The Challengers: Paul Steinke Wants to Transform Philly’s Commercial Corridors

Paul Steinke (on R) | Photo via Steinke’s Facebook

All week, Citified will be featuring Q&As with leading at-large City Council Democratic challengers on topics of their choosing. The prompt was simple: if elected, what’s a problem you would you prioritize, and how would you address it? To keep the conversation substantive and on-point, we asked the candidates to focus on a relatively narrow question (i.e., not “schools,” or “crime.”)

Paul Steinke shook up Philadelphia long before ever trying to get keys to an office in City Hall.

He was the Reading Terminal Market czar for 13 years. Before that, he was the finance director of the Center City District and the first executive director of the University City District. These are some of the most respected, even beloved organizations in the city.

Today, Steinke is trying out for the job of Democratic City Council At-Large. He told Citified he wanted to talk about Philly’s commercial corridors. Our questions have been paraphrased and Steinke’s answers have been edited lightly for clarity.

Citified: Why is the topic important to you? Is it because of your time working on corridors at the University City District?

Steinke: There and also the Reading Terminal, which is not a commercial corridor in the traditional sense, but it’s still a large collection of small retail businesses. And also the experience I had on the East Passyunk commercial corridor in the early 2000s.

I was part of the consulting team that put together the plan and budget that went into forming the East Passyunk business improvement district, which is still operating to this day.

Citified: What’s your favorite commercial corridor in the city?

Steinke: Oh boy, I guess that would have to be up there. I live close to the Baltimore Avenue commercial corridor, so I’m liking that more and more as it continues to transform. Beyond that, if there’s another I would throw there, I like what I’m seeing happening on Frankford Avenue in Fishtown.

Over the years, I’ve watched as Center City’s neighborhood commercial corridors have changed, like the 20th Street corridor between Locust and Spruce, the 10th Street corridor between Locust and Spruce. A little further up, what’s happening along Fairmount Avenue in that neighborhood is really exciting.

Citified: You’ve had a role in overseeing some of the more successful corridors in the city. What’s been your secret recipe for improving them?

Steinke: First of all, having management services for the public environment: regular cleaning, security patrols and ideally streetscape improvements like lighting. Lighting is huge. Pedestrian-scale lighting and improving the tree canopy to give a sort of softness to the streetscape. And then beyond that, having a qualified person to serve as a corridor manager — someone who is sort of minding the store, day in and day out, communicating with the merchants and property owners, coordinating marketing and promotions, pushing for services and also pushing for improvements to storefronts, and to recruit new vendors and also working to retain existing ones and finding out what their needs are and working to support them.

Citified: A lot of the services you listed have been funded by “special services districts,” in which businesses help fund neighborhood improvements through tax assessments. Do you think those districts should be expanded throughout the city?

Steinke: It’s a tool that can be used and it has been used successfully in a variety of them. And so, yes, I think one of the things the city should do probably through the commerce department is to play a coordinating role with the districts and also to help to create them in corridors where they don’t exist, but where they would make sense. And by make sense, I mean when there’s enough commercial property value to really generate a decent enough budget to provide meaningful resources. Not all corridors meet that test, but the ones that do should at least be considering it.

Citified: Which are those?

Steinke: Well, I was just up in one today where they used to have a special services district, but it sunsetted out of existence after 2011, and that’s Frankford Avenue under the El. And its absence was painfully obvious with a horrendous litter problem around the Margaret-Orthodox El station and bedraggled and tired-looking storefronts, lots of vacancies, and a general feeling that there was a sense of decline there. And I was surprised because it had been a few years since I was through there, and when the special services district was operating, conditions were better. And I’m not clear why it wasn’t renewed when the original legislation sunsetted in 2011. But as I say, the results were pretty clear.

Citified: What’s the solution for corridors stuck in the middle? Those that don’t have enough of a property value base to sustain a special services district, but have the most to gain from those services?

