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Bill No. 07069300.pdf
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City of Philadelphia
City of Philadelphia - 1 -
City Council
Chief Clerk's Office
402 City Hall
Philadelphia, PA 19107
BILL NO. 070693
Introduced September 20, 2007
Councilmembers Goode, Greenlee, Savage, Clarke, Miller, Reynolds Brown,
Council President Verna, Councilmembers Tasco, O'Neill, Rizzo, DiCicco,
Campbell, Krajewski, Blackwell, Kenney and Kelly
Referred to the
Committee on Finance
AN ORDINANCE
Creating the Philadelphia Re-Entry Employment Program ("PREP") for Ex-offenders; in
particular, amending Chapter 19-2600 of The Philadelphia Code, entitled "Business
Privilege Taxes," to provide a PREP Tax Credit for businesses that hire ex-offenders;
directing various City officials to take certain actions with respect to the employment of
ex-offenders by the public and private sector; and requiring those who contract with the
City or who receive certain financial benefits from the City to identify job opportunities
that may be available for ex-offenders and to take other action with respect to the hiring
of ex-offenders; all under certain terms and conditions.
THE COUNCIL OF THE CITY OF PHILADELPHIA HEREBY ORDAINS:
SECTION 1. Title 20 of The Philadelphia Code is hereby amended to read as
follows:
TITLE 20. OFFICERS AND EMPLOYEES.
* * *
CHAPTER 20-1700. PHILADELPHIA RE-ENTRY EMPLOYMENT PROGRAM
("PREP") FOR EX-OFFENDERS.
§20-1701. Duties of the Managing Director.
(1) The Managing Director shall coordinate the implementation of the Philadelphia
Re-Entry Employment Program set forth in this Chapter.
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(2) By January 31 of each year, the Managing Director shall submit a written annual
report to the Mayor, with a copy to the President and Chief Clerk of Council, which shall
include the following information for the prior calendar year:
(i) A summary and evaluation of the efforts of City agencies in carrying out
the Philadelphia Re-Entry Employment Program, including a summary and evaluation of
how the duties specified in this Chapter were performed.
(ii) A summary and evaluation of the efforts of City contractors and recipients
of financial assistance to cooperate with the City in providing employment opportunities
for ex-offenders, as required by Chapter 17-1500.
(iii) A summary and evaluation, as prepared by the Revenue Department, of
the City's experience with the PREP Tax Credit provided under §19-2604(8), including a
list of all businesses that participated, the number of Qualifying Employees certified
during the year, the number of Qualifying Employees whose certification expired during
the year and a summary of the reasons for such expiration; and recommendations for
improvement of the program.
§20-1702. Duties of the Personnel Director.
(1) Within forty-five days after this Section becomes law, the Personnel Director shall
transmit to the Mayor, the President of City Council, and to the Civil Service Commission
recommended guidelines for the City's hiring of ex-offenders, and recommendations for
increasing public, private and non-profit sector employment of ex-offenders, including
identifying barriers to such employment and ways to remove such barriers.
(2) In developing the recommendations required by subsection (1), the Personnel
Director shall first develop, in cooperation with the Mayor's Office for the Reentry of Ex-
offenders, the Philadelphia Prison System, the Department of Human Services (DHS),
Community Behavioral Health (CBH), the First Judicial District of Pennsylvania, any
other appropriate city, state or federal agencies, the Philadelphia Workforce
Development Corporation, chambers of commerce, other business advocacy
organizations throughout the City, and organizations that provide re-entry/ex-offender
services, a matrix of job titles and work categories matched to ex-offender criminal
offenses and work skills that can be used to help the City and other employers identify
jobs appropriate for potential employees with criminal records.
§20-1703. Duties of the Commissioner of the Philadelphia Prisons System.
(1) The Commissioner of the Philadelphia Prisons System shall ensure that the
Philadelphia Prisons System carries out the following program for each prisoner who
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was a Philadelphia resident and is to be released from a period of sentence in the
Philadelphia Prison System:
(a) Each such prisoner shall, at least six months prior to release, be advised
of the opportunity to participate in the Philadelphia Re-Entry Employment Program set
forth in §19-2604(8).
(b) Every prisoner who expresses an interest in participating will be given a
pre-release assessment of his or her current education, job training level and future job
prospects, physical and mental health status, and the housing and family circumstance to
which he or she expects to return to in Philadelphia upon release, and based on that
assessment, an individualized package of basic education, job training and retention,
financial and life skill management training, and other support services will be designed
to assist the prisoner in securing employment, housing or other life improvement services
as soon as possible after release.
