area bargaining, suggests, h o w ever, a t h o u g h t for the future. T h e City's " n e w a p p r o a c h " to u r b a n r e n e w a l has already b e g u n to e m p h a s i z e ( w i t h o u t m a r k e d success) the stimulation a n d professional g u i d a n c e of n e i g h b o r h o o d organization. T h e H e a l t h a n d Welfare C o u n c i l a n d the H o u s i n g Association h a v e m o v e d in the s a m e direction. T h e f o l l o w i n g e x t e n d e d q u o t a t i o n suggests the t h o u g h t for the f u t u r e : . . . People must participate in the development of neighborhood plans, must u n d e r s t a n d the need for such p l a n n i n g a n d the opportunities for neighborhood improvem e n t available to them. These people are going to be asked to invest their m o n e y in their properties. M a n y of t h e m a r e going to be moved to other areas. M a n y are going to b e urged to stay w h e n they m i g h t otherwise move. Grass root participation in the processes of u r b a n renewal will not b e secured by accident. I t will take organized, systematic, daily, professional liaison between the m a n y d e p a r t m e n t s of City Hall a n d each neighborhood. . . . J u s t as the U . S . D e p a r t m e n t of Agriculture d u r i n g the last century established an agricultural extension service to help farmers improve their farms, so must o u r municipalities in this century establish a n u r b a n renewal extension service to help people improve their neighborhoods. 1 T o the political scientist the t h o u g h t for the future will b e obvious, a n d the bucolic a n a l o g y will suggest the studies of Charles M . H a r d i n . 8

1 William L. C. Wheaton, "Urban Renewal—The New American Frontier," op. cit.

* Freedom in Agricultural Education (Chicago, 1955), and The Politics of Agriculture (Glencoe, 111., 1953).

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While, as we have argued, national and municipal politics are not quite the same animal, the generation of "grass roots" organization may well carry similar consequences in either jurisdiction. Such consequences can include the exertion of increased (since organized) local leverage on the legislature and pressure for continued or increasing public subsidy. It can mean a politics less responsive to executive leadership. In the big city it may pose the issue of neighborhood control by the political organization versus an independent grass roots politics. A p a r t from zoning and its relation to income and racial segregation, there would be plenty of room for activity respecting the capital budget unless the City's governmental organization plus the support of the city-wide citizen organizations are strong enough to hold the line. Local participation m a y never attain such scope and organization in Philadelphia; but if it should, the city-wide proclivities of the citizen organizations may be more seriously tested than they have yet been. (2) Professionalism. T h e groups support a small corps of dedicated, expert, and influential staff professionals. T o some extent this is a common corps, frequently in common attendance at meetings and on common projects. Most of them have been around Philadelphia for some time—none of the organizations currently has an executive director who has been less than five years in his j o b — a n d all of them were trained for municipal administration, planning, or social servicc and have made these their business since. They are close to City officialdom, for there has been a considerable movement back and forth between private organizations and public employment; in this sense there is a common corps of professionals staffing and "observing" the City government. 1 1 For example: the executive director of C C C P was formerly on the staff of the Planning Commission; the City's Deputy Managing Director and

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T h e y are sensitive to the implications of city politics for planning and administration and are generally political "realists," tending to think in terms of cycles of political rape and reform in which the position of the present reform administration can only be viewed as tentative. T h e citizen organizations, then, provide a base for the activity of a corps of professionals. Does this mean that the organizations are the professionals? W e think the answer in Philadelphia is clearly no. Though the extent of participation varies, all of the organizations have working boards of directors and/or committees. All of them have aimed at creating and involving civic leadership and giving focus to its activity. T h e small staffs of these organizations strive to maintain this purpose and, we think, succeed in significant degree, even if they do within narrow limits determine the "focus." In each organization the staff is capable, respected, and influential, but none is a letterhead organization. In this connection, the Bureau of Municipal Research deserves more attention than it could be given above. 1 B M R itself dates from the year 1908, the Pennsylvania Economy League from 1933. In 1954 B M R and the Eastern Division of P E L merged; B M R - P E L now maintains the largest private, non-academic organization for research in municipal affairs in

the C h i e f of the Capital Budget Division of the Budget Bureau (Office of the Finance Director) both formerly worked for B M R ; the Director of B M R was formerly the City's Finance Director; two G P M

executive

directors have become C i t y M a n a g i n g Directors; one of B M R ' s staff experts on the Capital Budget now works for the Water Department; the Housing

Association's

principal staff consultant

was once with

the

Redevelopment Authority. 1

Because it is fundamentally a research organization, with a less active

board of directors than the five organizations discussed above, we have not given it a major role in this chapter. Its effect is principally felt at the staff level through its studies,

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the city. Basically the organization is of the type described by Adrian as "interested in 'good government' as such, usually with no immediate personal benefits except in the belief that more modern forms of government will save taxpayer dollars.'' 1 The orientation and training of the staffis largely that of public administration and public finance. Its activities—of which research and publication are the chief—are financed by contributions from board members and other citizens, though it also does a significant amount of research under contract to private organizations (CBC, for example) and to the City and State. In summary, BMR-PEL is a mine of information and a reservoir of expertise and research, much of which is selfdirected at economy-efficiency objectives but which is also available to other organizations. Its Director, Lennox Moak, was once Finance Director of the City and must be put down as one of the most influential of the professional students and practitioners of municipal government in the city. Both Moak and BMR-PEL have been firm advocates of a heavier emphasis upon the industrial and economic base of the city in redevelopment policy and have emphasized cost-consciousness in capital programming. 2 The agreement among the five organizations on improvements-in-general and "rationality" in procedure is an important part of the environment of capital programming, but so—as we must now point out—are the differences among the groups. There are two basic differences. The first is between fiscal conservatism and a willingness to spend freely for improvements. The second is the difference of opinion now 1

Adrian, op. cit., pp. 102-103.

« Cf. BMR-PEL, An Approach to Philadelphia's Industrial Renewal Problem (Philadelphia, 1956), and Elements of a Comprehensive Industrial Renewal Program for Philadelphia (Philadelphia, 1 9 5 7 ) .

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coming to a head in the city (and shared by City departments and officials) over an industrial and economic-base emphasis for redevelopment versus a housing, recreation, or "welfare" emphasis. The two differences closely relate because, it is argued, industrial and "economic base" projects (for example, transportation and terminal facilities) are more likely to pay for themselves and enhance the City's fiscal base. The fiscal and industrial emphases are shared by the Chamber of Commerce and the Citizens' Budget Committee, to which may be added the Bureau of Municipal Research. The "spending" and "welfare" emphases are shared by the Health and Welfare Council and the Housing Association. The Citizens' Council on City Planning, with membership from both camps, occupies neutral ground. So far the issues have not become sharp, largely, we think, for the reasons already suggested as militating toward intergroup agreement. CCCP has played a moderating role through its overlapping membership and its project-byproject approach to capital budgets. And both the "industrialists" and the "housers" have recognized that something of both emphases is necessary to fiscal solvency and continued development. In the future, as urban renewal proceeds apace, conflicts may sharpen between industrial and recreational uses of land, over the scope of public housing (which would bring old ideologies into play), or over the size of the City's capital budgets. The last of these, of course, would have to stem from a general policy decision by the City; the others (in the probable absence of such general decisions) are likely to arise over particular projects. Each of the citizen organizations sees capital programming in somewhat different perspective. For CBC and for the Chamber's capital budget committee it is primarily a device for fiscal planning and cost control; for CCCP it is to some extent a method of overall assessment of objectives but

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primarily a means of ensuring thorough project evaluation; for the Housing Association it is chiefly a vehicle for scheduling urban redevelopment programs which have been broadly decided upon elsewhere. Of course, it is perfectly possible for the capital program to be all of these things and to compromise on integrating contrasting social and economic values. 1 Having explored the citizen organizations themselves, it remains to describe and assess their influence upon policy and capital programming. Such an assessment presents some of the most difficult practical and conceptual problems of the social scientist, and it should therefore be said that our own assessment rests more upon observation of group activity and testimony of group and City officials than upon conceptual refinements and/or detailed case-studies. Basically there are three main avenues of organization influence. One is through administrative relationships: service on advisory committees to departments or the Planning Commission, and the multitude of less formal contacts between public and private municipal practitioners. At the departmental level this avenue can transmit pressures for projects, as in the relations of the Chamber's Traffic and Transportation Council with the Commerce Department, or the Philadelphia Recreation Association or Health and Welfare Council with the Recreation or Public Health Departments. (We omit consideration here of administrative responsiveness to sectional and neighborhood interests.) Such relations with departments are relations between professionals, public and private, all of whom support the same program; 1

Potentially, the most direct functional conflict is probably that between the Housing Association view of the capital program device as a simple schedule flowing from explicit policy decisions and CCCP's stress on individual project evaluations, which implies that the capital program is a gradual means of making informed policy. Yet the social and organizational ties between the two organizations are very close.

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but they probably encourage the departments in project requests and justifications. The point of capital programming, however, is the institution of overhead and quasi-independent review procedures. At the level of the Planning Commission group contacts are fewer, more balanced, and generally initiated by the Commission. A second method of group influence is through recommendations public and private but short of organized consultation. Examples are letters and private approaches of CBC to the administration on fiscal policy, CCCP's annual capital program review and report, and HWC's letters to Mayor and Council. We have found little evidence for group influence directly upon substance through these means. Some influence undoubtedly exists; but it generally goes more to standards than to individual projects, and it is usually more supportive than distortive of City policy (and thus more difficult to demonstrate). The third avenue of influence may be termed old-fashioned "political" influence. In Council it is exerted largely by sectional or neighborhood groups and often operates through the Democratic organization and/or the threat of (usually primary) election sanctions. As we have seen, HWC on occasion makes able use of this avenue through its area committees. Council also hears from each of the city-wide organizations from time to time, and the unpleasant prospect of tax increases has resulted in a measure of Council responsiveness to such groups as CBC and the Chamber. Needless to say, the influence of "enlightened" citizen organizations upon the administration is in part political influence also; for the administration (unlike some Councilmen) must see its constituency more largely in terms of city-wide forces and movements of opinion. So far—as regards capital programs—most of the comment and criticism of the civic organizations have been directed at

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administration and Council; the Planning Commission has been relatively immune. This appears to be because in capital programming the basic questions of emphasis are decided in the administration. Some organizations—especially the Housing Association and the Chamber of Commerce—have been occasional critics of the Planning Commission in such fields as zoning and land use planning, in which the Commission is chiefly responsible. C C C P maintains, as it was intended to, a continuity of comment, criticism, and interpretation respecting such Planning Commission decisions as there are. When a comprehensive plan emerges, one would expect that all of these organizations will have something to say about it—particularly if leading policy directions and decisions are evident in it; that is, if it constitutes the premises of future capital programs. It remains to be seen whether the comprehensive plan will be of this order. In summary, the activity and influence of our five organizations appear to amount to the following. (1) They provide general support, leadership, and mobilization for "enlightenment" as defined above. This means support for capital improvements and. for capital programming as an informed and professional approach to improvements. (2) They provide comment and criticism to the same ends. (3) They constitute lobbies for different policy and project emphases in renewal and capital programming. (4) They provide a counterweight (some of them through their federated organization) to functional and/or local pressures for projects and assist in maintaining a city-wide view.

VII

Capital Budget Execution

D E C I S I O N S on policy and priorities described to this point are not the whole of capital programming. Actual execution of the budget is of considerable importance for two reasons. In the first place, delays in execution and the characteristic pace and facility of execution inevitably affect the remaining years of the capital program; and amendments during the life of the budget affect the integrity and predictability of previous capital programming. Secondly, experience with capital budget execution might serve as a guide to subsequent planning with respect to such matters as the total number of projects that are likely to be accomplished, the cost of projects, the timing of projects, and the evaluation of some projects against the goals they were designed to achieve. Three procedural factors are important in the execution of the Philadelphia capital budget. One is the length of the budget's life, another is the amending process subsequent to adoption of the budget, and a third is the group of charter provisions governing budget execution—review of plans, letting of contracts, and so forth. Of these, the first factor may be briefly described: the life of the capital budget is eighteen months, giving the City a considerable period in which to obligate funds. 1 Funds not encumbered at the close of the

THE

1

The legality of this practice is in some doubt, though the Charter is not explicit on the subject and the practice has not been tested in court. The 158

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eighteen-month period will, in many cases, be amended into the succeeding capital budget (then six months along) in an omnibus amendment passed by Council in June. If not encumbered during the succeeding year they may undergo a similar transfer the following June. In fact, a large share of both expenditures and encumbrances occur during the last six months of the life of the budget. City officials differ concerning the effects of the eighteenmonth execution period; some feel that it fosters delay in project execution, yet all agree that it is at least realistic. Some believe that a still longer executory period (say, two years) would be desirable, while maintaining that there must be a cut-off point at which Council and other reviewers can measure progress. M a y o r Clark's final capital budget message to Council suggested that "the Charter should be amended to provide for project authorizations which will remain in effect until the project is completed or abandoned even though funds are provided in several Capital Budgets." 2 T h e discussion reflects an administrative imponderable: to discover a "reasonable" executory period that will both discourage delay and "realistically" accommodate the procedures and the bulk of capital budgets. Amendments of the capital budget during its eighteenmonth life are of two types. T h e first and most frequent are

history is described in B M R - P E L , A Discussion of Some Proposed Revisions in the Home Rule Charter, at p. 27: " A s experience was had during 1952 it became apparent at an early date that authorizations for capital projects voted in November of one year would not be committed either wisely or fully within a twelve-month period. In consequence, the Council was requested to and did approve a procedure whereby appropriations in the annual capital budget were available for a period of eighteen months. . . . T h i s has been done annually since." • Mayor's Capital Budget Message, October 10, 1955, p. 8.

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passed by Council on its own initiative or that of the administration after referral to the Planning Commission. A second type of amendment results from the discretionary authority of the Finance Director to transfer sums of no more than 10 per cent of the appropriation for any project among the projects in the capital budget. 1 This authority has not been frequently used. Amendments in Council are, however, employed much more frequently—inspection of the City's financial reports shows that most of the original dollar amounts are amended upward or downward during the life of the budget and that a large number of projects are added or deleted. Of course, the fact of a fiscal ceiling often constrains Council to match dollar increases with decreases and project additions with deletions; but new items or increases for existing items can often be covered because of unforeseen delays in other items. The decision process described in previous chapters does not, then, issue in a permanent decision. Amendments in Council result from various factors. On some occasions they stem from outright changes in City policy and priorities. Short of deliberate policy change, they may result from delays or inaccuracies in project planning, faulty cost estimates, inaccurate estimates of timing due to procedural delays, delays in related projects on which others are contingent, delays in performance, and acts of God. The opportunity for timely site acquisitions frequently occasions

1 As in the case of the eighteen-month budget period, there is no Charter authorization for this 10 per cent discretionary authority of the Finance Director, and there is, therefore, some doubt about its legality. M r . Lennox Moak, the City's first Finance Director under the 1951 Charter, relates that he adopted the practice in order not to have to go back to Council constantly, but that he limited it to 10 per cent on the premise that, beyond a certain point, there should be resort to Council. T h e proeision was necessary, he says, because of the frequent inaccuracy of cost estimates.

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amendments; sometimes such a site acquisition results in turn in a change of priorities and policy once land is available for a project. There is still a good deal of deferred maintenance in capital budgets; sometimes this is both urgent and unforeseen and results in changes. Private construction and development, never entirely predictable, may alter departmental priorities. Councilmen themselves promote amendments to advance pet projects or appease constituents. Some changes are unavoidable and others (e.g., for site selection) are on most any standards commendable. Usually, these types involve relatively small dollar amounts. But outright changes in priorities are frequent. A few projects, moreover, never show up in a capital program document, except to be recorded as completed—this will be the case when they are amended into a going budget and do not undergo amendment into the succeeding budget in the midyear omnibus amendments. 1 Short of substantive alterations, a review of the Financial Reports indicates that the scheduling set forth in the capital program lacks significance because projects are constantly amended forward and backward. T h e recorded history of the 1957 Capital Budget (which started with 120 line items) shows the following actions: (1) Twenty-three projects amended into the budget, which do not appear in the six-year capital program at all. Some of these were originally authorized in the 1956 budget, A Youth Rehabilitation Center completed in 1959 affords an example. In this case an entry for such a project appeared in the 1956 capital program (scheduled for i960) but was dropped in succeeding programs as the Welfare Department felt it to be a State responsibility and was endeavoring to get the State to provide it. Late in 1958, however, the City abandoned a hospital facility and the Department seized this opportunity for an inexpensive facility and $380,000 was quickly appropriated to adapt it. By the time the published version of the 1959-1964 Capital Program appeared the project was already in operation. 1

P.M.I.-F

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then amended into the 1957 budget; but in the course of amendment the amounts authorized may be raised or lowered considerably. (2) Fifteen projects amended into the budget which were moved up from later years in the capital program. (3) Ten items amended into the budget (and not appearing in the capital program) which appear (from their size and context) to be for site acquisition, engineering or feasibility studies, etc., but not for actual construction. As with type (1), some of these have been amended into the 1957 budget from the 1956 budget; sometimes with funds authorized in the 1956 budget for the entire project trimmed to site acquisition or study funds. (4) Two items of the site acquisition and study type for sites or surveys for which funds for the projects are included in later years of the capital program, and where it was evidently decided to go ahead on preliminary stages at an earlier date. (5) Of the 170 items recorded in the 1957 Capital Budget, only 39 went unamended by either Council or the Finance Director, though many of the amendments were minor ones. The Finance Director amended 30 items. T h e foregoing list cannot be entirely accurate; changes in the site or description of a project may conceal the fact that it is basically the same project intended in a capital program and may thus make the change seem greater than it really is. Neither does the list convey the fact that, in the process of amending a project from one budget into the succeeding year's budget, the appropriation for the project is sometimes appreciably increased or trimmed—an indication of either faulty estimates or a change in the magnitude of the project. An example of the stringing out of projects through the amending process is the following. T h e 1955 Capital Budget carried an appropriation for a combined fire and police station and municipal building at a cost of $475,000. T h e

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entire project was scheduled for the year 1955. T h r o u g h amendments, some $70,000 was cut from the authorization during the eighteen-month period; and of the remaining $405,265 the total amount was obligated, but the project was not completed. T h e Financial Report for June 30, 1957, therefore, takes up the story: here it develops that the project was amended into the 1956 Capital Budget in June of 1956 and an additional $33,000 provided, of which the full amount was obligated during that eighteen-month period, without, however, completion of the project. Thus, there was amended into the 1957 Capital Budget an additional sum of $38,050 and of this—at the end of the eighteen-month period, $23.75 was merged, indicating final completion of the project sometime during the life of the 1957 Capital B u d g e t — t h a t is, by June, 1958. Here, it is worth noting, the total cost of the project closely approximated the original estimates and authorization. But the execution was spread over three years instead of one; funds were cut at one point and switched to other projects; funds were added at a later point from later projects then suffering delay. In this example, then, the chief deviation from the original capital budget is delay. But in a large number of other cases the dollar cost of the project is changed to reflect altered estimates, policies, and priorities. While there has been some tendency in the amending process toward a more constant level of spending (that is, toward budgets which, at the close of the executory period approximate the dollar appropriation in the original), the objects of appropriation and expenditure are as much amended as ever. 1 T h e result is that records of the net level of spending do not reveal the shifts in scheduling and level of appropriation within the net figure. It should be added that most such 1 O n the trend in the level of spending, see B M R - P E L , Financing Philadelphia's Capital Improvements, 1957-1962 (Philadelphia, 1956).

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shifting, with some large exceptions, takes place within rather than among departments. Much of the public and professional criticism of Philadelphia's capital budgeting (and there has not been much) has centered upon two aspects of execution: delay and costcontrol. One source of delay is the group of Charter requirements on capital budget execution. City officials all agree that these requirements conduce to delay, but most officials appear to feel that they are worth this price (though a few regard them as unnecessary red tape). The chief Charter injunctions are those regulating procedures for letting contracts (all contracts are let by the Procurement Department) and the requirement that plans for buildings must be drawn or reviewed by the City Architect and that all must be approved by the City Art Commission. The line agencies are likely to feel that each of the stages is unduly slow. The delaying effect of the Charter requirements poses a dilemma between the desiderata of fiscal and administrative rectitude and construction standards on the one hand, and the integrity and realism of planning on the other. For the longer the process of project execution, the larger is the hiatus between plan and project-in-being and the less realistic the planning. Not only do cost estimates become unreliable, but projections of community goals and wants must alsobelengthened. Some observers and officials suggest that there are more or less absolute physical and administrative limits to the dollar level of accomplishment in a capital budget period. The Charter requirements are thought to narrow these limits to some uncertain extent, but they are not the only impediment. 1 1

A few officials have suggested that a shortage of contractors in specialized fields—e.g., sewerage—sometimes occasions delay in these fields and to related projects, but this does not appear to be a frequent or serious source of delay.

