>> i'm monica malpass. a tight vote in the state senate means no budget deal even though we are five months overdue. let's get the inside story. ♪ good morning and welcome to "inside story." i'm monica malpass. let's meet our insiders today. they are ajay raju, attorney. good morning. welcome back. dom giordano, radio talk show host. >> morning, monica. >> good morning, sir. nelson diaz, attorney. welcome back to you. >> good morning, monica. >> and val digiorgio, attorney. welcome, as well. >> good morning. >> and happy thanksgiving to everybody. >> thanks, monica. >> let's talk a little bit because now governor wolf and the legislature is still doing their budget dance, which is not that entertaining, of course, to schools, counties, and nonprofits. they have had budget issues on the brink now for a while. the tentative budget deal looks like it could collapse. the long-term deal was voted down as a possibility last week. a split vote there. the lieutenant governor had to make the decision. so that went to the wayside,

deciding on property taxes or not. where does it leave us? and now the governor says he wants something new or old or redone or more votes by december 4th, next week. is that gonna happen? can anything change here? >> it can, but, i mean, we have a classic situation here where republicans added. people voted to put more republicans in in the election of 2014, but due to tom corbett being an ineffectual governor, he was the one republican that was defeated. so you have this struggle of the two parties, and republicans are not looking to cave in this time around, and you have these big moving parts, as i see it -- liquor privatization, property taxes. these guys can't agree on simple things, let alone these huge, complex things. >> well, they did have a property-tax vote a few years ago that was very wide apart. this time it's 24/24, only split by the lieutenant governor's vote. so they're getting closer on that. can they get a couple more votes, you think, dom, and put that thing through? >> val. >> i'm sorry, val. i'm looking at both of you. i'm sorry. >> that property-tax vote was separate and apart from the budget. they've been trying to get property-tax reform in pennsylvania for generations now. >> right.

>> that would have replaced school property taxes with a large sales-tax hike, which would have had tremendous winners and losers. i was surprised it was as close as it was. 24/24 was a very tight vote. i don't think they have that kind of support in the house for it, but they're gonna give another crack at it again. but that's separate and apart from the budget. they had this -- it wasn't ideal. it was a framework where they would raise $2 billion in sales taxes and use that to pay down property taxes $1.4 billion, another $600 million in state spending -- a dramatic increase in state spending. there's no support in the house or senate for broad-based income-tax or sales-tax increases. that's why it fell apart. the governor had to come up with 80 or so votes in the house for it on the democrats' side. it's not even clear that's there, let alone on the republican side. in the meantime, social service agencies are suffering. we tried to get stopgap funding for social service agencies passed and for schools and on and on. the governor vetoed that time and time again, and it's really a shame that the most needy

in our population are being held hostage. >> you mentioned that it's really a value-system differential between republicans and democrats, and neither side wants to give because we have a new governor, of course, and many new folks in the legislature. does it come down to maybe having fewer exemptions on the sales tax, nelson, and that would raise some funds? >> well, i think the whole taxing system is very regressive, which, essentially -- property taxes are used for school systems, and then to try use a sales tax is really regressive, particularly poor people and the impact that it would have. but as i understand it, many democrats are also somewhat upset at this whole process, and some of them are starting to cave in because they're getting pressure from home as regards to the lack of funding that some of the nonprofits and some of the other agencies are getting. so i think that if the governor doesn't get a deal as soon as possible, i think he's gonna lose the democratic leadership also and a budget will go through without the governor's approval. so that's the information that

i've received from many of the leadership on the democratic side of the state legislature. >> so, ajay, does this property-tax issue give an unfair advantage to casinos and skyscrapers and hurt people who are elderly, perhaps, and own their homes, but have no income to speak of? >> it all depends. if you look at the progressive states, where you use property taxes to fund education -- well, almost all states use real-estate taxes to fund education -- the richer neighborhoods have more assets, and as a result, the quality of the schools are better, and the poorer neighborhoods, where the property-tax income is not as great -- you know, funding does correlate a little bit with what the quality of schools are -- they're not as great. if you take that money and you then redistribute it to the poorer schools, that will be one equitable way to do it, but then what happens to reallocation where the good schools were and taking money from there? and nelson is absolutely right. going to an increase from 6% to 7.25% on sales tax to generate $2 billion,

