Mayor of Phoenix seeks share of bailout - East Valley Tribune: News

Mayor of Phoenix seeks share of bailout

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Posted: Friday, November 14, 2008 11:06 pm | Updated: 11:38 pm, Fri Oct 7, 2011.

Mayors of three cities hit hardest by the economic crisis — Phoenix, Philadelphia and Atlanta — asked the federal government Friday for a piece of the $700 billion bailout package, saying they need help just like financial institutions.

Mayor Michael Nutter of Philadelphia said he wants “to make sure that cities and metro areas are at the table, that their voices are being heard, that our challenges and problems are well understood, so that we can get relief.”

Phoenix Mayor Phil Gordon said his city’s budget deficit is at least $200 million and could reach $250 million by June if tax revenue keeps sliding. That figure represents up to 22 percent of the city’s $1.2 billion General Fund, which pays for most city services.

City officials say the cuts will affect every department. Phoenix will probably reduce hours at libraries, community centers and public pools and cut bus routes, among dozens of other actions.

If the government agrees to help, Phoenix could use the money to build new police and fire stations, water-treatment plants and extensions to a new light rail network.

“We’re going to have to do this in order to keep our city growing and healthy and safe,” Gordon said.

The mayors made their request in a letter to Treasury Secretary Henry Paulson.

The mayors proposed providing loans to help cities pay pension costs.

They also want $50 billion in loans for infrastructure investments and additional one-year loans to cities that are unable to borrow cash because of tight credit markets.

“The future prosperity of this country is tied directly to our ability to provide basic services and quality infrastructure to our citizens,” Atlanta Mayor Shirley Franklin wrote in a letter to Rep. Charles Rangel, D-N.Y., chairman of the House Ways and Means Committee. “We are at serious risk in failing in that most basic public responsibility.”

President-elect Barack Obama also has called for some sort of aid to state and local governments so they do not have to raise taxes or lay off workers while the federal government tries to revive the economy. But he has not proposed or endorsed a specific plan.

Also on Friday, San Jose Mayor Chuck Reed said he planned to make a separate request for $14 billion of the bailout package to pay for mass transit improvements and expansion of the area’s clean-technology businesses.

“If the federal government is going to be doling out money, we’ll be asking for our fair share,” Reed said. “As the 10th largest city in the country, we should at least get 2 percent. That would be fair.”

In Atlanta, an expected budget shortfall of $50 million to $60 million means that 4,600 city employees will have their weekly hours and pay cut by 10 percent. The city has also adopted a hiring freeze for most agencies and dipped into its reserves for $12 million. Earlier this year, the city laid off 372 employees and eliminated about 900 jobs .

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