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Another source of delay is lack of forward planning (especially project planning) in the departments. Projects thus find financial expression in capital budgets before the final plans are set, and delay (as well as revision) follows in the period required for further formulation of plans. Improvements in forward planning promise some reduction in delay, as does a recent City policy of spreading project funds over the capital program in such a way that allotments for site acquisition and/or project planning appear alone in the first year to be followed by construction funds in subsequent years. 1 It is still too early to assess the results of this procedure; but it can, in conclusion, be argued that some delay is endemic in the uncertainties and flexibility in programming that are revealed in the amendment process. T h e other source of some citizen concern has been costconsciousness. While cost control relates, as we have seen, to project planning and to capital program review, it also relates directly to execution. Thus the Bureau of Municipal Research has been increasingly critical of project planning and Planning Commission review in this respect and has further noted that the Procurement Department (which is responsible for letting contracts) "is not manned today to perform any adequate review of plans or specifications" from the standpoint of cost; that none of the devices for checking on costs which are employed in the operating budget are applied to capital budgeting; and that " . . . once the authorization of a capital project is made by formal appropriation and the allocation of capital funds, tremendous, and, in some cases, almost complete discretion is vested in the agency getting the project and there is no further effective review by any other officer above 1

U p to 1958, the year in which this policy was adopted, the ratio of

obligations to expenditures (in millions) w a s : 1954, 38:24; 1955, 30:23; 1956, 30:22; 1957, 3 5 : i g . T h u s , there was no trend toward elimination of delay prior to 1958. See B M R - P E L ,

ibid.

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the agency level of what the city is getting for its money." 1 Cost-consciousness and cost control in capital programming present thorny problems of interagency responsibility. 2 Costconsciousness as a desideratum may conflict with the goals of encouraging application of land use planning, professional standards, and departmental programming, if these goals arc thought to imply some measure of administrative discretion. One agency (that is, the Planning Commission) is unlikely to serve both sets of objectives with enthusiasm, and intervention by the Finance Director in behalf of cost-consciousness is likely to complicate achievement of goals and further complicate a difficult organizational process. In theory, cost-consciousness and control would seem to apply at three levels of capital programming: in central review and assembly; in departmental programming and project planning; and in construction and execution. In theory, it should be added, these "levels" can be considered devoid of both chronology and specific institutional participants, though it is the necessary inclusion of these elements in practice that especially complicates the picture. A t the first level, central review and assembly might emphasize the content and constitution of projects as well as 1 B M R - P E L , Memorandum Report on: The Budget Bureau and Instilling Cost Consciousness among Municipal Employees (Philadelphia, 1956), pp. 17-20. T h e Report was prepared for the Citizens' Budget Committee. See also the similar B M R - P E L , Memorandum on Cost Consciousness on Philadelphia Capital Projects (Philadelphia, 1957).

* T h e problem of interagency rivalry in capital programming in New York City, based in part upon this factor, is discussed in: Modern Management for the City of New York, Report of the Mayor's Committee on Management Survey, (New York, 1953), Vol. 2, Ch. 5., Sec. 2; and Frederick C. Mosher, "Fiscal Planning and Budgeting in New York City," in New York State-New York City Fiscal Relations Committee, A Report to the Governor of the State of New York and the Mayor of the City of New York (New York, 1956), pp. 65-84.

Capital

Budget

Execution

167

their objectives and location; that is, tighter justification might be required for the details of projects as well as for projects in the large. Such a review might direct more attention toward cost as a determinant in decision—that is, toward benefit-cost analysis or rate-of-return analysis in scheduling—and in such circumstances cost-consciousness in project design would pay off for departments. Or, alternatively, the central review might emphasize fund allocation to departments rather than project analysis and review and, through fairly systematic reductions in departmental requests, conduce to the goal of departmental cost-consciousness. In practice, either of these procedures would introduce serious problems; the burden on the reviewing agency would be extremely heavy or, if divided and shared, would likely lead to conflict; programmatic goals and professional standards might tend to be subordinated to frequently arbitrary "costing"; detailed project planning would necessarily (and perhaps prematurely and unrealistically) precede a review of broad purposes and policy. The dilemma between fund allocation and project allocation, between budget bureau behavior and land use planning behavior, that already confronts the Planning Commission would be sharpened. Or, alternatively, division of function between Planning Commission and Budget Bureau would invite institutional rivalry as an adventitious factor in decision. At the second level, project planning and design might be reviewed for "frills." Conceivably this could be done by the Planning Commission as part of its overall review; but the more likely methods would be review by a budgetary staff within the department, review by the Procurement Department as part of its supervision of contracts, or review by the Budget Bureau of the Finance Director's office. Review at this level raises some of the problems noted above: possible discouragement of or incursion upon professional standards; timing of the review so as not to complicate decisions on

168

Planning Municipal

Investment

overall project objectives; and interagency rivalry a n d project delay. O n the other hand, it does not seem inconceivable that cooperation in review of project planning by the Finance Director a n d Managing Director either prior or subsequent to Planning Commission review could result in savings without serious impairment of other objectives. Review for cost at the level of project execution is more easily segregated from the other institutions a n d criteria of the capital programming process. Such review, by the Finance Director or the Managing Director, would redress the situation noted by the Bureau of Municipal Research in which departments are substantially on their own once their project appropriations are secured. It might take place as part of a more general post-appropriation process designed to counter executory delay, to cut costs, and to measure the extent to which projects achieve the objectives for which they were ordered a n d authorized. Such a review might involve periodic inspections in addition to the present reports and might facilitate an ultimate assessment of projects against their original objectives and justifications. In summary, review at the third level would seem easiest to institute and to entail least reorientation of the assumptions and procedures of present capital programming. Those who feel that both assumptions and procedures should emphasize costs, quantification, and financial constraints more heavily than they now do will, however, probably urge review for cost at the other levels, where the review will have more impact upon policy. Conclusion. Both in Philadelphia and in the limited literature on capital budgeting, formal decision has stolen attention from execution. T h e material of this chapter should show, however, that decisions are not likely to be final in the political and administrative worlds and that execution impinges upon subsequent decisions. Thus the broad conclusion of this

Capital Budget

Execution

169

chapter m a y be p u t in two fashions. T h e first is that capital p r o g r a m m i n g is a continuing process in which political, a d ministrative, a n d non-predictable private forces are always at work; the decision process is not limited to the period a n d format prescribed by the Charter. A second statement of essentially the same conclusion is that the various aspects of capital p r o g r a m m i n g (including execution) are necessarily linked together—thus d e p a r t m e n t a l planning, p r o g r a m m i n g , project planning, administrative and Planning Commission review, a m e n d m e n t , executory delay, a n d cost estimates all combine to affect the stability and content of capital programs. T h e relation of capital budget execution to capital p r o g r a m stability (that is, predictability) is, we think, particularly significant; for a m e n d m e n t or delay in one year's budget is likely to have ramifications throughout the p r o g r a m . A further, didactic, conclusion may be in order. This is t h a t the process as it stands includes no formal, />oi σ> ο ^

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Planning Municipal Investment

Table 2. Tax-Supported Funds by Major Function as Percentage of Total TaxSupported Funds. Capital 1. Economic a. Residential 3. General 4. TransporProBase Services Gov't tation Total gram Pro- Bud- Pro- Bud- Pro- Bud- Pro- Bud- Pro- Budgram get gram get gram get gram get gram get '953-58 '954-59 '955-6° 1956-61 1957-62 '958-63 '959-64 Program Range

8.2 '5·' 9-4 10.0 "•3 I ι .0 I 1.0 8.2'5·'

9-0 17.8 7·' 16.0 "•5 .6.7 17.0

560 45-3 31.0 35° 43-5 40.6 46-5

57·ο 50.0 42-3 46.0 47.0 50.0 44.2 42-357·°

0 6.0 4.0 2.0 3·' >4-3 0'4-3

0 •03 8.8 4.6 4.2 2.8 10.9

35-3 35° 42.0 41.0 40.4 36.0 31.0 31.042.0

35·' 37-6 53-3 44-4 40.7 40.1 25-5

100 100 100 100 100 100 100

100 100 100 100 100 100 100

Explanation: 1. airport, port, industrial land, industrial renewal 2. street cleaning, refuse disposal, fire and police, welfare, public health, storm sewers, recreation, library, zoo, museum, aquarium, redevelopment, other than industrial 3. public buildings 4. all highways, transit improvements (where tax-supported). Source: Robert Coughlin, Philadelphia City Planning Commission. tables are presented. A n y breakdown of projects or activities is more or less arbitrary, and neither official nor citizen circles are likely to agree upon whether a given project is best classified as "economic base," " w e l f a r e , " or "physical plant and utilities." These caveats

entered, w h a t can be said about substantive

trends ? T h e most categorical observation is simply that there have not been confirmed, consistent, or dramatic trends. T w o further observations are, however, in order. O n e is that both tables indicate some

tendency toward a rise in "economic

base" allocations, and this would appear to be at the relative expense of " w e l f a r e " allocations. 1 T h e t e n d e n c y — a n d

its

marginal n a t u r e — a r e significant because, as w e have had repeated occasion to remark, the issue of the relative emphasis 1 T a b l e 1 is more likely to show this trend because it includes: (1) sewerage projects and certain City-State highways in the "economic base" category; and (2) self-sustaining funds, thus giving more weight to some public utilities which are "tooling u p " aspects of industrial development.

Capital Improvements and Budgetary Perfection

173

to be placed upon "welfare" versus "economic base" investments involves the most important ideologies and interests in City politics and administration. The table appears to reflect a close balance of forces. The second observation is that expenditures for physical plant and utilities show no marked trend toward absolute or relative decline. This category is largely comprised of routine City facilities, and the absence of any downward trend indicates that the City has not noticeably "caught u p " in these fields. "Forced" outlay to meet commonplace responsibilities and standards is probably a thing of the past, 1 but large "continuing programs" of improvement and replacement continue. As we suggested in Chapter I I , the programming of facilities in some of these fields seems inherently unpredictable. If so, their continued significance must handicap stability in capital programming. 2. Stability in capital programming. In this section we present some measures of "stability" in Philadelphia's capital programming. By "stability" is meant the extent to which forward programming is actually budgeted and budgeting actually executed; that is, broadly, predictability. "Stability" does not imply a more-or-less fixed pattern of budget allocation over the years, and capital programming, as a process of more "rational" or explicit judgment, is presumably designed to mitigate this frequent feature of operating budgets. A common 1 A striking example occurred as late as the year 1954 when, as a result of State and City surveys and inspections, some twenty-four bridges were declared unsafe, facing the administration with the alternatives of either shutting down important parts of the City's circulation system or repairing the bridges immediately and altogether at a large alternative cost in terms of the remainder of the capital program. The second alternative was chosen (there was no debate at all about the choice and no one suggested that there ought to be), and the 1955 Capital Budget was completely and belatedly revised to accommodate the forced capital outlay, or deferred maintenance.

174

Planning Municipal

Investment

claim for capital programming is its application of long-range planning to budgeting for the sake of anticipation and integration (not to mention fiscal advantages).1 "Stability," in our sense, should therefore be a measure of the effectiveness of the process. One test of stability is to ask how predictable are projected total expenditures and their interdepartmental allocation for Table 3. Total Funds Scheduled for 1959 Capital Budget in Previous Capital Programs (in thousands of dollars). Actual Budget Agency '956 '958 '954 1955 '957 '959 Commerce Fire Free Library Public Health Police Public Property Recreation Redevelopment Streets Water Welfare Gas Commission Total

$3,882 •85 0 374 0 0 3.370 6,205 5.849 •6,999 ',350 9,ooo

*4.'25 605 490 488 2,836 ',949 3,'4' '4.527 18,680 24,020 40 0

$5,264 3'5 662 373 3,329 3,765 2,633 '5.934 33.895 26,000 574 0

$46,749 $58,908 $117,716 $120,972 $69,318

$90,314

$1,100 75' 0 2,426 0 0 1.745 6,420 '8,745 18,711 0 9,000

$1,420 873 0 260 0 525 2,085 6,784 77,'72 '9.985 10 9,000

$4,617 i,255 257 54° 0 475 1,805 '3,897 78,550 20,035 240 0

Table 4. City Funds Scheduled for 1959 Capital Budget in Previous Capital Programs (in thousands of dollars). Actual Agency 1958 '956 '954 '955 •957 •959 Commerce Fire Free Library Public Health Police Public Property Recreation Redevelopment Streets Water Welfare Total

$3,882 '85 0 374 0 0 3,37o 1,040 4,710 2,563 ',350

$ 1,100 75' 0 2,425 0 0 ',745 737 10,499 4,"4

$2,616 ',255 257 540 0 475 1,805 2,643 13,280 2,257 240

$2,125 605 490 488 2,836 ',949 3.141 3.244 9.380 3.468 40

$2,513 315 662 238 3,"5 3,637 2,545 2,706 5,877 3,820 487

$17,474 $21,422 $19,897 $25,361

$26,266

$25,870

S ' , 170 873 0 260 0 525 1,985 1,161 12,900 1,013 10

S e e Jesse Burkhead, Government Budgeting, op. cit., Ch. 8 and esp. p. 185. 1

Capital Improvements and Budgetary Perfection

175

1959 from their first appearance in the 1954-1959 Capital Program through succeeding programs to the 1959 Capital Budget. Tables 3 and 4 provide this information for, respectively, funds from all sources and City tax-supported funds. 1 Both tables demonstrate wide annual variability in departmental allocations. Table 4 shows a progressive "filling out" of the tax-supported program for 1959 down to the penultimate year, with a subsequent cut-back in the actual budget year 2 while Table 3 shows a vast instability in the scheduling of funds from all sources, some of which may reflect the vagaries of intergovernmental negotiations. Examination of scheduled expenditures for other years indicates that the year 1959 was in no way peculiar, and it should be added that the dollar figures in the tables represent net changes only and indicate little about the stability of scheduling of actual projects within departments. Table 5. Funds Scheduled for Sixth Year of C a p i t a l Programs. ( I n thousands of dollars. Tax-supported City f u n d s only. Does not include previously available loan funds.) 1959

Agency Commerce Fire Free L i b r a r y P u b l i c Health Police P u b l i c Property Recreation Redevelopment Streets Water Welfare Total

1954

in 19601η 1961 in 19621η 19631η 19641η C P ' 9 5 5 C P 1956 C P ' 9 5 7 C P 1958 C P • 959 C P

$3,882

$2,640

'85

345 υ 2,300 0 2,425 2,550 0 4,37°

2'5 0 0 356 1,610 950 9,974

4,624

i,9°o

0 374 0 0 3.370 1,040 4,710

2,563 i,350

$

850 180

$3,295 600

$1,850 215

$4,370 265

>'5

1,230

1,287

1,865

0 "7

1,665

1,722 0 0 2,935

2,780

2,098

2,363

3,000

2,700

3,000

9,100

9,150

7,820

2,813

6,082

4,100

200

2,521 230

3,312 75

$26,577

$22,075

$25,862

$17.474 $21,154 $20.949

0

1

A word of caution is in order respecting the tables that follow. This is that their preparation involves a factor ofjudgment in dealingwith changes in project nomenclature and with the significance of program changes. In general, changes in dollar amounts of less than 5 percent were ignored. J T h e rise in the total in the 1 9 5 7 - 1 9 6 2 Capital Program reflects in part the raising of the ceiling from $ 2 0 to $ 2 5 million in 1956.

176

Planning Municipal Investment

Table 5 shows the scheduling of funds (by departments) for the ultimate years of six capital programs. Bearing in mind the rise in the financial ceiling in 1956, there appears to be no strong tendency for the sixth year to become "fuller" as experience with capital programming has developed, though the table indicates little about the actual predictability of projects scheduled for the sixth year. Sixth-year scheduling for individual departments varies widely. The dramatic increase for the Free Library reflects the advent and gradual acceptance of its long-range plan for regional and branch libraries. The Police Department is never programmed for the sixth year because it is always expected that its program will be completed sooner, but such has not been the case. Another test of stability compares the funds budgeted for a given year with those scheduled for that year in the program of the immediately preceding year. The three most recent comparisons (at the time of writing) are set forth in Figure 1, which shows percentage deviations from the previous year's allocations. In the 1959 Capital Budget, for example, there was no department in which the deviation was less than 13 per cent and in seven departments it was greater than 30 per cent. The most dramatic percentage deviation (though the absolute sums were not large) occurred in the Welfare Department and reflected the sudden introduction of a Youth Rehabilitation Center plus similarly unscheduled improvements to an existing facility. The deviation resulted in part from the unexpected availability of a site for the Youth Rehabilitation Center; in part it appears to have resulted from increased public and political concentration upon the problem of juvenile delinquency. The 1959 Capital Budget, in any event, compared favorably with preceding years in the matter of stability, though the three years taken together (or compared with previous years) show no discernible trend toward greater stability in programming. It should be noted that the dollar

178

Planning Municipal Investment

figures are net figures and doubtless conceal cases of project substitutions within the totals. Table 6. Project Changes at Various Stages of 1958 and 1959 Capital Budgets. 1 2 3 4 5 1959 Budget 1959 Budget 1959 PC Ree 1958 Budget 1958 PC Ree

1959 PC Ree 1958 PC Ree 1958 Budget 1957 Budget 1957 Program 8 22 18 21 17 16 18 16 9 9 8 12 >3 32 25 21 10 '7 4 24 20 77 33 3° 3° 26 6 22 3° 25 6 31 44 33 34

A Β C D Ε F G

The vertical columns show changes of various types between the stage below the line (the base) and the stage above the line—e.g., in Column 1 between the Planning Commission recommendations for the 1959 Capital Budget and the 1959 Capital Budget itself. Changes recorded are of the following types: A—Increase in funds allotted to a previously scheduled project. Β—Increase in funds together with shifting forward of project. C—Decrease in funds allotted to a previously scheduled project. D—Shifting back of project (from budget year to later year). Ε—No change—the project appears in the budget as scheduled. F — A new and previously unscheduled project appearing in budget. G—Previously scheduled project removed from program. T h e difficulty presented b y net dollar figures can be overcome by a comparison in terms of actual projects, which T a b l e 6 provides for the two b u d g e t years 1958 and 1959. T h e table sets forth several comparisons

(from right to left):

between the 1957 program for 1958 and the 1958 capital budget

recommendations

of

the

Planning

Commission;

between the 1957 program for 1958 and the 1958 Capital B u d g e t ; between the 1958 program for 1959 and the Planning Commission recommendations for the 1959 C a p i t a l B u d g e t ; between the Planning

Commission

1958 program

recom-

mendations for the 1959 C a p i t a l Budget and the actual 1959 budget;

and between the Planning

Commission's

capital

b u d g e t recommendations for 1959 and the actual 1959 Capital Budget. T h e comparisons thus show changes made at various

Capital Improvements and Budgetary Perfection

ϊ JQ

stages of the programming process. Column 2 indicates that between the Planning Commission's 1958-1963 capital program recommendations for 1959 and the actual 1959 Capital Budget, twenty-two items underwent dollar increases; sixteen items were shifted forward into the budget years; thirteen items underwent reduction in funds; and twenty-one items were moved back out of the budget year. Only thirty-three items met with no change at all and thirty-one items were deleted. 1 The comparisons in column 1 deal largely (though not exclusively) with changes made by Council in its review, and the considerably larger number of changes in the remaining columns indicate that instability in programming is more attributable to the administration and Planning Commission than to Council. 2 The relative role of Council in program stability may be further clarified by the data in Table 7. These data reflect a comparison of the Planning Commission's recommended 1958-1963 Capital Program with the program as adopted by Council. Comparison of Table 7 with column 5 of Table 6 indicates that a much larger number of changes resulted from administrative and Planning Commission actions, and Table 7 alone demonstrates that changes in Council are primarily changes in scheduling. Most of the changes that affect capital program stability, then, take place in the departments, the upper reaches of the administration, and the Planning Commission. Many of the changes are simply scheduling or costing revisions in routine 1 2

Capital budgets average about 120 line items.

One possible qualification of this conclusion would be anticipation by the administration and Planning Commission of Council attitudes indicating probable pressure for changes. Our own interviewing and observation convince us that, while this factor is of some importance, it is not the principal factor in administration and Planning Commission changes.