it will be a disproportionately heavier burden on the poor in our community. i don't know if there's a right or wrong answer there, but either scenario is a sophie's choice. it's going to hurt the poor. now, more and more you think about it, should it be an energy tax? should it go back to a shale tax to generate that so that we can pump more money into poor neighborhoods? >> right. >> $100 million, $150 million from shale tax, and i don't know if the industry's already on its knees because of low energy prices. you can go there, but the point is, to do what the governor wants, you need broad-base sales or income-tax increase. >> well, in philadelphia, it would be a 9.25% sales tax, the second highest in the country outside of california. so renters would lose out on this and low-income people are gonna buy stuff, and merchants are going crazy, and these representatives that border delaware, for example, or jersey... >> sure. >> ...people will go -- delaware, particularly. no sales tax. >> right. >> that's a big number -- 9.25%. >> absolutely. >> it would hurt the small-business person.

>> sure. >> and in addition to that, the commercial real-estate community is willing to pay more taxes. >> yeah. >> they have said so, and to some extent, because of the way we have our constitution, which has an equalization, you and i, who are residents, pay the same percentages that the commercial taxpayers pay, and until that is fixed -- and that's gonna take the bravery of some great governor and the great legislature to change that structure so there'll be a progressive tax instead of this regressive situation. >> and this bill would also, or a similar legislation that the legislature's proposing, would have a multibillion-dollar state takeover of the schools and the school boards, as well as the taxation changes. aren't we in the middle of that already? >> well, but i think that's another objection, too. >> yes. >> just on my show the last couple weeks, people are saying, "wait a minute. more money's gonna go to harrisburg. they determine all this stuff versus the local level." there's already problems with that over the testing thing coming out of harrisburg. >> right. >> this feeds into another reason to oppose this, and there's strange bedfellows, democrats and republicans,

that i think oppose most of this stuff. >> a lot of people in philadelphia are asking for the end of the s.r.c. >> right. >> i mean, there is a total movement to do that, and if you continue to give harrisburg the entire power, then we give the whole thing to harrisburg. let them deal with the issues of education, which they're not. >> meantime, we're talking about schools, let's talk about an interesting trip that the mayor-elect took, along with some of the school officials and others in the city. they went to ohio to look at what's called community schooling. it's literally at a school location where local and impoverished neighborhoods can get vision care, medical, dental. it's a food bank, it's a day-care center if you have younger siblings, mental-health counseling -- so it's sort of a one-stop shopping that impoverished families can go to, not just for schooling. teachers would still be teaching over here, but on the rest of the building in a regular, formatted way, families could get all of their needs met, essentially. it's working in ohio. people didn't believe it would, and in some ways -- they haven't had dramatic result changes, but they are, some say, improving the quality of life

in some of these impoverished communities. do you see that happening here, val? mayor-elect kenney's all about it. >> they are improving the quality of life in those schools, but they're not fixing education. that's the problem. my wife and i had a big debate on this last night. she's involved with pan american charter school. they do this, and it does really help the kids. the question is, what does it do for test scores? and it's a great idea. children in those school districts need help, but if you look at the school that mayor kenney went to visit, they're not doing any better than the schools here in philadelphia. >> right. nine years later. >> 30%, 40% proficiency, and there's been no improvement in test scores. we're talking about the wrong thing. we need real reform in education. we have to shut down schools that aren't performing well, whether they're charter or public, and we have to provide resources to schools that are doing better. we have to have tenure reform. we have to give principals real power to manage their schools, including curriculum. until we do those things, you're not gonna see an improvement in education. the other thing is, unions love this kind of thing. it's more union jobs. there's no reform for unions, for the teachers' union and the way they do business in philadelphia, pennsylvania.

>> i agree to some extent with your viewpoint, and it's what's known as the wraparound system, which is the system which all professional educators have required and imposed. he didn't have to go all the way to ohio. the only school that i see has that kind of system is right here in camden -- leap. 100% of their kids graduate, and they have this wraparound system where the entire social-service structure and educational programs -- each one of those kids goes on to college, and you're talking about the same kind of kids that we have here in philadelphia. >> well, that's important. it's a great point, i think, judge, too. certain schools succeed in the inner city, even in philadelphia in places like that, and the reason's usually the principal and the parental involvement that the principal engenders or the parents that are there. it's not things like this. this is reinventing it. and kenney, i think, personally, is such an opponent of charter schools... >> right. >> ...which are what people are voting with. there are bad charter schools, corrupt ones, even, but, by and large, any number of these are working, and i think that's what people want.