(c) A PREP Employee's Agreement will be prepared in accordance with §19-
2604(8)(e).
(2) The Commissioner of the Philadelphia Prisons System shall seek to enter into
cooperative arrangements with federal, state and other non-City correctional facilities
located in the Commonwealth of Pennsylvania, through which the same program set
forth in subsection (1) will be provided to prisoners who were Philadelphia residents and
who are to be released from a period of sentence in such facilities.
§20-1704. Duties of the Revenue Commissioner.
(1) The Revenue Commissioner shall ensure that all businesses holding a business
privilege license in Philadelphia are provided information about the PREP Tax Credit
available under §19-2604(8).
(2) The Revenue Commissioner shall also, in consultation with the Mayor's Office for
the Reentry of Ex-offenders, provide to such businesses information on other federal,
state and local programs available to assist in the employment of ex-offenders.
SECTION 2. Title 17 of The Philadelphia Code is hereby amended to read as
follows:
TITLE 17. CONTRACTS AND PROCUREMENT.
* * *
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CHAPTER 17-1500. PHILADELPHIA RE-ENTRY EMPLOYMENT PROGRAM
("PREP") FOR EX-OFFENDERS.
§17-1501. Definitions.
(1) Contract. Any contract awarded by the City, including contracts subject to
the competitive bidding requirements of the Philadelphia Home Rule Charter and
contracts not subject to competitive bidding, including, but not limited to, contracts
subject to the prevailing wage requirements set forth in §17-107.
(2) Financial Assistance. As defined in §17-1401.
§17-1502. Duties of City Contractors and Those Receiving Financial Assistance.
(1) No Contract shall be awarded, no Financial Assistance shall be provided, and no
tax abatement shall be provided with respect to a construction project with a value of
more than $1 million, unless the person awarded the Contract, or receiving the Financial
Assistance or tax abatement agrees in writing:
(a) To identify potential job opportunities that may be available for ex-
offenders, based on the matrix of job titles and work categories developed by the
Personnel Director under §20-1702(2), and to report to the City on such person's
employment practices and experience with respect to the hiring of ex-offenders,
including: (i) a monthly tally of ex-offenders hired and currently working, or an
explanation as to why no ex-offenders have been hired; and (ii) an explanation as to why
any ex-offender who applied for employment was refused employment;
(b) To cooperate with the City in addressing the goal of securing employment
for ex-offenders;
(c) That if such person fails to comply with the requirements of such written
agreement, the City may withhold any payments due under the Contract or any Financial
Assistance yet to be provided until the Contractor or recipient of Financial Assistance
achieves full compliance; and
(d) To require any subcontractor it uses to comply with and be bound by the
provisions of this Section as if the subcontractor had been directly awarded a City
contract.
SECTION 3. Chapter 19-2600 of The Philadelphia Code is hereby amended to
read as follows:
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CHAPTER 19-2600. BUSINESS PRIVILEGE TAXES.
* * *
§19-2604. Tax Rates, Credits, and Alternative Tax Computation.
* * *
(8) Philadelphia Re-Entry Employment Program for Ex-offenders ("PREP") Tax
Credit.
(a) Definitions.
(i) Ex-offender. A person previously convicted of a felony, or who was
incarcerated for any conviction, or who is currently on probation or parole for any
conviction.
(ii) Qualifying Employee. For any given tax year, an Ex-offender is a
"Qualifying Employee" of a business if he or she:
(.1) Is employed by the business during the tax year in a full-
time job for which the average hourly rate, excluding benefits, is at least 150% of the
federal minimum wage, and who receives an employment package that includes adequate
health care benefits and at least $2,000 in tuition support for GED, Community College
or other post-secondary education, or vocational/technical education or training;
(.2) Earns wages that are subject to the tax on wages imposed
by Chapter 19-1500;
(.3) Was first hired by the business after it entered into a PREP
Tax Credit Agreement as required by subsection (8)(c);
(.4) Was released from incarceration no more than seven years
before being hired by the business, and was a Philadelphia resident for at least one year
before being incarcerated;
(.5) Before being hired by the business, executed a PREP
Employee's Agreement as required by subsection (8)(e); and
(.6) Has been certified by the Revenue Department as a
Qualifying Employee in accordance with subsection (8)(d).