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Capital Improvements and Budgetary Perfection

181

projects or continuing program resulting, for instance, from unanticipated difficulties in site selection or acquisition, from delays in project execution and the consequent "backing u p " of programs, from revisions in project magnitude or cost estimates, or from simple judgmental changes in departmental or administrative priorities. Some alterations, however, are more fundamental and reflect the basic exercise of administrative or Planning Commission discretion, generally at a late stage in the programming process, and often in magnitudes that require considerable revision of the capital program. Late in 1956, for example, the M a y o r pressed a $2 million appropriation for transit improvements into the 1957 Capital Budget, and in 1958 the administration's pressure for immediate construction of a municipal administration building set off the wrangle with Council described in Chapter V . In 1958 requests for funds for transit improvements were light; the executive director of the Planning Commission suggested a heavier submission to the Public Property Department, and supplementary requests were embodied in the later years of the 1 9 5 9 - 1 9 6 4 Capital Program. The projects just mentioned presented programming difficulties for several reasons. Transit and transportation have been a particular interest of the M a y o r but have also required complex negotiations with the private operator of the facilities; government buildings have political and symbolic significance and must also be integrated with redevelopment planning; and both types of projects fall within the purview of the Public Property Department, which is more custodial than programmatic in tradition and function. But the major projects of other departments have also departed from schedule or originated late in the game because of shifts in policy emphasis or the unpredictability of private land uses or intergovernmental grants. Recently, for example, the more or less forced purchase of

182

Planning

Municipal

Investment

land facilities has b e c o m e a complicating factor. T h u s in 1959 the C i t y negotiated to b u y from the Pennsylvania R a i l r o a d at a cost in excess of $2 million a plot of land between City Hall and P e n n C e n t e r because projected private plans for the site were t h o u g h t to prejudice future C i t y development plans for the area. T h e funds were necessarily scheduled for the near future. Similarly, in 1958 the federal government declared " i n excess o f f e d e r a l requirements'' three of the largest piers in the C i t y ' s port, handling 25 per cent of annual general cargo. F e a r i n g that the piers might be privately bought for warehousing, thus limiting the general cargo trade of the port, the C i t y late in 1958 scheduled $3,000,000 for their purchase and i m p r o v e m e n t in the 1959-1964 C a p i t a l Program, beginning w i t h the first y e a r a n d averaging about $500,000 per year. A t this writing negotiations with the federal g o v e r n m e n t are still in process, special federal legislation is being sought, and the ultimate price is still not known. I f p r o g r a m stability is thought important, then the preceding data are discouraging. Professionals differ, however, on the importance of stability. A n u m b e r of City administrators are prone to feel that a six-year p r o g r a m is too long for realistic and/or stable p r o g r a m m i n g — t h o u g h this contention may not be relevant to the data that demonstrate substantial variation from one y e a r to the next. M o s t city planners value six-year stability more highly since it is a test of the long view which is the planner's stock-in-trade. W e will argue in Part 2 that the possibility o f p r o g r a m stability p r o b a b l y varies somewhat a m o n g types of projects. W e will also argue that, on the whole, instability is endemic in capital p r o g r a m m i n g in the metropolis and that stability is likely to conflict with other objectives. 3. Some proposed administrative reforms. Despite our doubts about stability, some administrative reforms seem worth

Capital Improvements and Budgetary Perfection

183

considering. Of the suggestions at large in the literature and in the City itself, we have selected three for brief discussion. A. The content of the capital budget. In a valuable study of capital budgeting in New York City, Frederick C. Mosher has argued the advantage of a more restricted capital budget content. 1 Maintaining that the basic role of the planning commission relates to "the future growth of the City, and the development of a general plan of private and public development," and that "its principal interest is in the physical development of the C i t y , " Mosher contends that the planning commission can do a better j o b in this field " i f it is relieved of the vast number of 'capital' items that are only remotely relevant to such physical development." 2 His own suggestion for New York City is that such items should find their review in a staff agency to the Mayor. Philadelphia's capital budgets and programs contain, as we have seen, a number of similar items. All of them are passed upon by the Planning Commission, though departmental priorities are normally accepted and the prior screening of the Managing Director plays an important role. Mosher's proposal may be taken in two senses. The first (and minor) sense is as a recommendation for the more conservative definition of "capital," with non-capital items strictly relegated to the operating budget. Definition of "capital" projects, however, is always arbitrary and is

1

"Fiscal Planning and Budgeting in New York C i t y , " in New York State—New York City Fiscal Relations Committee, Report op. cit., pp. 65-84, esp. pp. 8 1 - 8 2 . Mosher himself applies the argument only to New York City. 2 Ibid., pp. 8 1 - 8 2 . Emphasis in original. Mosher illustrates by "minor structural renovations and equipment of many kinds, such as new kinds of traffic lights, and the costs of electric generating stations for the transit system."

184

Planning Municipal

Investment

primarily of fiscal rather than physical concern. 1 In Philadelphia both the Charter and subsequent practice have resulted in a conservative definition, though there has been persistent criticism from some quarters of "deferred maintenance" in capital budgets. 2 Yet much of the "deferred maintenance" consists in the replacement of extremely old facilities, much of the rest of it is minor, deferred maintenance is in any event difficult to define, and the Finance Director has argued (persuasively, we think) that such capital outlay is reasonable where there is no budgetary provision for depreciation. In a second (and major) sense the Mosher proposal may be construed as relegation of the Planning Commission to land use concerns plus, perhaps, a few other " l u m p y " items. If applied to Philadelphia the proposal would exclude a minimum of $ 1 0 million of tax-supported City funds from Planning Commission purview, and probably closer to half the level of the present financial ceiling. It would require a fundamental administrative alteration in which the Budget Bureau or a similar staff agency (or perhaps the Managing Director) undertook responsibility for review of those facilities relatively unrelated to the physical development of the city, and it would entail a continuing definitional and jurisdictional

1

See, e.g., Burkhead, op. cit., C h . 8 ; United Nations, Department of Economic Affairs, Budgetary Structure and Classification of Government Accounts (New York, 1 9 5 1 ) , C h . 2 ; International City Managers' Association, Municipal Public Works Administration (3d ed.; Chicago, 1946Ί, Ch. 13. * T h e Citizens' Council on City Planning has criticized inclusion in the capital budget of "drinking fountains, paving, or items occurring annually, such as traffic signals, traffic islands, and street lighting. . . . " Analysis of Proposed 1957 Capital Budget and igsy-igöä Capital Program (Philadelphia, 1 9 5 6 ) , p. a. T h e principal critic of deferred maintenance has been the Bureau of Municipal Research-Pennsylvania Economy League.

Capital Improvements and Budgetary Perfection

185

problem in drawing the line between physically relevant and non-relevant projects. We are inclined to doubt that the not-so-simple redrafting of jurisdictional lines would greatly enhance stability or improve physical planning. For this conclusion there are two practical reasons: the countervailing definitional and jurisdictional problems implicit in the proposal and the current division of labor in the Planning Commission in which the Comprehensive Planning Division is free to focus on physical planning alone. Philadelphia's capital programming experience to date has been relatively free of adventitious jurisdictional rivalries that might derationalize public investment. More rigorous and goal-oriented physical planning in the Planning Commission might emphasize institutional rivalry rather than integration. Two further and more fundamental considerations are argued in Part 2 below—that the major sources of program instability are likely to be administrative and political, and that some confusion is inevitable between what we term "land use" and "programmatic" planning. B. Cost estimates and controls. Better estimates of project costs would almost certainly enhance capital program stability. The experience described in Chapters I I I and V I I suggests, however, that there are serious limits on the predictability and reporting of costs in the departments. More emphasis on costconsciousness in the central review might make for some economies, but its effects on stability are likely to be marginal. Performance budgeting and other cost controls are probably less relevant to capital than to operating budgets. They require definitions of standards or goals which often can only be provided by experience. They may discourage experiment. They emphasize controls rather than construction, and they deemphasize the competences of the Planning Commission. Thus the pursuit of economy, like that of stability, must be

186

Planning Municipal Investment

b a l a n c e d against

other

objectives

in

public

investment.

C . Departmental planning. Besides the p r o b l e m s of cost control and the definition o f c a p i t a l , critics of the

Philadelphia

experience h a v e e m p h a s i z e d a relative lack o f p l a n n i n g a n d p r o g r a m m i n g in the line. T h e discussion in C h a p t e r I I lends some support to such criticism, t h o u g h it is seriously q u a l i f i e d b y the reflection that a d v a n c e p l a n n i n g for some fields a n d facilities m a y necessarily derive m o r e f r o m short-run administrative j u d g m e n t than f r o m l o n g - r u n decisions o n responsibilities, standards, a n d c a p i t a l p r o g r a m s . E v e n the forthc o m i n g c o m p r e h e n s i v e p l a n will p r o b a b l y h a v e to r e c o g n i z e this administrative fact o f life. 4. Conclusion. It is a c o m m o n p l a c e that b u d g e t i n g presents hard a n d irreconcilable alternatives a m o n g purposes

and

processes. T h e f o r e g o i n g discussion indicates that this is true of capital as well as o p e r a t i n g b u d g e t s . T h e principal alternatives suggested w i t h respect to purposes h a v e lain (a) b e t w e e n contrasting emphases on physical a n d p r o g r a m p l a n n i n g , a n d (b) b e t w e e n emphasis u p o n b o t h of these on the one h a n d a n d upon cost controls on the other. T h e s e alternatives entail institutional choices as to process w h i c h , chiefly, c o n c e r n the relative roles a n d competences of the P l a n n i n g C o m m i s s i o n , a b u d g e t a r y staff a g e n c y , a n d the administrative line in project review or f u n d allocation. O u r o w n tentative conclusion is that, save for possible minor modifications (for e x a m p l e , in the definition o f " c a p i t a l , " or the imposition of cost controls in the line or subsequent to project r e v i e w ) , the costs of a c h a n g e in o r g a n i z a t i o n w o u l d p r o b a b l y o u t w e i g h the gains. T h i s conclusion rests in part upon our a c c e p t a n c e of w h a t w e take to be the C i t y ' s existing capital p r o g r a m purposes, w h i c h h e d g e b e t w e e n (or h o p e to integrate) p h y s i c a l a n d p r o g r a m p l a n n i n g a n d w h i c h rate cost controls as of less i m p o r t a n c e t h a n either in c e n t r a l review. T h e conclusion further rests on some f u r t h e r conclusions re-

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specting the institutional and intellectual attributes of the process, which are argued in Part 2 of this study. T h e description, data, and tentative conclusions above derive from a capital programming experience that began in earnest in 1953 (six years prior to the date of writing). In that time the process has "shaken d o w n . " Administrative innovations still occur, and the Planning Commission has recently increased its staffing in the field in anticipation of the comprehensive plan. Interest in capital programming in City circles continues high, and the process is taken seriously in all the quarters described in this study. T w o phases may be seen in the six-year history, and a third phase may possibly lie in the future. T h e first was a period of rapid "catching u p " in which " f o r c e d " expenditures figured prominently and unpredictably. This phase ended at different times in different fields, but it does not figure in the data presented above for capital budgets and programs since 1956. The second phase has been one of emphasis upon consolidation and extension of programs together with the launching of urban renewal; it has emphasized planning, programming and tighter project justification in the departments, and the budgetary constraint embodied in the City's financial policy. I n some circles the hope exists that a third phase lies in the immediate future. I n this phase emphasis would be placed upon large programs and projects (for example, renewal and transportation) to change the face of the city rather than upon more routine departmental services. Priorities would derive from a comprehensive plan rather than from the process of capital programming described above. While conscious of the hazards in prediction, we feel that the data of this study suggest a less radical view of the future. It seems to us logical to suppose that substantive emphases in capital programming will continue to shift toward the City's fiscal base and physical face, but we think it less likely that capital programming itself

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will largely become a means of "suboptimizing" central or "higher level" decisions. Traditional services and facilities and their departmental providers must continue to play a role in capital programs. Program emphases to date have changed slowly except when they have changed unpredictably, and City policy has not characteristically taken the form of longrange and ready guidelines for project review and fund allocation. Planning so far has tended to hedge on goals; goals in many fields have been derived from departments; these, in turn, are liable to change. Despite the imminence of the comprehensive plan, basic decisions have yet to be taken on the goals of city development; and one reason may well be that the organized citizenry is divided with respect to such goals. Such considerations (and others argued in succeeding chapters) lead us to believe that, while comprehensive planning will assist capital programming, it will not replace it as a vehicle of City decision.

PART 2

I X ' '

Politics, Administration and Public Investment

I N P A R T 2 we endeavor to draw the implications for theory, rather than directly for practice, of the experience of capital programming in Philadelphia. T h e two chapters following this one deal (1) with the organization and practice of city planning in capital programming, and (2) with economic analysis and criteria for public investment. In the present chapter we essay some generalizations about how the institutions of municipal government may be expected to work in capital programming. Our problem here is the relative "instability" of capital programming revealed in the data of Chapter V I I I , and our method consists in a set of propositions bearing on this instability. Most of the propositions are efforts at systematic summary of the material in Part 1, though a few of them are a priori notions upon which this material is brought to bear. Ceteris paribus, we would expect most of them to apply beyond Philadelphia and above the level of " l o c a l " government.

I. There has been a tendency for capital programming decisions to gravitate from the Planning Commission to the administrative line. The literature of public administration would probably lead one to predict such a development. 1 But the dominant ex1

See, for example, Herbert A . Simon, Donald W. Smithburg and Victor A. Thompson, Public Administration (New Y o r k , 1950), Ch. 20, esp. pp. 442-447. 191

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pectations surrounding capital programming in Philadelphia appear to point to a large and at least penultimate adjudicatory role for the Planning Commission. 1 Such expectations are seemingly embodied in the City Charter, though the ex officio device somewhat obscures its intent. The expectations and intentions appear, however, to have been more nearly fulfilled in the early years of capital programming than they are today.* We believe that the adjudicatory function just mentioned is now primarily performed in the administration. The principal factors in "line" predominance appear to be the following. 1. The importance of being on the spot and involved in day-to-day operations seems considerable; policy (or projects) have tended to emerge from ongoing operations or immediate necessities. 2. There has been an improvement in long-range planning in the departments, stimulated in part by the role of the Planning Commission in programming and the demand for better project justifications. This improvement generally falls short of what anyone in the City government considers a substantively useful level, but it has lent persuasiveness to departmental justifications and authority to the Managing Director. 1 We think this view is expressed in the following editorial comment on an issue between Council and Planning Commission concerning the 1959-64 Capital Program: ". . . the Planning Commission is only doing its job when it reshuffles priorities. Its purpose is to consider the City as a whole, and to balance desirable capital spending ideas against each other and against the amount of money which may be spent. "Without such over-all planning, the Commission would have no function. City building would then descend to pork-barrel tactics. . . . " The Evening Bulletin (Philadelphia), October 27, 1958. 1 We say "appear" because we are not directly familiar with the early years of capital programming and because the trend postulated here is difficult to document. We have relied heavily on the testimony of a number of City officials and observers.

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T h e deferred m a i n t e n a n c e a n d " c o n t i n u i n g p r o g r a m s " in capital p r o g r a m s h a v e h a d the same effect. 3. T h e M a n a g i n g D i r e c t o r is formally charged w i t h coordination

of

most

departments.

The

City's

Managing

Directors h a v e been able a n d effective and h a v e believed that the chief responsibility for forward planning should rest with the departments rather than w i t h the P l a n n i n g Commission. 4. T h e M a n a g i n g Director's office has kept a tight grip on most departments t h r o u g h central staff work on their operating and c a p i t a l budgets. It has instituted an initial screening o f d e p a r t m e n t a l c a p i t a l p r o g r a m requests at their inception and an overall review before their submission to the P l a n n i n g Commission. T h e informality of this screening has left a good deal of discretion to some o f the departments while closely circumscribing others, b u t the potential for central control is present. T h e administrative screening process has lately been carried f u r t h e r a n d f o r m a l i z e d in a C a b i n e t subcommittee c h a r g e d w i t h r e v i e w i n g the " l u m p y " projects that are the troublemakers in the c a p i t a l budget. 5. T h e ex officio device has right along given a good deal of w e i g h t to the administration members w h o sit on the C o m mission, t h o u g h it has left to the Commission in the past a function o f a r b i t r a t i n g or otherwise deciding in those cases w h e n the ex officio m e m b e r s were not in substantial prior agreement. S u c h cases h a v e not been infrequent, though it seems likely that the C a b i n e t subcommittee will induce more prior agreement. 6. T h e ability o f the Commission to cope w i t h the ex officio m e m b e r s has d e p e n d e d upon the knowledge, interest, a n d ability of the P l a n n i n g Commissioners respecting the C a p i t a l P r o g r a m . I n the early years these seem to h a v e been considerable, but there is m u c h testimony to the effect that C o m missioners' participation in capital p r o g r a m m i n g has declined. T h e role o f the Commission's staff vis-a-vis the Commission p.M.ι.—ο

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appears to have grown. It may be, as some students of administration have argued, that the tendency toward "marasmus" and decline is endemic in independent commissions.1 7. Two staff divisions of the Planning Commission are involved in review of the Capital Budget and Program. These are the Projects Division and the Comprehensive Planning Division. The latter has entered the picture only in recent years, reviewing the departmental requests for their conformance with the projected comprehensive plan. This review has not been particularly influential to date, partly, no doubt, because it has not been based upon explicit or persuasive criteria for programming due to the tentative state of the comprehensive plan. The Projects Division is in charge of assembling the Capital Budget and Program. The Division has been prone to recognize that the range of choice for the Commission is limited by continuing programs, administrative attitudes, top-level policies, and popular demands for some projects working their way forward in the program. Its decisions thus rest basically on (a) knowledge of the projects' etiology in the departments and an assessment of departmental planning and appraisal of "need," and (b) the "law of anticipated reactions" with reference to administration and Council. Integrative and long-term considerations are far from being ignored in the decision; but with the range of discretion narrowed and lacking explicit criteria, the Projects Division is handicapped. Its members are extremely able and well-informed; but the very nature and sources of its in1

The term is that of Samuel Huntington, "The Marasmus of the ICC," Tale Law Journal, 61 (195a), 647; but the thesis has been advanced by numerous writers respecting independent regulatory commissions. There is some discussion of city planning commissions from this point of view in Robert Walker, The Planning Function in Urban Government (Chicago, I940-

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formation p r o b a b l y cause it to act, to some extent, as a buffer between administrators a n d " p l a n n e r s . " Testimony f r o m sources outside the Planning Commission is general to the effect that the role of the Commission vis-ä-vis administration has declined somewhat in recent years. Some sources attribute this largely to loss of Commission interest a n d knowledge; some stress the lack of criteria for decision and look to the forthcoming comprehensive plan to alter the distribution of influence; some say that there are fewer decisions to be taken now since main emphases have been collectively settled and most obvious projects are in the Program a n d have simply to be shuffled a n d reshuffled from one year to another. T h e reasoning advanced above would indicate t h a t positive factors in the line have been rather more influential in the trend t h a n have negative factors in the Commission. T h e Commission's role remains, however, a significant one. It is not entirely detached from the line. Its vigorous C h a i r m e n and Executive Director have prevailed in numerous policy decisions; generally they have been consulted in i m p o r t a n t decisions. Its prestige has given weight to its occasional protests over projects or scheduling. It has been conceded a genuine role of an integrative sort in the prevention of future diseconomies t h r o u g h conflicting projects or land uses or (from the City-wide view) inefficient scheduling. Increasingly, the administration has been attending to some of these aspects itself, thus restraining the integrative role of the Commission from becoming one of thoroughgoing allocation; but the Commission will clearly continue to play a role in a d u m b r a t ing long-range goals a n d in integrating the scheduling of projects over the shorter-run. I I . Although capital programming entails administrative initiative, the legislature retains a large role in relating investment to

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community values. Capital programs are bulky and complex. Administrative initiative prevails for four major reasons: (i) the formal, "executive-centered" structure of Philadelphia government; (2) the substantial and organized citizen support for this structure and for progress in capital improvements; (3) the need for some central overview and initiative if this progress is to be rapid and apparent; and (4) the consequent necessity for Council to accept administrative initiatives so as to realize the political and fiscal returns from improvements. Yet Council's participation in capital programming—as described in Chapter V—goes well beyond abject ratification of the works of planners and administrators. The quality, and thus the effects, of Council's participation will now be explored in a series of propositions. A. Council's perspectives on capital programming are actually and admittedly more "political" than those of the administration and Planning Commission. In this form the proposition is either a truism or a tautology, but it can be spelled out more fully. Council's view of capital programming is short-run, emphasizing the budget and imminent years of the program. Council has not been interested in abstract criteria for programming, relying instead upon its own estimate of popular wants when they are immanent. The attention of rank-and-file Councilmen (and perforce of their leadership) tends to focus upon projects deemed popular and productive of electoral gain. Thus widespread popular gratification becomes the most salient point of reference for Council, rather than criteria related to remote and long-run goals, macro-economic analysis for the city, or rigorous standards of administrative performance. In the testimony of Councilmen their application of this perspective approaches a deliberate division of labor in capital program review. B. Council is interested and active in scheduling and takes its capital budget and program decinons in this fashion. Of course, the

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ultimate capital program decisions concern scheduling—it is perfectly possible for a project to be programmed yet continually deferred and never budgeted. The proposition amounts, then, to a statement that Council influence is considerable, if in fact Council does freely change scheduling. Council's influence is usually exerted on the basis of alternatives set before it rather than in the broader selection of the range of those alternatives or the standards that might govern that range. Council's response to political pressures, and the short time horizon of the Council, operate to emphasize scheduling rather than broader generalization about long-run needs. The same factors sometimes militate toward inertia; in the absence of specific forces urging change Council tends to stick to the scheduling provided in previous programs. 1 Since Council's time horizons are short and projects scheduled for remote years are not carefully scrutinized, the legislature thus subjects itself to pressures against rescheduling for those projects that acquire public support. However, specific forces demanding Council's active attention to scheduling are frequently present. One such force is the administrative introduction— often as top policy and generally for the coming budget year— of lumpy and exigent items, for which room must (it is urged) be found. Such projects set off a series of scheduling changes, by both administration and Council, in which the changes inade by the administration will frequently be altered by Council. A second force making for scheduling changes is reassessment by Council, (often on tangible evidence) of the relative intensity and/or breadth of public or segmental 1

This type of inertia, and marginal movement from existing allocations, is, of course, characteristic of the budgeting process in operating budgets. The more elaborate planning and screening process of capital budgeting is, in part, an attempt to get away from this tendency and to make decisions more "rational," and, of course, the lumpiness of capital budget items makes marginalism difficult.