>> there's a news conference scheduled for tomorrow where they're going to announce what, at least, their hopes and intentions are. it's a low price tag, relatively speaking -- $65,000 -- but i would assume that proponents say, "look, if you raise the tide, then all the boats go up," and that includes the family structure and the quality of life on these day-to-day issues that, apparently, are buckling under some kids who can't even get to school, having been fed breakfast, with shoes on. >> well, i would say we know what to do. it's do we have the will to do it? sometimes they make it a mystery -- "let's go off to cincinnati," and we discovered something new? the judge is right. we know what to do. we know what the fundamentals -- i think val is right -- what to do. but the will to do that is often not there. >> just getting everybody moving in the right direction? >> it's putting a band-aid on a bigger problem -- dysfunctional communities, dysfunctional families that have been created, in large part, because of the great society. there's a guy named geoffrey canada in harlem that's doing this kind of thing, but on a holistic basis where he brings in single mothers and their children into his facilities. there's a charter school next door. the kids go there. they come home. there's a counselor there for them to do homework. mom's getting drug-abuse

counseling or workforce training, or high school equivalency training, and then she comes homes, spends time with her kids, and that's -- if you really want to do a holistic approach, let's scrap t.a.n.f., temporary assistance for needy families and housing vouchers. let's get these 19-year-old moms who are out there, we give them the voucher and say, "go live your life." let's bring them in-house and do it holistically. >> but why can't we do both? and the idea behind it, the logic behind it is to be the gravitational pull in neighborhoods, where if the school is a center of community where both social services, as well as education, then the parental involvement, community involvement goes hand in hand within the ecosystem that you're generating. so it's creating these multiple zones of impact, where the schools themselves become the nucleus of the community. from a logical standpoint, that does make sense. the question is, that on its own will not solve our problem with education. we need the kinds of reforms that you're talking about, val. but the logic does make sense to me. >> the reforms include, obviously, one of kenney's movements, which, essentially,

is the pre-k. you've got to start them as early as possible, and i agree with that pre-k process because there is a guarantee that a pre-k kid is gonna be reading a heck of a lot faster than a kid who never goes to pre-k. >> but look at the difference between a private school and main line, where parents and communities are absolutely involved with the school system, and look at the urban schools where the parents and the community are not involved, and you see the difference. the public and the private schools are good not only because they have good teachers, it's also because the entire community is involved with them. >> but you got to understand the inner city. you know, coming from there, working with them, and then going through the process, the poverty rate is so high that they're just trying to survive to live, to eat. i went to homes where kids were totally naked. there was drug abuse in the house. there was totally lack of understanding of what's going on. >> you can't study when you're hungry. >> that's right. and a school is a school

to them, and if you look at leap, where there is a contract relationship between the school and the home and the child -- >> but, judge, that's the point. there are parents that are barely getting by, but they're not addicted to drugs, they're in touch with their kids. when they're in a charter school or the better public schools that work, there's a commitment, and when there's a commitment, this works. and i think the big obstacle -- and i was a teacher for a number of years in schools like this -- are the parents that don't care, and the kids that act out, and the school can do nothing to stop it. it's very, very hard to teach. you're exhausted when you have to deal with kids that are acting out versus the kids that are there to learn. >> right. it takes the energy out of the room completely. >> and that's why a lot of teachers quit. the second year, they quit. they give up. >> today they don't have paper in the school system. they don't have books in the school, while if you go across the way to delaware -- >> but wait a minute. there's a budget of $2.6 billion. >> $18,000 per kid in philadelphia. >> so why can't you have toilet paper in the room? >> that's what i'm asking you. today they have absolutely -- >> it's the management. >> well, if it's the management... >> no, not hite. but i've had him on,