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(b) Calculation of Tax Credits.
(i) A business shall receive a tax credit for each certified Qualifying
Employee who has been employed by the business for more than six months. The tax
credit shall be in the amount of $10,000 multiplied by the percentage of the tax year that
the Qualifying Employee was employed by the business.
(ii) Tax credits are available for a total of thirty-six months of
employment of a Qualifying Employee, and the maximum amount of tax credits a
business may receive for any one Qualifying Employee over all tax years is $30,000.
(iii) Tax credits shall be taken against total business privilege tax
liability, and any unused credits may be carried forward until used.
(iv) A business receiving tax credits under §19-2604(7) for a given tax
year shall not be eligible to receive tax credits under this subsection (8) for that same tax
year.
(c) Eligibility; PREP Tax Credit Agreement.
(i) To be eligible to receive tax credits, a business must first execute a
PREP Tax Credit Agreement with the Revenue Department that:
(.1) Details all the terms and conditions of the PREP Tax
Credit as set forth in this subsection;
(.2) Sets forth the business' agreement to notify the Revenue
Department within one week after any Qualifying Employee is no longer employed by the
business, which notification shall include an explanation as to why the Qualifying
Employee's employment terminated;
(.3) Sets forth the business' agreement to withhold from the
wages of any Qualifying Employee and remit to the City the payments the Qualifying
Employee must make to the City under subsection (8)(e)(iii); and
(.4) Sets forth the business' commitment to maintain its
operations in the City of Philadelphia for five years from the date of the agreement, and
the business' agreement to repay any tax credits it receives if it violates such
commitment, as required by subsection (8)(e)(i).
(d) Certification of Qualifying Employees; Maximum Number Permitted.
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(i) After a business has executed a PREP Tax Credit Agreement, it
shall make application to the Revenue Department, on a form required by the
Department, for each employee it wishes to have certified as a Qualifying Employee.
(ii) The Revenue Department shall certify all persons who meet the
definition of Qualifying Employee, except:
(.1) The number of certified Qualifying Employees at any one
time shall not exceed 1,000; and
(.2) The Revenue Department shall not certify an Ex-offender
as a Qualifying Employee if it finds that the hiring of the Ex-offender is displacing
another employee of the business, and that the primary reason for such displacement is to
obtain PREP tax credits. The Revenue Department shall by regulation develop standards
to insure that other employees are not unfairly displaced or impacted by the tax credits
provided by this subsection.
(iii) The certification of a Qualifying Employee shall expire after such
employee has been employed for thirty-six consecutive months, or when the Qualifying
Employee is no longer employed by the business, and a Qualifying Employee whose
certification has expired shall no longer count against the maximum number of certified
Qualifying Employees permitted at any one time.
(e) PREP Employee's Agreement. To be a Qualifying Employee, an ex-
offender must have executed an agreement with the City that sets forth:
(i) A package of basic education and job training and retention and
support services that the City has designed for the ex-offender;
(ii) The ex-offender's agreement to participate in life skills and basic
financial management training, as well as meet all of his or her outstanding child support
and other legal obligations; and
(iii) The ex-offender's agreement to pay the City a sum equal to 5% of
his or her total wages earned during any period during which a business claims tax
credits based on the ex-offender's status as a Qualifying Employee, in consideration of
the services provided to the ex-offender by the City and in consideration of the City's
provision of tax credits to employers as an incentive to hire the ex-offender. The ex-
offender shall repay the total amount due the City without interest over a three year
period beginning with the expiration of the ex-offender's certification as a Qualifying
Employee, and the ex-offender must agree to permit the business to withhold any
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payments due the City from the ex-offender's pay and remit withheld amounts directly to
the City.
(f) Penalties.
(i) Failure to maintain operations. A business which receives tax
credits and fails to substantially maintain existing operations and the operations related
to the tax credits in the City of Philadelphia for a period of five (5) years from the date
the business executes a PREP Tax Credit Agreement shall be required to refund to the
City of Philadelphia the total amount of tax credits granted, unless the Department of
Revenue determines that a business' operations were not substantially maintained
because of circumstances beyond the business' control, including natural disasters, acts
of terrorism, unforeseen industry trends or a loss of a major supplier or market.
* * *
______________________
Explanation:
[Brackets] indicate matter deleted.
Italics indicate new matter added.