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demand for certain projects. T h e result of these forces is that, despite some tendency not to reschedule, this tendency cannot generally prevail; and our proposition holds. C. Council action tends toward regional parity in the distribution of projects. " P a r i t y " in this case does not mean that each Councilmanic district receives capital outlay in the same dollar amount nor that identical projects are awarded each district. T h e sense of the proposition is that Council's action in capital budget review—more than that of other agencies— tends to emphasize regional distribution of certain types of projects. We think there are four major reasons for the tendency toward regional parity. One is the structure of Council, in which ten of the seventeen Councilmen are elected from districts. 1 Councilmen agree that district and at-large members have characteristically different orientations to capital programming. 2 A second distributive tendency probably lies in the legislative process of decision, which is said to lend itself more to trading and logrolling than does hierarchical decision. Philadelphia's Council, dominated by one party, takes its capital program decisions in the closed caucus of that party; and this procedure probably furthers free and frank trading. A third factor doubtless conducing to regional parity and The Charter provides that each district shall contain approximately 10 per cent of the population by the decennial census. The total voting population of the city is about one million, so the districts are quite populous. 1

2 One Democratic Councilman-at-large, who lives in a district now represented by a Republican, told us that he is under constant pressure from his party leadership to "represent" that district, and that he takes great care to avoid being labeled as the Councilman from that district in order to preserve his independence and breadth of view. He is one of the last of the non-"organization" members of Council.

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accentuating Council's concern for this value relative to that of the administration is the fact that most Councilmen are members of the dominant Democratic "organization," while the Mayor is not and is frequently at odds with it. A frequent generalization about big-city political organization runs to the effect that, while it is capable of achieving some centralization and overview, its most basic virtues are sectional responsiveness and flexibility.1 T h e following news item is illustrative: Democratic Ward leaders in the Northeast will ask that $250,000 which was stricken from the capital program for acquisition of land for recreation purposes be restored, it was announced today. The leaders met Monday with City Council leaders to discuss with them the needs of the Northeast area. . . . This item was knocked from the program by the City Planning Commission, (Councilman) McDevitt said. "All of the Northeast Democratic leaders are pledged to have this item reinstated. The Councilmen who met with us indicated agreement with this and have agreed to have this item added to the 1959-1964 Capital Program." 2 Finally, government and city-wide citizen organizations in Philadelphia have actively encouraged and created citizen organization at the neighborhood level. The political party is far from the only method of voicing or creating local demands. Administrative agencies, as well as Councilmen, work closely with the neighborhood groups, which are alert to capital program decisions and mark the progress of relevant items in the printed capital program. Thus, the news account above had its origin in a review of the Planning Commission's capital program recommendations 1

For a recent discussion, see Martin Meyerson and Edward C. Banfield, Politics, Planning, and the Public Interest (Glencoe, III., 1955), Chs. 3, 9 - 1 1 . 1

The Evening Bulletin (Philadelphia), November 12, 1958.

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by the Health and Welfare Council, which notified its Northeast Area Committee, which put " h e a t " on the Democratic organization and on a Councilman who was already faced with a difficult primary fight. City informants agree that Council is more solicitous of regional parity than either the overhead administration or the Planning Commission; but to the extent that departments or the Planning Commission endeavor to anticipate Council, the tendency toward parity spreads. While the administration is likely to attempt a measure of geographical distribution in the six-year program as a whole, Council tends to place this upon an annual basis. 1 We have not attempted to figure the dollar amounts spent in each Councilmanic district, but we have counted the number of projects of certain types begun or under way in the ten districts. 8 There is a marked tendency toward parity among districts, with the exception that in the two districts of Northeast Philadelphia (a large and sparsely populated area now under development) there are more planned facilities. The exception seems to be accounted for by site acquisitions executed prior to 1 9 5 1 , the need for basic facilities in the development of part of the area, and the fact that sites are less expensive in that area. Though it is true that planning standards for recreation themselves embody regional parity in terms of population, it is also the case that the Planning Commission has advocated rather large expenditures now for site 1 Our proposition Ais relevant here,since criteria for allocation other than political ones are more likely to proceed from an overall city perspective in which regional parity may be discounted or not even considered. The Planning Commission does, in fact, divide the city into twelve planning districts, but equality of treatment among districts is not the ruling consideration in this. 1 Parks and recreation centers, including site acquisitions, new construction, and construction at existing facilities.

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Administration

and Public

Investment

201

acquisition in such sparsely populated areas, and that C o u n c i l has stricken and deferred several such expenditures in the interest of maintaining, within given resources, regional parity in the actual development of recreation centers at existing sites. D . Council exhibits a strong tendency toward fiscal conservatism. W e do not advance this as a proposition that is likely to hold for legislative bodies generally, but it is certainly true in Philadelphia. Council has strongly supported the $25 million limit on tax-supported City funds in capital budgets and has, in fact, usually cut the budget below this figure and accomplished further reductions during the life of the budget. Council leadership shows great concern with the impact of capital budgets on operating budgets with respect to both carrying charges and routine operating expenses. T h e fiscal conservatism ofPhiladelphia's Council challenges explanation for two reasons. T h e first is the effect of this attitude upon the size and substance of capital budgets which, while marginal to date, shows some signs of increasing. T h e second is that it is something of a countervailing tendency to the distributive bent just discussed. City councils might, a priori, be expected to approach more closely than other branches of government the model proposed by A n t h o n y Downs in which government spends up to the point at w h i c h the financing of projects outweighs in adverse votes the votes gained from the projects themselves. 1 T h e principal pressures upon Council might be expected to be spending rather than retrenching pressures. 1 Anthony Downs, An Economic Theory of Democracy (New Y o r k , 1957). T w o caveats are in order: (1) Downs' discussion is not expressly directed at capital projects (which, because lumpy and loan-financed, may raise sharper questions of legislative prudence or "responsibility"); and (2) his model assumes no separation of powers and the election at-large of the small governing body.

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T w o lines of explanation appear suggestive and of roughly equal importance. One relates to the representative structure of Council and to the distribution of organized attitudes and interests in the city. The small Council, partially elected atlarge, disciplined by a leadership based in an entrenched party organization, appears responsive to the several city-wide citizen organizations that function as fiscal watchdogs. 1 Significantly, the fiscal conservatism of Council is centered in its leadership rather than in the rank-and-file and serves as something of a counter-weight to the pressures for local projects discussed above. 2 M a n y of the most politically popular projects (for example, recreation centers, health centers, fire stations) have also been among the least costly projects. A second explanation would relate Council's fiscal conservatism to its governmental, rather than its political, role. O n this view, Council's economizing tactics can be seen as an aspect of legislative-administrative rivalry, as a reaction to the administrative budgetary initiatives provided in the Charter, and as a means of exacting and publicly demonstrating some budgetary control. In the absence of "objective" criteria for capital budgeting, moreover, a predisposition to economy may be indulged as a means of forcing detailed justifications from the departments and of asserting an interest in the operating budget, which Council has been endeavoring to control in more detail.

1 Cf. the discussion in C h . 4 of Leverett L y o n (Ed.), Modernizing a City Government (Chicago, 1954). T h e r e , Gilbert Y . Steiner, discussing the relative advantages of election at large versus election b y districts, suggests that the " c i t y - w i d e " interests that are alleged to prevail over " l o c a l " interests in councils elected at-large are primarily interests in tax-reduction, whereas " l o c a l " interests tend to favor particular projects. S e e C h . V I above for a description of some of these interests in Philadelphia. 1 T h e C h a i r m a n of the Finance C o m m i t t e e , a n d C o u n c i l ' s chief fiscal stalwart, is an at-large C o u n c i l m a n .

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E. Capital budgeting and party politics. Discussions of national economic "planning" have characteristically (if inconclusively) considered the question of whether or to what extent planning could subsist within a partisan political framework. Three major problems have been suggested: (1) that of partisan provocation to disagreement on major ends of values; (2) the effects of elections and alternating administrations on the stability of plans; and (3) the danger that "rational" decisions (meaning integrated or long-run decisions, or both) would be subverted by attempts of parties to outbid one another (with, say, capital projects) or to spend selectively for particular groups. The lack of close party competition in Philadelphia means that this study sheds little direct light on these questions. All three "problems" are clearly present in Philadelphia in some degree, and those to whom they cause concern may conclude that lack of party competition per se will not obviate them, though it could be that party competition would intensify them. If so, then one-party, "organization" politics in the metropolis may abet stability in capital programming as it has sometimes been said to do in other fields;1 yet planners may feel that the propositions discussed in this chapter still reflect some political derangement of public investment. The question of whether districts represented by the minority party tend to be punished or short-changed cannot be answered with any authority. For much of the period studied, all districts have had Democratic representation; and the single present Republican district is a close one.2 1

See, e.g., V . O. K e y , Politics, Parties and Pressure Groups (3d ed.; New York, 1955), Chs. 1 2 - 1 3 . 1

For obvious political reasons, one would not expect "close" districts to be short-changed. The single present Republican district does not appear to get more or less—as a whole—than other districts, but it, too,

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Philadelphia's lack of tight party competition is far from unique, for one-party domination is the rule rather than the exception among large American cities. T o this extent one may conclude that the question of party competition and capital programming is largely irrelevant if, as we believe, this generally non-competitive big-city politics is likely to continue to be the rule. 1 However, one qualification upon even these tentative conclusions appears in order. This is that while big-city politics may be generally one-party and noncompetitive, many cities may have substantial pockets that are either politically competitive or dominated by the minority party; and for these cities the questions raised above may be extremely relevant.* F. Conclusion. O f budgeting at the Federal level (where the capital-operating distinction is not procedurally observed), it has been said that the proper role for Congress is to "supply the pattern of value judgments around which the budget is built" without going so far as actually to "formulate the budget." 3 For Herbert Simon, "democratic institutions find was represented by a Democrat until 1956. This district, however, is composed of three wards, one of which is a traditionally Republican ward which has been solidly controlled for years by the family of which the incumbent Republican Councilman (who is also Chairman of the Republican City Committee) is a member. It is worth noting that very little has been programmed for this ward, and particularly since 1956. 1 There are a number of reasons to believe that it will. See e.g. Edward C . Banfield, " T h e Politics of Metropolitan Area Organization," Midwest Journal of Political Science, 1 (1957), 77 fr. 1 See the data on Congressional districts in, e.g., Samuel Huntington, " A Revised Theory of American Party Politics," 43, American Political Science Review (1949), 669 ff.; or Samuel Lubell, The Revolt of the Moderates (New York, 1956), Ch. 9. 5 E. Banfield, "Congress and the Budget: A Planner's Criticism," American Political Science Review, 43 (1949), 1217, at p. 1219. Banfield distinguished sharply—as do many —between the budget as an aspect of

Politics, Administration and Public Investment 205 their principal justification as a procedure for the validation of value judgments ί " 1 and if "efficiency" and accountability are to have meaning, this requires a full spelling-out by the legislature of its objectives, the desired degree of their accomplishment, and intermediate, aggregate, and distributive values. 2 The usual process of formulating operating budgets for governments seems necessarily to violate this division of labor and invalidate the model. 3 Administrations generally have the initiative; and legislative reactions are piecemeal, not comprehensive instructions. The administrative initiatives and planning considerations employed in capital programming might appear even further to reduce the legislative role in "supplying" or "validating" values. Some relevant values are temporarily remote and popularly opaque, and technical considerations are often presumed to weigh more heavily in decisions. In fact, Philadelphia's Council assumes an active role in the ultimate scheduling of capital projects. It amends the capital

administrative management and the budget as a means of allocating funds among purposes. In capital budgeting, of course, the second aspect is primary and the first relatively unimportant. 1 Herbert Simon, Administrative Behaviour (2nd ed.; New York, 1957), p. 56. Simon's discussion emphasizes both the importance for administrative rationality of pressing these distinctions, and the practical difficulty of drawing them clearly. 2 3

Simon, op. cit., Ch. 9.

Some of the reasons are: the fact that budgets tend to be constructed more from the "bottom u p " and incrementally than from the "top d o w n " and with reference to ultimate values; the "suboptimization" problem which makes nearly impossible the organizational and budgetary spelling out of values from the "top down," and the inexactitude and prophetic character of budgetary estimates coupled with the difficulty of legislative exploration of estimates.

2o6

Planning

Municipal

Investment

budget (both before and after adoption) more significantly than the operating budget. While in some respects it manifests similar attitudes and tendencies respecting both budgets, there is the important difference that lumpiness in the capital budget forces some sharp departures from previous allocations and/or administration proposals; scheduling decisions by any party are perforce never final, and Council's role in applying political considerations to scheduling is thus a continuing one. Given popular interest it will be a large one. In fact, the capital program, unlike operating budgets, closely approaches the "alternative budget" device in giving to Council a cafeteria of projects to choose among. 1 The initial project screenings by administration and Planning Commission chiefly apply professional judgments, together with long-run assumptions about popular values. Most projects appear in the program well in advance of their tentative budgeting date; thus scheduling options are publicized in advance and public reactions are tested. The "validation of values" in Council then becomes a political up-dating of planners' and administrators' assumptions concerning public wants; Council's scheduling decisions will reflect popular reactions and pressures or the political judgment of Councilmen (in the absence of specific evidence of desires and/or pressures) as to the projects for which they are willing to go on record. On this interpretation, capital programming is not the categoric reduction to concrete and debentures of administrative judgments and planners' research and assumptions; it is, on the administrative and planning side, a winnowing and research process, and it remains on the legislative side (and, to some extent, on the part of the Mayor) a preeminently political 1 O n the "alternative budget" proposal, see Verne B. Lewis, "Toward a Theory of Budgeting," Public Administration Review, 12 (1952), 42 ff.

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decision. Moreover, it provides an opportunity for popular consultation and legislative judgment that the normal budgeting process seemingly cannot afford, and it provides a continuous process of correction or second-thinking since the vital scheduling decisions never constitute outright rejection but simply deferral. III. There is a tendency for a large number of small projects to be preferred to a small number of large projects of equal cost. Our specific evidence on this point is fragmentary, yet the a priori reasons for supposing such a tendency appear to us so strong that many of them would be expected to operate in any capital programming process. For nearly all parties to the process—political, administrative, and planning—a larger number of projects would be expected to ease the process of decision. Political. Choice among a few large projects would likely heighten political controversy since it would fail to spread direct and visible benefits as broadly as would a larger number of projects. Decision would thus entail debate over rather more basic values and would render more difficult political compromise and consensus. More political uncertainty would appear to be involved in "marginal" decisions among extremely lumpy items since the risk of disapproval and the probabilities of approval could not be spread over so many projects and since, often, more abstract voter values must be the frame of reference for decision. 1 Incremental changes from year to year, or from one stage of the process to 1 It may not even be correct to write of "marginal" decisions where extremely lumpy items are involved. The notion of political "uncertainty" here is suggested by Downs, An Economic Theory of Democracy, esp. Chs. 5-6, and relates mainly to uncertainty about "how a given governmental act will affect the utility incomes of voters . . ." (p. 80), end how voters will react politically to whatever the effect may be.

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another, are obviously easier with a larger number of projects, which, again, helps avoid the difficulties and uncertainties of choice among rather basic values. T h e cost of a small number of large projects is probably more apparent than is that of a larger number of small projects, and the benefits (to many, at least) are likely to appear indirect and difficult to argue. A large number of smaller projects facilitates bargaining among the political and administrative parties to the programming process, and it also makes more possible the regional parity of treatment that tends to result from the bargaining process in Council and that was reviewed above. 1 Administrative. A m o n g administrative agencies, and between them and the Planning Commission, a larger number of smaller projects also facilitates bargaining. There is an added a priori reason to expect an administration to look with favor on a larger number of smaller projects; this is that it enables the spreading of projects among departments and thus encourages departmental initiative, progressivism, and forward planning. Planning. It seems clear that the uncertainties involved in city planning would be enhanced by a policy of concentration. These uncertainties are basically of two types: (i) factual projections and predictions of city development, and (2) popular values and " d e m a n d . " Economic and behavioral forecasting being as difficult as they are, it might well appear more politic to spread the risk of error by not emphasizing large projects, even though the prevention of future blunders is one of the chief justifications for the role of the city-wide planner in capital programming decisions. 2 1

For another study touching on these points of small projects, disposal of projects, and regional parity of treatment, see Albert O. Hirschman, The Strategy of Economic Development (New Haven, 1959), Ch. 10. * There is, however, a countervailing consideration. Some large projects (such as Philadelphia's Penn Center or Eastwick Redevelopment projects) have a symbolic value in dramatizing and promoting planning.

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In the nature of the case, direct evidence on this proposition will be difficult to adduce. If the proposition generally holds, then there is nothing with which to compare the Philadelphia experience. Moreover, the proposition is cast, as it must be in the absence of specific criteria for the City's investment decisions, in relative terms. Some aspects of the Philadelphia experience do, however, appear to bear upon the proposition. Large projects tend to be stretched out over a n u m b e r of years (partly, of course, because of construction problems) and thus leave room for a number of smaller projects. Such large projects usually enter the program late and are top-level decisions taken by the Mayor. Generally, then, they are in response to some fairly urgent need or opportunity, and/or to the j u d g m e n t of the Mayor that the political climate is healthy for them. When such large projects are contemplated or pressed into the program there is, as would be expected, a good deal of complaining from everyone who must help find a place for them in the program. Neither the staff of the Planning Commission nor Councilmen, on their own testimony, welcome such projects and the hard decisions they entail, though they often recognize that the projects properly belong in the program. Finally, though the specific evidence is tentative and fragmentary, several persons involved in the City's capital programming are inclined to believe that the tendency expressed in the proposition does hold. I V . There is a tendency for the area of explicit decision in the capital budget and program to diminish,1 Ideally, on some conceptions of capital programming, only the sixth year of the program would afford room for decision (excepting items of an emergency nature); but the data on stability of the process in Chapter V I I I show clearly that capital programming in 1 This proposition states an institutional tendency, not a temporal tendency.

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Philadelphia does not work in this fashion. O n the contrary, it might be supposed from the record that both the forward years of the program and the budget itself are entirely open to revision each year; and formally this is the case. Political and administrative pressures (sometimes building on the prescriptive prior appearance of a project in the capital program) are of considerable importance in narrowing alternatives, yet the tendency is accentuated by several other factors. A . Each capital budget contains several tax-supported lines of what can be termed "continuing programs," or recurring expenditures, or, in some cases, simply deferred maintenance. Each year, for example, the capital budget of the Streets Department carries sums for seven "continuing programs." 1 Some are recurring expenditures that may be expected to continue indefinitely (for example, "grading and new paving") ; others are major improvements which it has been decided to schedule over a period of years (for example, "construction of traffic islands"). The programs average about $3.5 million annually, with very small annual deviations. The continuing items in all departments sum to $6 to $7 million annually, a figure that is quite stable from year to year, though allocations for the constituent programs that comprise it sometimes vary significantly. 2 It could be argued that the consistency of the overall allocation for continuing progress is a force for stability in capital programming; and

Grading and new paving; street openings; street lighting; unallocated engineering services; traffic signals (city-wide); road construction and paving, Fairmount Park; construction of traffic islands. 1

* Because the constituent items vary in size, it is plain that some explicit decisions are made on these items, both in the departments and in the Planning Commission; yet the fairly consistent overall allocation to such continuing programs indicates—and our interviews indicate that it indicates—a lack of much explicit central attention to these programs and, of course, a narrowing of the area remaining for decision.