the superintendent, and he said, "what do you mean there's no toilet paper?" he was on the air with me, called, and got toilet paper to the school. come on. >> you know, there is absolutely -- and you're right about principal leadership and getting the wraparound. >> last comment. go ahead, ajay. >> it's the skins and uniform, but instead of basketball, it's really they're playing football -- padded vs. non-padded. >> that's right. >> the public/private schools that have the funding, but it's more than that. it's the families. they don't have the poverty issue, they're not hunger issue. they don't have the social, emotional issues. >> that's right. >> by the time they walk into the classroom, they don't just need education, they need a full array of social services by the time they walk in, and that's why it's an uneven fight. >> and that's what works, and that's what the experts tell you in terms of the wraparound, and that's what happened to me, and so if you have a kid who was sick, who had asthma, who had all of the problems, and then you have him able then to learn and to be educated and then turn around, and then the language issue. you've got to look at the holistic approach, and i believe that works, and with all of that money that's there,

if you compare the money that's being used -- you said $18,000 per kid -- and you look at the amount that's being used in the camden school system at leap that has a relationship with rutger's university? >> right. >> there is a community commitment by the institution, also. so we need these universities to commit. >> well, we said this before, judge. penn's committed out in west philly, and that's why people camped out in the cold to go to that school. every college in the city should be demanded to have a relationship with a school in the manner that penn does with that alexander school. >> all right. we're gonna take a break. "inside story" continues right after this. >> "inside story" is presented by temple university. temple fuels students with academics and opportunities to take charge. plugged into the city, powered by the world. temple.edu/takecharge.

a new entity is saying she may have to go. it is the pennsylvania legislative reference bureau. they are a nonbinding legal advisory board, and the senate and governor asked, "can we get her out?, and, legally, do we have the means?," and this board said, "yes." now the question is, should they? should they? do you think they should, ajay? >> well, the question is not whether they should or not. everybody is saying at this point, she was elected to serve the public, and i think her credibility is absolutely shot, and that office is essentially an impotent office. so whether it is through you're wearing an orange

jumpsuit or whether it is by removal or whether it is by suspension, i think the writing's on the wall. >> she said she won't leave without a subpoena. >> right. everybody can read it except for kathleen kane. >> okay. do you think they will make that move? that's very bold. >> there's removal and there's impeachment. we're looking at removal here. i think she should be removed. though as a republican leader, i can tell you, she's the gift that keeps on giving for us, for our side, because it's an embarrassment to the democrats, many of whom still have not called for her removal. but, yes, i think she should be removed. she's been indicted. she's been -- and it's affecting law enforcement across the state. d.a.'s refer cases to the attorney general. they're no longer doing that to cases where they have a conflict. so cases aren't being heard. >> i'd rather see impeached. >> so would i. the removal requires two-thirds of the senate. >> right. >> which, essentially, is similar to what you need for impeachment. so why not go through the impeachment process? >> right. all right. speaking of possible removal, let's talk about a supreme court justice who's in the crosshairs at the moment -- michael eakin. part of the porngate issue, having seen and perhaps passed along e-mails that many say were

unsavory and certainly don't mean people are getting a fair shot in the legal system if they're of color or women. that's what the e-mail issue is about. now, should he go? because this is the same issue that supreme court justice seamus mccaffery had that brought him into a resignation situation? >> yeah, i have to say, when you look at these, they are pretty bad, and i think seamus had the same thing, monica. so i'm surprised that it's taking this long. i think there's a different dynamic there, and it may change, but i think the pressure and what's out there, and people will make that point, i would be surprised if he survives. >> i think tony hardy williams put it right, that it's very difficult to appear before someone who you feel is homophobic and is racist, and he's made those comments relating to the stuff that he has been seen with regard to, and so my opinion, tony hasd toe on that. >> some people are saying that the attorney general -- back to her -- these two issues

are mixed, of course -- that she is handpicking the folks she wants to bring out in the public eye or pick on, because dozens of people saw or sent these hateful e-mails, and yet less than 10 names -- 8 people have been brought to the public forefront. so why some and not the others? >> well, i think she is the problem, and she wasn't challenged early on. because she was this golden star, it was very difficult to do it, and as a result, she is the ultimate political force willing to take down everybody with her. so she's picking and choosing. same thing. she's involved with seth williams. >> right. >> i think williams is entirely correct in what he's done around these public officials, and now there's blowback in that office, also. so wherever she is, there's gonna be widespread destruction. >> speaking of which, nine members of philadelphia city council have now asked that those three prosecutors involved locally allegedly in porngate be removed, and yet they have just been sent for training, sensitivity training at this point, and i don't see any movement happening there. judge, you're laughing. tell me your reaction on that one. >> you know, it's a good reaction to some people --