Steinke: A few things come to mind. One is to make sure that those corridors are getting their fair share of city services: sanitation, policing, L&I enforcement, health department attention — to make sure that they’re not in decline because they become the stepchild of city government. That’s the last thing we want. And once we guarantee that that is occurring, then I think coordinated efforts by both the city through the commerce department, and also the local community development corporation or community association, but preferably a CDC that organized as nonprofit and has staff that can serve as the local watchdogs and work with the property owners to try to do base-level intervention to fill vacant storefronts and provide access to resources for building maintenance and upgrades.

Citified: What could you do as a Council person to ensure that those areas get adequate city services, other than doing normal constituent services that all Council members already do? That method of ensuring city services can be scattershot.

Steinke: I would like to play a role in creating a citywide task force for commercial corridors that would bring in various disciplines from both inside city government, as well as CDCs and other nonprofits that would have an impact on those corridors to fill up with strategies to ensure their improvement. To access governmental, non-governmental and philanthropic funds that can help restore cleanliness and safety and also bring in new tenants and new uses to fill vacancies and provide grants and loans for improvements. These things are done in more of the scattershot way in kind of silos around the city. And as Councilman, I would seek to break down those silos and have a more coordinated approach with an emphasis on revitalizing corridors.

Citified: Business leaders say that one of the things that’s holding back businesses and commercial corridors in Philadelphia are the city’s high business and wage taxes. What’s your position on changing the tax structure and are you a supporter of the Levy-Sweeney plan to shift the tax burden from business and wage taxes onto property taxes?

Steinke: I’m definitely in favor of lowering wage and business profit taxes, both of which are out of line with our peer cities around the county, but also with the surrounding counties. And they have demonstrably resulted in the loss of jobs, tax revenue and economic vitality from the city, which of course mean underfunded schools, underfunded city departments, poorly maintained roads, you name it. Every city agency has fewer resources than they should. …. There’s no such thing as a free lunch, so the Levy-Sweeney approach … is one way to solve it, which is a constitutional change in Harrisburg to allow us to tax commercial property at a higher rate, and I think it makes a lot of sense to do that. And Pennsylvania is one of the few states that prohibits it, so I support that idea and think it’s something we should strive for. If we could get the Southeast delegation of Pennsylvania on board with it, I bet it would increase our chances to get it in Harrisburg.

… Ninety-three percent of tax revenue in the city is locally generated, meaning that we only get about 7 percent from the state and federal government and it’s not reasonable to expect that we can increase that percentage any time soon. So we need to get our own house in order, we need to make the city more competitive for business formation and expansion and growth.

So if we can’t get the constitutional change, then I would favor a plan that would impose some short-term, revenue-generating activities on the economy, while we lower wage and business and property taxes and while we wait for business activity to expand as a result. Some of those things would include looking at adjusting the land-value portion of the real estate tax. We tax our land too low. We might want to be looking at some strategic asset sales that could generate some short-term revenue while we await the growth that pretty much all economists believe would occur.

And I would even knock on the door of the nonprofits and say look, “We don’t want to just pick your pockets because we need the money. We’re talking about PILOTs.” My approach would be, “Here is a well thought-out strategy for making the city more competitive for business, but hey, we need some help in the short-term to bridge the gap. Would you help us?” And I would like to think that the large institutions would take much more kindly to that kind of approach rather than the current approach, which is simply to threaten them with PILOTs, which [they] aren’t legally obligated to pay anyway.

Citified: The Nutter administration has said that a 1997 state law makes it difficult to ask nonprofits for PILOTs, much more difficult than it was under then-Mayor Ed Rendell in the early 1990s when the city was collecting much more money from PILOTs. So how would you have any more success than Mayor Michael Nutter has had?

Steinke: I’ve worked with those large nonprofits — in particular Penn and Drexel — and they know me. I think if I were in a position of leadership, I could make an appeal based on logic and reason and sound economic thinking, that the PILOTs aren’t just going to be dumped in the vast general fund, but would actually be used to help us bridge the revenue gap while we reform the city’s taxes. I don’t think that argument has ever been made to them.