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so, in a sense, it is. But variations within the net figure and the pressure on the remainder of the $25 million limit exerted by the continuing programs are factors that point in the opposite direction. B. Large projects have (often necessarily) been stretched out over several years and entailed continuing appropriations for their completion. Examples of such projects are large City-State highways and the new $10 million municipal administration building programmed to begin in 1959. Such items have averaged $2 to $3 million annually during the past few years. C. Where large items or programs—such as the highway programsjust mentioned—depend upon State or Federal aid, the timing and extent of the City's contribution are not entirely at the discretion of the administration or the Planning Commission. Sometimes this lends urgency and leverage to certain departments (especially the Streets Department) for capital budget and program allocations. Sometimes intergovernmental aids add stability to capital programming because of pressure to block out constant amounts over a period of years for continuing programs; but they are also a source of instability where this pressure is not present or when their availability is uncertain until late in the game. In all cases they have some tendency to narrow local discretion. D. Some items are relatively removed from explicit decision annually because of earlier explicit decisions. These may concern acceptance of general goals for certain programs (for example, that there will be a continuous program of replacing obsolete or ramshackle police and fire stations until all such stations are replaced), or decision on a more-or-less permanent annual figure for a certain program (for example, $3 million in City funds for urban redevelopment). Though the basic decisions can be revised at any time, they tend to become prescriptive.

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Narrowing of the area of explicit decision probably has contradictory results for stability. Precedents, continuing programs, and long-run allocations would be expected to enhance stability. But they also have adverse effects, of which the following seem most serious, ( i ) In narrowing the area of explicit annual decision they make it more difficult to accommodate bulky and/or exigent items without extensive reshuffling. (2) Lack of explicit decision in certain fields (for example, some continuing programs) implies freedom from commitment and thus freedom for administrative changes. (3) Lack of explicit decision probably facilitates administrative bargaining since explicit decisions would presumably be central decisions. (4) Lack of explicit decision may reduce the impetus toward prompt project execution to the extent that it encourages continued revision during the executory period of the budget. V . In general, the time horizons of the planners outrun those of the administrators; administrators take a somewhat longer view than does the Mayor; and the time horizons of Council are the shortest of all. For many planners, of course, such a statement simply amounts to a definition of " p l a n n i n g , " "administration," and "politics." 1 Reliance on the comprehensive plan as a guide to capital budgeting, or emphasis upon spending today for site acquisition rather than on immediate improvements, are both commonplace evidences of the planner's concern with the long-run.

For a classical statement in the planning literature that planning involves (1) supplying the factor of adjustment and coordination among competing ideas, specialties, and pressures, (2) supplying the long-range view and counteracting the pressure of the moment, and (3) research and data gathering free from the pressures of the moment, see Alfred Bettman, " T h e Planning Commission: Its Functions and Method," in Bettman, City and Regional Planning Papers (Cambridge, 1946).

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Administrators might be expected to be less firmly committed to the future, more committed to flexibility in decision and action. T h e administrator evidences skepticism about the ability of anyone to predict accurately the circumstances under which he will be operating in two or three years, let alone six or twenty. This attitude probably reflects in p a r t the importance attached to administrative detail as a d e t e r m i n a n t of decision a n d action; in part it may be a reflex bow to the political environment. I n any event, some of Philadelphia's top overhead administrators evince some feeling that six-year capital programming tends to h a m p e r administrative initiatives and responses and that a better procedure might be one in which departmental plans were only roughly blocked out in capital programs for, say, a three-year period, thus reserving funds but reserving, too, the right to change course when necessary a n d to determine details at a later date. Administrators are also inclined to defend flexibility in capital budget execution, a process that has to date been devious and delayed. T h o u g h the practice has now been generally adopted of scheduling funds for project planning and site acquisitions for the first year of the project, with the larger construction funds following later, capital budgets are still freely a m e n d e d in the executory period. Several top administrators have voiced the opinion that the eighteenmonth period should be extended by Charter a m e n d m e n t . T h e Mayor's major interest in capital budgets centers on large policy decisions. Neither M a y o r Clark nor Dilworth has had a capital program, though each has pressed particular projects, functional programs, or general but implicit emphases as to the direction of city development. Both Mayors have characteristically reserved m a j o r capital policy decisions until late in the game, though both have on occasion attempted to take leadership for certain projects and, on a few occasions, have retreated in the face of a p p a r e n t opposition.

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To the extent that firm investment decisions were made for the long-run, the Mayor's freedom to respond to or manipulate the pressures on his office would probably be reduced; and his political risks would probably be enhanced. As a rule (with some exceptions) it would a priori appear to be to the Mayor's advantage to postpone decisions; the exceptions relate to the testing of public reactions or the heading off of developing opposition. A large proportion of the major policy items (which tend to be "lumpy" items) enter the capital budget late in the game and have often not appeared at all in previous capital programs. The short time horizons of Council have already been discussed. The Mayor, due to his city-wide constituency and his administrative protection, is probably not as exposed to a broad range of immediate pressures as is Council. Council therefore rescheduled a number of projects; and while some of this rescheduling is a force for "instability," this is not the whole story. Some of Council's rescheduling of the administration-Planning Commission program results in eliminating administrative and Planning Commission deviations from preceding programs and is thus a force for stability based upon popular expectations, based in turn upon previous capital programs. It seems possible that, as the City "catches up" in the capital budgetary fields of most interest to Councilmen and if the Councilmanic fiscal conscience continues to develop, the legislature will place more emphasis on "stability" in programming as a means of tightening its supervision of administrative action. Or it may be that Council will discover new fields of interest (and there will always be some: for example, streets) in which to pursue the politics of improvement. In any event, Council's present perspective does not seem a serious source of instability since most changes are made in the administration and Planning Commission. The hypothesis of perspectives of the sort discussed here is

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widely current in democratic political systems. We think it is of major importance in explaining the instability of Philadelphia's capital programming. One reason for this is simply that the time horizons of agencies do differ and that these differences are embedded in institutional interests, activities, and pressures. A second reason is that neither "political" nor "administrative" agencies normally command time horizons of as long as six years. V I . Until recently the City has shown little interest in the development and employment of explicit andformal criteria for the evaluation of projects and the allocation of funds. An approach to capital programming through economic analysis or formal professional standards has not been promising to date, for such criteria have not been well developed. Where developed, they are difficult to apply because of problems of measurement and comparison and the arbitrary nature of their assumptions. In Philadelphia, moreover, there has been some tendency to wait for the comprehensive plan (which is mandated by the City Charter) in the hope that it would provide criteria for capital programming. Expectations about the scope and specificity of the plan have varied widely. Apart from the intellectual problems with formal criteria, there are historical and institutional reasons for their lack of employment. T h e historical explanation is that Philadelphia, like most American cities, emerged from the years of depression and World W a r I I with its physical plant run down to the point where the city could be regarded as an underdeveloped area. It faced a rapid post-war pace of private development. Nor was there a vigorous city administration until 1952. Thus, when capital programming began, large allocations went for deferred maintenance, as well as for basic utilities and infrastructure in the rapidly developing areas of the city. Some of this outlay was simply " f o r c e d " ; some was financed by

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self-sustaining loans; for many projects urgency and site acquisition opportunities made it possible to beg any question of explicit criteria. A complex of political factors may have further forestalled the exploration and adoption of formal investment criteria. T h e 1951 election overturned an administration of many years' incumbency and was fought by the victors with an emphasis upon both specific reforms and benefits and the general redemption of the City. From the "Fair D e a l " tenor of the campaign and the drama of the victory it could be argued that the incoming administration had a mandate for large-scale development that would support its leadership and judgment at points on which campaign promises or emphases provided no guidance. O n the assumption that the city was badly run down and " b e h i n d , " it could further be argued that political demands should not be discounted and that large (if intangible) returns would accrue to projects that commanded political support. Strictly the argument would run as follows: that while such returns must simply be inferred or imputed, the political inference or imputation is strengthened if, by all existing and implicit standards—such as the comparative position of other cities or existing professional standards—it is conceded that the city is " b e h i n d " and needs to "catch u p . " 1 Nor should administrative responsiveness be discouraged; and, in fact, those departments in the fields of welfare and community services developed the practice of attempting to tap (and lead) public sentiment through neighborhood meetings and organization. 1

It is interesting to note that this argument runs diametrically opposite to

that applied to justify central planning and stringent controls in "iron curtain" underdeveloped areas in order to " c a t c h u p " — a f t e r which, presumably, political demands m a y be allowed to figure more importantly in decisions.

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We are not aware that such arguments received explicit statement. W e do suggest, however, that in the context of the "reform" administrations they provide a rationale for reliance upon political and administrative judgment at the expense of formal planning and investment criteria. Finally, one should ask who would be expected to want explicit and long-range criteria anyway. Interest in such criteria is presently centered in the Planning Commission; the City's political and administrative leadership is understandably less enthusiastic. With the advent of the Clark administration, new administrators and departmental commissioners were recruited to the City, many from successful careers in other cities. It seems likely that projects were to some extent considered in light of their tendency to build the departments and advance the energy and progressivism of administration. Thus, since 1953 every department has been represented in each capital budget. Such considerations as these still appear to figure in the project screenings of the Managing Director. A n d Managing Directors have consistently maintained that most planning and programming belong in the administrative line. As administrative practices and competences have improved, it might be expected that such considerations would weigh less heavily. But it might also be expected that departments would not welcome the application of criteria that would discount their own planning and programming, undermine their bargaining position, or reduce their scope for administrative salesmanship and responsiveness. T h e "time horizons" reasoning in the preceding proposition is relevant to this point. Nonetheless, as the City catches up with what are, in both professional and lay circles, considered more satisfactory levels of service, and as the comprehensive plan approaches completion, the demands for more sophisticated (and certainly

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more complete) project justification become greater in several quarters and particularly in tax-conscious quarters. T h o u g h it will not in itself include scheduling criteria, the comprehensive plan may afford the Planning Commission support for the application of such standards as it may evolve; and this, in turn, would enhance the role of the Planning Commission in capital programming, //"this happens, sharp differences may occur between the Commission a n d other parties to the programming decision; the Projects Division a n d the ex officio device may cease to perform their present functions of mollification and reduction of friction; and the independent (or quasi-independent) planning commission device may, partly by virtue of its independence, come under fire. Yet there is no certainty that this course of events will occur. T h e comprehensive plan may turn out to be a vague enough adumbration of goals that its reduction to criteria a n d capital programs will appear neither logical nor practicable. T h e plan is unlikely to be treated (by public, administration, or Planning Commission) as either the last word or the W o r d , but rather as a statement subject to continuing discussion and revision. An indifferent public reception could conceivably preclude the hypothetical developments sketched above. All this is to say that the effects of the comprehensive plan on criteria will depend upon what view is taken of the comprehensive plan and its functions, and at present there is no prevailing set of understandings in the City on these points. Some planners, however, regard it as a goad and challenge to the development of scheduling capital criteria. Some fiscally conscious citizen groups may come to this faith, too, though the tradition of informed j u d g m e n t applied to weigh the intrinsic merits in individual projects is still strong among them. V I I . Conclunon. Much of this chapter has consisted in summary of the material of earlier chapters, but we think it

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will be helpful to provide a further summary and to pull together the threads of our argument at this point. Our data demonstrate considerable "instability" (that is, lack of predictability) in Philadelphia's capital programs. ι . We argue that, for a variety of reasons, instability is to be expected in a process of this sort. Not all of the propositions and evidence developed above point toward instability as we have defined it; there are conflicting tendencies, as one might expect. Instability could, we think, be reduced somewhat. Taken together, however, we think these tendencies militate toward a modicum of stability, but toward no more than a modicum. 2. The major forces making for stability are the accentuation of planning and programming and its widespread civic support, together with a centralized city governmental structure. 3. Some instability is endemic in democratic politics and review by the legislative body. Regional and neighborhood organization, political organization, and local legislative representation combine to ensure that Council will make some changes in capital budgets or that Councilmanic desires will be anticipated by administrative changes. Even city-wide political leadership is unlikely to be wholly addicted to longrange planning and programming. The political chief executive will require some flexibility of action and will tend to resist long-range commitments so long as the political environment remains (as it must) pluralistic and indeterminate. 4. We have described Philadelphia under the Home Rule Charter as an "executive-centered" City, though there is some tendency to decentralization as urban renewal and redevelopment move to the forefront of concern. Nonetheless, for several reasons intra-administrative bargaining seems endemic in a capital programming process that must handle a large number of items. The top level of the City administration is a somewhat pluralistic universe, consisting of the Managing Director, Commerce Director, and Finance Director, and the

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quasi-independent Planning Commission, each with interests that must on occasion compete. Much of the City's planning, as we have argued, must take place in the "line"; and two tendencies follow from this. One results from the short time horizons of administrators relative to those of planners and militates toward a constant intra-administration bargaining process and desire to preserve departmental initiatives. Another, and reinforcing, tendency is that of line administrative "responsiveness" to clientele, which in some degree ties the administrator to the political process. Given the difficulty of devising plausible "standards" for programming in many fields, the unpredictability of intergovernmental aids, the fact of "continuing programs" which can be altered at will to achieve flexibility, and the initiatives of private developers upon whom many City programs depend—such "givens," added to the political and administrative facts of life already mentioned must, we argue, conduce to instability. 5. We think that the capital programming process as we have described it satisfies a number of desiderata. It provides and encourages administrative initiative, energy, and competence. It leaves room for popular consultation and provides—through the pre-provision of alternatives plus (ideally) research and discussion of alternatives—a context for public and legislative decision reflecting both long-range and immediate, city-wide and segmental considerations. By the interposition of central processes of capital programming between the departments that build and operate the projects and the public that must pay for them both, departmental planning and public discussion have been encouraged; and this is no small accomplishment. 1 1 See the article by Edmund N . Bacon, Executive Director of the Philadelphia City Planning Commission, " C a p i t a l Programming and Public Policy," Journal of the American Institute of Planners, 22 (1956), 3 5 38, for much the same point.

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6. For many, however, the foregoing is not a sufficient justification for planning; and larger results have been expected. (a) If a major rationale for city planning is anticipation and advance determination of both directions and details of development, and if the major rationale for capital programming is application of physical (rather than fiscal) planning to investment, then the process as we have described it does not stand up well. Its demonstrated instability means that planning does not determine the details of development nor (to some extent a fortiori) the broader directions of development, though there is little doubt that planners and planning have had some influence in plotting and shifting major developmental emphases within the City. (b) If the major rationale for planning and its role in capital programming is the integration of projects to the end of preventing the diseconomies of overlap, conflict and/or obsolescence, then the Philadelphia process stands up rather well. And, in fact, this appears to have been the chief purpose of the Charter Commission in the provisions governing capital programming. 7. In general, four roles and justifications for " p l a n n i n g " in investment decisions are possible, though they are not sharply distinguishable. One is the integrative function just discussed. A second is the function of the planning commission, through research, to provide enlightenment on the implications of alternative projects for patterns of city development and popular values. Philadelphia's Planning Commission does not appear to have regarded this as a major function. 1 A third is the 1 T h e Planning Commission's research in some areas—e.g., population and land use—is generally regarded as excellent, and some of this research has been useful to the departments and to civic organizations. But the research has been directed primarily toward the comprehensive plan rather than toward the function under discussion here.

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function of adjudication

(or allocation) among projects and

functions, which is widely presumed to be performed by the Planning Commission in Philadelphia. 1 In fact, we think that administrative and political powers and pressures tend sharply to reduce this role of the Commission. A fourth and final function is that of taking the long view—the

enabling or actual

taking of early and anticipatory decisions, ultimately in light of a comprehensive plan. It is to this point, especially, that our data on the instability of capital programming are relevant. Functions three and four are closely related: if the planning commission could adjudicate then, by definition, its decisions would stick and instability would be reduced. Much of the instability, as we have seen, flows from administrative and political factors that cannot be anticipated or controlled by planners. 2 Whether, this point apart, planning itself could be made

more realistic

and anticipatory

is the subject of

subsequent chapters. Thus, the central point of this chapter is a simple one, though it is often overlooked. It is that factors termed "politi-

Strictly speaking, the function we have in mind here is one of allocation, and the term "allocation" is employed in the more abstract examination of planning commission functions in the following chapter. We have employed theweaker term, "adjudication," in the present chapter because we think it better expresses the prevailing role of Philadelphia's Planning Commission in capital programming. Thus, it is stronger than "integration" but weaker than "allocation" because the review function is generally supposed to have regard to projects rather than funds; because it usually involves temporal scheduling decisions rather than ultimate distributions; and because the Planning Commission does not have—in fact or in the prevailing view—the "last say." 1

1 Martin Meyerson and Edward C. Banfield, Politics, Planning and the Public Interest, p. 273: " A comprehensive plan must be the expression of some intention regarding the fundamentals of city development and, if it is to have any significance, the intention must be one which will actually govern the use of land in the future, i.e., to which the actions of public and private agencies will conform or be subordinated."

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c a l " and "administrative," working both together and separately, produce instability in capital programming. It is, of course, true enough that factors of these types are also promotive of stability—for example, citizen group pressures, political commitments, administrative standards and pride. What we argue is that a theoretical thoroughgoing stability is not realistic theory; and we have essayed some propositions which, we think, explain why this is so.

City Planning and Capital Programming

PHILADELPHIA'S CITY Planning Commission plays a role in capital programming that in theory can include (i) research, (2) integration of projects, (3) inter-agency allocations, and (4) the anticipation of trends and/or articulation of long-range goals. W e have argued that its role has in practice been largely one of integration, backed by research and the anticipation of trends. But the role has so far been played without benefit of a comprehensive plan, and there are some who feel that emergence of the plan will make more explicit the fourth function and lend leverage for performance of the third. Because of the political and administrative processes just discussed, it seems to us unlikely that large expectations about the role of the comprehensive plan in City investment will be fulfilled. Moreover, these institutional tendencies will probably be supplemented by both institutional and intellectual difficulties in central and comprehensive planning. These problems are the subject of the present chapter. O u r analysis here is concerned with the probable role of the comprehensive p l a n — o r master p l a n — i n municipal investment. T h e chapter is not intended as a general critique of city planning; rather, the practice of "city planning" is examined here as a special case of planning in public investment. T h e discussion, however, remains largely within the framework of the specialized, if eclectic, literature of city planning. 224

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I. The scope of city planning. It has been said that "planning— even within the confined limits that some would like to place upon physical planning—is a subject that flows over any compartments which strict theory would like to construct. Of necessity it impinges upon many interests, touches assorted fields, and, if pursued to a logical end, would encompass most of the functions of government." 1 Not only does the activity of planning lead ineluctably from one municipal function to the next; but the language of municipal policy does not distinguish sharply among such values or valences of activity as health, safety, welfare, morals, convenience, economy, amenity.' The activity of planning thus resists categorization, and its subject matter and goals resist definition. Distinctions among activities and objectives cannot be scrupulously observed in practice. But the view just set forth seems curiously inattentive to the adjective aspects of government, for all its rationalism regarding substantive policy. And both planners and administrators have characteristically regarded capital programming as an endeavor toward a jointure of sorts among physical, program, and fiscal planning. This objective would seem to imply that these fields are functionally and substantively at once discrete and related. Functionally, the role of city planning in capital programming can be conceived as ranging from regulatory (review, integration, and the formulation of standards) to entrepreneurial (instigation of programs and projects and elaboration of program levels and goals) to budgetary (allocation among

1

Charles M . Haar, Land Planning Law in a Free Society (Cambridge, Mass., 1 9 5 1 ) , p. 12. * See F. Stuart Chapin, J r . , Urban Land Use Planning (New York, 1957), Chs. 3 - 4 , for a definition of the "public interest" goals of land use planning in this modern variant of police power objectives: health, safety, convenience, economy, amenity. P.M.ι.—Η

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programs and projects and overall land uses). Substantively, the relevant fields of planning might be described as physical (land use and design), programmatic (the ends and means of conventional city policy), and fiscal (the relating of physical and programmatic ends and means to resources). The two sets of distinctions are closely parallel. A. The functions of planning: regulatory, entrepreneurial, and budgetary. The conventional approach to city planning has been the regulatory approach, linked to the planner's competence in land use and design. It should be emphasized that this regulatory role extends to public as well as private activities. 1 Recent developments in metropolitan policy have tended to extend the planner's role from regulatory to entrepreneurial and budgetary. These developments have chiefly been: the entrepreneurial approach to land use implied in urban renewal; the professionalization of some services with increasing emphasis upon explicit standards of service; and the increasing capital intensity of many city services, with resultant emphasis on planned public investment. It has long been argued that regulatory planning should be "comprehensive," as opposed to piecemeal and/or ephemeral. The principal gains from comprehensiveness are said to be procedural equity for individuals and substantive economies for the community. 2 Yet regulatory planning in American municipalities has not, as a rule, been recognized as either comprehensive or detailed. In Philadelphia, it is apparent from the capital programming experience that regulatory 1

See, e.g., Haar, " T h e Master Plan: An Impermanent Constitution," Law and Contemporary Problems, 20 (1955), 350; and " T h e Content of the General Plan: A Glance at History," Journal of the American Institute of Planners, a 1 (1955), 66. 1

Once again, Charles Haar provides a cogent statement. See " I n Accordance with a Comprehensive Plan," Harvard Law Review, 68 (1955), "54·

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planning in land use has not approached outright control of the direction of private development. As a result, predictability in contingent public programs, while enhanced by planning, has been far from perfect. Entrepreneurial and budgetary planning have not, to date, been "comprehensive." T h e y have largely been performed in line departments, developmental authorities, a n d staff financial agencies. Some planners would like to see such planning centralized in a planning agency and embodied in a comprehensive p l a n ; others argue that the planner's role should r e m a i n a basically regulatory one and that the rest of planning should be decentralized. 1 I n this discussion the argued gains from comprehensiveness are less specific t h a n in regulatory planning. T h e y m a y broadly be described as " r a t i o n a l i t y " and/or "efficiency," meaning primarily clarification of goals and consistency a m o n g policies. Those opposed to p l a n n i n g of this scope sometimes suggest that the narrower if less speculative values of regulatory planning m a y be threatened or obscured in the entrepreneurial and budgetary approaches. T h e issues raised by this discussion concern both the feasibility and the desirability of centralized and/or comprehensive p l a n n i n g that goes beyond the regulatory role. Some suggestions on these points m a y emerge from a review of the substantive fields of planning. B. The subject matter of planning: physical, programmatic, and fiscal. T h e literature of city planning is not unanimous on the

' S e e , e.g., H a r v e y S. Perloff, " E d u c a t i o n of City Planners: Past, Present a n d F u t u r e , " Journal of the American Institute of Planners, 22 (1956)1 1 8 6 - 2 1 7 ; a n d the rejoinder by J a m e s M . Lee, " T h e R o l e of the Planner in the Present: A P r o b l e m in Identification," ibid., 24 ('95β)> ' 5 Ι - , 5 7 · S e e also, H e n r y Fagin, " O r g a n i z i n g and Carrying out P l a n n i n g Activities within U r b a n G o v e r n m e n t , " ibid., 25 (1959), 109-114.