sensitivity training. there's got to be more discipline than just that and possibly even a demotion, if not a termination. they can practice law, but they don't have to have that kind of opinion when they're working in the public service. >> aren't some of the people that sent and received these still on kathleen kane's staff, by the way? >> you wonder where people have time. who's working anymore sending all these e-mails? i don't know enough about exactly what fina and the other two prosecutors were handing out. this is clearly politically motivated by kathleen kane, as it was with eakin -- hanging the sword of damocles over the head of her enemies and dribbling out this information. you know, i know seth. i went to high school with seth. i trust his judgment. he's got to run an office. it's a tough office to run. he needs good prosecutors, and if he thinks -- to me, it's an h.r. issue. if that's the way his h.r. the new chief diversity officer, nolan atkinson, who's been doing that in the private sector, duane morris, for a while.

it sounds like on paper a good idea. is it gonna be enough, ajay? >> well, i think he has the right people in terms of nolan atkinson and harold epps as the new commerce director. both are giants in their fields, one in diversity, other one is trusted in terms of both the business community, as well as neighborhoods. harold epps' appointment was interesting. his primary focus on bringing sort of the radiance of the renaissance that philadelphia's experienced to the neighborhoods seem to be a refreshing change to the old dynamic of only focusing on just the advanced manufacturing and knowledge revolution. so i think there's promise, but many of the other appointments were a carryover from past administrations. there may be a "back to the future" in some cases. >> one of the surprises was perri, because he talked about putting an architect or engineer into l&i, which is the biggest corrupt. i'm surprised that he didn't bring that to bear. >> all right. we're gonna have inside stories coming your way right after a break. ♪

>> "inside story" is presented by temple university. y with iml 12k stories of the week, and let's start with val. >> thank you. well, monica, the american courts have awarded $45 billion in judgments to american families and victims of iranian terrorism, and senator toomey and u.s. congressman pat meehan are looking out for those folks by introducing legislation that says not one dime of the $100-plus million in sanctions gets released to iran until those american victims get paid. that passed the house. it's hung up in the senate, mostly because of the veto threat by the president. but we're hoping to see that move forward and start protecting american families. >> nelson. >> the women just had a major conference in pennsylvania from throughout the state, and the woman forum are going to develop a real project in terms of holding accountable this old-boy network where there

are only 13% of the women in the state are on any of the corporate boards, and in the state, and in the city, particularly, it's even worse. so look out for that report card which the woman forum are going to publish on a regular basis. >> all right. dom. >> monica, i emceed an event for broadcast pioneers. these are guys that archive all the media people -- radio, tv -- back forever, and they have a hall of fame, and this year two i got to introduce -- harvey holiday and pierre robert -- and i was thinking about the fact that in philadelphia, it's a tough town, but once you make it, people want you here forever, and channel 6, i think, does the right thing, and that's why there's such success -- you, jim gardner, david henry was a hall of fame member, karen rogers. it speaks well of this area that we have people that we like and they're there for decades and maybe decades more. >> and we appreciate that. thank you. ajay. >> monica, this past saturday, cystic fibrosis foundation hosted the breath of life gala honoring my partner joe jacovini, raising over

$1 million. not that long ago, people who had cystic fibrosis, the death sentence was that you couldn't see kindergarten. today people live long into their 40s, and very soon, c.f. will mean "cure found." >> wouldn't that be wonderful? all right, thanks to all our insiders for your ideas and your time. thanks so much to you for watching. hope you have a great week ahead, and we'll see you right here next sunday morning. ♪ i'm nydia han along with eva pilgrim. grew breaking news, several firefighters are injured when a car arrest fire truck collide in west philadelphia. a police officer in western pennsylvania is gunned down in the line of duty while responding to domestic issues and police have the suspect in custody. >> authorities in colorado released disturbing details about the man accused of killing three people at a planned parenthood. those stories and more next on "action news."

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