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content of the comprehensive plan. The core of it, however, has been physical development, including land use and design. 1 In capital programming, land use planning is closely related to programmatic and fiscal concerns. The distinction between the fields is not, therefore, a sharp or stable one; and several city functions overlap it. But the distinction does point to some probable differences in the procedures appropriate to formulating policy and in the putative goals of city policy. Choices among land uses relate to an imperfectly competitive market, elaborate and somewhat problematical research, and a broad range of often tenuous and intangible individual and community values. 8 The question of values becomes increasingly important as the community moves from regulatory to entrepreneurial and budgetary planning, as in wholesale urban redevelopment. Land uses are long-lived, and land use goals require both stability and scope if entre1 Cf. J o h n D . Millett, in C h . 5 of the Report of the Mayor's Committee on M a n a g e m e n t Survey (New Y o r k , 1953), V o l . II at p. 94: " T h e essential element in defining function is that the purpose of City planning is the orderly, intelligent, and comprehensive development of long-term programs of capital improvement. T h e work of the City Planning Commission concentrates almost exclusively upon problems of physical layout and growth of the City. T h e Commission is not an agency for reviewing fiscal policies or plans,for reviewing thesubstance of educational and recreational plans, or sanitary plans. It is concerned with the physical aspects of City life, with City geography, and with City structures."

* O n imperfections in the land and housing markets, see, e.g., Richard U . Ratcliff, Urban Land Economics (New Y o r k , 1949), or Chester Rapkin, L. Winnick, and D. M . Blank, Housing Market Analysis (Washington, D . C . , Federal Housing and Home Finance Agency, 1953). O n fields of land use research, see, e.g., Chapin, op. cii., or William H . Ludlow, " U r b a n Densities and their Costs," in Coleman W o o d b u r y (Ed.), Urban Redevelopment: Problems and Practices (Chicago, 1953), pp. 101-220. On the problem of values, see e.g., William L . Slay ton and Richard Dewey, " U r b a n Redevelopment and the U r b a n i t e , " in Woodbury (Ed.), The Future of Cities and Redevelopment (Chicago, 1953), pp. 291-476, and Part I of the same volume.

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preneurial policies are to pay off. Popular values are normally either fragmented or opaque with respect to the social, esthetic, and economic aspects of land use policies; and neither the market nor the machinery of representative government is likely to pose alternatives or reflect preferences adequately. 1 Substantial consensus around large programs is extremely unlikely. Where goals are indefinite or in dispute, while some longterm city commitments in land use remain a necessity, "standards" provide one approach to municipal policy. Land use standards can in form be physical or quantitative (that is, based in engineering and/or economics) though in fact they must also embody some social and esthetic values. City policy can thus approach the determination of land use responsibilities through progressive definition and application of regulatory land use standards that incorporate an increasing range of values. 2 In land use, then, a pattern of policy-making emphasizing steady research and the long view rather than ready responsiveness may best provide for equity in regulatory planning and incrementalism in entrepreneurial and budgetary planning. Programmatic responsibilities, on the other hand, are traditionally determined outside the market and normally derive from "needs" and values that have received political definition and organization. Pragmatic political and administrative determinations thus appear more appropriate to "programmatic" fields than to land use. Central planning probably cannot provide realistic standards for such programs. Functional specialists can produce provisional standards; but in the absence of enduring consensus on city 1 s

Cf. Slayton and Dewey, op. cil., and Ludlow, op. cit.

Contrast the conceptual approach to planning set out in Chapter II. In that "hierarchical" approach the process would move from determination of responsibilities to derivation of standards.

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policy and priorities in general, these standards will not be stable. Normally the "standards" for these fields in comprehensive plans simply embody and project departmental determinations, subject to changing popular tastes and utilities. 1 Several city functions tend in practice to defy the distinctions among land use, programmatic, and fiscal planning. The entrepreneurial practice of urban renewal is one; but two more traditional examples may be cited from the Philadelphia experience. One is recreation, in which the economic and esthetic considerations in land use and the professional standards relating to levels of service come together. T h e Philadelphia method of deciding on the scope of public responsibility, the standards of service, and the programming of facilities, has therefore been a "technical committee" in which the Recreation Department and the Planning Commission are the principal participants. The Free Library affords another example. Here, the Library's assumption of a responsibility to "merchandise" reading by maximizing accessibility impinged, in turn, on land use; and, again, the method of planning and programming was a joint technical committee devising, applying, and extending "standards" into "responsibilities." The distinction between land use and programmatic planning can, however, be rather clearly drawn in some other areas. Some city functions (for example, parks or sewers) principally relate to land use planning strictly construed (in some balance of esthetic, police, power, and economic objectives). Others relate only marginally to land use and are "programmatic" in nature. Land use planning has, for example, little relevance for the Welfare Department under current conceptions of the Department's mission. 1 This is largely the case with the standards for routine services and facilities in Philadelphia's nascent comprehensive plan.

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Nevertheless, if capital program review is lodged in the planning agency, some comparisons between land use-related and other projects are unavoidable. This is increasingly so to the extent that the review comprehends allocation of funds as well as integration of projects and programs. T h e distinction among land use, programmatic, a n d fiscal planning thus helps suggest some of the values that are likely to be implicit or explicit in investment decisions. These values do not readily lend themselves to categorization, b u t three directions of possible divergence of views may be indicated. From the standpoint of the program administrator, the planner may appear to overemphasize economic efficiency or the fiscal pay-off from projects a n d unduly to discount those projects to which the techniques of economic measurement and analysis are least applicable. O r the planner might appear to overemphasize inchoate esthetic ideas, formalistic criteria of design, or symbolic project attributes at the expense of the short-run social objectives embodied in social programs. T h i r d — a n d related to the first two points— the planner might attempt to accomplish social objectives (for example, reduction in juvenile delinquency) by promoting redevelopment and/or redesign rather than traditional services a n d facilities. Where municipal services require relatively little in the way of tax-supported capital outlay, land use planning alone may function as the comprehensive basis for regulating private and public development. T h e large city, however, provides a broader array of capital-intensive programs. Capital programming and the pursuit of u r b a n renewal tend further to blur the distinction between land use, programmatic, a n d fiscal planning. 1 1 T h r e e studies of planning and capital b u d g e t i n g in N e w York City h a v e pressed similar distinctions. See Millett, op. cit.; F. C. Mosher,

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It has therefore been concluded by some that the distinctions discussed here have no point and that comprehensive planning must cover the whole of city policy. O u r conclusion is rather that the distinctions remain in point as reminders of the limited role that comprehensive plans are likely to play in capital programming. A plan restricted to the broad regulation of land uses—the traditional approach—may, as an "impermanent constitution," advance the legal and economic values for which it was framed. A plan aimed in addition at what we have termed entrepreneurial and budgetary objectives, programmatic and fiscal concerns, seems unlikely to afford any but the most general guidelines for public investment. This is because it must attempt too many predictions, reconcile too many conflicting interests, and relate too many organized city activities. It is not likely so to combine land use, programmatic, and fiscal considerations that capital program decisions follow by simple "suboptimization." 1 II. The nature of the plan. Planners appear to be generally agreed that planning should be "comprehensive" but that comprehensive planning is better viewed as a process than as production and subsequent protection of a master document. * Agreement on these points is not complete, however. Some differences with respect to flexibility and comprehensiveness may be seen in two strong statements by practicing planners.

"Fiscal Planning and Budgeting in New York City," in New York State-New York City Fiscal Relations Committee, Report (New York, 1956), pp. 65-84; and Henry Fagin and C. M c K i m Norton, "Physical and Fiscal Planning," ibid., pp. 85-94. For a contrasting view, see R . E. Coughlin, " T h e Capital Programming Problem," Journal of the American Institute of Planners, 26 (i960), 39-48. Cf. Ch. I V above. 1

* A number of statements from the large literature on this point are collected in Haar, " T h e Master Plan: An Impermanent Constitution," op. cit.

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A . Flexibility. For some the plan, if not a "static blue-print," is at least a definitive statement of land use goals; and planners' energies are to be bent upon the plan, not upon " p l a n n i n g . " Consider the following statement: We have put ourselves in (a) valley of frustration by emphasizing the wrong thing. The emphasis should be on t h e city plan—not

planning

o r t h e planning

commission

or the

planner. The planners' and the planning commissions' proper place in the hierarchy of municipal development is found only when they are the authors and guardians of the city's P L A N and when the P L A N is the recognized and accepted guide for all improvements—both public and private. . . . It can be objected that no city planner has a 100 per cent effective "crystal ball" in which he can see the future and that he and his plan commission—and his city council—will make mistakes that will have to be corrected. This is true. However, a carefully prepared city plan will contain only a small portion of such mistakes. On the big issues—the basic land use pattern, the major street and freeway system, and the school and park locations—planners today are well enough qualified not to make many mistakes. And even if there are a few mistakes—and these mistakes are b u i l t — this will be far better than continuation of an unplanned and uncoordinated urban pattern without real control or direction at all. 1 Others reverse the emphasis: T h e idea of a dynamic, changing society suggests another characteristic of Plans. . . . Since change will never cease— and, we may hope, change will always represent an improvement over the previous condition—Master Plans for 1 Eldridge Lovelace, "Three Essays on City Planning," Journal of the American Institute of Planners, 24 (1958), at pp. 7 and 10. (All emphasis in the original.)

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change are futile if they are regarded as representations of ultimate goals. They make sense only as symbols of milestones of future progress. And, since goals crystallized into specific plans such as housing densities or playground standards are also sure to shift as time goes by, such goals embodied in Master Plans are less significant as absolutes than as measures of the direction of desirable planned change. . . , 1 O f course, it is difficult to learn from these statements precisely how great is the difference of opinion between the writers (who were not formally joined in debate). A substantial divergence is clear, but the distinctions so far developed suggest that the two commentators may not view the " P l a n " byidentical prisms offunction orsubstance.Thustheargument of Lovelace appears, for all its stringency, to regard the plan in a predominantly integrative light; whereas Howard's skepticism is largely directed at a possible further and allocative role for comprehensive planning. 2 As to substance, Lovelace illustrates his argument by land use and locational considerations; but Howard's reference to deliberate densities and standards carries the argument from land use into "programmatic" planning and suggests the instabilities in programmatic planning already suggested here. Differences of opinion respecting the permanence of the comprehensive plan thus appear to result from different expectations as to its scope, to which question we accordingly turn.

1 J o h n T . H o w a r d , " T h e P l a n n e r in a D e m o c r a t i c S o c i e t y — a C r e d o , " Journal of the American Institute of Planners, 21 ( 1 9 5 5 ) , 6 2 - 6 5 at p. 64. 1 L o v e l a c e m a y g o further, for he argues (at p . 7) t h a t " c o o r d i n a t i o n " is the p r o p e r f u n c t i o n of m a y o r , m a n a g e r , or administrator. " T h e p l a n n e r ' s j o b is m o r e than m e r e c o o r d i n a t i o n . It is to see that all these efforts a n d p r o j e c t s — b o t h p u b l i c a n d p r i v a t e — b r i n g a b o u t the most desirable possible c o m m u n i t y in w h i c h to live a n d w o r k . "

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B. Comprehensiveness. T h e same authors can stand for two polar emphases on this point. T h u s Lovelace maintains t h a t : A city plan is one of the most important means at hand to improve urban environment. To be effective it must recognize and deal with all of urban life. To do this it cannot be limited by "dimensions." In addition to the simple ones of length, breadth and height, the city plan must deal with such "dimensions" as time, climate, geology, sociology, economics, geography, ecology, anthropology, astronomy, physiology, and psychology—to mention just a few. The city plan should present a detailed, realistic—and inspiring picture of the city of tomorrow—a plan so practical that we can start building it today, yet visionary enough to impel persons to start this building. A plan that does not deal with all dimensions cannot do this. 1 After arguing for the practicality of this view on the ground that for any problem there is usually one key "dimension" of control—which, it appears, is usually a design or topographical (that is, land use) dimension—Lovelace continues: " O u r planning for the city of the future is effective only in the degree that it affects the parts of the city of the future that we are building today. Unless all of these small parts arc coordinated with the city plan when they are built, our accomplishment is n i l . " 2 J o h n T . H o w a r d again provides a counter-statement: . . . Completely "comprehensive" planning—that is, looking at the entire structure of society and seeking to coordinate planned improvements in all the parts that are not perfect—is too big a job for any one individual, or even one agency. . . . Such comprehensive planning has never yet been undertaken without loss. The measures that we in 1

Lovelace, ibid., p. 8.

J

Ibid., at p. 9. Emphasis in the original.

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Planning Municipal

Investment

America take for improving our society are held together only by implicit goals. . . . And the leadership in setting the goals, as directions of desirable change, comes not from government officials as such, but from individuals—religious leaders, political leaders, perhaps philosophers. Until both the knowledge of our planners and the wisdom of our governments are very greatly increased, this very loose "team" operation is as close to "comprehensive" planning for society as it may be wise to attempt.1 These contrasting quotations press the difference of opinion one stage further—to the definition of goals of development and the role of the planner in long-range goal articulation. T h e first school of thought would appear to vest the planner with heavy responsibility in defining the good life or the desirable community. Though the second school takes a more limited claim for planning per se, it would seem to accommodate both more variety and more ambiguity in goals than does the first school. If, in fact, Lovelace's key "dimensions" are just that—physical dimensions of land use and design—the result may be that while the plan is "comprehensive" in the problems it covers it is limited with respect to goals and "inarticulate major premises" of community policy. Where capital programming is concerned, the second school would seem likely to view conservatively the planner's role in a "loose 'team' operation." The first school would appear more apt to emphasize the rubric of the plan, either in spelling out the capital implications of numerous categorical "dimensions" of urban existence, or in the presumptive applicability of land use dimensions to "programmatic" as well as land use problems.

1

Howard, op. cit.,

at pp. 63-64. Howard stressed that plans should,

however, be as comprehensive as

possible.

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C . The comprehensive plan and capital programming—radical

and

minimal approaches. D i f f e r e n c e s o f o p i n i o n a b o u t t h e role o f t h e p l a n n e r a n d the c o m p r e h e n s i v e p l a n in c a p i t a l p r o g r a m m i n g r e l a t e in p a r t to m o r e or less explicit u n d e r s t a n d i n g s o f t h e s u b j e c t m a t t e r o f p l a n n i n g . I n p a r t , h o w e v e r , t h e y r e l a t e to v a r i a t i o n s in the m e t a p h y s i c a l p a t h o s a t t a c h i n g to s u c h t e r m s as " p l a n n i n g , " " c o o r d i n a t i o n , " " f l e x i b l e , " a n d " c o m p r e h e n s i v e . " S u c h v a r i a t i o n s are likely to b e b a s e d in d i f f e r e n t political philosophies a p p l i e d to m u n i c i p a l decision m a k i n g — philosophies

here d e s c r i b e d

as the r a d i c a l

and

minimal

a p p r o a c h e s to p l a n n i n g . A v i g o r o u s s t a t e m e n t o f the r a d i c a l a p p r o a c h w a s m a d e in 1940 b y R e x f o r d T u g w e l l , w r i t i n g o f his e x p e r i e n c e as C h a i r m a n o f the N e w Y o r k C i t y P l a n n i n g C o m m i s s i o n . 1 I n its r e v i e w o f d e p a r t m e n t a l c a p i t a l projects, T u g w e l l r e p o r t e d , t h e P l a n n i n g C o m m i s s i o n e m p l o y e d such c o n s i d e r a t i o n s a s : t h e size, rate o f g r o w t h , a n d distribution o f the c i t y ' s f u t u r e p o p u l a t i o n ; trends in the city's e c o n o m i c b a s e ; a n d the o v e r a l l c a p a c i t i e s o f citizens to p a y for the c u s t o m a r y

municipal

services. I n its p r e p a r a t i o n o f c a p i t a l p r o g r a m s the

Com-

mission a i m e d for the least possible f u t u r e c h a n g e in s u c h p r o g r a m s ( t h o u g h r e c o g n i z i n g that there w o u l d a l w a y s b e l e g i t i m a t e s u d d e n contingencies) a n d a t t e m p t e d t o g e a r the c a p i t a l p r o g r a m i n t o the m a s t e r p l a n as closely as possible. O f c a p i t a l b u d g e t i n g prior to p l a n n i n g T u g w e l l w r i t e s : . . . With respect to all the hundreds of services and facilities the modern city provides for its citizens, whole series of master plans existed in the minds of the departmental heads and in the files of their subordinates. T h e i r accomplishment was determined by such factors as the political astuteness, public appeal, or administrative ability

1

Tugwell, "Implementing the Public Interest," Public Administration

Review, I (1940), 32.

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Planning Municipal Investment

of the department heads, by activities of pressure groups which they might build up, or by similar irrelevant uses of power. T h e city might in this way be committed to capital expenditures which would prevent more necessary facilities from being built and to burdens on the expense budget which would exclude other expenditures. . . , 1 W h a t , then, to set against "irrelevant uses of p o w e r " as a public interest standard for budgeting ? . . . A city, no less than a person, has a Gestalt, a behavior pattern which is distinct from (and not to be understood by study of) its parts. . . . This configuration, this city in being, is more than a system of streets, sewers, water pipes, schools, hospitals, and the like; it is more even than all of these taken together with houses, transit lines, and places of work and recreation. It is, in one sense, the life, the spirit, the whole that is quite apart from all the elements which analysis would reveal; it is something like an individual's character which is not to be understood by description of his bodily members. Indeed the analytical method is one which yields few necessary results for the planner. He has to use an entirely different one which attempts to grasp the whole before it considers the parts, since these have only a derived, a contributory significance and none taken alone. There is nothing esoteric about such an approach. . . . Beginning with the axiom that all social arrangements are man made, it follows that they may be made, within the resources at disposal, in conformance with an objective. If this objective is broadly defined as an ideal urban life, then that in turn may be broken down. . . . It is this whole, this emergent, this relative and conjunctural interest, which, it seems, the Planning Commission was intended to represent. 2

1

Ibid., p. 34.

»Ibid., p. 34.

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239

T h u s land use planning and budgeting can be unified in a master plan under someone's (the planning commission's) view of the good life and the good community, and the "irrelevant uses of power" can be set at naught. Involved, of course, is an idealist view of the public interest a n d the problem of how a n d by whom it is best apprehended. How, that is, does the planner arrive at his "Gestalt," and how does the " p u b l i c " recognize a n d deal with what he has in mind ? A decade later we find Tugwell (and Banfield) writing on this p r o b l e m : It would seem likely, both because the techniques are becoming available and because the absurdity of present methods has become so obvious, that governmental institutions for discovering and objectifying the future as well as for precipitating social decisions will be accepted in the half-century to come. . . . (In most city governments) there is a budget and there is usually some kind of physical plan. They have no organic connection in most cases, and no connection, either, with executive and legislative, except at the will of mayors and councilmen. That this is not good enough there is quite general understanding, but consent to the establishment of a planning agency with the duty of creating and administering a development plan is almost everywhere being fought off. 1

H e r e are the two root notions of the radical protagonist of planning. Planners can project long-range goals a n d precipitate decisions embodying them because power is increasingly organized and concentrated—all that remains to be achieved is the necessary mutuality of interest among organizational forces. And, planning commissions will administer as well as plan. Given this view of the planning commission as a directing fourth governmental branch, the problem of linking 1

Tugwell and E . C. Banfield, "Governmental Planning at Mid-century,"

Journal of Politics, 13 (1951), 133, at p. 163. Our emphasis.

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Planning Municipal Investment

r e g u l a t o r y , entrepreneurial, a n d b u d g e t a r y , land use, prog r a m m a t i c , a n d fiscal decisions is institutionally solved b y a presumptive " r e l e v a n t use o f p o w e r . " T h e m i n i m a l a p p r o a c h , on the other h a n d , emphasizes regulatory a n d l a n d use p l a n n i n g a n d on the w h o l e rejects b u d g e t a r y a n d p r o g r a m m a t i c p l a n n i n g . It has found a recent statement in an article b y Allison D u n h a m . 1 D u n h a m ' s thesis c a n be briefly expressed: it is that the principal justification for city p l a n n i n g is to be f o u n d in the functions o f oversight a n d integration w i t h resultant economies to the city in conflict, o v e r l a p a n d early obsolescence averted. T o this single g a i n D u n h a m is willing to a d d a m a r g i n a l gain from p l a n n i n g commission research t h o u g h he doubts that this p o i n t alone c a n j u s t i f y " p l a n n i n g . " I m p l i c i t in the a r g u m e n t is D u n h a m ' s d o u b t that centralized decision m a k i n g is efficient in the long r u n ; for he is explicit in s a y i n g that, w i t h respect to project p l a n n i n g and the ( p r o g r a m m a t i c ) selection of means to policy ends, the line d e p a r t m e n t is likely to m a k e the more i n f o r m e d decision. It is a p p a r e n t l y assumed that policy ends are decided t h r o u g h leadership, response, a n d b a r g a i n i n g b y a n d a m o n g political a n d administrative agencies; and it might be further assumed that, w i t h i n the line departments, means a n d ends reciprocally interact a n d that ends are often implicit or ambiguous. W i t h respect to the relation of city p l a n n i n g to capital p r o g r a m m i n g , then, the r a d i c a l view tends to m e r g e our f u n c t i o n a l a n d substantive a p p r o a c h e s to p l a n n i n g ; or, on another classification, to m e r g e research, integration, allocation, a n d the anticipation of trends a n d articulation o f goals. T h e m i n i m a l v i e w , on the other hand, is likely to emphasize the distinctions a n d to p l a c e p r i m a r y (if not exclusive) reliance

1

"A

Legal and Economic Basis for C i t y Planning," Columbia Law

Review, 58 (1958), 650-671.

City Planning

and Capital

Programming

241

upon regulatory and land use planning and the research and integrative functions. The comprehensive plan, on the minimal view, is more flexible and less comprehensive than on the radical view. It is less comprehensive because it is thought that both expertise and response to relevant values will mainly reside in the departments. It is more flexible because it is supposed that the goals of land use—and particularly the responsibilities, standards, and facilities of social policy—will shift even in the short-run. One question raised by the minimal view is whether a master plan—sufficiently permanent and comprehensive to include long-range goals for a variety of programs linked to land use through capital projects—is essential in order to achieve the economies and esthetics of integration. W e think the answer is negative. While long-range goals may appear logically necessary to integration, they are probably not practically essential in other than fragmentary form. "Integration" can yield values simply as a process of review and clarification, and "aims are often discovered or clarified only in the face of actual policy decisions." 1 O n this argument the process of capital programming makes good sense, but the radical approach to comprehensive planning does not. In fact, the radical approach calls into play all the usual arguments about central decision making in a pluralistic community. T w o of these arguments are especially relevant to the metropolis. One is that long-range anticipation of public values and policy goals is not likely to anticipate accurately, with the result that such anticipations will require more or less continuous and extensive revision. T h e other is that "too m u c h " centralization of decision is likely to yield diseconomies

C . E. Lindblom, "Tinbergen on Policy-making," Journal of Political Economy, 46 (1958), 531-538,31 p. 534. See also Lindblom, " T h e Science of 'Muddling Through,' " Public Administration Review, 19 (1959), 79-88. 1

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Planning Municipal Investments

since "aims cannot be rationally chosen without regard to costs, but costs are not always known in advance. Negotiation among policy-makers discloses what costs each can impose on the other . . . , " and voters can seldom choose reliably until faced with concrete alternatives and contexts. 1 I I I . The probable role of the comprehensive plan. The results of abstract argument to this point are admittedly ambiguous and themselves reflect some of the "metaphysical pathos" of the schools of social thought. There are incommensurable community diseconomies in decision that are "too" centralized or " t o o " fragmented. But the considerations and distinctions advanced to this point do suggest the probable contributions and limitations of comprehensive planning in capital programming. These are now briefly reviewed in terms of degrees of comprehensive planning. A. Perhaps the most "flexible" view of comprehensive planning would emphasize planning commission research: a continuing process of what Chapin has termed "tooling up studies." 2 Such research can be brought to bear in central capital project review or at prior stages. It can link land use and programmatic considerations at many points, as in pointing the implications for traditional city services and facilities of patterns and densities of development, and vice versa. It can assist in the clarification of goals; and it can, even in "programmatic" fields, be helpful in suggesting alternative avenues to the achievement of goals—a possible example would be the pooling of sociological, design, and economic 1 Ibid., pp. 5 3 4 - 5 3 5 . See also, Lindblom, "Policy Analysis," American Economic Review 48 (1958), 2 9 8 - 3 1 2 ; and R . Dahl and Lindblom, Politics, Economics and Welfare (New York, 1953), esp. pp. 3 7 2 - 3 8 4 . 1

F . Stuart Chapin, J r . , op. cit., Part I I . For a strong statement on the value of planning research (or the costs of its absence), see Lloyd Rodwin, The British New Towns Polity, op. cit., esp. Ch. 10 and Appendix A .

City Planning and Capital Programming

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research on the problem of juvenile delinquency. Research thus serves as a valuable supplement to the "incrementalism" of the administrator, particularly with respect to land use wherein the many marginal esthetic, economic, and engineering alternatives may be remote from the mind of the administrator. B. T h e contribution of next degree is the integration of projects in planning commission review. This may extend beyond the physical integration of projects to the substantive integration of policies; but we have argued that this is in general unlikely. Integration can be based in a "comprehensive" plan or simply in less codified research. In either case it can assist the short-run scheduling of facilities by relating them to other public and private land uses, and it can on occasion eliminate projects that conflict with anticipated land uses or anticipatory land use policies. It can largely govern the location of projects, though there will be cases in which project location is so closely related to programmatic effectiveness (for example, the location of libraries) that some administrative settlement must be reached. In all cases, integration will be more decisive as land use projections and goals are firmer. Moreover, integration through project scheduling can slide into actual interdepartmental allocations of funds and projects based, perhaps, on values peculiar to the planner. This will be the case if some types of funds are habitually cut or some projects habitually deferred. In strictness, such long-range allocations should presumably rest upon a plan sufficiently inflexible and comprehensive to provide something like a long-range welfare function for the community. In practice they rest upon annual scheduling decisions in the nature of "adjudications" in which integrative considerations have allocative consequences which, in turn, are limited by political and administrative processes. "Adjudication" thus appears as a half-way house between integration and allocation, based

244

Planning

Municipal

Investment

in the contingent nature of scheduling decisions in a six-year program. C . A still more decisive function would be one of allocation, in which programmatic and land use requirements are projected so as to yield long-range capital budgetary constraints for each city agency. T h e discussion above indicates that comprehensive planning is unlikely to be permanent or comprehensive enough to support this function a n d that, if it were, some community diseconomies might be incurred. O n e problem lies in the differences between p r o g r a m m a t i c and land use planning. Some measure of administrative j u d g m e n t and political responsiveness is instrumental in prog r a m " e f f i c i e n c y , " but it also contributes to instability in the definition of responsibilities and standards. Instability in the programming of facilities is, moreover, endemic in some fields; it can be mitigated but not eliminated b y long-range planning. 1 Allocation would also require that competing regional a n d directional land use goals be ordered and adj us t e d — f o r example, between the center city and the neighborhoods and a m o n g the latter; among industrial, recreational and residential uses. T h o u g h short-run project integration and adjudication do not

1 For some persuasive reasoning on the causes of this, see Lindblom, ibid, (both articles), in which it is argued: (ι) that administrative decisions often depend upon an intimate knowledge of the history of programs and the etiology of problems that only the career administrator is likely to have; (2) that the experienced administrator is often better prepared than anyone else to gauge the feasibility (i.e., the acceptance) of a solution in terms of the political and administrative environment; and (3) that only a limited number of empirical and normative variables can be manipulated by any individual or organization a n y w a y , and that attempts at rigorous categorization and suboptimization are likely to be artificial, irrelevant, and more complicated in fact than the administrator's assimilative " f e e l " and selection of the facts and values at stake in a problem.

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require such specificity as to goals, ultimate allocations may, at their margins. Land use projections and goals may be more stable than programmatic projections and goals, but this is far from certain. D. Thus a final planning function is provision of the long view through anticipation of trends and, perhaps, the adumbration or even further articulation of goals. If all these ambitions can be comprehensively and harmoniously embodied in a plan, then the documentary basis at least exists for somehow " m a p p i n g " or "suboptimizing" the master plan into capital programs. Perhaps the further technical problems of accomplishing this could be solved acceptably; but the initial condition is most unlikely to be met. Provision of the long view has its principal significance in land use. Even here, the plan will probably consist more largely in the projection of trends and in broad adumbrations (and imputations) of city policy than in explicit articulations of ends. 1 One reason for this is that developmental trends in part depend on city policies, but explicit and long-range decisions are often resisted, as the Philadelphia experience suggests. 2 At its most rigorous the pattern of decision is likely

1

O n the relation between trends and goals, projections, and policies in comprehensive planning, see Arthur R o w and Ernest J u r k a t , " T h e Economic Factors Shaping L a n d U s e , " Journal of the American Institute of Planners, 2 5 ( 1 9 5 9 ) , 7 7 - 8 1 . T h e senior author is Chief of the Comprehensive Planning Division of the Philadelphia Planning Commission. 2 Despite the imminence of the comprehensive plan there have been few firmdecisionsfrom the City administration or Council as tothe overalllevel of development, the relative emphasis upon industrial development and land use as against housing and welfare, or a number of other aspects of land use. T h e principal objectives of the plan have been tentatively defined within the Planning Commission as: ( 1 ) Realize potential economic growth of City and Region and provide a range of employment opportunities consistent with labor force projections; (2) improve the spatial distribution of land uses in relation to one another and the

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to be one in which the planner's research supplies "alternatives at progressively more detailed levels of decision making . . . with policies at each level feeding into the planning process and the findings of the planning process . . . feeding back into policy decisions." 1 In the more probable pattern, in which long-range developmental decisions are commonly resisted or amended, capital programming itself would remain a principal avenue of decision. Capital programs would progressively and continuously supply some of the premises of comprehensive plans, though comprehensive plans would generate some capital projects. It is sometimes said that comprehensive plans, as statements of long-range goals, are means of arousing civic interest and rallying consensus. Y e t the goals in comprehensive plans are usually abstract. T h e proposals in capital programs are more concrete and more readily enable comparisons and calculations of cost. It could therefore be argued that capital programs provide a more "rational" framework for civic action in that they are more realistic. A n d even capital programs have been subject to frequent change in Philadelphia. T h e discussion to this point refers to the presumptively

transportation between them; (3) improve the quality of the facilities, combinations of facilities and their environment; (4) give articulate [social and esthetic] form to the city; (5) improve the appearance of the c i t y ; (6) reconcile regional and local interests; and (7) develop the Center City as (a) the economic and cultural center of the region and (b) the symbol of the metropolitan area. (From an outline, entitled "Objectives and Policies of Comprehensive P l a n , " of a talk by Arthur R o w , Assistant Executive Director of the Commission, before the Citizens' Council on City Planning.) Cf. Coughlin, op. cit. 1 Chapin, op. cit., pp. 268-270. Chapin adds (p. 271) that "probably in very few American communities have . . . policy and planning developed in any way approaching such a sequence."

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routine conduct of city policy. Suppose, however, that a decision is reached to intensify a n d extensify redevelopment through large scale land clearance. This would open u p to more explicit determination the land uses of the future a n d the city programs to accommodate them. A n d this, in turn, would seem to enlarge the gains from more p e r m a n e n t a n d comprehensive planning, since city policy would perforce be more long-run and less incremental. T h e comprehensive plan could then provide additional criteria for the scheduling of projects a n d facilities in three ways, (a) I n wholesale redevelopment the relationships (complementary, substitutive a n d conflicting) among projects would be less obvious in the absence of a plan, (b) Projects should be so scheduled as to maximize desired effects on private development, a n d (c) to maximize their matching contribution to federal f u n d s or other intergovernmental aids. Yet wholesale redevelopment a n d renewal m a y accentuate dispersive tendencies in government and discursive tendencies in politics. It may enlarge the area of administrative bargaining in project planning, clearance, a n d relocation; a n d it m a y raise the level of political controversy respecting the overall direction and local details of development. These tendencies m a y result in a measure of " f o r c e d " a n d short-run scheduling of projects and facilities in the context of a city politics aimed at a workable level of compromise that will support a workable p r o g r a m of development. I V . Three organizational problems. T h e several distinctions d r a w n so far, if useful in revealing differences in goals, values a n d techniques, are still blunt distinctions in practice. T h r e e practical problems follow from this fact. A. O n e of these— t h a t of the content of the capital p r o g r a m a n d the proposal to restrict it to land use-relevant projects—was discussed in C h a p t e r V I I I and need not be considered f u r t h e r . T w o other

248

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aspects of the role of the planning commission may be briefly discussed. B. Fund allocation versus project integration. T h e conclusions just reached with respect to the role of research a n d comprehensive planning suggest the further conclusion that the skills of the planning commission and the guidelines of the comprehensive plan can more legitimately be applied to the review of projects than of funds. By and large it is the nature and location of projects rather than the scope of departmental programs that is relevant to land use. And to the extent that the planning commission through its capital program review is attempting the clarification of city policies a n d " p r o g r a m matic" goals, the same consideration applies: specific projects as means to putative ends rather than dollar amounts as expressions of the weight attached to various ends would seem the logical focus of review. I n Philadelphia there are, however, sections of the capital program that the Planning Commission treats solely in dollar terms. These, chiefly, are the "continuing programs" in utilities and some other fields, to which three considerations are relevant. T h e first is that some of these programs (for example, new streets, water mains) bear a land use relationship, though many others do not; the second is that programmatic expression in dollar terms leaves the matter of priorities among constituent projects to departmental j u d g m e n t ; and the third is that the fund allocations involved are largely, though not entirely, made in the administration. 1 T h e large and " l u m p y " projects of the same departments, of course, receive individual and integrative Planning Commission review. Fund allocations are not and cannot be entirely made in the administration. Within an overall capital budgetary constraint dollars become the g r a m m a r of capital programming. 1

See Chs. III, IV, IX above.

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If the content of the capital program includes the timing and matching of intergovernmental aids, the fact of "continuing programs," and the phasing of repairs, renovations, extensions, and constructions of minor facilities, then these must all figure in planning commission review. It is then inevitable that project integration will slide toward fund allocation in the short-run form described above as "adjudication." This measure of fund allocation may disturb those who are concerned about the planner's aggrandizement of his own goals and standards in capital programs. The other side of the dollar is, however, that fund allocation is well adjusted to administrative bargaining and political adjustment, as every student of budgeting knows. An extensive and long-term capital program gives these processes their opportunity in the phasing of funds and scheduling of smaller projects. The result is that the planning commission is placed in something of a half-way house. While its reviewing function tends to overstep the logical distinctions suggested above, it is nonetheless held in check by the processes described in Chapter I X . C. The independent planning commission. Philadelphia's Housing Commission is, of course, a jHOji-independent commission; and the arguments for outright independence were rejected in its constitution. The traditional arguments for independence or quasi-independence primarily related to land use planning, and to research, integration and the long view, but not to allocation. 1 The question is whether

1 See, e.g., Robert Walker, The Planning Function in Urban Government, op. cit., Part I I ; Alfred Bettman, City and Regional Planning Papers, op. cit., Ch. 5. Bettman saw the planning function as one of supplying adjustment and coordination among competing ideas, specialties and pressures; of providing a long-range view in city government; and of research and data-gathering free from the pressures of the moment. H e was inclined to accept a measure of ex officio membership of the planning commission.

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capital programming (especially when linked to all-out redevelopment) requires revision of those arguments. 1 A good example of the argument for revision and reorganization is a recent study by Fagin and Norton of capital programming in New York City, directed to the place of land use, programmatic, and fiscal planning in capital programming. * Capital project planning must be related to "the broad policies of the City administration as to programs to be achieved and fiscal principles to be observed;" to the "total status and development potential of the City's physical plant, private as well as public"; and to the operating budget. 3 Any decision locating the responsibility for capital programming must follow from a weighing of these three "interlocks;" and it is argued that planning commission independence in New York has given too much weight to the second ("physical planning objectives") at the expense of the others. T h e authors thus propose an ultimate reorganization in which city planning would lose its independence. "Forward programming" in general would be the responsibility of the line, and particularly of the City Administrator, aided by the staff work of the Bureau of the Budget and the Planning Department. T h e Budget Bureau can "observe and analyze the important interaction of operational and capital expenditures," but its

1

A statement of the general issues by a writer who favors a pervasive

role for planning is contained in Perloff, Education for

Planning,

op.

cit.,

pp. 28-32. 2 Henry Fagin and C . M c K i m Norton, "Physical and Fiscal Planning," op. cit. In this study capital programming is defined as one aspect of "forward programming," which is in turn defined (at p. 87) as: " . . . embracing both physical projects and functional activities. It takes account of private developments in the City as well as public facilities and services. It is concerned equally with the quality of public programs and with their costs." 3

Ibid.,

p. 88.

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perspectives are likely to be limited to cost reduction and functional efficiency. The Planning Department can provide another set of perspectives: anticipation of overall trends in city development; programmatic integration (in terms of location, efficiency and economy) of project proposals; land use integration of projects; and evaluation of the relative benefits of alternative capital proposals in the light of a broad master plan. 1 A t the same time, fiscal, cost, constructional, and operational considerations are unlikely to achieve prominence on the horizons of the Planning Department; hence "forward programming" and capital programming must remain the responsibility of the line. Although population magnitudes and administrative pluralism may render the New York City contest unique, the Fagin-Norton study is valuable for its specification and weighting of goals of municipal investment activity as well as for its analysis of the details of capital programming. The location of planning (that is, of comprehensive planning) must be decided by preferences among the functions and subject matter of planning and references to the local context. Probably it cannot be decided in general, but the distinctions so far developed may still be useful. If entrepreneurial and programmatic, budgetary and fiscal planning are to be emphasized, then a line or staff location would seem logical even at some probable cost to research and the long view, which are perhaps uniquely the characteristics of regulatory and land use planning. If, on the other hand, the planner's role (and that of the comprehensive plan) in capital programming is primarily integrative rather than allocative and is based in regulatory and land use planning, then a measure of

Ibid., pp. 90-94. Note the assumption (in the fourth function) that a master plan can provide some reliable measures of relative project benefit. 1

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independence may still be appropriate. The argument of this preceding chapter is that these are the most logical and probable functions, though reorganization itself might modify these arguments to some limited extent. Wholesale redevelopment and renewal may lend impetus to the relocation of planning on the ground that these processes erode the distinctions discussed in this chapter. Two considerations, however, may still support a measure of planning independence. Many development decisions (for example, the level of redevelopment relative to other programs, the direction of development among major ends, and project design) will probably still be made by political leadership and operating agencies. And some may feel that the entrepreneurial nature of redevelopment is itself an argument for safeguarding the characteristic functions of regulatory and land use planning in research and the gradual formulation of standards.

Λ Ι

< 3 ψ

Criteria for Public Investment

Introduction. Chapters I X and X dealt with political and administrative roles in capital budgeting and with probable and possible roles of the comprehensive plan. In this chapter we offer a more technical review ofsome techniques and criteria that might be used by a central reviewing agency in the formulation of a capital budget. The discussion centers on the uses and limitations of formal economic analysis and professional standards. The problem facing the reviewing agency in the assembly of the capital budget and program can be stated simply. The individual departments of the city government present a series of requests for particular projects. The number of projects presented is sufficiently great that the budget constraint allows only some of these projects to be included in the budget. A central reviewing agency—whether planning commission, budget bureau, or line agency—to choose among projects, must implicitly or explicitly have criteria or tests of preferences. Using the term preference or criterion in the most formal sense implies the maximization of something. For example, the planners might wish to maximize "welfare," "the real income of the city," or employment. Goal articulation is a prerequisite for maximization. Since the number of variables that are found in such functions as "the public welfare" is so large, it is impossible for 253

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the p l a n n e r to identify all of the variables i n v o l v e d , let alone relate all o f the possible outcomes of the alternative investment opportunities. I n p r a c t i c a l terms this means that w h a t will be used in the m a k i n g o f choices are a smaller n u m b e r o f variables w h i c h serve as surrogate measures for these c o m m u n i t y values. G i v e n the identification o f such a variable, the p l a n n e r c a n attempt

to estimate

certibus paribus

the consequences

of

alternative projects in terms o f t h a t variable. I f more than one o f the variables c a n be identified, similar analysis c a n be carried t h r o u g h . W h a t this means, o f course, is that the criteria used b y the p l a n n e r will o n l y h a v e m e a n i n g in terms o f the p a r t i c u l a r v a r i a b l e used. T h e y are in no sense criteria for a n optimus optimorum. For e x a m p l e , suppose w e wish to achieve in a city c a p i t a l b u d g e t m a x i m u m e m p l o y m e n t within the city, or a certain distribution o f i n c o m e . A l l projects m i g h t be ranked in terms o f e a c h o f these variables, b u t it w o u l d only be the greatest c o i n c i d e n c e if the rankings for each value directly corresponded w i t h e a c h other. It is here that a higher level of decision m a k i n g must be called upon. W i t h i n the f r a m e w o r k of f o r m a l analysis used here, it is only the legislature a n d the m a y o r w h o c a n decide on the general w e i g h t i n g to be given the b r o a d goals o f the c o m m u n i t y . 1 T h u s , w h e n the term " c r i t e r i o n " is used it should be understood as, at best, a rough i n d e x to some c o m p l e x of c o m m u n i t y values. Economic technique

Analysis. that

Economic

may

be

of

analysis use

in

is

one

evaluating

important projects.

I f this analysis is used, the criterion is that of achieving

In the technical language of the economist, the analyst attempts to define an "efficiency locus" while the higher level decision is concerned with picking a point on this locus. See, for example, R . A . Musgrave, The Theory of Public Finance (New Y o r k , 1959), pp. 80 ff. 1

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economic efficiency. 1 O n e level of economic efficiency is associated with the working of a perfectly competitive price system: consumers through adjusting their market purchases so that the last dollar spent in each use gives the same satisfaction maximize their utility, subject to a budgetary constraint ; producers through equating marginal costs to prices maximize profits subject to the constraint of the production function. It is through prices that the tastes of consumers and the technical conditions of production are brought together to achieve efficient allocation of resources. If the assumptions of the model are met, then a so-called "Pareto o p t i m u m " is reached; and we can call this allocation of resources "efficient." Efficiency in this sense means simply that we cannot find another allocation of resources that will make anyone better off (in terms of real income) without making someone else worse off. Several theoretical assumptions and value judgments are implied in the criterion of economic efficiency. T h e major ones will be briefly noted and identified. i. It is assumed that there are no external technological economies or diseconomies of production or consumption. This means, in cfiect, on the production side of the market, that the amount of any one good produced has no effect on the inputs used in producing another good. This may be illustrated by the hoary example of river pollution affecting the costs of a firm downstream. O n the consumption side, external economies would exist if consumption by one individual increased the satisfaction of another in the community. In 1 Good general discussions of economic efficiency are to be found in such texts as R. H. Leftwich, The Price System and Resource Allocation (New York, 1955); J. Bain, Pricing Distribution and Employment (New York, 1953). More detailed discussions of welfare economics are to be found in W. Baumol, Welfare Economics and the Theory of the State (Cambridge, Mass., 1952).

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problems of local government this is probably the most important case since many municipal programs such as recreation, library, public health, and welfare are defended in terms of external economies: for example, the prevention of juvenile delinquency, a better educated and healthier population, and therefore a more productive population. 2. T h e distribution of income that results from market decisions must be considered appropriate. For given a different distribution of factor ownership and assuming some elasticity in the supply of the factors, there will be a different optimum; and a preceding allocation may no longer be considered "efficient." Thus a project that might be chosen under one distribution of income might no longer be preferred under a different distribution of income. This does raise a more important question. T o the extent that many projects are engaged in by government primarily to change the distribution of income, can economic efficiency be considered the appropriate criterion to be used? It may be noted, however, that the majority of redistributive expenditures are contained in the operating not the capital budget. 3. A similar problem comes up when we ask whether the " m a r k e t " rate of interest is the appropriate criterion to use in discounting future costs and benefits. T h e interest rate in our purely competitive model is the price that allocates resources among different periods of time. A high rate will encourage projects on which the returns are expected in the immediate future; with a lower rate, the returns would be expected over a longer period of time. In our pure model this rate would reflect only present consumers' preferences about the resources available for future consumers. Just as the"Pareto optimum" resulting from a given distribution of income may be questioned, so, as the conservationists have so often pointed out, may the market rate of interest be questioned concerning the temporal distribution of resources among different generations.

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4. T h e pure competitive model provides no signalling device for the production of "public goods." These are goods and services, such as parks and police protection, which, in general, are consumed by the community as a whole and their consumption does not depend on the prices paid by individuals. Thus the individual's consumption is independent of the amount of the commodity he pays for. Since there is no market through which the consumer can indicate his preferences, some technique of group decision must be used to determine the objects and level of public expenditures. These qualifications suggest some limitations of traditional economic analysis for the problem of choosing public investment projects. Economic analysis also raises broader problems of values, procedures, and popular preferences, which are discussed later. Y e t there are important policy aids and insights to be gained by the techniques of economic analysis; and these, in the main, are the subject of the following sections. Rate-oj-Return Analysis. If the concept of economic efficiency is adopted as a criterion, the traditional approahc of the economist would be to estimate the internal rate-of-return from each possible project and projects would be undertaken until the marginal rate of return was equal to the relevant interest rate. By internal rate-of-return we mean that rate of discount which equates the discounted net income stream from the project to the cost of the investment. If this rate of discount is greater than or equal to the market rate of interest, the investment should be undertaken. T h e procedure would appear to have the simplicity of giving a ranking to all the alternatives presented to the reviewing agency for consideration. Further, the size of the budget would be automatically determined since all projects would be included which provide an internal rate-of-return P.M.I.—I

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Planning Municipal Investment

greater than or equal to the interest rate. This is important since the discount rate used by the analyst will determine the projects chosen. If a low rate is chosen, capital intensive projects will be favored, while a high rate would favor labor intensive projects. For example, in choosing between a playground and subway equipment, the playground might have low capital and high operating expenses while with subway equipment the major costs might be capital with very low operating expenses. A high interest rate would favor the playground; a low interest rate the subway equipment. Further if a high rate of interest is chosen, projects whose payoff periods are short will be preferred. Rate-of-return analysis must, however, be qualified when investment projects are interdependent. Thus projects designed for approximately the same purposes may differ in capital intensity and thus imply different discount rates. For example, a port facility may be mechanized to the m a x i m u m ; or it may be built so as to be less capital intensive and less labor saving. Since a choice must be made between these two techniques, the projects are mutually exclusive. O n e possible solution to this problem for the analyst is to calculate present value at a variety of discount rates—with these rates clustered about the marginal internal rate of return. 1 If this is done, the implications of the choice of discount rate become apparent to all parties in the decision making process. Thus, economic analysis through the use of an interest rate forces consideration of two problems, the capital intensity of the project and the time stream of costs and benefits. T h e problem of selecting the relevant discount rate has administrative implications somewhat similar to those entailed by central cost controls. While the choice of project specifi-

1

T h e best discussion of the relevant issues is to be found in M c K e a n , op.

cit., esp. pp. 74.-96.

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259

cations and design is made at the departmental level, this choice implies a choice of discount rate; and the rate postulated in the department's project design may differ from the rate employed by planners in evaluating projects. Thus, the reviewing agency and the department might differ significantly in the priorities awarded to departmental projects. Project interdependence, or mutual exclusiveness, may also result from capital rationing; that is, from a city budgetary ceiling. For example, in Philadelphia the Planning Commission works under a budget constraint of $25 million of taxsupported funds. Mutual exclusiveness results here because a choice must be made among projects even if all of the projects have an internal rate of return greater than the market rate of interest. With the adoption of capital rationing by the city administration, there is an implicit rejection of the time distribution of income implied in a perfectly competitive model. A variety of reasons may be suggested. First, a fear that carrying a budget to the point where the marginal internal rate of return was equal to the interest rate would mean higher tax rates in the future. In Chapter V Council's role in maintaining a conservative fiscal policy was pointed out. And in Chapter III the adoption of the fixed ceiling is described as a means of protecting Philadelphia's financial rating. Second, there may be an implicit preference by the administration and legislature for a higher rate of discount since this would favor projects from which the returns could be expected in the more immediate future. Third, there are certainly important administrative advantages in a fixed budgetary constraint. Some of these are matters of procedure or control; others relate to substance or criteria for decision. All must be set against the criterion of the market model. In point of procedure, a budgetary ceiling forces

26ο

Planning Municipal Investment

planners to make comparisons and eliminate projects; it militates toward cost control; and it assists the legislature in forcing project justifications from planners and administrators. So far as substantive criteria for decision are concerned, a budgetary constraint may be viewed as a form of hedge against uncertainty—against the possibility that the estimated "returns" from projects may not eventuate in full. Finally, the financial community's knowledge of the fixed limit makes it easier for the city to float bonds. Benefit-Cost Analysis. Benefit-cost analysis represents another attempt to apply economic analysis to the problem of choosing investment projects. It has frequently been used by the federal government in evaluating water-resources development projects, national parks, and beaches. 1 This criterion has recently been subject to intensive analysis by Eckstein and Krutilla and McKean, and the following is essentially a summary of points raised in their analyses. 4 On the most abstract level and assuming no problem in measuring either benefits or costs, benefit-cost analysis consists in finding a ratio in which total discounted benefits appear in the numerator and total discounted capital and operating costs appear in the denominator. Projects can then be ranked in terms of the ratios and those projects chosen which give the greatest possible benefits per dollar of cost. How does this differ from the rate-of-return analysis just discussed? Stating the rate-of-return technique in similar terms, the initial capital costs are set equal to future benefits minus operating costs and solved for the discount rate that equates the capital cost of the project with the net income 1

See, for example, Proposed Practices for Economic Analysis of River Basin Projects—Report to the Federal Inter-Agency River Basin Committee (Washington, D.C., 1950). ' Eckstein and Krutilla, op. cit.; McKean, op. cit.; Eckstein, op. cit.

Criteria for Public Investment

261

stream from the project. 1 There are no ratios involved. Thus the major difference between the two criteria is found in the fact that discounted operating costs for the life of the project appear in the denominator in the benefit-cost analysis while only in the numerator and therefore in a net income sense in the rate-of-return analysis. T h e importance of this distinction is that the analyst in each case is faced by a different budget constraint. Using rate of return analysis, the constraint is this year's budget while benefit-cost analysis proceeds on the assumption that the size of the total budget, both capital and operating, is fixed

1

T h e differences between the two criteria can be seen more simply if

they are written out in algebraic form. Let C be the initial capital cost, Ο the annual operating expenses, Β the benefits as defined for the proj e c t , i the interest rate. T h e n the present value of total cost is

η ' 5 4 . ' 6 5 . 184 n. cited, 77, 79, 80, 99, 129, 153, 158, 163, 165, 166 Capital budget: definitions o f " c a p i t a l , " 26-27, 183-184 charter provisions for, 2 3 - 2 9 a m e n d m e n t s to, 1 5 9 - 1 6 4 delays in execution, 1 6 4 - 1 6 6 period of execution, 26, 1 5 8 - 1 5 9 periodic evaluation of, 1 6 9 - 1 7 0 Capital programs: history a n d content s u m m a r i z e d , 170-173, 187-188 stability of, 1 7 3 - 1 8 2 , 1 9 1 - 2 2 3 small and large projects in, 207-209

111,195-207 role in b u d g e t i n g , 98-99, 1 6 0 - 1 6 1 relations w i t h citizen organizations, 100, 156 stability in c a p i t a l p r o g r a m s ,

179,

' 9 7 . 214 C i t y R e p r e s e n t a t i v e , see D i r e c t o r of Commerce C i v i c Associations: g e n e r a l discussion of, 1 1 2 - 1 5 7 testimony to C o u n c i l , 1 0 0 - 1 0 1 , 199 relations w i t h administration, 1 5 5 '56 grass roots o r g a n i z a t i o n , 1 4 9 - 1 5 1 professional staff, 1 5 1 - 1 5 3 Clark, Joseph S.: financial p o l i c y of, 7 8 - 7 9

290

Index policy on c a p i t a l p r o g r a m s , 80, 83-04, 2 1 3 and P h i l a d e l p h i a H o u s i n g Association, 138 Commerce Department: and u r b a n renewal, 5 9 role in capital p r o g r a m m i n g , 7 3 - 7 4 C o n t i n u i n g programs, 5 1 - 5 2 , 2 1 0 2 1 1 , 248 Cost controls, 7 7 - 7 8 , 130, 1 6 5 - 1 6 8 , 185-186 C o u g h l i n , R o b e r t E . , 89-90, 232, 281 Criteria for p u b l i c investment: general discussion of, 3 3 - 3 5 , 2 0 9 210, 2 1 5 - 2 1 8 e c o n o m i c analysis as source of, 253-272 professional standards as source of, 272-283 public health, 3 8 - 3 9 recreation, 4 2 - 4 5 Water Department, 54-55 Police a n d Fire D e p a r t m e n t s , 5 5 - 5 6 politics as source of, 2 1 6 - 2 1 7

Deferred m a i n t e n a n c e , 27, 48, 173, 184, 193, 2 1 0 - 2 1 1 , 2 1 5 D e p a r t m e n t a l boards, 30 D e p a r t m e n t a l p l a n n i n g , see P l a n n i n g D e v e l o p m e n t C o o r d i n a t o r , 2 1 , 59, 60, 72, 142

Dilworth, Richardson (mayor), policy on c a p i t a l programs, 8 0 - 8 1 , 83-84, 213 Director of C o m m e r c e : C h a r t e r provisions for, 20 role in capital p r o g r a m m i n g , 7 3 - 7 4 , 85 as m e m b e r o f P l a n n i n g C o m m i s sion, 95 D i r e c t o r of F i n a n c e : C h a r t e r provisions for, 20 ff. role in capital p r o g r a m m i n g , 7 4 - 7 8 , 85, 160 as m e m b e r of P l a n n i n g C o m m i s sion, 95 D o w n s , A n t h o n y , 201, 207 n. D u n h a m , Allison, 240

291

Eckstein, O t t o , 260, 265-266 E c o n o m i c base of the c i t y : as element in capital p r o g r a m m i n g , 83-84, 86, 139, 1 4 2 - 1 4 3 , 154, '72-173 Efficiency, economic, 255 Enlightenment, o f citizen organizations, 1 4 7 - 1 4 8

F a g i n , H e n r y , 250-251 Federal Housing A c t of 1954, 58, 13g Financial policy of the city, 28, 78-80, 128, 130, 270 Fire D e p a r t m e n t : long-range p l a n n i n g in, 5 5 - 5 7 role in capital programs, 211 Fiscal conservatism, 83-84, 1 0 5 - 1 0 6 , >3°. 1 5 3 - " 5 4 . 201-202 Free L i b r a r y , 35, 176, 230 Gans, Η . J . quoted, 2 7 2 - 2 7 3 Greater Philadelphia Movement, 125-127 Greenfield, A l b e r t M . , 9 4 - 9 5 , 101 H a a r , Charles M . : quoted, 225 cited, 226, 232 H a r b e r g e r , Α . , 265 H a r d i n , Charles M . , 150 H e a l t h centers, 37 H i r s c h m a n , A . O . , 208 n., 284 n . H o w a r d , J o h n T . , 139, 233-236 I n c o m e distribution, 256 Keynes, J. M . quoted, 288 K r u t i l l a , J o h n , 260, 265-266 L e v i n e , A a r o n , 112, 140 Lindblom, C. E. q u o t e d , 241, 242 L o v e l a c e , Eldridge quoted 233-235

292

Index

Managing Director: Charter provisions for, 19 role in capital programming, 6973,85,192-193 as member of Planning Commission, 72,95. »93 Mayor of Philadelphia: and capital programming, 24-25, 68, 78-86, 101, 104-105, 181, 209, 213-214 "Strong mayor" in Charter, 17-19, 29-31 McKean, Roland, 258, 260 Medical Care for the Needy, report on, 37-39 Meyerson, M. quoted, 222 n. Millett, John D. quoted, 228 n. Moak, Lennox, 79 n. and BMR, 153 comments on City Charter, 19-20 as Finance Director, 160 n. Mosher, Frederick C., 183-184 cited, 166, 231 n. National Recreation Association standards of, 272-280 New York City: capital budgeting in, 231 n., 25025' Planning Commission, 237 Norton, C. McKim, 250-251 Performance budgeting, 185-186 Perkins, G. Holmes, 95, 140 Philadelphia City Planning Commission : Charter provisions for, 19, 192 role in capital programming, 8797, 101-104, 106, 179-180, 191'95,217-218, 221-222, 224 Philadelphia Health and Welfare Council: relation to Department of Public Health, 36 role in capital programming, 100, 131-136, 137, 149, 154-157, 200

Philadelphia Housing Association, 136-144,149,154,157 Philadelphia Housing Authority, 21 Philadelphia Industrial Development Corporation, 61-62 Philadelphia Recreation Association, '55 Philadelphia Redevelopment Authority, 21,58 ff. Pitts, Charles, 87-88 Planning: allocation function, 244-245 budgetary, 225-227 comprehensive planning: defined, 232-236 role in Philadelphia's capital programming, 88-91, 194, 215 source of criteria for investment decisions, 217-218, 242-247 departmental: types of, 33 ff. evaluation of, 63-67, 186 entrepreneurial, 225, 227 fiscal, 227 goals, 57-58, 230-232, 244-247 independent planning commission, 19, 249-252 integration, 221, 240-242, 243-244, 249 land use planning, 184, 228-229 distinguished from "programmatic" planning, 226, 229231, 236 "minimal" approach, 237-242 physical and fiscal distinguished, 69-70, 183-185, 226 "radical" approach, 237-242 regulatory, 225, 226-227 research, 221, 242-243, 284-285 standards, see criteria for public investment Police Department: long-range planning in, 55-57 role in capital programs, 176, 211 Political parties: role in capital programming, 203204 Democratic Party in Philadelphia, 18, 98, ιοί, 112, 203

Index Port improvements, 73, 182 Public funds, cost of, 264-271 Public Health Department long-range

planning

in,

293

Streets Department, 64, 103, 133, 210, 211 35-39,

'55 Public Welfare Department, 35, 176, 230 Quadrennial budget, 98 Rate of interest, 256, 257-258, 267 Rate-of-return analysis, 55, 257-260, 262-264 Recreation Department: long-range planning in, 39-47, 155 relations with City Council, 103104,106-107 relations with citizen organizations, 155 Recreation Space Standards for Philadelphia, Report on, 42-45 Regional parity in capital programming, 198-201 Row, Arthur cited, 245 n. Schools, relation to capital programs, 22 Self-supporting projects, 27 ff., 48 Sewage disposal, 47, 50-51 Simon, Herbert, 204, 205 n. Stability, in capital programs, 173— 182,191-223 Steiner, G . Y . , 202 n. Storm sewers, 53-54, 81, 108

Taxes and cost of public funds, 266270 Technical advisory committees, 33, 41 ff., 92-93, 230 Time horizons, 212-215 Transportation in capital programs, 181,211 Transportation Coordinator, 22 Tugwell, R. G., 237-239 Urban renewal: relation to capital programming, 57-63,247 Philadelphia Housing Association on,139-144 "new approach" of City, 59-60, •42-'43 industrial renewal, 59, 145, 154 consequences for City policy, 21, 139-140 Urban Traffic and Transportation Board, 22 Walker, Robert Α., 194 η., 249 η. Water Department, 35, 123 long-range planning in, 47-55 Water rates, 48, 49 "Welfare" as emphasis in capital programs, 83-84,86, 154, 172-173 Wheaton, W . L. C . quoted, 136, 150

W. Η. BROWN, JR. Born in 1924, Dr. Brown received his B.A., M.A., and Ph.D. at Yale University, the latter degree being awarded him in 1952. In the years 1950-52, he instructed at Yale, and since 1953 h*3 been Assistant Professor of Political Science at Swarthmore College. Articles by him have appeared in the Quarterly Journal of Economics and the American Political Science Review. C. E. G I L B E R T Dr. Gilbert, born in 1927, received his B.A. from Haverford College in 1950. He did graduate work at the London School of Economics and at Northwestern University where he received his Ph.D. in 1955. He has been a Research Fellow of the Social Science Research Council, and an assistant to Senator Hubert H. Humphrey of Minnesota. Dr. Gilbert has contributed to such journals as Ammls of the American Academy of Political and Social Science, The Journal of Politics and the American Political Science Review. Since 1955, he has been Assistant Professor of Political Science at Swarthmore College.